AUSL The Law Pertaining To The State and Its Relationship With Its Citizens

EXECUTIVE COUNCIL
JAYSON FRANCISCO JULIAN PAOLO FABROS LOUIE JOHN BAYON

Chairperson Operations Head Auditor
REA MAY HERMOSURA MA. ISIS DANIELLE VOLANTE CRISTOBAL RABINO

Vice Chairperson for Academics Secretary Creative Director
MIKYLA CORDERO TIMOTHY JAMES PACSON ARRIANE SANGALANG

Vice Chairperson for Administration Treasurer Volunteer Core Head
CIVIL LAW COMMISSION

JOVAN KEFF ALVARO MA. RUTH CUSTODIO
Commissioner Subject Head - Property LYCELLE MAE BALOING
GERON BUENO
KEVIN ALBERT ABOY ANTONIETTE PULUTAN CHRISTINE JOY DAVID
Deputy Commissioner Subject Head - Land Titles and Deeds LEIRA MARIE GUEVARRA FILIO
JOBELUZ IGDANES
JANINE NICOLE ORCENA JANE EUNICE GADIN YASSER MAMBUAY
Subject Head - Persons and Family Subject Head - Sales PETER JANSSEN MANALO
Relations GERMINIANO DALISAY MANIO
HANNA AYON ANNA HYACINTH NICERIO
JONAINA SUWALAWAN-HADJINOOR Subject Head - Torts and Damages TIMOTHY JAMES PACSON
Subject Head - Succession VERONICA PANGILINAN
ELLAINEMOR SAN PASCUAL ELLAINEMOR SAN PASCUAL
LANIE GRACE LIM Subject Head - Conflicts MARION PATRICIA RODRIGUEZ
Subject Head - Obligations and Contracts AIRA JANILLE TIMOTEO
JAN TRISTAN RAMOS RAEZEL LOUISE VELAYO
LOUIE AERON CORDOVA Subject Head - Agency and Trusts Members
Subject Head Credit Transactions
COMMERCIAL LAW COMMISSION

MARY ANGELA FABON DAEWIN PAMITTAN JOHN HENRY ALMANZOR
Commissioner Corporation Law Subject Head JIMBOY ARANAS
APRIL JOY BATALLA
AILE CARISSA ABCEDE MIKE FERDINAND SANTOS RAMILYN BERTOLANO
Insurance and Pre-Need Laws Subject Law on Securities Subject Head JOSEPH ERIC POCHOLO BRIONES
Head ED THADEUS CAMMAYO
CAMILLE BIANCA PINTO REENA MAE CAÑAMAQUE
LORILLE LEONES Banking Laws Subject Head BIANCA CHIA CASTRO
Transportation Law Subject Head
JOJEE ROSE DELA CUEVA
LOIS RENEE TUBON WILLIAM CYDRICK ESTRADA
CLARIZ MINGOA Intellectual Property Law Subject Head
KENKEN LAGUTAN
Law on Partnerships Subject Head
MARIELLE ERIKA LITUANAS
MAC VINCENT JAVIER
FLEMARIE MAGNE MEDIDA
Special Commercial Laws Subject Head
IMARI JOIE RAVANILLA
RR RICAFORT
RENZO NIÑO ROSALES
JIZZA SOFIA CRISTINE TENDENILLA
FAITH CLAIRE TOLENTINO
GERALDINE YU
Members
CENTER FOR LEGAL EDUCATION AND RESEARCH
ATTY. RODERICK VILLOSTAS
Director
ATTY. ANTONY PARREÑO

ATTY. LESTER NAZARENE OPLE
ATRY. RICKSON M. BUEVIAJE
Research Fellows
BRANDO DE TORRES
MARICAR ASUNCION
JAYSON GALAPON
Research Staff
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THE 1987 CONSTITUTION
1. What are the tests to determine whether a proposed change is an amendment or a

revision of the Constitution?
a) Quantitative Test – The Court examines only the number of provisions affected and does
not consider the degree of the change. The quantitative test asks whether the proposed
change is so extensive in its provisions as to change directly the ‗substantial entirety‘ of the
constitution by the deletion or alteration of numerous existing provision.
b) Qualitative Test – The Court inquires into the qualitative effects of the proposed change in
the Constitution. The main inquiry is whether or not the change will ―accomplish such far
reaching changes in the nature of our basic governmental plan as to amount to a revision.‖
The changes include those to the ―fundamental framework or the fundamental powers of its
branches,‖ and those that ―jeopardize the traditional form of government and the system of
checks and balances.‖ Whether there is an alteration in the structure of government is a
proper subject of inquiry. (Lambino vs. Commission on Elections, G.R. No. 174153, October 25,
2006)
2. Distinguish Amendment from Revision.
AMENDMENT REVISION
Definition An addition or change within the lines A change that alters a basic principle in the
of the original constitution that will Constitution.
affect an improvement, or better carry (Lambino vs. Commission on Elections, supra)
out the purpose for which it was
framed.
Scope Envisages a change of only a few Involves alterations of different portions of

specific provisions. the entire document. (Sinco, Philippine
Political Law, 1935)
Intention To improve specific parts or to add new To determine how and to what extent a
provisions deemed necessary to meet document should be altered.
new conditions or to suppress specific (Lambino vs. Commission on Elections, supra)
portions that may have become
obsolete or that are judged to be
dangerous.
Who may The Congress, a Constitutional Only the Congress or a Constitutional

propose? Convention or a People’s Initiative Convention may propose revisions to the
may propose amendments to the Constitution. (Lambino vs. Commission on
Constitution. Elections, supra)
3. What are the methods in interpreting the Constitution?
a) Verba legis – whenever possible, the words used in the Constitution must be given their
ordinary meaning except where technical terms are employed;
Center for Legal Education And Research |1

ARELLANO UNIVERSITY
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b) Ratio legis est anima – words of the Constitution should be interpreted in accordance with
the intent of the framers;
c) Ut magis valeat quam pereat – the Constitution should be interpreted as a whole. (Francisco
vs. House of Representatives, G.R. No. 160261, November 10, 2003)
BASIC CONCEPTS
Declaration of principles and state policies
4. In the Domestic Setting, which law prevails in the event of a conflict between
international law and municipal law?
If there is conflict between Philippine law and international law, efforts must be made to
harmonize the conflicting provisions. If the conflict is irreconcilable, and a choice has to be made
between the two, Philippine Law must be upheld as police power cannot be bargained away by
the medium of a treaty. (Ichong vs Hernandez, G.R. No. L-7995, May 31, 1957)
Sovereignty
5. What happens when there’s a change in sovereignty?
Political laws of the former sovereign, whether compatible or not with those of the new
sovereign, are automatically abrogated, unless they are expressly re-enacted by the affirmative
act of the new sovereign. Municipal laws of the newly acquired territory not in conflict with the
laws of the new sovereign continue in force without the express assent or affirmative act of the
conqueror. (Macariola vs. Asuncion, A.M. No. 133-J, May 31, 1982)
6. What happens when there’s a belligerent occupation?
There is no change in sovereignty during a belligerent occupation, however, political laws, except
the law on treason, are suspended. Municipal laws remain in force unless repealed by the
belligerent occupant. (Laurel vs. Misa, G.R. No. L-409, January 30, 1947)
Separation of powers
7. The House of Representatives has a long standing tradition that the candidate for
House Speakership who garnered the second highest of votes automatically becomes
Minority Leader. The elections for Speakership were held and it resulted in the
following: 252 Members voted for Alvarez, 8 voted for Baguilat, 7 voted for Suarez, 21
abstained, and 1 no vote.” Despite this, Baguilat was never recognized as the House
Minority Leader. Consequently, those who did not vote for Alvarez convened and
elected Suarez as the House Minority Leader. Thereafter, Suarez was officially
recognized as the House Minority Leader. Gomez, a representative of the 4th District
of Bulacan, filed a Petition for Mandamus before the Supreme Court to compel the
House of Representatives to respect the long standing tradition and recognize
Baguilat as the House Minority Leader. Will the petition prosper?
No. Under the Constitution, the Senate shall elect its President and the House of Representatives,
its Speaker, by a majority vote of all its respective Members. Each house shall choose such other
officers as it may deem necessary. While the Constitution is explicit on the manner of electing a
Speaker of the House of Representative, it is, however, dead silent on the manner of selecting
the other officers. All that the Charter says is that 'each House shall choose such other officers as
it may deem necessary.' As such, the method of choosing who will be such other officers is
merely a derivative of the exercise of the prerogative conferred by the aforequoted constitutional
Bar Operations Commissions |2

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provision. Therefore, such method must be prescribed by the House itself, not by the Court. ( Sec.
16, Art. VI, 1987 Constitution, Baguilat vs. Alvarez, G.R. No. 227757, July 25, 2017).
Checks and balances
8. How did the Disbursement Acceleration Program violate the doctrine of separation of
powers?
The Disbursement Acceleration Program violated the doctrine of separation of powers through
the following acts and practices:
a. The withdrawal of unobligated allotments from the implementing agencies, and the declaration
of the withdrawn unobligated allotments and unreleased appropriations as savings prior to the
end of the fiscal year and without complying with the statutory definition of savings contained
in the General Appropriations Acts;
b. The cross-border transfers of the savings of the Executive to augment the appropriations of
other offices outside the Executive; and
c. The funding of projects, activities and programs that were not covered by any appropriation in
the General Appropriations Act. (Araullo vs. Aquino, G.R. No. 209287, July 1, 2014)
9. How does the Congressional Pork Barrel System violate the (a) principle of separation
of powers; (b) non-delegability of legislative power; (c) principle of checks and
balances; (d) principle of accountability and (e) principle of local autonomy?
a. Principle of separation of powers: The defining feature of all forms of Congressional Pork
Barrel would be the authority of legislators to participate in the post enactment phases of
project implementation. At its core, legislators – may it be through project lists, prior
consultations or program menus – have been consistently accorded post- enactment authority
to identify the projects they desire to be funded through various Congressional Pork Barrel
allocations. Aside from the area of project identification, legislators have also been accorded
post- enactment authority in the areas of fund release and realignment. Clearly, these post-
enactment measures which govern the areas of project identification, fund release and fund
realignment are not related to functions of congressional oversightand, hence, allow legislators
to intervene and/or assume duties that properly belong to the sphere of budget execution.
b. Non-delegability of legislative power: The Pork Barrel System, insofar as it confers post-
enactment identification authority to individual legislators, violates the principle of non-
delegability since said legislators are effectively allowed to individually exercise the power of
appropriation, which is lodged in Congress. It must be emphasized that individual legislators
have no law-making authority except only when acting as a body.
c. Principle of checks and balances: A prime example of a constitutional check and balance
would be the President‘s power to veto an item written into an appropriation, revenue or tariff
bill submitted to him by Congress for approval through a process known as "bill presentment."
For the President to exercise his item veto power, it necessarily follows that there exists a
proper "item" which may be the object of the veto. Under the Pork Barrel System, the amount
specified in the GAA is only a collective allocation limit since the said amount would be further
divided among individual legislators who would then receive personal lump -sum allocations
and could, after the GAA is passed, effectively appropriate PDAF funds based on their own
discretion. As these intermediate appropriations are made by legislators only after the GAA is
passed and hence, outside of the law, it necessarily means that the actual items of PDAF
appropriation would not have been written into the General Appropriations Bill and thus
effectuated without veto con-sideration. This kind of lump sum/post enactment legislative
identification budgeting system fosters the creation of a ―budget within a budget" which

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subverts the prescribed procedure of presentment and consequently impairs the President‗s
power of item veto.
d. Principle of accountability: An accountability mechanism with which the proper

expenditure of public funds may be checked is the power of congressional oversight. The fact
that individual legislators are given post enactment roles in the implementation of the budget
makes it difficult for them to become disinterested "observers" when scrutinizing, investigating
or monitoring the implementation of the appro-priation law. To a certain extent, the conduct
of oversight would be tainted as said legislators, who are vested with post- enactment
authority, would, in effect, be checking on activities in which they themselves participate. Also,
it must be pointed out that this very same concept of post enactment authorization runs afoul
of Sec. 14, Art. VI of the 1987 Constitution (prohibition to intervene in any matter before any
office of the Government for pecuniary benefit or where they may be called upon to act on
account of their office).
e. Principle of local autonomy: The concept of legislator control underlying the Countrywide
Development Fund (CDF) and PDAF conflicts with the functions of the various Local
Development Councils (LDCs) which are already legally mandated to "assist the corresponding
sanggunian in setting the direc-tion of economic and social development, and coordinating
development efforts within its territorial juris-diction." Considering that LDCs are
instrumentalities whose functions are essentially geared towards managing local affairs, their
programs, policies and resolutions should not be overridden nor duplicated by individual
legislators, who are national officers that have no law-making authority except only when
acting as a body. (Belgica vs. Ochoa, Jr., G.R. No. 208566, November 19, 2013)
Delegation of powers
10. The Social Security Commission (SSC) issued a resolution providing for an increase in
the SSS members’ contribution rate from 10.4% to 11% and the maximum monthly
salary credit from P15,000 to P16,000. Social Security System members filed a case
against the government officials and agencies involved in issuing the premium hike
in the social security system contribution. Petitioner’s attack on the increase in
contribution rate and maximum monthly salary credit is two (2)-tiered: (1) they
assail the validity of the exercise of respondents Social Security System and Social
Security Commission's power under the law; and (2) they assail the validity of the
delegation of power to respondent Social Security Commission. KMU argues that the
assailed issuances are void for being issued under vague and unclear standards
under the Social Security Act. They admit that Sec. 18 allows the Social Security
Commission to fix the contribution rate subject to several conditions. However,
petitioners claim that the term "actuarial calculations" is too vague and general, and
the relationship between the rate of benefits and actuarial calculations is not clearly
defined. Thus, they conclude that the delegation of power to fix the contribution rate
is incomplete in all its terms and conditions.Is the argument of Kilusang Mayo Uno
tenable? Explain.
No. Under the law, a valid delegation are: (1) the completeness of the statute making the
delegation; and (2) the presence of a sufficient standard. Not only is the Social Security Act
complete in its terms; it also contains a sufficient standard for the Social Security Commission to
fix the monthly contribution rate and the minimum and maximum monthly salary credits as
provided in Sec 18 of the said Act. Petitioners are putting in issue not only the validity of the
exercise of the delegated power, but also the validity of the delegation itself. They are, thus,
collaterally attacking the validity of the Social Security Act's provisions. Collateral attacks on a
presumably valid law are not allowed. Unless a law, rule, or act is annulled in a direct
proceeding, it is presumed valid. (KMU vs. Aquino III, G.R. No. 210500, April 02, 2019, J.Leonen)

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11. What are the tests of a valid delegation of power?
a. Completeness Test – the law must be complete in all its terms and provisions when it
leaves the legislature that nothing is left to the judgment of the delegate; when it reaches the
delegate, the only thing he will have to do is to enforce it.
b. Sufficient Standard Test - the law must offer a sufficient standard to specify the limits of
the delegate‘s authority, announce the legislative policy, and specify conditions under which it
is to be implemented. A sufficient standard is one which defines legislative policy, marks its
limits, maps out its boundaries and specifies the public agency to apply it. It indicates the
circumstances under which the legislative command is to be effected. ( Abakada Guro Partylist
vs. Purisima, G.R. No. 166715, August 14, 2008)
Fundamental powers of the State
12. Requisites for the exercise of the fundamental powers of the state.
POLICE POWER POWER OF EMINENT DOMAIN POWER OF TAXATION
1.Lawful subject 1.Private property; 1.Public purpose;

2.Lawful means 2.Taking in the constitutional sense; 2.Uniform, equitable, and
3. Public use; progressive;
When exercised by a delegate: 4.Just compensation; 3. Within the
5.Due process of law. jurisdiction of the taxing
1.Expressly granted by law authority;
2.Within the territorial limits When exercised by a delegate 4.Certain guarantee against
3. Must not be contrary to (additional): There must be genuine injuries to individuals shall
law necessity. be provided. (Nachura,
Outline Reviewer in Political
Law, 2016)
13. Distinctions between and among the fundamental powers of the state.
POLICE POWER POWER OF EMINENT POWER OF TAXATION

DOMAIN
Basis Public necessity and right Necessity of the property Power emanating from
of State and of the public for public use. necessity. (Lifeblood
to self-protection and self- Doctrine Theory)
preservation.
Scope Life, liberty and property. Property rights only. Property rights only.
Who may Only by the government. Government, as well as Only by the government.
exercise? private entities through a
valid delegation (Example:
Metropolitan Waterworks
and Sewerage System by
virtue of RA 6234, Sec.
3[l])

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SCHOOL OF LAW
Purpose For property or purpose Property taken intended Property taken intended
that are noxious, thus for public use, thus for for public use, thus for
may be destroyed. wholesome purposes. wholesome purposes.
Compensation Intangible, altruistic Full and fair equivalent Protection and public
feeling that the value of the property improvements for the
individual has expropriated. taxes paid.
contributed to the public
good.
LEGISLATIVE DEPARTMENT
1. Scope and limitations of Legislative Power
14. What are the scope and limitations of the Legislative power?
The following may exercise legislative power:
a. Congress of the Philippines,Sec. 1, Art. VI of the 1987 Constitution states that such power
shall be vested in the Congress of the Philippines which shall consist of a Senate and a House
of Representatives.
b. Regional/Local Legislative Power

a. Delegation to Local Governments, It is sufficient that the statute indicated the subject
matter over which the local law-making agency may legislate.
b. Delegation to Administrative Agencies
c. Except to the extent reserved to the people by the provision of initiative and
referendum (Art. VI, Sec. 1, 1987 Constitution)
Limitations on the legislative power of Congress:

The Constitution itself provides limitations on the exercise of legislative powers:
1. Substantive: limitations on the content of laws.
2. Procedural: limitations on the manner of passing laws.
3. Congress cannot pass irrepealable laws.
4. Congress, as a general rule, cannot delegate its legislative power.
2. Principle of non-delegability; exceptions
15. Discuss the Principle of Non-Delegability of Powers.
Potestas delegate non potest delegare (what has been delegated cannot be further delegated). It
is based on the ethical principle that delegated power constitutes not only a right, but a duty to
be performed by the delegate through the instrumentality of his own judgment and not through
the intervening mind of another. (Cruz, Philippine Political Law, 2014).
16. What are the permissible delegations of power under the 1987 Constitution?
a. Tariff Powers to the President (Sec. 28[2], Art. VI, 1987 Constitution);
b. Emergency Powers to the President (Sec. 23[2], Art. VI, 1987 Constitution);
c. Delegation to the people (Sec. 32, Art. VI; Sec. 10, Art. X; Sec. 2, Art. XVII, 1987
Constitution; Republic Act No. 6735);
d. Delegation to local government units (Sec. 9, Art. IX, 1987 Constitution; Republic Act No.
7160);
e. Delegation to administrative bodies; and

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f. Delegation of rule-making powers to the Supreme Court (Sec. 5[5], Art. VIII, 1987
Constitution) and Constitutional Commissions (Sec. 6, Art. IX-A; Sec. 3, Art. IX-C; Sec. 2[2], Art.
IX-D, 1987 Constitution).
17. A law, which delegated some appropriation powers to the President, was passed.
The law contains provisions such as “and for such other purposes as may be
hereafter directed by the President” and “to finance the priority infrastructure
development projects and to finance the restoration of damaged or destroyed
facilities due to calamities, as may be directed and authorized by the Office of the
President of the Philippines.” Are these provisions valid?
No. These provisions constitute an undue delegation of legislative power insofar as it does not
lay down a sufficient standard to adequately determine the limits of the President‘s authority
with respect to the purpose for which the law may be used (sufficient standard test). It gives the
President wide latitude to use the funds for any other purpose he may direct and, thus, allows
him to unilaterally appropriate public funds beyond the purview of the law. (Belgica vs. Ochoa,
G.R. No. 208566, November 19, 2013)
18. What is a legislative veto? Is it unconstitutional?
Legislative veto is a statutory provision requiring the President or an administrative agency to

present the proposed implementing rules and regulations of a law to Congress which, by itself or
through a committee formed by it, retains a "right" or "power" to approve or disapprove such
regulations before they take effect.
Yes. It is unconstitutional in three respects:
a. In exercising discretion to approve or disapprove IRRs based on a determination of whether

or not they conformed with the provisions of the law, Congress arrogated judicial power unto
itself, a power exclusively vested in the Courts by the Constitution;
b. It violates the principle of bicameralism because legislative power is vested in Congress which
consists of two chambers, the Senate and the House of Representatives. A valid exercise of
legislative power requires the act of both chambers. Corrollarily, it can be exercised neither
solely by one of the two chambers nor by a committee of either or both chambers. Thus,
assuming the validity of a legislative veto, both a single-chamber legislative veto and a
congressional committee legislative veto are invalid;
c. It violates the rule on presentment. Every bill passed by Congress must be presented to
the President for approval or veto. In the absence of presentment to the President, no bill
passed by Congress can become a law. In this sense, law-making under the Constitution is a
joint act of the Legislature and of the Executive. Assuming that legislative veto is a valid
legislative act with the force of law, it cannot take effect without such presentment even if
approved by both chambers of Congress. (Abakada Guro Partylist vs. Purisima, G.R. No.
166715, August 18, 2008)
B. Chambers of Congress; composition; qualifications
1. Senate
2. House of Representatives
a. District representatives and questions of apportionment
b. Party-list system

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19. What are the compositions, qualifications, and terms of office of members of
Congress?
SENATORS DISTRICT PARTY-LIST NOMINEES

REPRESENTATIVES
COMPOSITIONS
24 Senators who shall be Each legislative district shall 20% of the total number of
elected at large by qualified comprise, as far as practicable, representatives including those
voters of the Philippines as contiguous, compact, and under the party list. One-half of
may be provided adjacent territory. Each city the seats allocated to party-list
by law (Sec. 3, Art. VI, 1987 with a population of at least representatives shall be filled, as
Constitution) two hundred fifty thousand, or provided by law, by selection or
each province, shall have at election from the labor, peasant,
least one representative. urban poor, indigenous cultural
(Sec. 5(3), Art. VI, 1987 communities, women, youth, and
Constitution) such other sectors as may be
provided by law, except the
religious sector. (Sec. 5(2), Art.
VI, 1987 Constitution)
QUALIFICATIONS

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a. a.Natural-born citizen of a. a.Natural-born citizen of the a. a.Natural-born citizen of the

the Philippines; Philippines; Philippines;
b. b.On the day of the b. b.On the day of the election, at b. b.Registered voter;
election, is at least thirty- least twenty five (25) years of age; c. c.Resident of the Philippines
five (35) years of age; c. c.Able to read and write; for at least one (1) year
c. c.Able to read and write; d. d.Except for Party-List immediately preceding the day
d. d.Registered voter; Representatives, a registered voter of the elections;
e. e.Resident of the in the district in which he shall be d. d.Able to read and write;
Philippines for not less elected; and e. e.The nominees of sectoral
than two (2) years e. e.Resident thereof for not less parties or organizations that
immediately preceding the than one (1) year immediately represent the "marginalized
day of the election. (Sec. preceding the day of the election. and underrepresented," or that
3, Art. VI, 1987 (Sec. 6, Art. VI, 1987 Constitution) represent those who lack "well-
Constitution) defined political
constituencies," either must
belong to their respective
sectors, or must have a track
record of advocacy for their
respective sectors. The
nominees of national and
regional parties or
organizations must be
bona-fide members of such
parties or organizations
(Paglaum vs. COMELEC, G.R.
No. 203766, April 2, 2013);
and
f. At least twenty five (25) years
of age on the day of the
election. (Nachura, Outline
Reviewer in Political Law,
2016)
TERM
6 years 3 years
Limit: No Senator shall Limit: No Member of the House of Representatives shall serve for more
serve for more than two than three consecutive terms. Voluntary renunciation of the office for
consecutive terms. any length of time shall not be considered as an interruption in the
Voluntary renunciation of continuity of his service for the full term for which he was elected.(Sec.
the office for any length of 7, Art. VI, 1987 Constitution)
time shall not be considered
as an interruption in the
continuity of his service for
the full term of which he
was elected.(Sec. 4, Art. VI,
1987 Constitution)
20. Who may participate in the Party-List elections?
a. Three (3) different groups may participate in the Party-List system, namely: (1) national
parties or organizations; (2) regional parties or organizations; and (3) sectoral parties or
organizations;
b. National parties or organizations and regional parties or organizations do not need to

organize along sectoral lines and do not need to represent any ―marginalized or under-

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represented‖ sector;
c. Political Parties can participate in Party-List elections provided they register under the Party-
List system and do not field candidates in legislative district elections;
d. Sectoral parties or organizations may either be ―marginalized and under-represented‖ or

―lacking well-defined political constituencies‖;
e. .A majority of the members of sectoral parties or organizations that represent the

―marginalized and under-represented‖ must belong to the ―marginalized and under-
represented‖ sector they represent. Similarly, a majority of the members of sectoral parties
or organizations that lack ―well-defined constituencies‖, either must belong to their
respective sectors, or must have a track record of advocacy of their respective sectors;
f. National, regional, and sectoral parties or organizations shall not be disqualified if some of
their nominees are disqualified, provided they have at least one (1) nominee who remains
qualified. (Atong-Paglaum, Inc. vs. COMELEC, G.R. No. 203766, April 2, 2013)
21. What are the inviolable parameters to determine the winners in Party-list Elections?
1. The twenty percent allocation: the combined number of all party-list congressmen shall
not exceed twenty percent of the total membership of the House of Representatives,
including those elected under the party list;
2. The two percent threshold:only those parties garnering a minimum of two percent of
the total valid votes cast for the party-list system are qualified to have a seat in the House
of Representatives;
3. The three-seat limit: each qualified party, regardless of the number of votes it actually
obtained, is entitled to a maximum of three seats; that is, one qualifying and two additional
seats;
4. Proportional representation: the additional seats which a qualified party is entitled to
shall be computed in proportion to their total number of votes.
In determining the allocation of seats for party-list representatives under Sec. 11 of R.A. No.
7941, the following procedure shall be observed:
a. The parties, organizations, and coalitions shall be ranked from the highest to the lowest
based on the number of votes they garnered during the elections.
b. The parties, organizations, and coalitions receiving at least two percent (2%) of the total
votes cast for the party-list system shall be entitled to one guaranteed seat each.
c. Those garnering sufficient number of votes, according to the ranking in paragraph 1, shall be
entitled to additional seats in proportion to their total number of votes until all the additional
seats are allocated.
d. Each party, organization, or coalition shall be entitled to not more than three (3) seats.
The percentage of votes garnered by each party-list candidate is arrived at by dividing the
number of votes garnered by each party by the total number of votes cast for party-list
candidates.
There are two steps in the second round of seat allocation:
a. First, the percentage is multiplied by the remaining available seats which is the difference
between the maximum seats reserved under the Party-List System and the guaranteed seats
of the two- percenters. The whole integer of the product of the percentage and of the
remaining available seats corresponds to a party‘s share in the remaining available seats.
b. Second, assignment of one party-list seat to each of the parties next in rank until all available
seats are completely distributed. Distribute all of the remaining seats in the second round of

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seat allocation.
c. Finally, apply the three-seat cap to determine the number of seats each qualified party-list
candidate is entitled. (BANAT vs. COMELEC, G.R. 179271, April 21, 2009)
22. Whether the divisor for the computation of the percentage votes in determining the
winners in a Party-List Election includes votes which are spoiled and votes for
disqualified party-lists.
No. Not all votes cast in the elections should be included in the divisor. The total votes cast do
not include invalid votes. The formula in determining the winning party-list groups, as used and
interpreted in the case of BANAT vs. COMELEC, is MODIFIED as follows:
The formula to determine the proportion garnered by the party-list group would now
henceforth be: Number of votes of party-list= Proportion or Percentage of votes garnered by
party-list divided by Total number of valid votes for party-list candidates.
The total votes cast for the party-list system include those votes made for party-list groups
indicated in the ballot regardless of the pendency of their motions for reconsideration or
petitions before any tribunal in relation to their cancellation or disqualification cases. However,
votes made for those party-list groups whose disqualification attained finality prior to the
elections should be excluded if the electorate is notified of the finality of their disqualification by
the Commission on Elections. The divisor also shall not include invalid votes. The invalid votes,
for the determination of the denominator, may be votes that were spoiled or votes that resulted
from the following: improper shading or having no shade at all; existence of stray or ambiguous
marks; tears in the ballot; and/or ballots rejected by the Precinct Count Optical Scan
(PCOS)machines under the paper-based automated election system. All these are causes that
nullify the count for that vote that can be attributable to the voter‘s action. (Alliance for Rural and
Agrarian Reconstruction, Inc. vs. COMELEC, G.R. 192803, December 10, 2013)
Legislative privileges, inhibitions, and disqualifications
23. What are the immunities and privileges granted to the legislative members?
a. Immunity from arrest - grants the legislators the privilege from arrest while Congress is
―in session‖ with respect to offenses punishable by NOT more than 6 years of
imprisonment, (Sec. 11, Art. VI, 1987 Constitution) whether or not he is attending the
session. (People vs. Jalosjos, G.R. Nos. 132875-76, February 3, 2000)
b. Legislative privilege - No member shall be questioned or held liable in any forum other
than his respective Congressional body for any debate or speech in Congress or in any
committee thereof. (Sec. 11, Art. VI, 1987 Constitution)
24. What are the inhibitions attached to the respective offices of senators and
representatives?
a. No Senator or Member of the House of Representatives may hold any other office or
employment in the Government, or any subdivision, agency, or instrumentality thereof,
including government-owned or controlled corporations or their subsidiaries, during his
term without forfeiting his seat (Incompatible Office) ( Sec. 13, Art. VI, 1987 Constitution);
b. Neither shall he be appointed to any office which may have been created or the
emoluments thereof increased during the term for which he was elected (Forbidden Office)
(Sec. 13, Art. VI, 1987 Constitution);
c. No Senator or Member of the House of Representatives may personally appear as counsel
before any court of justice or before the Electoral Tribunals, or quasi-judicial and other
administrative bodies (Sec. 14, Art. VI, 1987 Constitution);
d. Neither shall he, directly or indirectly, be interested financially in any contract with, or in
any franchise or special privilege granted by the Government, or any subdivision, agency, or

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instrumentality thereof, including any government-owned or controlled corporation, or its

subsidiary, during his term of office (Sec. 14, Art. VI, 1987 Constitution);
e. He shall not intervene in any matter before any office of the Government for his pecuniary
benefit or where he may be called upon to act on account of his office. (Sec. 14, Art. VI, 1987
Constitution)
25. During his incumbency as member of the Senate, Senator Rocky Del Sur was elected
Chairman of the Philippine National Red Cross (PNRC). Does the election of Senator
Rocky as the Chairman of the PNRC resulted to the forfeiture of his senate seat in
view of Sec. 13, Art. VI of the 1987 Constitution?
No. The PNRC is an autonomous, neutral and independent organization. To ensure and
maintain its autonomy, neutrality, and independence, the PNRC cannot be owned or controlled
by the government, does not have government assets and does not receive any appropriation
from the Philippine Congress. Also, the PNRC Chairman is not an official or employee of the
Executive branch since his appointment does not fall under Sec. 16, Art. VII of the Constitution
nor he is not an official or employee of the Judiciary or Legislature. The office of the PNRC
Chairman is not a government office or an office in a government- owned or controlled
corporation for purposes of the prohibition in Sec. 13, Art. VI of the 1987 Constitution. (Liban vs.
Gordon, G.R. No. 175352, July 15, 2009)
Quorum and voting majorities
26. Enumerate the quorum and voting requirements in Congress.
NATURE OF PROCEEDING REQUIRED VOTE
Senate Concurrence in a treaty or 2/3 of ALL the Members of the

international agreements Senate (Sec. 21, Art. VII)
Conviction in impeachment cases 2/3 of ALL the Members of the

Senate (Sec. 3[6], Art. XI)
House of Affirm/Override a Resolution to 1/3 of ALL the Members of the House

Representatives impeach of Representatives (Sec. 3[3], Art.
XI)
Common to both Election of President or Speaker of the Absolute majority or MAJORITY of

Houses House, as the case may be ALL of its respective Members (Sec.
16[1], Art. VI)
Quorum to do business Simple Majority or MAJORITY of each

House (Sec. 16[2], Art. VI)
Discipline Members for disorderly 2/3 of ALL of its Members (Sec.

behavior [suspend or expel] 16[3], Art. VI)
Request of matters to be entered in 1/5 of the Members present (Sec.

the Journal 16[4], Art. VI)
Declaration of the existence of a State 2/3 of both Houses in joint session

of War assembled, voting separately (Sec.
23[1], Art. VI)
Overriding the President‘s Veto 2/3 of ALL the Members of such

House (Sec. 27[1], Art. VI)

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NATURE OF PROCEEDING REQUIRED VOTE
Grant of tax exemption Absolute majority or MAJORITY of

ALL the Members of the Congress
(Sec. 28[4], Art. VI)
Breaking a tie in cases of President Absolute majority or MAJORITY of

and Vice President elections ALL the Members of both Houses,
voting separately (Sec. 4, Art VII)
Confirmation of a new Vice President Absolute majority or MAJORITY vote

nominated by the President of ALL the Members of both Houses
of Congress, voting separately (Sec.
9, Art. VII)
Determination whether or not the 2/3 of both Houses, voting

President is unable to discharge the separately (Sec. 11, Art. VII)
powers and duties of his office
Revocation of the proclamation of Absolute majority or MAJORITY of

Martial Law or suspension of the ALL its Members, voting jointly (Sec.
privilege of the Writ of Habeas Corpus 18, Art. VII)
Extension of the proclamation of Absolute majority or MAJORITY of

Martial Law or suspension of the ALL its members, voting jointly (Sec.
privilege of the Writ of Habeas Corpus 18, Art. VII)
Concurrence with President‘s grant of Absolute majority or MAJORITY of

amnesty ALL the Members of the Congress
(Sec. 19, Art. VII)
Amendment/Revision of the 1987 3⁄4 of ALL the Members of the

Constitution (as a Constituent Congress (Sec. 1[1], Art. XVII)
Assembly)
Calling of Constitutional Convention 2/3 of ALL of the Members of the

Congress (Sec. 3, Art. XVII)
Submitting to the electorate the Absolute majority or MAJORITY vote

question of calling a Constitutional of ALL its Members (Sec. 3, Art.
Convention XVII)
Commission on Approval/Rejection of Appointment MAJORITY vote of ALL the Members

Appointments (Sec. 18, Art. VI)
Discipline of members
27. A complaint for violation of Anti-Graft and Corrupt Practices Act (RA 3019) was filed
against Marie, the Commission of Immigration and Deportation (CID)
Commissioner. During the pendency of the investigation, Marie resigned as the CID
Commissioner and ran for Senator. She won and started to serve her term as a
member of the Senate. During her incumbency as senator, the investigation on her
alleged violation of RA 3019 was finally completed and an Information was filed
formally charging her before the Sandiganbayan. The Sandiganbayan then issued an
order for her suspension effective for 90 days. Marie questioned the said order
contending that since she is a senator, only the Senate has the power to suspend
her. Is she correct?

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No. The order of suspension prescribed by RA 3019 is distinct from the power of Congress to
discipline its own ranks under the Constitution. The suspension contemplated in the
Constitution is a punitive measure that is imposed upon determination by the Senate or the
House of Representatives, as the case may be, upon an erring member. While the preventive
suspension under RA 3019 is not a penalty but a preliminary, preventive measure, prescinding
from the fact that the latter is not being imposed on the person for misbehavior as a Member of
the Congress. (Santiago vs. Sandiganbayan, G.R. No. 128055, April 18, 2001)
Process of law-making
28. What is an Enrolled Bill? State the Enrolled Bill Theory.
An enrolled bill is one duly introduced and finally passed by both Houses, authenticated by the
proper officers of each House, and approved by the President. The enrolled bill is conclusive
upon the courts as regards the tenor of the measure passed by Congress and approved by the
President. The court is bound under the Doctrine of Separation of Powers by the contents of a
duly authenticated measure of legislature. (United States vs. Pons, G.R. No. L-11530, August 12,
1916; Mabanag vs. Vito, G.R. No. L-1123, March 5, 1947; Arroyo vs. De Venecia, G.R. No. 127255, August
14, 1997)
29. May a bill become a law without the approval of the President? Is the rule absolute?
As a general rule, a bill may not become a law without the signature of the President.There are
exceptions to this rule wherein the bill becomes a law after third reading, such as:
a. When the veto of the President is overridden. (Sec. 27(1), Art. VI)
b. When the president does not act on it within 30 days after receipt. (Sec. 27(1), Art. VI)
c. When it is a bill repealing the emergency powers granted to the President. ( Sec. 23(2), Art.
VI)
d. When the bill calls for a special election to elect a President and Vice-President. (Sec. 10, Art.
VII)
Electoral tribunals and the Commission on Appointments
30. Nature, Powers, Composition, and Quorum Required for Electoral Tribunals and
Commission on Appointments:
Electoral Tribunals Commission on Appointments
Nature Although the Electoral Tribunals are Revived in the 1987 Constitution to
predominantly legislative in limit, once again, the President‗s
membership and the provision appointing power. (Sec. 18, Art. VI,
creating them is found in Art. VI on 1987 Constitution)
the Legislative Department, it is not
correct to say that they are mere The powers of the Commission on
adjuncts of the Congress of the Appointment do not come from
Philippines. In fact, in the discharge Congress,but emanate directly from
of their constitutional duties, they the Constitution. Hence, it is not an
are independent of the legislature, agent of Congress. And In order that
and also of the other departments the members of the Commission
for that matter. (Cruz, Philippine could properly discharge their duties
Political Law, 2014) as such, it is essential that their
tenure therein be provided with a
The tribunals are independent from certain measure of stability to insure
Congress, devoid of partisan the necessary freedom of action.
influence or consideration and (Cunanan vs. Tan, G.R. No. L-19721,
therefore, Congress has no power to May 10, 1962)

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regulate the proceedings of these

electoral tribunals.
(Angara vs. Electoral Commission,
G.R. No. L-45081, July 15,
1936; Bondoc vs. Pineda, G.R. No.
97710, September 26, 1991)
The Electoral Tribunals of the a. The Commission shall act on all

Houses of Congress shall be the sole appointments submitted to it
judge of all contests relating to the within 30 session days of Congress
election, returns and qualifications from their submission.
of their members. (Sec. 17, Art. VI, b. The Commission shall rule by
1987 Constitution) majority vote of its members.
c. The Commission shall meet only
To be considered a member of while Congress is in session, at the
Congress, there must be call of its Chairman or a majority
concurrence of the following of all its members.
requisites: (1) a valid proclamation; d. The Commission on Appointments
(2) a proper oath; and (3) is independent of the two Houses
assumption to duty. The following of Congress. Its employees are
requisites would bring the election not, technically, employees of
contest under the jurisdiction of the Congress. It has
HRET. Absent any of the foregoing, e. the power to promulgate its own
the COMELEC retains jurisdiction rules of proceedings.
over said contest. (Reyes vs. f. The powers of the Commission do
Commission on Elections, G.R. No. not come from Congress, but
207264, June 25, 2013) emanate directly from the
Constitution. Hence, it is not an
The decisions of the Electoral agent of Congress. In fact, the
Tribunals may be reviewed by the functions of the Commissioner are
Supreme Court only upon showing purely executive in nature.
Powers of grave abuse of discretion in a (Cunanan vs. Tan, G.R. No. L-
petition for certiorari filed under 19721, May 10, 1962)
Rule 65 of the Rules of Court. (Pena
vs. HRET, G.R. No. 123037, March Note: The Presidential appointments
21, 1997) subject to confirmation by the
Commission on Appointments are the
following:
a. Heads of the Executive

departments (Except the Vice-
President who is appointed to a
cabinet post);
b. Ambassadors, other public
ministers, or consuls;
c. Officers of the AFP from the rank
of colonel or naval captain;
d. Other officers whose appointments
are vested in him by the
Constitution, such as:
i. Chair and members of the

COMELEC, COA, and CSC;
ii. Regular members of the JBC.
(Sec. 16, Art. VII, 1987
Constitution)
Three (3) Justices of the Supreme a. Senate President as ex-officio

Composition
Court designated by the Chief chairman

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SCHOOL OF LAW
Justice; The Senior Justice shall be b. 12 Senators

its Chairman; and Six (6) members c. 12 Members of the House of
of the Senate (SET) or House of Representatives
Representatives (HRET) (Sec. 17,
Art. VI, 1987 Constitution) Note: The 12 Senators and 12
members of the
House of Representatives are elected
by each
house on the basis of proportional
representation.
The presence of at least one (1) At least thirteen (13) members is

Justice and four (4) Members of the necessary to constitute a quorum:
Tribunal shall be necessary to Provided, however, that at least four
constitute a quorum. In the absence (4) of the members constituting
of the Chairperson, the next Senior the quorum should come from either
Justice shall preside, and in the House. Provided, further, that
absence of both, the Justice present the presence of the Chairman shall
shall take the Chair. be considered in determining
the existence of a quorum. (Sec. 10,
In the absence of a quorum and The New Rules of the Commission on
provided there is at least one Justice Appointments)
in attendance, the Members
Quorum required
present, who shall not be less than
three (3), may constitute
themselves as an Executive
Committee to act on the agenda for
the meeting concerned, provided,
however, that its action shall be
subject to confirmation by the
Tribunal at any subsequent meeting
where a quorum is present.
(Rule 6, The 2015 Rules of the
House of Representatives Electoral
Tribunal)
31. Gabriel Singson was appointed Governor of the BSP. Petitioner questioned it as
there was no confirmation by the Commission on Appointments. Rule on the
contention.
The contention is not correct. The appointment of the Governor of BSP is not among the
appointments which have to be confirmed by the Commission on Appointment (CA). Under R.A.
7653, Sec. 6, Art. II of the same, the law provides or requires the confirmation by the CA of the
appointment of the BSP Governor. In Calderon vs. Carale, it was said that Congress cannot, by
law, expand the confirmation powers over government officials not expressly mentioned in Sec.
16, Art. VII of the constitution.
Powers of Congress
1. Legislative inquiries and oversight functions
32. Discuss the three post-enactment measures exercised by Congress.
1. Scrutiny - Congressional scrutiny implies a lesser intensity and continuity of attention to

administrative operations. Its primary purpose is to determine economy and efficiency of
the operation of government activities. In the exercise of legislative scrutiny, Congress may

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request information and report from the other branches of government. It can give
recommendations or pass resolutions for consideration of the agency involved. This is
exercised when Congress asks the heads of departments to appear before and be heard by
either House of Congress on any matter pertaining to their departments for budget
purposes. Likewise, Congress exercises legislative scrutiny thru its power of confirmation.
2. Congressional investigation - While congressional scrutiny is regarded as a passive

process of looking at the facts that are readily available, congressional investigation
involves a more intense digging of facts. The power of Congress to conduct investigation is
recognized by the 1987 Constitution under Sec. 21, Art. VI - the power of Congress to
conduct inquiries in aid of legislation.
3. Legislative supervision - The third and most encompassing form by which Congress
exercises its oversight power is thru legislative supervision. Supervision connotes a
continuing and informed awareness on the part of a congressional committee regarding
executive operations in a given administrative area. While both congressional scrutiny and
investigation involve inquiry into past executive branch actions in order to influence future
executive branch performance, congressional supervision allows Congress to scrutinize the
exercise of delegated law-making authority, and permits Congress to retain part of that
delegated authority. (Abakada Guro Partylist vs. Purisima, G.R. No. 166715, August 18, 2008)
33. Distinguish Legislative Inquiry from Oversight Function.
IN AID OF LEGISLATION OVERSIGHT FUNCTIONS
Who may appear? Any person Department Heads
Who may be Anyone, except the President and No one. Each House may only request
summoned? the members of the Supreme Court the appearance of the Department
Heads
Subject matter Any matters for purposes of Matters related to the Department only
pending legislation
Obligatory force of Mandatory Discretionary

appearance
34. What are the three limitations to the power of each House of Congress to conduct
inquiries in aid of legislation?
a) The inquiry must be in aid of legislation;

b) It must be conducted in accordance with the duly published rules of procedure of a House
of Congress conducting such inquiry; and
c) The rights of persons appearing in or affected by such inquiry shall be respected. (Sec. 21,
Art. VI, 1987 Constitution; Bengzon vs. The Senate Blue Ribbon Committee, G.R. No. 89914,
November 20, 1991)

ARELLANO UNIVERSITY
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35. Distinguish Inquiry in Aid of Legislation from Question Hour.
INQUIRY IN AID OF LEGISLATION QUESTION HOUR

(Sec. 21) (Sec. 22)
Relates to? Relates to the power to conduct inquiries Pertains to the power to conduct a
in aid of legislation. question hour.
Purpose To elicit information that may be used for To obtain information in pursuit of
legislation. Congress‘ oversight function.
Nature of Attendance is compulsory. Attendance is discretionary.

attendance
Persons Any person. Only Department Heads.

required to
attend
Who conducts? Committees. Entire body.
Subject matter Any matter for the purpose of legislation. Only matters related to the
Departments.
Basis Grounded on the necessity of information Congress merely seeks to be

in the legislative process (the power of informed on how Department
inquiry) being co-extensive with the Heads are implementing the
power to legislate. statutes which it has issued.
36. Is an Executive Order requiring all Executive Department heads to secure the
consent of the President before appearing in Question Hour valid?
Yes. The requirement to secure presidential consent, limited as it is only to appearances in the
question hour, is valid on its face. For unlike inquiries in aid of legislation under Sec. 21, Art. VI
of the Constitution where such appearance is mandatory, under Sec. 22, the appearance of
department heads in the question hour is discretionary on their part. (Senate vs. Ermita, G.R. No.
169777, April 20, 2006)
37. Will your answer be the same for appearances of department heads in inquiries in
aid of legislation?
No. Congress is not bound in such instances to respect the refusal of the department head to
appear in such inquiry, unless a valid claim of privilege is subsequently made, either by the
President herself or by the Executive Secretary by order of the president to invoke the privilege
on her behalf. (Senate vs. Ermita, supra)

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2. Non-legislative
a. Informing function
38. What is the informing function of the Congress?
The power of Congress, when it investigates, is either in aid of legislation or by way of

oversight. What appear to have been forgotten is an equally important and fundamental power
and duty of Congress and that is its informing function by way of investigating for the purpose
of enlightening the electorate.(Akbayan Citizens Action Party, et al. vs. Thomas G. Aquino, et al., G.R.
No. 170516, July 16, 2008)
1. Initiative and referendum
39. Distinguish Initiative from Referendum.
Initiative is the power of the people to propose amendments to the Constitution or to propose
and enact legislation through an election called for the purpose. There are three (3) systems of
initiative, namely: (a) Initiative on the Constitution, (b) Initiative on statutes, and (c) Initiative
on local legislation.
Meanwhile, referendum is the power of the electorate to approve or reject legislation through
an election called for the purpose. It may be of two (2) classes, namely: (a) Referendum on
statutes and (b) Referendum on local laws. (Nachura, Outline Reviewer in Political Law, 2016)
EXECUTIVE DEPARTMENT
A. Qualifications, election, and term of the President and Vice-President
40. What are the qualifications for President and Vice-President?
1. Natural-born citizen of the Philippines;

2. At least 40 years of age on the day of the election;
3. Able to read and write;
4. Registered voter; and
5. Resident of the Philippines for at least 10 years immediately preceding such election.
(Sec. 4, Art. VII, 1987 Constitution)
41. What is the term of office for the President and Vice President?
1. The President and the Vice-President shall be elected by direct vote of the people for a
term of six years which shall begin at noon on the thirtieth day of June next following the
day of the election and shall end at noon of the same date, six years thereafter. (Sec. 4,
Art. VII, 1987 Constitution)
2. The President shall NOT be eligible for any re-election. No person who succeeds as
President and has served as such for more than 4 years shall be qualified for election to the
same office at any time. (Sec. 4, par. (1), Art. VII, 1987 Constitution)
3. No Vice-President shall serve for more than 2 consecutive terms . (Sec. 3, par. (2), Art. VII,
1987 Constitution)

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B. Privileges, inhibitions, and disqualifications
1. Presidential immunity
42. Why is the President enjoying immunity from suits?
The rationale for the immunity is to assure exercise of presidential duties and functions free
from any hindrance or distraction considering that it is a job that requires the Chief Executive‗s
time as well as undivided attention. (Soliven vs. Makasiar, G.R. No. 82585, November 14, 1988, Per
Curiam)
43. During his incumbency, President Ronel shot to death one of his advisers during a
heated argument over a game of golf that they were playing. The deceased
adviser’s family filed a case of homicide against President Ronel before the city
prosecutor’s office. He moved to dismiss the case, invoking presidential immunity
from suit. Should the case be dismissed?
Yes, President Ronel‘s immunity holds for the whole duration of his tenure. The President,
during his tenure of office or actual incumbency, may not be sued in any civil or criminal case,
and there is no need to provide for it in the Constitution or law. It will degrade the dignity of
the high office of the President, the Head of State, if he can be dragged into court litigations
while serving as such. Furthermore, it is important that he be freed from any form of
harassment, hindrance, or distraction to enable him to fully attend to the performance of his
official duties and functions. (Rubrico vs Arroyo, G.R. No. 183871, Feb 18, 2010)
2. Presidential privilege
44. What are the three elements of presidential communications privilege?
a. Quintessential and non-delegable presidential power: Power subject of the

legislative inquiry must be expressly granted by the Constitution to the President, e.g
commander-in-chief, appointing, pardoning, and diplomatic powers;
b. Operational Proximity Test: It must be authored, solicited, and received by a close
advisor of the President or the President himself. The judicial test is that an advisor must
be in ―operational proximity‖ with the President (i.e. officials who stand proximate to the
President, not only by reason of their function, but also by reason of their positions in the
Executive‘s organizational structure);
c. The privilege may be overcome by a showing of adequate need, such that the information
sought ―likely contains important evidence,‖ and by the unavailability of the information
elsewhere by an appropriate investigating authority. (Neri vs. Senate Committee, G.R. No.
180643, September 4, 2008)
45. Enumerate the prohibitions attached to the President, Vice- President, Cabinet
Members, and their deputies or assistants, unless otherwise provided in the
Constitution.
a. For President and Vice President, they shall not receive any other emolument from the
government or any other source (Sec. 6, Art. VII, 1987 Constitution).
b. Shall not hold any other office or employment during their tenure unless:
a. Otherwise provided in the Constitution (e.g. VP can be appointed as a Cabinet Member
without the need of confirmation by Commission on Appointments; Secretary of Justice
sits as ex officio member in the Judicial and Bar Council)
b. The positions are ex-officio and they do not receive any salary or other emoluments
therefore (e.g. Secretary of Finance as head of the Monetary Board)
c. Shall not practice, directly or indirectly, any other profession during their tenure;
d. Shall not participate in any business;

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e. Shall not be financially interested in any contract with, or in any franchise, or special
privilege granted by the Government, including GOCCs;
f. Shall avoid conflict of interest in conduct of office; and
g. Shall avoid nepotism (Sec. 13, Art. VII, 1987 Constitution).
C. Powers of the President
46. Enumerate the powers of the President under the Constitution.
a. Appointing power (Sec. 16, Art. VII, 1987 Constitution);

b. Power of control over all executive departments, bureaus and offices (Sec. 17, Art. VII, 1987
Constitution);
c. Commander-in-Chief powers (calling-out power, power to place the Philippines under
martial law, and power to suspend the privilege of the writ of habeas corpus) (Sec. 18, Art.
VII, 1987 Constitution);
d. Pardoning power (Sec. 19, Art. VII, 1987 Constitution);
e. Borrowing power (Sec. 20, Art. VII , 1987 Constitution);
f. Diplomatic/Treaty-making power (Sec. 21, Art. VII, 1987 Constitution);
g. Budgetary power (Sec. 22, Art. VII, 1987 Constitution);
h. Informing power (Sec. 23, Art. VII, 1987 Constitution);
i. Veto power (Sec. 27, Art. VI, 1987 Constitution);
j. Power of general supervision over local governments (Sec. 4, Art. X, 1987 Constitution);
k. Power to call special session (Sec. 15, Art. VI, 1987 Constitution).
1. General executive and administrative powers
2. Power of appointment
a. In general
47. What are the elements of a valid appointment made by the President?
a. Authority to appoint and evidence of the exercise of the authority;

b. Transmittal of the appointment paper signed by the President and evidence of the
transmittal;
c. A vacant position at the time of appointment;
d. Receipt of the appointment paper and acceptance of the appointment by the appointee
who possesses all the qualifications and none of the disqualifications.
Concurrence of all these elements should always apply, regardless of when the appointment is
made, whether outside, just before, or during the appointment ban. These steps in the
appointment process should always concur and operate as a single process. There is no valid
appointment if the process lacks even one step. (Velicaria-Garafil vs. Office of the President, G.R.
No. 203372, June 16, 2015)
48. What are midnight appointments?
Appointments made by the President or Acting President two months immediately before the
next presidential elections and up to the end of his term. ( Sec. 15, Art. VII, 1987 Constitution)
49. Does the prohibition on midnight appointments apply to the Judiciary?
No. The framers did not need to extend the prohibition to appointments in the Judiciary,
because their establishment of the Judicial Bar Council (JBC) and their subjecting the
nomination and screening of candidates for judicial positions to the unhurried and deliberate

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prior process of the JBC ensured that there would no longer be midnight appointments to the
Judiciary(De Castro vs. JBC, G.R. No. 191002, March 17, 2010).
b. Limitations on the exercise/power
50. Elena Bautista was appointed as Undersecretary of DOTC. She was designated as
Undersecretary for Maritime Transport of the department. Following the resignation
of then MARINA Administrator Vicente Suazo, Bautista was designated as Officer -in
-Charge (OIC), Office of the Administrator, MARINA, in concurrent capacity as DOTC
Undersecretary. Does the designation of Bautista as OIC of the Office of the
Administrator of MARINA violate Sec. 13, Art. VII of the 1987 Constitution which
prohibits the President, Vice-President, the Members of the Cabinet, and their
deputies or assistants from holding any other office or employment during their
tenure?
Yes. While all other appointive officials in the civil service are allowed to hold other office or
employment in the government during their tenure when such is allowed by law or by the
primary functions of their positions, members of the Cabinet, their deputies and assistants may
do so only when expressly authorized by the Constitution itself. The phrase unless otherwise
provided in this Constitution must be given a literal interpretation to refer only to those
particular instances cited in the Constitution itself, to wit: the Vice -President being appointed
as a member of the Cabinet under Sec. 3, par. (2), Art. VII; or acting as President in those
instances provided under Sec. 7, pars. (2) and (3), Art. VII; and, the Secretary of Justice being
ex--officio member of the Judicial and Bar Council by virtue of Sec. 8 (1), Art. VIII.
Bautista, being the appointed Undersecretary of DOTC, was covered by the stricter prohibition
under Sec. 13, Art. VII and consequently she cannot invoke the exception provided in Sec. 7,
paragraph 2, Art. IX-B where holding another office is allowed by law or the primary functions
of the position. (Funa vs. Executive Secretary Ermita, G.R. No. 184740, February 11, 2010 )
c. Types of appointment
51. What are the kinds of Appointment?
a. Regular Appointment – requires the confirmation of the CA before the appointee can
assume office. The President nominates, the CA confirms, and the President issues the
commission.
b. Ad Interim – takes effect immediately. It is valid if it is confirmed by the CA or until the

next adjournment of Congress.
c. Recess Appointment – needs no confirmation by the CA. It is effective immediately, but

temporary in the sense that it is valid until disapproved by the CA or until the next
adjournment of Congress. (Political Law Reviewer 2020 Edition, Judge Albano, page 695)

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52. Distinguish disapproved ad interim appointment from by-passed appointment.
Disapproved Ad Interim Appointment By-passed Appointment

Appointment made by the President while Appointment which receives neither approval nor
Congress is not in session or doing recess. An rejection from the Commission. (Matibag vs. Benipayo,
ad interim appointment is permanent in nature G.R. No. 149036, April 2, 2002)
and takes effect immediately. Thus, one who
was issued an ad interim appointment may
immediately enter upon the discharge of his
functions. An ad interim appointment ceases to
be valid upon disapproval by the Commission
on Appointments or, if not confirmed, until the
next adjournment of Congress. (Matibag vs.
Benipayo, G.R. No. 149036, April 2, 2002)
3. Power of control and supervision
53. Then President Gloria Macapagal-Arroyo issued Executive Order No. 12 creating the
Presidential Anti-Graft Commission (PAGC) and vesting it with the power to
investigate or hear administrative cases or complaints for possible graft and
corruption, among others, against presidential appointees and to submit its report
and recommendations to the President. President Benigno Aquino III, however,
issued Executive Order No. 13, abolishing the PAGC and transferring its functions to
the Office of the Deputy Executive Secretary for Legal Affairs (ODESLA), more
particularly to its newly-established Investigative and Adjudicatory Division (IAD).
Senator Francis assailed the constitutionality of E.O. No. 13 on the ground that the
President is not authorized under any existing law to create the IAD-ODESLA and
that by creating a new, additional and distinct office tasked with quasi-judicial
functions, the President usurped the powers of congress to create a public office,
appropriate funds and delegate quasi-judicial functions to administrative agencies.
a. Can the President validly issue E.O. 13?
Yes. Sec. 31 of Executive Order No. 292 (E.O. 292), otherwise known as the
Administrative Code of 1987, vests in the President the continuing authority to reorganize
the offices under him in order to achieve simplicity, economy and efficiency. Under Sec.
31(1) of EO 292, the President can reorganize the Office of the President Proper by
abolishing, consolidating or merging units, or by transferring functions from one unit to
another. Clearly, the abolition of the PAGC and the transfer of its functions to a division
specially created within the ODESLA is properly within the prerogative of the President
under his continuing "delegated legislative authority to reorganize" his own office pursuant
to E.O. 292.
b. Did the President, in issuing E.O. 13 usurp the power of Congress to create a
public office?
No. The abolition of the PAGC did not require the creation of a new, additional and distinct
office as the duties and functions that pertained to the defunct anti-graft body were simply
transferred to the ODESLA, which is an existing office within the Office of the President
Proper. The reorganization required no more than a mere alteration of the administrative
structure of the ODESLA through the establishment of a third division – the Investigative
and Adjudicatory Division – through which ODESLA could take on the additional functions
it has been tasked to discharge under E.O. 13. (Pichay, Jr. vs. Office of the Deputy Executive
Secretary for Legal Affairs-IAD, G.R. No. 196425)

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54. Sec. 8 (2) of RA 6770 states that "A Deputy, or the Special Prosecutor, may be
removed from office by the President for any of the grounds provided for the
removal of the Ombudsman, and after due process." Is this provision constitutional?
No. Subjecting the Deputy Ombudsman to discipline and removal by the President, whose own
alter egos and officials in the Executive Department are subject to the Ombudsman's
disciplinary authority, cannot but seriously place at risk the independence of the Office of the
Ombudsman itself. The law directly collided not only with the independence that the
Constitution guarantees to the Office of the Ombudsman, but inevitably with the principle of
checks and balances that the creation of an Ombudsman office seeks to revitalize. What is true
for the Ombudsman must be equally and necessarily true for her Deputies who act as agents of
the Ombudsman in the performance of their duties. (Gonzales III vs. Office of the President, G. R.
No. 196231, January 28, 2014; Barreras- Sulit vs. Office of the President, G.R. No. 196232; February 26,
2014)
55. Will your answer be the same if it is the Special Prosecutor who is subjected to the
disciplinary authority of the President?
No. Jurisprudence provides the maintenance of the validity of Sec. 8(2) of RA No. 6770 insofar
as the Special Prosecutor is concerned. The Court did not consider the Office of the Special
Prosecutor to be constitutionally within the Office of the Ombudsman and is, hence, not entitled
to the independence the latter enjoys under the Constitution. The Office of the President has
administrative disciplinary power over a Special Prosecutor. By virtue of Sec. 21 of the
Ombudsman Act grants the President the power to remove a Special Prosecutor for any of the
grounds provided for the removal of the Ombudsman, and after due process. (Gonzales III vs.
Office of the President, supra)
Over Local government units
56. Does the Office of the President have control over local government units?
No. The Constitution vests the President with the power of supervision, not control, over local
government units (LGUs). Such power enables him to see to it that LGUs and their officials
execute their tasks in accordance with law. While he may issue advisories and seek their
cooperation in solving economic difficulties, he cannot prevent them from performing their
tasks and using available resources to achieve their goals. He may not withhold or alter any
authority or power given them by the law. (Pimentel vs. Aguirre, G.R. 132988, July 19, 2000)
However, as an exception, in cases of epidemics, pestilence, and other widespread public

health dangers, the Secretary of Health may, upon the direction of the President and in
consultation with the local government unit concerned, temporarily assume direct
supervision and control over health operations in any local government unit for the
duration of the emergency, but in no case exceeding a cumulative period of six (6) months.
With the concurrence of the government unit concerned, the period for such direct national
control and supervision may be further extended.(Sec. 105, Local Government Code)
4. Emergency powers
57. What are the conditions in granting emergency powers to the President?
(1) There must be a war or other emergency.

(2) The delegation must be for a limited period only.
(3) The delegation must be subject to such restrictions as the Congress may prescribe.
(4) The emergency powers must be exercised to carry out a national policy declared by
Congress. (Sec. 23(2), Art. VI, 1987 Constitution)

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5. Commander-in-chief powers
58. Can a governor declare a state of national emergency and exercise emergency
powers?
No. A provincial governor is not endowed with the power to call upon the armed forces at his
own bidding. He will exceed his authority when he declares a state of emergency and calls
upon the Armed Forces, the police, and his own Civilian Emergency Force. The calling-out
powers contemplated under the Constitution is exclusive to the President. Springing from the
well-entrenched constitutional precept of One President is the notion that there are certain acts
which, by their very nature, may only be performed by the president as the Head of the State.
One of these acts or prerogatives is the bundle of Commander-in-Chief powers to which the
―calling-out‖ powers constitutes a portion. An exercise by another official, even if he is the local
chief executive, is ultra vires, and may not be justified by the invocation of Sec. 465 of the
Local Government Code. (Kulayan vs. Tan, G.R. No. 187298, July 3, 2012)
Declaration of martial law and suspension of the privilege of the writ ofhabeas corpus;
extension
59. What are the parameters for review to determine whether there exists a factual
basis for the proclamation of Martial Law and/or suspension of the privilege of
Habeas Corpus? What is the standard of proof required in determining such?
The parameters for determining the sufficiency of the factual basis are as follows: (a) actual
rebellion or invasion; (2) public safety requires it; and 3) there is probable cause for the
President to believe that there is actual rebellion or invasion. The first two requirements must
concur. The President needs only to satisfy probable cause as the standard of proof in
determining the existence of either invasion or rebellion for purposes of declaring Martial Law.
(Lagman vs. Medialdea, G.R. No. 231658, July 4, 2017)
60. After being confirmed that the town of Masinloc was attacked and seized by a group
inspired by ISIS, a well-known international terrorist group, President Munggo
declared Martial Lawand suspended the privilege of the writ of habeas corpus on
the entire region of Mindawi where the town of Masinloc is situated. Congress fails
to convene and vote on either extending or revoking the proclamation of Martial
Law. Senator Mapilit filed a Petition for Mandamus to compel Congress to convene
and decide on the extension or revocation of the Martial Law pursuant to Sec. 18,
Art. VII, of the 1987 Constitution. Would the action prosper?
No. The Congress is not constitutionally mandated to convene in a joint session except to vote
jointly to revoke the President's declaration or suspension. The use of the word "may" in the
Constitution is to be construed as permissive and operating to confer discretion on the
Congress on whether or not to revoke, but in order to revoke, the same provision sets the
requirement that at least a majority of the Members of the Congress, voting jointly, favor
revocation. (Padilla vs. Congress of the Philippines, G.R. No. 231671, July 25, 2017)

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61. Acting on the recommendations of the Department of National Defense Secretary

Demi and the then Armed Forces of the Philippines Chief of Staff General Gero in a
letter dated December 8, 2017, President Munggo again asked both the Senate and
the House of Representatives to extend the Proclamation of martial law and the
suspension of the privilege of the writ of habeas corpus in the entire Mindanao for
one year. Before the expiration of the second extension of Proclamation No. 216 or
on December 4, 2018, Secretary Demi in a letter to the President, recommended the
third extension of martial law and the suspension of the privilege of the writ of
habeas corpus in the entire Mindanao for one year from January 1, 2019 up to
December 31, 2019. Congressman Mario prayed for the issuance of a Temporary
Restraining Order (TRO) or a Writ of Preliminary Injunction (WPI) to enjoin the
respondents from implementing the one-year extension contending that a third
extension violates the constitutional proscription against a long duration of martial
law or the suspension of the privilege of the writ of habeas corpus. Is Congressman
Mario’s contention tenable?
No. There is no limit as to how many times and for how may it extend the suspension of the
privilege of habeas corpus. The Congress has the prerogative to extend the martial law and the
suspension of the privilege of the writ of habeas corpus as the Constitution does not limit the
period for which it can extend the same. The Court in the case of Lagman vs. Medialdea
explained the only limitations to the exercise of congressional authority to extend such
proclamation or suspension: a) the extension should be upon the President's initiative; b) it
should be grounded on the persistence of the invasion or rebellion and the demands of public
safety; and c) it is subject to the Court's review of the sufficiency of its factual basis upon the
petition of any citizen. (Lagman vs. Medialdea, G.R. No. 243522, February 19, 2019)
62. Does the declaration of Martial Law automatically suspend the privilege of Habeas
Corpus?
Martial law does not automatically suspend the privilege of the writ of habeas corpus or the
operation of the Constitution. The civil courts and the legislative bodies shall remain open;
Military courts and agencies are not conferred jurisdiction over civilians. The suspension of the
privilege of the writ of habeas corpus shall apply only to persons facing charges of rebellion or
offenses inherent in or directly connected with invasion. Any person arrested for such offenses
must be judicially charged within 3 days. Otherwise, he shall be released. (Sec. 18, Art. VII, 1987
Constitution);
Executive clemency
63. What are the limitations on the exercise of the pardoning power of the President?
a. It cannot be granted in cases of impeachment (Sec. 19, Art. VII, 1987 Constitution);
b. It cannot be granted in cases of violation of election laws without the favorable
recommendation of the Commission on Elections (Sec. 5, Art. IX-C, 1987 Constitution);
c. It can be granted only after conviction by final judgment (People vs. Salle, Jr., G.R. No. 103567,
December 4, 1995, reiterated in People vs. Bacang, G.R. No. 116512, July 30, 1996);
d. It cannot be granted in cases of legislative or civil contempt;
e. It cannot absolve the convict of civil liability (People vs. Nacional, G.R. Nos. 111294-95,
September 7, 1995); and
f. It cannot restore public offices forfeited (Monsanto vs. Factoran, G.R. No. 78239, February 9,
1989).

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64. Does pardon ipso facto restore former office, as well as the corresponding rights
and privileges?
No. Pardon does not ipso facto restore a convicted felon neither to his former public office nor
to his rights and privileges, which were necessarily relinquished or forfeited by reason of the
conviction although such pardon undoubtedly restores his eligibility to that office. To regain
former public officer, one must re-apply and undergo the usual procedure required for a new
appointment. (Monsanto vs. Factoran, G.R. No. 78239, February 9, 1989)
65. What are the forms of executive clemency? Explain briefly.
a. Pardon – an act of grace which exempts the individual on whom it is bestowed from the
punishment that the law inflicts for the crime he has committed;
b. Commutation – the reduction or mitigation of the penalty;
c. Reprieve – the postponement of a sentence or stay of execution;
d. Parole – the release from imprisonment but without full restoration of liberty as parolee is
still in the custody of the law although not in confinement;
e. Remission of fines and forfeitures – prevents the collection of fines or the confiscation of
forfeited property and it cannot have the effect of returning properly which has been vested
in third parties or money ion the public treasury; and Amnesty – an act of grace concurred
in by the legislature and usually extended to groups of persons who committed political
offenses, and which puts into oblivion the offense itself;
f. Amnesty - The grant of general pardon to a class of political offenders either after
conviction or even before the charges is filed. It is the form of executive clemency which
under the Constitution may be granted by the President only with the concurrence of the
legislature. (Nachura, Outline Reviewer in Political Law, 2016)
66. Distinguish Pardon from Amnesty.
PARDON AMNESTY
Judicial notice Private act of the President Public act of the President that courts
upon which there can be no may take judicial notice of.
judicial scrutiny; it must be
pleaded and proved.
To whom Granted to an individual after Granted to classes of persons or

granted; when conviction. communities before the institution of
criminal prosecution or sometimes after
conviction.
Concurrence by No need for the concurrence of Need the concurrence of the Congress.
the Congress the Congress.
Acceptance Acceptance is necessary. No need for a distinct act of acceptance.
Offense Generally granted for Addressed to political offenses.

infractions of peace of the
state.
Effect Looks forward and relieves the Looks backward and abolishes and puts
offender from the into oblivion the offense itself, as if no
consequences of an offense of offense was committed. (Barrioquinto
which he has been convicted. vs. Fernandez, G.R. No. L-1278, January
21, 1949)

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7. Diplomatic power
67. Distinguish Treaties from Executive Agreements.
TREATIES EXECUTIVE AGREEMENTS
Binding effect Formal documents, which Become binding through

require ratification with the executive action without need of
approval of 2/3 of the Senate. a vote by the Senate or
Congress.
Nature International agreements, International agreements

involving political issues or embodying adjustments of detail
changes of national policy, and carrying out well established
those involving international national policies and traditions
arrangements of a permanent and those involving
character. arrangements of a moreor less
temporary nature.
8. Powers relative to appropriation measures
68. What are the requisites to exercise the President’s (Senate President’s, Speaker of
the House’s, Chief Justice’s, Head of Constitutional Commissions’, as the case may
be) Power of Augmentation?
1. There is a law authorizing the President, the President of the Senate, the Speaker of the
House of Representatives, the Chief Justice of the Supreme Court, and the heads of the
Constitutional Commissions to transfer funds within their respective offices;
2. The funds to be transferred are savings generated from the appropriations for their respective
offices; and
3. The purpose of the transfer is to augment an item in the general appropriations law for
theirrespective offices. (Araullo vs. Aquino III, G.R. No. 1209287, July 1, 2014)
69. The Executive Department has accumulated substantial savings from its
appropriations. Needing P5,000,000.00 for the conduct of a plebiscite for the
creation of a new city but has no funds appropriated soon by the Congress for the
purpose, the COMELEC requests the President to transfer funds from the savings of
the Executive Department in order to avoid a delay in the holding of the plebiscite.
May the President validly exercise his power under the 1987 Constitution to
transfer funds from the savings of the Executive Department, and make a cross-
border transfer of P5,000,000.00 to the COMELEC by way of augmentation? Explain
your answer.
The President may not transfer savings to the Commission on Elections as aid. The
constitutional prohibition against the transfer of appropriations to other branches of
government or Constitutional Commission applies must be strictly observed . (Araullo vs. Aquino
III, G.R. No. 209287, July 1, 2014)
9. Delegated powers
70. What are the powers that may be delegated to the President?
The Congress may, by law, authorize the President to fix within specified limits, and subject to
such limitations and restrictions as it may impose, tariff rates, import and export quotas,

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tonnage and wharfage dues, and other duties or imposts within the framework of the national
development program of the Government. [Sec. 28 (2), Art. VI, 1987 Constitution]
10. Residual powers
71. Is the power of the President limited to those set forth in the Constitution?
No, this pertains to the residual power of the President. It is founded on the duty of the
President, as steward of the people. It is not only the power of the President but also his duty
to do anything not forbidden by the Constitution or the laws that the needs of the nation
demand. The President is not only clothed with extraordinary powers in times of emergency,
but is also tasked with attending to the day-to-day problems of maintaining peace and order
and ensuring domestic tranquillity in times when no foreign foe appears on the horizon. (Marcos
vs. Manglapus, G.R. No. 88211, September 15, 1989)
11. Veto powers
D. Rules of succession
72. Rules in the vacancy in the Office of the President.
Circumstance Who will succeed?
Vacancy at the Death or permanent disability. Vice President-elect.

beginning of the
term of the
President-elect Fails to qualify. Vice President-elect shall act as
President until the President-elect shall
have qualified.
President shall not have been Vice President-elect shall act as

chosen. President until a President shall have
been chosen and qualified.
No President and Vice The President of the Senate or, in case

President chosen nor shall of his inability, the Speaker of the
have been qualified, or both House of Representatives shall act as
shall have died or become President until a President or Vice
permanently disabled. President shall have been chosen and
qualified.
N.B.: In the event of inability of the

officials mentioned, Congress shall, by
law, provide for the manner in which
one who is to act as President shall be
selected until a President or a Vice
President shall have qualified.
Vacancy during the Death, permanent disability, Vice President

term removal from office, or
resignation of the President.

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Circumstance Who will succeed?
Death, permanent disability, The President of the Senate or, in case

removal from office, or of his inability, the Speaker of the
resignation of the President House of Representatives shall act as
and Vice President. President until a President or Vice
President shall have been chosen and
qualified.
N.B.: In the event of inability of the

officials mentioned, Congress shall, by
law, provide for the manner in which
one who is to act as President shall be
selected until a President or a Vice
President shall have qualified.
Temporary disability When President transmits to Vice President as Acting President.

the Senate President and the
Speaker of the House his
written declaration that he is
unable to discharge the powers
and duties of his office, and
until he transmits to them a
writing declaration to the
contrary.
When a majority of all of the Vice President as Acting President.

members of the Cabinet
transmits to the Senate Thereafter, when the President
President and the Speaker of transmits to the Senate President and
the House their written Speaker of the House his written
declaration that the President declaration that no inability exists, he
is unable to discharge the shall re-assume the powers and duties
powers and duties of his office. of his office.
If the Congress, within ten days after

receipt of the last written declaration,
or, if not in session, within twelve days
after it is required to assemble,
determines by a two-thirds vote of both
Houses, voting separately, that the
President is unable to discharge the
powers and duties of his office, the
Vice-President shall act as the
President; otherwise, the President shall
continue exercising the powers and
duties of his office.
(Sec. 11, Art. VII, 1987 Constitution)
Serious illness Does not result to vacancy because the

Cabinet members in charge of national
security and foreign relations can still
access the President. (Nachura, Outline
Reviewer in Political Law, 2016)

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JUDICIAL DEPARTMENT
A. Concepts
1. Judicial power
73. What is the scope of judicial power?
a. Adjudicatory Powers - To settle actual controversies involving rights which are legally
demandable and enforceable.
b. Expanded Power of Judicial review - To determine whether or not there has been a
grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any
branch or instrumentality of the Government ( Sec. 1[2], Art. VIII, 1987 Constitution).
c. Incidental Powers – those which are necessary to the effective discharge of the judicial
functions such as: power to punish persons adjudged in contempt and power to issue
restraining orders or prohibition and injunction in aid of power of judicial review.
2. Judicial review
74. What is the expanded power of judicial review?
It is the power of the court to inquire into the exercise of discretionary powers to determine
whether or not there has been a grave abuse of discretion amounting to lack or excess of
jurisdiction. (Sec. 1, Art. VIII, Marcos vs. Manglapus, G.R. No. 88211, September 15, 1989 )
75. Orpeza, after purchasing a foreclosed property from PNB, discovered that 5 families
were residing and planting crops on the property by virtue of Certificate of Land
Ownership Award issued by DAR. Aggrieved, she demanded the return of her
payments. Due to PNB's refusal to refund, Orpeza filed a complaint in the RTC. The
RTC ruled in favor of Orpeza ordering PNB to refund plus damages; RTC's decision,
however, did not contain analysis of the evidence of the parties or reference to any
legal basis on how it reached its conclusion. PNB appealed to CA. CA granted and
nullified RTC's order for non-compliance with Art. VII, Sec. 14 of the 1987
constitution. The records of the case were remanded to RTC for rendition of
judgment in accordance to the mandate of the constitution and the Rules of Court.
Is the CA correct?
Yes, 1st paragraph of Sec. 14, Art. VIII of the 1987 Constitution provides that ―No decision
shall be rendered by any court without expressing therein clearly and distinctly the facts and
the law on which it is based.‖ This is a component of due process and fair play. The factual and
legal reasons must lead to the conclusions of the court. The losing party is entitled to know the
reason for his loss in order to appeal to the higher court. Thus, a decision that does not state
the facts and the law on which it is based is prejudicial to the losing party who is unable to
provide the errors of the court to the higher tribunal. Also, this requirement is a safeguard
against arbitrary decisions of judges. This allows the judge to depend on the processes of legal
reasoning. In the case at bar, the decision of the RTC judge is a mere recitation of facts and a
dispositive portion which failed to provide legal basis in declaring PNB‘s liability. Therefore, CA
is correct.(PNB vs. Heirs of Ireneo and Entapa, G.R. No. 215072 September 7, 2016, J. Leonen)
76. Enumerate and discuss the requisites of Judicial Review.
a. Actual case or Controversy– It involves a conflict of legal rights, assertion of opposite legal
claims susceptible of legal resolution. It must be both ripe for resolution and susceptible of
judicial determination, and that which is not conjectural or anticipatory, or that which seeks
to resolve hypothetical or feigned constitutional problems.
b. Proper party(locus standi)– One who has sustained or is in immediate danger of sustaining

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an injury as a result of the act complained of;

c. Earliest opportunity– Constitutional question must be raised at the earliest possible
opportunity.
d. Necessity of deciding constitutional questions – As long as there are other bases which
courts can use for decision, constitutionality of the law will not be touched, thus, courts
should refrain from resolving any constitutional issue "unless the constitutional question is
the lis mota of the case." (Belgica vs. Ochoa, G.R. No. 208566, November 19, 2013)
77. Explain the concept of Moot and Academic Question in Judicial Review. Enumerate
the exceptions to this rule.
As a rule, the Court may only adjudicate actual, ongoing controversies. The Court is not
empowered to decide moot questions. An action is considered "moot" when it no longer
presents a justiciable controversy because the issues involved have become academic or dead
or when the matter in dispute has already been resolved and hence, one is not entitled to
judicial intervention unless the issue is likely to be raised again between the parties. There is
nothing for the court to resolve as the determination thereof has been overtaken by
subsequent events.
Nevertheless, the Court will decide cases, otherwise moot, if:

a. There is a grave violation of the Constitution;
b. The exceptional character of the situation and the paramount public interest are involved;
c. When the constitutional issue raised requires formulation of controlling principles to guide
the bench, the bar, and the public; and
d. The case is capable of repetition yet evading review. (International Service for the Acquisition of
Agri-Biotech Applications, Inc. vs. Greenpeace Southeast Asia, G.R. No. 209271)
78. What is the Operative Fact Doctrine?
The doctrine of operative fact recognizes the existence of the law or executive act prior to the
determination of its unconstitutionality as an operative fact that produced consequences that
cannot always be erased, ignored or disregarded. In short, it nullifies the void law or executive
act but sustains its effects. It provides an exception to the general rule that a void or
unconstitutional law produces no effect. (Araullo vs. Aquino, G.R. No. 209287, July 1, 2014)
Note: This is an exception to the general rule that "An unconstitutional act is not a law; it
confers no rights; it imposes no duties; it affords no protection; it creates no office; it is, in
legal contemplation, as inoperative as though it had never been passed ."(Republic vs. CA, G.R.
No. 79732, November 8, 1993)
79. What is the Doctrine of Relative Constitutionality?
The constitutionality of a statute cannot, in every instance, be determined by a mere

comparison of its provisions with applicable provisions of the Constitution, since the statute
may be constitutionally valid as applied to one set of facts and invalid in its application to
another. A statute valid at one time may become void at another time because of altered
circumstances. Thus, if a statute in its practical operation becomes arbitrary or confiscatory, its
validity, even though affirmed by a former adjudication, is open to inquiry and investigation in
the light of changed conditions. (Central Bank Employees Association, Inc. vs. Bangko Sentral ng
Pilipinas, G.R. No. 148208, December 15, 2004)

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80. Explain the Political Question Doctrine.
Political questions refer ―to those questions which, under the Constitution, are to be decided by
the people in their sovereign capacity, or in regard to which full discretionary authority has
been delegated to the legislative or executive branch of the government. It is concerned with
issues dependent upon the wisdom, not legality of a particular measure.‖ ( Vinuya vs. Romulo,
G.R. No. 162230, April 28, 2010)
81. What is the test to determine whether a question is political or justiciable?
The determination of a truly political question from a non-justiciable political question lies in the
answer to the question ―whether there are constitutionality imposed limits on powers or
functions conferred upon political bodies.‖ If there are, then our courts are duty-bound to
examine whether the branch or instrumentality of the government properly acted within such
limits. (Francisco Jr. vs. House of Representatives, G.R. No. 160261, November 10, 2003 )
Judicial independence and autonomy
82. What are the safeguards of Judicial Independence?
a. The Supreme Court is a constitutional body. It may not be abolished by legislature.

b. The members of the Supreme Court are removable only by impeachment.
c. The Supreme Court may not be deprived of minimum original and appellate jurisdiction.
Appellate jurisdiction may not be increased without its advice and concurrence.
d. Appointees to the Judiciary are nominated by the Judicial and Bar Council and are not
subject to confirmation by the Commission on Appointments.
e. The Supreme Court has administrative supervision over all inferior courts and personnel.
f. The Supreme Court has the exclusive power to discipline judges/justices of inferior courts.
g. Members of the Judiciary have security of tenure, which cannot be undermined by a law
reorganizing the Judiciary.
h. The members of the Judiciary may not be designated to any agency performing quasi-
judicial or administrative functions.
i. The Judiciary enjoys fiscal autonomy. Salaries of judges may not be reduced. (In Re:
Clarifying and Strengthening the Organizational Structure and Administrative Set-up of the Philippine
Judicial Academy, A.M. No. 01-1-04-SC-PHILJA, September 25, 2009)
j. The Supreme Court alone may promulgate Rules of Court. Congress can no longer enact
any law governing rules of procedure for the courts. (Echegaray vs. Secretary of Justice, G.R.
No. 132601, January 19, 1999)
k. The Supreme Court alone may order temporary detail of judges. The Supreme Court can
appoint all officials and employees of the Judiciary. (Nachura, Outline Reviewer in Political Law,
2016)
l. The Supreme Court may assign temporarily judges of lower courts to other stations as
public interest may require.
83. Discuss Judicial Privilege.
The privilege against disclosure of information or communications that formed the process of
judicial decisions. This applies to confidential matters, which refer to information not yet
publicized by the Court like (1) raffle of cases, (2) actions taken in each case in the Court‘s
agenda, and (3) deliberations of the Members in court sessions on case matters pending before
it. This privilege, however, is not exclusive to the Judiciary and it extends to the other branches
of government due to our adherence to the principle of separation of powers. (In Re: Production
of Court Records and Documents and the Attendance of Court Officials and Employees as Witnesses under
the Subpoenas of Feb. 10, 2012 and the Various Letters of Impeachment Prosecution Panel dated January
19 and 25, 2012, February 14, 2012)

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Appointments to the judiciary
1. Qualifications of members of the judiciary
84. What are the qualifications to the appointment to the Judiciary?
Supreme Court Court of Regional Trial Metropolitan Sandiganbaya

Appeals Court Trial Court, n
Municipal Trial
Court, Municipal
Circuit Trial
Court
Natural born citizen of the Philippines
A judge of a A judge of a Has been engaged Has been engaged Has been a
lower court lower court in the practice of in the practice of judge of a court
engaged in the engaged in the law in the law in the of record or
practice of law in practice of law Philippines or has Philippines or has been engaged in
the Philippines in the held a public office held a public office the practice of
for fifteen (15) Philippines for in the Philippines in the Philippines law in the
years or more. fifteen (15) requiring requiring admission Philippines or
years or more.* admission to the to the practice of has held office
practice of law as law as an requiring
*Same an indispensable indispensable admission to the
qualifications as requisite for at requisite for at bar as a pre-
provided in the least ten (10) least five (5) years. requisite for at
1987 years. least ten (10)
Constitution for years.
Justices of the
Supreme Court.
(Sec. 7, Chap.
1, Batas
Pambansa Blg.
129)
At least 40 years of age. At least 35 years At least 30 years of At least 40 years

of age. age. of age.
A Member of the Judiciary must be a person of proven competence, integrity, probity, and
independence. (Sec. 7 (3), Art. VIII, 1987 Constitution)

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2. Judicial and Bar Council
a. Composition
b. Powers
85. What are the powers and composition of the Judicial and Bar Council?
Composition Powers
a. Ex-Officio members: The Council shall have the principal
i. Chief Justice, as Chairman; function of recommending appointees to
ii. Secretary of Justice; and the Judiciary. It may exercise such other
iii. a Representative of Congress. functions and duties as the Supreme
Court may assign to it. (Sec. 8[5], Art.
b. Regular members: VIII, 1987 Constitution)
i. Representative from the Integrated Bar of the
Philippines;
ii. Professor of Law;
iii. Retired Justice of the Supreme Court; and
iv. Representative of the private sector. (Sec. 8, Art.
VIII, 1987 Constitution)
The Supreme Court
1. Composition
2. Powers and functions
86. What is the composition, powers, and functions of the Supreme Court?
Composition Powers and Functions

A Chief Justice and 14 Associate Justices. It a. Exercise original jurisdiction over cases affecting
may sit en banc or in its discretion, in divisions ambassadors, public ministers and consuls, petitions for
of three, five or seven members. Any vacancy certiorari, prohibition, mandamus, quo warranto, and
shall be filled within 90 days from occurrence habeas corpus
thereof (Sec. 4[1], Art. VIII, 1987 Constitution) b. Review, revise, reverse, modify, or affirm on appeal
or certiorari, as the law or the Rules of Court may
provide, final judgments and orders of lower courts in:
i. All cases in which the constitutionality or validity of
any treaty, international or executive agreement, law,
presidential decree, proclamation, order, instruction,
ordinance, or regulation is in question.
ii. All cases involving the legality of any tax, impost,
assessment, or toll, or any penalty imposed in relation
thereto.
iii. All cases in which the jurisdiction of any lower court
is in issue.
iv. All criminal cases in which the penalty imposed is
reclusion perpetua or higher.
v. All cases in which only an error or question of law is
involved.
c. Assign temporarily judges of lower courts to other
stations as public interest may require. Such temporary
assignment shall not exceed six months without the
consent of the judge
concerned.
d. Order a change of venue or place of trial to
avoid a miscarriage of justice.
e. Promulgate rules concerning the protection and
enforcement of constitutional rights, pleading, practice,

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and procedure in all courts, the admission to the

practice of law, the integrated bar, and legal assistance
to the under-privileged. Such rules shall provide a
simplified and inexpensive procedure for the speedy
disposition of cases, shall be uniform for all courts of
the same grade, and shall not diminish, increase, or
modify substantive rights. Rules of procedure of special
courts and quasi-judicial bodies shall remain effective
unless disapproved by the Supreme Court.
f. Appoint all officials and employees of the Judiciary in
accordance with the Civil Service Law. (Sec. 5, Art.
VIII, 1987 Constitution)
87. According to Sec. 3, Art. VIII of the Constitution, the Judiciary shall enjoy fiscal
autonomy. What does the term fiscal autonomy mean?
Fiscal autonomy contemplates a guarantee of full flexibility to allocate and utilize resources with
the wisdom and dispatch that the needs require. It recognizes the power and authority to deny,
assess and collect fees, fix rates of compensation not exceeding the highest rates authorized by
law for compensation and pay plans of the government and allocate and disburse such sums as
may be provided by law or prescribed by it in the course of the discharge of its functions.
(Bengzon vs. Drilon, G.R. No. 103524, April 15, 1992)
88. May Congress exempt a government-owned and controlled corporation from the
payment of legal or docket fees?
No. The payment of legal fees under Rule 141 of the Rules of Court is an integral part of the
rules promulgated by the Supreme Court pursuant to its rule-making power under Sec. 5(5),
Art. VIII of the Constitution. In particular, it is part of the rules concerning pleading, practice
and procedure in courts. Since the payment of legal fees is a vital component of the rules
concerning pleading, practice and procedure, it cannot be validly annulled, changed or modified
by Congress. Moreover, legal fees under Rule 141 have two basic components, the Judiciary
Development Fund (JDF) and the Special Allowance for the Judiciary Fund (SAJF). The laws
which established the JDF and the SAJF expressly declare the identical purpose of these funds
to "guarantee the independence of the Judiciary as mandated by the Constitution and public
policy." Legal fees therefore do not only constitute a vital source of the Court's financial
resources but also comprise an essential element of the Court's fiscal independence. Any
exemption from the payment of legal fees granted by Congress to government-owned or
controlled corporations and local government units will necessarily reduce the JDF and the
SAJF. Undoubtedly, such situation is constitutionally infirm for it impairs the Court's guaranteed
fiscal autonomy and erodes its independence. (Re: Petition for Recognition of the Exemption of the
GSIS from Payment of Legal Fees, A.M. No. 08-2-01-0, February 11, 2010)
89. Can the court issue an injunction against the construction of the Torre de Manila
Condominium, on the ground that such is a sore to the view of the Rizal Monument
and an endangerment to the nation’s cultural heritage?
No. There is no law prohibiting the construction of the condominium project due to its effect on
the background of the Rizal Monument. While the Rizal Park has been declared a National
Historical Site, the area where Torre de Manila Condominium is being built is a privately-owned
property that is not part of the Rizal Park that has been declared as a National Heritage Site,
and the Torre de Manila Condominium area is in fact "well-beyond" the Rizal Park. (Knight of
Rizal vs. DMCI, G.R. No. 213948, April 18, 2017)

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90. Can the Court allow the release of copies of SALN and other personal documents of
the incumbent Justices?
Yes. The right to information goes hand-in-hand with the constitutional policies of full public
disclosure and honesty in the public service. It is meant to enhance the widening role of the
citizenry in governmental decision-making as well as in checking abuse in government. Sec. 17,
Art. XI, has classified the information disclosed in the SALN as a matter of public concern and
interest. There is no cogent reason to deny the public access to the SALN, PDS and CV of the
Justices of the Court and other magistrates of the Judiciary subject, of course, to the limitations
and prohibitions provided in R.A. No. 6713, and its implementing rules and regulations. ( RE:
Request for Copies of the SALN and Personal Data Sheet or Curriculum Vitae of the Justices of
the Supreme Court and Officers and Employees of the Judiciary, A.M. No. 09-8-6-SC, June 13,
2012)
91. Distinguish judicial legislation from the rule-making power of the Supreme Court.
Judicial legislation is the act of a court in engrafting upon a law something that has been
omitted which someone believes ought to have been embraced. This exercise of judicial power
is forbidden by the tripartite division of powers among the three departments of government,
the executive, the legislative, and the judicial. ( Tañada vs. Yulo, G.R. No. L-43575, May 31,
1935)
On the other hand, rule-making power is an auxiliary administrative power of the Supreme
Court to promulgate rules concerning the following:
a. protection and enforcement of Constitutional rights;
b. pleading, practice, and procedure in all courts;
c. admission to the practice of law;
d. Integrated Bar, discipline and practice of law;
e. legal assistance to the underprivileged.
Such rules shall provide a simplified and inexpensive procedure for the speedy disposition of
cases, shall be uniform for all courts of the same grade, and shall not diminish, increase, or
modify substantive rights. Rules of procedure of special courts and quasi-judicial bodies shall
remain effective unless disapproved by the Supreme Court. (Sec. 6[5], Art. VIII, 1987 Constitution)
CONSTITUTIONAL COMMISSIONS
A. Common provisions
B. Institutional independence safeguards
92. What are the common provisions for the CSC, COMELEC and CoA?
CONSTITUTIONAL SAFEGUARDS TO COMMON FEATURES OF THE ROTATIONAL

ENSUREINDEPENDENCE OF CONSTITUTIONALCOMMISS SCHEME OF
COMMISSION IONS APPOINTMENT
(REQUISITE
CONDITIONS)
a. They are constitutionally created and may a. They are multi-headed a. The terms of the first
not be abolished by statute. bodies; three Commissioners
b. Each is expressly described as b. They are categorized as should start on a
―independent. ―independent by the common date;
c. Each is conferred certain powers and Constitution; b. The appointment to
functions which cannot be reduced by c. Their powers and functions any vacancy due to
statute. are defined in the Constitution; death, resignation, or
d. The Chairmen and members cannot be d. The Commissioners are disability should only

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removed except by impeachment. required to be natural-born for the unexpired

e. The Chairmen and members are given a citizens of the Philippines; balance of the term of
fairly long term of office of seven years. e. Their terms of office are the
f. The Chairmen and members may not be staggered with a two-year predecessor.
reappointed or appointed in an acting interval (Rotational Scheme of
capacity. Appointment);
g. The salaries of the Chairmen and members f. The Commissioners appointed
are relatively high and may not be decreased are ineligible for reappointment
during continuance in office. for a period beyond the
h. The Commission enjoys fiscal autonomy. maximum tenure of seven
i. Its approved annual appropriations shall be years;
automatically and regularly released. The g. Appointment to any vacancy
Secretary of Budget and Management cannot is only for the unexpired portion
make the release of the appropriations of the term of the predecessor;
subject to the submission of reports. (Sec. 5, h. The Commissioners cannot be
Art. IX-A, 1987 Constitution; Civil Service appointed or designated in a
Commission vs. Department of Budget and temporary or acting capacity;
Management, G.R. No. 158791, July 22, and
2005) i. The Commissioners are
j. Each Commission may promulgate its own removable only by
procedural rules, provided they do not impeachment.
diminish, increase or modify substantive
rights (though subject to disapproval by the
Supreme Court).
k. The Chairmen and members are subject to
certain disqualifications calculated to
strengthen their integrity.
l. The Commissions may appoint their own
officials and employees in accordance with
the Civil Service Law.

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C. Powers and functions
93. Overview of the Powers and Functions of Constitutional Commissions.
CSC COMELEC COA
a. The central personnel a. Enforce and administer all laws The 1987 Constitution has made
agency of the and regulations relative to the the COA the guardian of public
Government: conduct of an election, funds, vesting it with broad
b. a.Establish a career plebiscite, initiative, referendum, powers over all accounts
service and adopt and recall. pertaining to government
measures to promote b. Decide, save those involving the revenues and expenditures and
morale, efficiency, right to vote, all questions the use of public funds and
integrity, responsiveness affecting elections, including property, including the exclusive
and courtesy in the civil determination of the number authority to define the scope of its
service. and location of polling places, audit and examination; to
c. b.Strengthen the merit appointment of election officials establish the techniques and
and rewards system. and inspectors, and registration methods for the review; and to
d. Integrate all human of voters. promulgate accounting and
resources development c. Deputize, with the concurrence auditing rules and regulations. Its
programs for all levels and of the President, law exercise of its general audit power
ranks. enforcement agencies and is among the constitutional
e. Institutionalize a instrumentalities for the mechanisms that give life to the
management climate exclusive purpose of ensuring check and balance system
conducive to public free, orderly, honest, peaceful inherent in our form of
accountability (Sec. 3, Art. and credible elections. government. (DelaLlana vs. COA,
IX-B, 1987 Constitution). d. Register, after sufficient G.R. No. 180989, February 7,
publication, political parties, 2012)
▪ The Civil Service Commission organizations or coalitions which
has the power to hear and must present their platform or a.Examine, audit and settle all
decide administrative cases program of government and accounts pertaining to the revenue
instituted before it directly or accredit citizens‘ arms. and receipts of, and expenditures
on appeal, including contested e. .File, upon a verified complaint, or uses of funds and property
appointments (Administrative or on its own initiative, petitions owned or held in trust or
Code of 1987). in court for the inclusion or pertaining to, the Government.
exclusion of voters, investigate
The power of the Civil Service and, where appropriate, The COA conducts examination or
Commission includes the prosecute cases of violations of post-audit basis with regard to
authority to recall an election laws. Constitutional Commissions and
appointment initially approved f. Recommend to Congress bodies or offices granted fiscal
in disregard of applicable effective measures to minimize autonomy under the Constitution;
provisions of the Civil Service election spending, including autonomous state colleges and
rules and regulations. (Mathay limitation of places where universities; other government-
vs. Civil Service Commission, propaganda materials shall be owned and controlled corporations
G.R. No. 130214, August 9, posted, and to prevent and and their subsidiaries; and not
1999) penalize all forms of election governmental entities receiving
frauds, offenses, malpractice, subsidy or equity, directly or
and nuisance candidates. indirectly, from or through the
g. Recommend to the President the Government.
removal of any officer or
employee it has deputized, or b.Keep the general accounts of
the imposition of any other Government, and preserve
disciplinary action, for violation vouchers and supporting papers
or disregard of, or disobedience for such period as provided by
to, its directive, order, or law.
decision.
h. Submit to the President and c. Authority to define the
Congress a comprehensive scope of its audit and examination,
report on the conduct of each establish techniques and methods
election, plebiscite, initiative, required therefore.
referendum or recall. (Sec. 2,

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CSC COMELEC COA
Art. IX-C, 1987 Constitution) N.B.:The power of the

Commission to define the scope of
its audit and to promulgate
auditing rules and regulations and
the power to disallow unnecessary
expenditures, is exclusive, but its
power to examine and audit is not
exclusive. (Development Bank of
the Philippine vs. Commission on
Audit, G.R. No. 88435, January 15,
2002)
d.Promulgate account and auditing

rules and regulations, including
those for the prevention and
disallowance of irregular,
unnecessary, expensive,
extravagant or unconscionable
expenditures or uses of
government funds or property.

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D. Composition and qualifications of members
94. State the composition, qualifications, requirement of confirmation of appointment

and prohibitions on members of the Constitutional Commissions.
CIVIL SERVICE COMMISSION ON COMMISSION ON

COMMISSION ELECTIONS AUDIT
Composition 1 Chairman 1 Chairman 1 Chairman

2 Commissioners 6 Commissioners 2 Commissioners
Qualifications a. Natural born citizens; a. Natural born citizens; a. Natural born

b. At least 35 years at b. At least 35 years at citizens;
the time of the the time of the b. At least 35 years at
appointment; appointment; the time of the
c. With proven capacity c. Holders of College appointment;
for public Degrees; and c. Certified Public
administration; and d. Not candidates for any Accountant with at
d. Not candidates for any elective position in the least 10 years of
elective position in the election immediately auditing experience
election immediately preceding or a lawyer who
preceding appointment practiced law for at
appointment least 10 years;
N.B.: Majority, including
the Chairman, must be N.B.: At no time
members of the shall all Members of
Philippine Bar and the Commission
practiced law for at least belong to the same
10 years. profession
d. Not candidates for

any elective position in
the election
immediately preceding
appointment
Appointments Needs the confirmation of the Commission on Appointments.
Disqualifications Same as President and Vice President (Art. VII of the 1987 Constitution) and
members of the Congress (under Art. VI of the 1987 Constitution).
E. Prohibited offices and interests
95. What are the prohibited offices and interests imposed upon members of
Constitutional Commissions?
No member of a Constitutional Commission shall, during his tenure:
a. Hold any other office or employment;

b. Engage in the practice of any profession;
c. Engage in the active management and control of any business which in any way may be
affected by the function of his office; and

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d. Be financially interested, directly or indirectly, in any contract with, or in any franchise or

privilege granted by the Government, any of its subdivisions, agencies or instrumentalities,
including GOCCs or their subsidiaries. (Sec. 2, Art. IX, 1987 Constitution)
96. President Arroyo appointed Guillermo Carague as Chairman of the Commission on

Audit (COA) for a term of seven (7) years. Carague’s term of office started on
February 2, 2001 to end on February 2, 2008. She also appointed Reynaldo Villar as
the third member of the COA for a term of seven (7) years starting February 2, 2004
until February 2, 2011. Following the retirement of Carague on February 2, 2008
and during the fourth year of Villar as COA Commissioner, Villar was nominated and
appointed as Chairman of the COA. The Commission on Appointments confirmed his
appointment. Was the appointment valid?
No. Although promotional appointment (Commissioner to Chairman) is not prohibited, Villar‘s

appointment is still not valid. Sec 1(2), Art. IX(D) of the Constitution provides that:
(2) The Chairman and Commissioners [on Audit] shall be appointed x x x for a term of seven
years without reappointment. x x x Appointment to any vacancy shall be only for the unexpired
portion of the term of the predecessor. x x x
Accordingly, the promotional appointment as COA Chairman of Villar for a stated fixed term of
less than seven (7) years is void for violating a clear, but mandatory constitutional prescription.
The vacancy in the position of COA chairman when Carague stepped down in February 2, 2008
resulted from the expiration of his 7-year term. Hence, the appointment to the vacancy thus
created ought to have been one for seven (7) years. However, Villar cannot be appointed to a
full 7-year term because of the rule against one serving the commission for an aggregate term
of more than seven (7) years because when he was appointed as Chairman, he already served
4 years as Commissioner. (Funa vs. Villar, G.R. No. 192791, April 24, 2012)
97. In what instances may a promotional appointment (Commissioner to Chairman) be

valid?
A commissioner who resigns after serving in the Commission for less than seven years is
eligible for an appointment to the position of Chairman for the unexpired portion of the term of
the departing chairman. Such appointment is not covered by the ban on reappointment,
provided that the aggregate period of the length of service as commissioner and the unexpired
period of the term of the predecessor will not exceed seven (7) years and provided further that
the vacancy in the position of Chairman resulted from death, resignation, disability or removal
by impeachment. (Funa vs. Villar, G.R. No. 192791, April 24, 2012)
98. The Sangguniang Panlalawigan of Palawan enacted a Provincial Ordinance which

provides for an additional levy on real property tax for the special education fund at
the rate of 0.5%. In conformity with the Ordinance, the Municipality of Narra,
Palawan collected from owners of real properties located within its territory an
annual tax as special education fund at the rate of 0.5% of the assessed value of
the property subject to tax which was effected through the municipality treasurer,
Mr. D. On post-audit, COA issued Audit Observation Memorandum which shows
supposed deficiencies in the special education fund collected by the said
municipality. COA questioned the levy of the special education fund at the rate of
only 0.5% rather than at 1%, the rate stated in the Local Government Code. COA
issued a Notice of Charge in the amount of ₱1,125,416.56. COAheld that Mr. D and
all special education fund payors liable for the deficiency in special education fund
collections. Is the COA correct in holding them personally liable for such
deficiencies?

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PRE-WEEK NOTES
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No. Mr. D‘s actions were done pursuant to an ordinance which, at the time of the collection,
was yet to be invalidated. It is basic that laws and local ordinances are ―presumed to be valid
unless and until the courts declare the contrary in clear and unequivocal terms.‖ Thus, the
concerned officials of the Municipality of Narra, Palawan must be deemed to have conducted
themselves in good faith and with regularity when they acted and collected the additional levy
for the special education fund. Moreover, it was an error amounting to grave abuse of
discretion for respondent to hold petitioner personally liable for the supposed deficiency. Even if
a contrary ruling were to be had on the propriety of collecting at a rate less than 1%, it would
still not follow that petitioner is personally liable for deficiencies. ( Demaala vs. COA, G.R. No.
199752, February 17,2015, J. Leonen)
99. The governing board of 21 state universities and colleges issued resolutions which
granted honoraria to board members in amounts ranging from P3,000.00 to
P5,000.00 for attendance in board meetings. These honoraria were in addition to
the P2,000.00 mandated by the Department of Budget and Management Circular
Nos. 2003-5 and 2003-6, and were sourced from these state universities and
colleges' income from tuition fees, otherwise called the special trust fund.
Subsequently, various audit team leaders of the Commission on Audit's Regional
Legal and Adjudication Offices issued an audit observation memoranda. These
resulted in Notices of Disallowance for the payments of the honoraria on the ground
of lack of legal basis. The governing board contends that the Commission on Audit
has no power to disallow honoraria made in administrative agencies. Is the claim
meritorious?
No. The Supreme Court held that it is the general policy of the Court to sustain the decisions of
administrative authorities, especially one that was constitutionally created like herein
respondent COA, not only on the basis of the doctrine of separation of powers, but also of their
presumed expertise in the laws they are entrusted to enforce. It is, in fact, an oft-repeated rule
that findings of administrative agencies are accorded not only respect but also finality when the
decision and order are not tainted with unfairness or arbitrariness that would amount to grave
abuse of discretion. Thus, only when the COA acted without or in excess of jurisdiction, or with
grave abuse of discretion amounting to lack or excess of jurisdiction. ( Rotoras vs. COA, G.R.
No. 211999, August 20, 2019, J. Leonen)
100. In relation to the previous question, should the governing boards of the state
universities and colleges be ordered to refund the amounts they had received?
Yes. The defense of good faith, which precludes the requirement to return disallowed benefits
or allowances, is based on the principle that public officials are entitled to the presumption of
good faith when discharging their official duties. On several occasions, officials and officers who
disbursed the disallowed amounts are liable to refund: (1) when they patently disregarded
existing rules in granting the benefits to be disbursed, amounting to gross negligence; (2) when
there was clearly no legal basis for the benefits or allowances; (3) when the amount disbursed
is so exorbitant that the approving officers were alerted to its validity and legality; or (4) when
they knew that they had no authority over such disbursement. In this case, since no legal basis
for the grant of additional honoraria has been established, it would be an unjust enrichment to
allow the members of the governing boards to retain what they had received . (Rotoras vs. COA,
G.R. No. 211999, August 20, 2019, J. Leonen)

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BILL OF RIGHTS
A. Concept of Bill of Rights
1. Privacy and autonomy
101. Discuss how the right to privacy is enshrined in the Bill of Rights.
The right to privacy is a fundamental right enshrined by implication in our Constitution. One
of its dimensions is its protection through the prohibition of unreasonable searches and
seizures in Art. III, Sec/ 2 of the Constitution. The mantle of protection upon one‘s person
and one‘s effects through Art. III, Sec. 2 of the Constitution is essential to allow citizens to
evolve their autonomy and, hence, to avail themselves of their right to privacy. (People vs.
Cogaed, G.R. No. 200334, July 30, 2014, J. Leonen)
2. Relation to human rights
102. Discuss the hierarchy of rights in the Bill of Rights.
The primacy of human rights over property rights is recognized in the Bill of Rights. Property
and property rights can be lost thru prescription; but human rights are imprescriptible. If
human rights are extinguished by the passage of time, then the Bill of Rights is a useless
attempt to limit the power of government and ceases to be an efficacious shield against the
tyranny of officials, of majorities, of the influential and powerful, and of oligarchs — political,
economic or otherwise.
The superiority of these freedoms over property rights is underscored by the fact that a
mere reasonable or rational relation between the means employed by the law and its object
or purpose — that the law is neither arbitrary nor discriminatory nor oppressive — would
suffice to validate a law which restricts or impairs property rights. On the other hand, a
constitutional or valid infringement of human rights requires a more stringent criterion,
namely existence of a grave and immediate danger of a substantive evil which the State has
the right to prevent. (Philippine Blooming Mills Employment Organization vs. Philippine
Blooming Mills Co., Inc., G.R. No. L-31195, June 5, 1973)
B. Due process of law
1. Concept of right to life, liberty and property
103. Discuss the concept of right to life, liberty and property.
a. Right to life - guarantees essentially the right to be alive - upon which the enjoyment of
all other rights is preconditioned - the right to security of person is a guarantee of the
secure quality of this life. (Secretary of Defense vs. Manalo, G.R. No. 180906, October 7,
2008)
b. Right to Liberty - The right to liberty guaranteed by the Constitution includes the right
to exist and the right to be free from arbitrary personal restraint or servitude. (Rubi vs.
Provincial Board of Mindoro, G.R. No. L-14078, March 7, 1919)
c. Right to Property – includes all kinds of property found in the Civil Code. It also
includes the right to work and the right to earn a living. A mere privilege, however, may
evolve into some form of property right protected by due process. (Bernas, The
1987Constitution of the Republic of the Philippines,2009)

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Due Process
a. Substantive
b. Procedural
i. Judicial
ii. Administrative
104. What are the kinds of due process and its requisites?
a. Substantive – serves as a restriction on government‘s lawmaking and rule-making

power. Its requisites are: (a) the interests of the public, in general, as distinguished from
those of a particular class, require the intervention of the State; and (b) the means
employed are reasonably necessary for the accomplishment of the purpose, and not
unduly oppressive on individuals;
b. Procedural – serves as a restriction on actions of judicial and quasi-judicial agencies of

government. See table below for its requisites. (Nachura, Outline Reviewer in Political Law,
2016)
105. Requisites of Procedural Due Process in Judicial and Administrative Proceedings
Type Requisites
Judicial a. There must be an impartial court or tribunal clothed with judicial

Proceedings power to hear and determine the matter before it;
b. Jurisdiction must be lawfully acquired over the person of the
Defendant and over the property which is the subject matter of
the proceedings;
c. The Defendant must be given an opportunity to be heard; and
d. The judgment must be rendered upon lawful hearing. (Nachura,
Outline Reviewer in Political Law, 2016)
Administrati a. There must be a right to a hearing;
ve and b. The tribunal must consider the evidence presented;
Quasi- c. The decision must have something to support itself;
Judicial d. The evidence must be substantial;
Proceedings e. The decision must be rendered on the evidence presented at the
hearing, or, at least, contained in the record and disclosed to
parties;
f. The tribunal or any of its judges must act on its or his own
independent consideration of the facts and the law of the
controversy, and not simply accept the views of a subordinate in
arriving at a decision; and
g. The board or body should, in all controversial questions, render its
decision in such a manner that the parties to the proceeding will
know the various issues involved, and the reasons for the
decision. (Ang Tibay vs. Court of Industrial Relations, G.R. No. L-
46496, February 27, 1940)

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c. Levels of scrutiny
106. What are the three (3) levels of scrutiny?
1. Strict Scrutiny Test – the legislative classification which impermissibly interferes with
the exercise of a fundamental right or operates to the peculiar disadvantage of a suspect
class is presumed unconstitutional, and the burden is upon the government to prove that
the classification is necessary to achieve a compelling state interest and that it is the least
restrictive means to protect such interest.
2. Middle-Tier or Intermediate Scrutiny Test – the government must show that the
challenged classification serves an important state interest and that the classification is at
least substantially related to serving that interest.
3. Deferential or Rational Basis Test – the challenged classification needs only be

shown to be rationally related to serving a legitimate state interest. (Serrano vs. Gallant
Maritime Services, Inc., G.R. No. 167614, March 24, 2009)
Equal protection of laws
107. Discuss the concept of equal protection of laws in relation to foundlings.
The equal protection of laws serves as a guarantee that persons under like circumstances and
falling within the same class are treated alike, in terms of privileges conferred and liabilities
enforced. It is a guarantee against undue favor and individual or class privilege, as well as
hostile discrimination or oppression of inequality.
Other than the anonymity of their biological parents, no substantial distinction differentiates
foundlings from children with known Filipino parents. They are both entitled to the full extent
of the state's protection from the moment of their birth. Foundlings' misfortune in failing to
identify the parents who abandoned them—an inability arising from no fault of their own—
cannot be the foundation of a rule that reduces them to statelessness or, at best, as inferior,
second-class citizens who are not entitled to as much benefits and protection from the state
as those who know their parents. Sustaining this classification is not only inequitable; it is
dehumanizing. It condemns those who, from the very beginning of their lives, were
abandoned to a life of desolation and deprivation. (David vs. SET,G.R. No. 221538, September 20,
2016, J. Leonen)
108. What are the requisites of a valid classification?
a. It must be based upon substantial distinctions: There must be real and substantial
differences between the classes treated differently.
b. It must be germane to the purpose of the law.
c. It must not be limited to existing conditions only: The classification must be enforced not
only for the present but as long as the problem sought to be corrected continues to exist.
d. It must apply equally to all members of the class: The classification would be regarded as
invalid if all the members of the class are not treated similarly, both as to rights conferred
and obligations imposed. (Biraogo vs. Philippine Truth Commission, G.R. No. 192935, December
7, 2010)

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109. A law was passed which provides that: (a) any person holding a public appointive
office or position, including active members of the Armed Forces of the
Philippines, and officers and employees in government-owned or -controlled
corporations, shall be considered ipso facto resigned from his office upon the
filing of his certificate of candidacy; and (b) an elected official is not deemed to
have resigned from his office upon the filing of his certificate of candidacy for the
same or any other elected office or position. Is there a substantial distinction
between appointive and elective officials to justify the different treatment?
Yes. The former occupies their office by virtue of the mandate of the electorate. They are
elected to an office for a definite term and may be removed therefrom only upon stringent
conditions. On the other hand, appointive officials hold their office by virtue of their
designation thereto by an appointing authority. Some appointive officials hold their office in a
permanent capacity and are entitled to security of tenure while others serve at the pleasure
of the appointing authority. (Quinto vs. COMELEC, G.R. No. 189698, February 22, 2010)
Levels of scrutiny
Right against unreasonable searches and seizures
1. Concept of privacy
110. What is required to a police office for a valid waiver by the accused of his/her
constitutional right to privacy?
For a valid waiver by the accused of his or her constitutional right to privacy, the police
officer must:
a. Introduce himself or herself, or be known as a police officer;

b. Inform the person to be searched that any inaction on his or her part will amount to a
waiver of any of his or her objections that the circumstances do not amount to a
reasonable search.
c. Communicate this clearly and in a language known to the person who is about to waive
his or her constitutional rights.
d. There must be an assurance given to the police officer that the accused fully understands
his or her rights.
The fundamental nature of a person‘s constitutional right to privacy requires no less. (People
vs. Cogaed, G.R. No. 200334, July 30, 2014, J. Leonen)
2. Concept of a search
111. What is the rule in determining whether a search and seizure is reasonable?
There is no hard and fast rule in determining when a search and seizure is reasonable. In any
given situation, what constitutes a reasonable search is purely a judicial question, the
resolution of which depends upon the unique and distinct factual circumstances. This may
involve inquiry into the:
a. Purpose of the search or seizure;
b. Presence or absence of probable cause;
c. Manner in which the search and seizure was made;
d. Place or thing searched, and
e. Character of the articles procured. (Veridiano vs. People, G.R. No. 200370, June 7, 2017, J.
Leonen)

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SCHOOL OF LAW
3. Requisites of a valid warrant
112. What are the requisites of a valid warrant?
1. Probable cause is present;

2. Such presence is determined personally by the judge;
4. The complainant and the witnesses he or she may produce are personally examined by
the judge, in writing and under oath or affirmation;
5. The applicant and the witnesses testify on facts personally known to them; and
6. The warrant specifically describes the person and place to be searched and the things to
be seized. (Del Castillo vs. People of the Philippines, G.R. No. 185128, January 30, 2012)
4. Warrantless searches
113. What are instances when searches are reasonable even when warrantless?
The known jurisprudential instances of reasonable warrantless searches and seizures are:
a.Warrantless search incidental to a lawful arrest;

b. Seizure of evidence in "plain view‖;
c. Search of a moving vehicle;
d.Consented warrantless search;
e. Customs search;
f. Stop and frisk; and
g.Exigent and emergency circumstances. (People vs. Cogaed, G.R. No. 200334, July 30, 2014, J.
Leonen)
114. Can a search precede a lawful arrest for a valid warrantless search incidental to a
lawful arrest?
No. A search incidental to a lawful arrest requires that there must first be a lawful arrest
before a search is made. Otherwise stated, a lawful arrest must precede the search; the
process cannot be reversed. (Veridiano vs. People, G.R. No. 200370, June 7, 2017, J. Leonen)
115. Distinguish search incidental to a lawful arrest and the stop and frisk search.
Search Incidental to a Lawful Stop and Frisk Search

Arrest
Quantum of Existence of a lawful arrest as a A genuine reason must exist, in light of the
Proof/Test to condition precedent police officer's experience and surrounding
be Valid conditions. Not a mere suspicion or hunch.
(Telen vs. People, G.R. No. 228107, October
9, 2019, J. Leonen)
116. Discuss the concept of “suspiciousness” required to balance stop and frisk
searches as a law enforcement tool with the need to protect the right to privacy of
citizens.
The balance lies in the concept of "suspiciousness" present in the situation where the police
officer finds himself or herself in. This may be undoubtedly based on the experience of the
police officer. Experienced police officers have personal experience dealing with criminals and
criminal behavior. Hence, they should have the ability to discern — based on facts that they
themselves observe — whether an individual is acting in a suspicious manner. Clearly, a basic
criterion would be that the police officer, with his or her personal knowledge, must observe

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the facts leading to the suspicion of an illicit act. (People vs. Cogaed, G.R. No. 200334, July
30, 2014, J. Leonen)
For a valid stop and frisk search, this Court instructed in Manibog vs. People, that the
arresting officer should have personally observed at least two (2) or more suspicious
circumstances. A reasonable inference must be deduced from the totality of circumstances to
justify further investigation by the arresting officer. Suspicion alone is not sufficient to defeat
petitioner's constitutional right to privacy. A mere hunch, in the absence of any other
circumstance of which he had personal knowledge, does not satisfy the requirements for a
valid stop and frisk search. (Telen vs. People, G.R. No. 228107, October 9, 2019, J. Leonen)
117. Upon receipt of an information from a police asset that Manibog was standing
outside the Municipal Tourism Office with a gun tucked in his waistband, Chief
Inspector Beniat and his team proceeded to the area around 20 meters from the
police station. Upon verification that such information was credible, the team
slowly approached Manibog for fear that he might fight back. Upon closer look,
Chief Inspector Beniat saw a bulge on Manibog’s waist which the police officer
deduced to be a gun due to its distinct contour. As they have confirmed that
Manibog had a gun tucked in his waistband, Chief Inspector disarmed and
arrested him for violating the election gun ban and brought him to the police
station for inquest proceeding. Is there a valid stop and frisk search?
Yes. For a "stop and frisk" search to be valid, the totality of suspicious circumstances, as
personally observed by the arresting officer, must lead to a genuine reason to suspect that a
person is committing an illicit act.
In the present case, combination of the police asset's tip and the arresting officers'
observation of a gun-shaped object under petitioner's shirt already suffices as a genuine
reason for the arresting officers to conduct a stop and frisk search on petitioner. Dingras
policemen searched the accused not only because of a tip - a very specific one - that he was
at that moment standing in front of the nearby Municipal Tourism Office with a gun on his
waist. More importantly, PCI Beniat testified that at a distance of about two to three meters
from the accused, he saw the latter's bulging waistline indicating the "distinct peculiar
contour" of a firearm tucked on his waist. Citing his experience as a police officer, PCI Beniat
testified that he could distinguish a firearm from any other object tucked on the waist of a
person. In the language of Justice Panganiban's separate opinion in People vs. Montilla, the
Court finds that the bulging waistline of herein accused constituted "an outward indication"
that clearly suggested he was then carrying a firearm. (Manibog vs. People, G.R. 211214, March
20, 2019, J. Leonen)
118. What is the Plain View Doctrine?
Objects in the ―plain view‖ of an officer who has the right to be in the position to have that
view are subject to seizure and may be presented as evidence. It is usually applied where the
police officer is not searching for evidence against the accused, but nonetheless inadvertently
comes upon an incriminating object. It has the following requisites:
a. a prior valid intrusion based on the valid warrantless arrest in which the police are legally
present in the pursuit of their official duties;
b. the evidence was inadvertently discovered by the police who has the right to be where
they are;
c. the evidence must be immediately apparent; and
d. ―plain view‖ justified the seizure of the evidence without any further search. (People vs.
Musa, G.R. No. 96177, January 27, 1993)

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119. Mr. Dela Cruz, a travelling passenger, while at the pier of Cebu Domestic Port
placed his bag on the x-ray scanning machine for inspection, the operator saw
firearms inside his bag. When asked whether he had the proper documents for the
firearms, Dela Cruz answered in the negative. Dela Cruz was then arrested;
informed of his violation and of his constitutional rights. Dela Cruz argues that
there was no voluntary waiver against warrantless search, thus, the firearms
seized are inadmissible as evidence, since it is inadmissible, the subsequent
warrantless arrest is, therefore, illegal. Is Dela Cruz correct?
No. There was a valid search and seizure. Routine baggage inspections conducted by port
authorities, although done without search warrants, are not unreasonable searches per se.
Constitutional provisions protecting privacy should not be so literally understood so as to
deny reasonable safeguards to ensure the safety of the traveling public. The security
measures of x-ray scanning and inspection in domestic ports are akin to routine security
procedures in airports. X-ray machine scanning and actual inspection upon showing of
probable cause that a crime is being or has been committed are part of reasonable security
regulations to safeguard the passengers passing through ports or terminals.
The presentation of petitioner's bag for x-ray scanning was voluntary. Petitioner had the
choice of whether to present the bag or not. He had the option not to travel if he did not
want his bag scanned or inspected. Hence, when the search of the bag revealed the firearms
and ammunitions, Dela Cruz is deemed to have been caught in flagrante delicto justifying his
arrest without a warrant. The firearms and ammunitions obtained in the course of such valid
search are thus admissible as evidence against Dela Cruz . (Dela Cruz vs. People, G.R. No.
209387, January 11, 2016. J. Leonen)
5. Warrantless arrests and detention
120. What are the instances of valid warrantless arrest?
a. In flagrante delicto: When, in his presence, the person to be arrested has committed, is
actually committing, or is attempting to commit an offense. (Sec. 5[a], Rule 113, Rules of
Court);
b. Hot Pursuit Doctrine: When an offense has just been committed and he has probable
cause to believe, based on his personal knowledge of facts or circumstances, that the person
to be arrested has committed it. (Sec. 5[b], Rule 113, Revised Rules of Court);
c. Escape Rule: When the person to be arrested is a prisoner who has escaped from a penal
establishment or place where he is serving final judgment or is temporarily confined while his
case is pending, or has escaped while being transferred from one confinement to another .
(Sec. 5c, Rule 113, Rules of Court);
d. Abscond Rule: An accused released on bail may be re-arrested without the necessity of a
warrant if he attempts to depart from the Philippines without permission of the court where
the case is pending. (Sec. 23[2], Rule 114, Rules of Court); and
e. When the right is voluntarily waived(People of the Philippines vs. Navarro, G.R. No.
130644, March 13, 1998)
121. Based on “reliable information” from a confidential informant that spouses X and
Y were rampantly selling drugs along Hustisya Street, a police team was sent to
conduct surveillance operations at around 11:30 p.m. A police officer saw X
holding a plastic sachet while talking to a woman, prompting him to approach X
discreetly, held X’s hand and introduced himself as a police officer. After verifying
that X was indeed holding a sachet of shabu, the police officer arrested X and

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confiscated the sachet. During trial, the police officer testified that he arrested X
because of the informant's tip that X was selling drugs. The RTC convicted X and
held that there was a valid warrantless arrest because X was caught in flagrante
delicto of having in his possession an illegal drug. Is the ruling of the RTC that
there was a valid warrantless arrest correct?
No. It is settled that "reliable information" provided by police assets alone is not sufficient to
justify a warrantless arrest. There must be independent circumstances perceivable by the
arresting officers suggesting that a criminal offense is being committed to comply with the
exacting requirements of a valid warrantless arrest of in flagrante delicto. An accused must
perform some overt act within plain view of the police officers indicating that he or she has
just committed, is actually committing, or is attempting to commit a crime. (Villasana vs.
People, G.R. No. 209078, September 4, 2019, J. Leonen)
122. Search Warrant vs. Warrant of Arrest.
Basis Search Warrant Warrant of Arrest
As to The judge must personally examine in the It is not necessary that the judge should
authority form of searching questions and answers, personally examine the complainant and his
which in writing and under oath, the witnesses; the judge would simply
examines complainant and the witnesses he may personally review the initial determination of
produce on facts personally known to the prosecutor to see if it is supported by
them. substantial evidence.
Basis of The determination of probable cause He merely determines the probability, not
determinatio depends to a large extent upon the the certainty of guilt of the accused and, in
n finding or opinion of the judge who so doing, he need not conduct a new
conducted the required examination of hearing.
the applicant and the witnesses.
6. Exclusionary rule
123. What is the “fruit of the poisonous tree” doctrine and its effects?
The ―fruit of the poisonous tree‖ doctrine or the exclusionary rule entails that any evidence
obtained in violation of the right against unreasonable searches and seizures shall be
inadmissible for any purpose in any proceeding. Evidence obtained through unlawful seizures
should be excluded as evidence because it is "the only practical means of enforcing the
constitutional injunction against unreasonable searches and seizures." It ensures that the
fundamental rights to one‘s person, houses, papers, and effects are not lightly infringed upon
and are upheld. (People vs. Cogaed, G.R. No. 200334, July 30, 2014, J. Leonen)
7. Effects of unreasonable searches and seizures
124. Ivan Li was flagged down by PO1 Jad Ong for violating a municipal ordinance for
not wearing a helmet while driving. While he was issuing a citation ticket to Li, he
noticed that the latter was uneasy and kept on getting something from his jacket.
He told Li to take out the contents of the pocket of his jacket and Li obliged and
slowly put out the contents of the pock-et of his jacket which included a nickel-
like tin or metal container about two (2) to three (3) inches in size. Upon seeing
the said container, PO1 Ong asked Li to open it; and in the process of opening, Li
spilled out the contents of the container which turned out to be four (4) plastic
sachets of shabu. Li was then charged with illegal possession of dangerous drugs.
Li objected to the admissibility of the evidence. Despite the objection, the RTC

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convicted Li ruling that the search and seizure was lawful as it was incidental to a
lawful arrest. Was the conviction proper?
No. There was no valid arrest. When Li was flagged down for committing a traffic violation,
he was not, ipso facto and solely for this reason, arrested. Under R.A. 4136, or the Land
Transportation and Traffic Code, the general procedure for dealing with a traffic violation is
not the arrest of the offender, but the confiscation of the drivers‘ license of the latter. At the
time Li was waiting for PO1 Ong to issue the ticket, he could not be said to have been under
arrest. There was no intention on the part of PO1 Ong to arrest him, deprive him of his
liberty, or take him into custody. Prior to the issuance of the ticket, the period during which Li
was at the police station may be characterized merely as waiting time.
There being no valid arrest, the warrantless search that resulted from it was likewise illegal.
When a police officer stops a person for speeding and correspondingly issues a citation, this
procedure does not authorize the officer to conduct a full search of the car. There was no
justification for a full-blown search when the officer does not arrest the motorist. Instead,
police officers may only conduct minimal intrusions, such as ordering the motorist to alight
from the car or doing a patdown. (Luz vs. People, G. R. No. 197788, February 29, 2012, J. Sereno)
8. Effects of illegal detention
125. What are the effects of an invalid arrest?
a. The failure to acquire jurisdiction over the person of an accused;

b. Criminal liability of law enforcers for illegal arrest; and
c. Any search incident to the arrest becomes invalid thus rendering the evidence acquired as
constitutionally inadmissible. (Veridiano vs. People, G.R. No. 200370, June 7, 2017, J. Leonen)
Privacy of communications and correspondence
1. Concept of communications, correspondence
126. When does “communication” subject of the right to freedom of expression exist?
Communication is an essential outcome of protected speech. Communication exists when:
a. A speaker, seeking to signal others, uses conventional actions because he or she

reasonably believes that such actions will be taken by the audience in the manner
intended; and
b. The audience takes the actions. In communicative action, the hearer may respond to the
claims b either accepting the speech act‘s claims or opposing them with criticism or
requests for justification.
The right to freedom of expression, thus, applies to the entire continuum of speech from
utterances made to conduct enacted, and even to inaction itself as a symbolic manner of
communication. (The Diocese of Bacolod vs. COMELEC, G.R. No. 205728, January 21, 2015, J.
Leonen)
127. Does the freedom of speech include the right to be silent?
Yes. The Bill of Rights that guarantees to the individual the liberty to utter what is in his mind
also guarantees to him the liberty not to utter what is not in his mind. (The Diocese of Bacolod
vs. COMELEC, G.R. No. 205728, January 21, 2015, J. Leonen)

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2. Intrusion, when and how allowed
128. When is intrusion on privacy of communication allowed?
a. By lawful order of the court; and

b. When public safety or order so requires otherwise, as may be provided by law. (Sec. 3, Art.
III, 1987 Constitution)
129. Explain the doctrine of reasonable expectation to privacy.
This test determines whether a person has a reasonable expectation of privacy and whether
the expectation has been violated.
The reasonableness of a person‘s expectation of privacy depends on a two-part test:

a. Whether, by his conduct, the individual has exhibited an expectation of privacy; and
b. This expectation is one that society recognizes as reasonable.
c. Customs, community norms, and practices may, therefore, limit or extend an individual‘s
―reasonable expectation of privacy.‖ Hence, the reasonableness of a person‘s expectation
of privacy must be determined on a case-to-case basis since it depends on the factual
circumstances surrounding the case. (Ople vs. Torres, G.R. No. 127685, July 23, 1998)
3. Exclusionary rule
F. Freedom of speech and expression
1. Concept
130. Discuss the concept of freedom of speech and expression in political decision-
making.
In a democracy, the citizen‘s right to freely participate in the exchange of ideas in furtherance
of political decision-making is recognized. It deserves the highest protection the courts may
provide, as public participation in nation-building is a fundamental principle in our
Constitution. As such, their right to engage in free expression of ideas must be given
immediate protection by this court. (The Diocese of Bacolod vs. COMELEC, G.R. No. 205728,
January 21, 2015, J. Leonen)
131. Enumerate the scope of protected freedom of expression under the Constitution.
a) Freedom of speech;
b) Freedom of the press;
c) Right of assembly and to petition the government for redress of grievances;
d) Right to form associations or societies not contrary to law;
e) Freedom of religion; and
f) Right to access to information on matters of public concern (Art. III, 1987 Constitution).
a. Continuum of thought, speech, expression, and speech acts
b. Purposes of free speech doctrines
c. Balance between unbridled expression and liberty
132. Distinguish “Political Speech” and “Commercial Speech”.
Political speech refers to speech both intended and received as a contribution to public
deliberation about some issue, fostering informed and civic-minded deliberation. On the other

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hand, commercial speech has been defined as speech that does no more than propose a
commercial transaction. The expression resulting from the content of the tarpaulin is,
however, definitely political speech. (The Diocese of Bacolod vs. COMELEC, G.R. No. 205728,
January 21, 2015, J. Leonen)
133. Distinguish “Content-Based Restraint” and “Content-Neutral Regulation”.
Content-Based Regulations Content-Neutral Regulations
Content-based regulations can either be Concerned with the incidents of the speech, or one
based on the viewpoint of the speaker that merely controls the time, place, and manner.
or the subject of the expression.
Clear and present danger and strict Intermediate Scrutiny Test or Substantial interest test.
scrutiny test (The Diocese of Bacolod vs. COMELEC, G.R. No.
205728, January 21, 2015, January 21, 2015, J.
Leonen)
134. What are the tests for valid governmental interference to freedom of expression?
a. Clear and Present Danger Rule – words are used in such circumstance and of such
nature as to create a clear and present danger that will bring about the substantive evil that
the State has a right to prevent. (Schenck vs. U.S., G.R. No. 437, 438, March 3, 1919)
Clear: The degree of the danger. Causal connection with the danger of the substantive evil
arising from the utterance questioned.
Present: The proximity of the danger. Time element, identified with imminent and immediate
danger; the danger must not only be probable, but very likely inevitable. (Gonzales vs.
Commission on Elections, G.R. No. L-27833, April 18, 1969)
b. Dangerous Tendency Rule – words uttered create a dangerous tendency of an evil

which the State has a right to prevent. (Cabansag vs. Fernandez, No. L-8974, October 18, 1957)
c. Balancing of Interest Rule – when a particular conduct is regulated in the interest of

public order; and the regulation results in an indirect, conditional and partial abridgment of
speech, the duty of the court is to determine which of the two conflicting interest demands
the greater protection under the particular circumstances presented. (American Communications
Association vs. Douds, 339 US 382 [1950])
d. Grave-But-Improbable Danger Test – whether the gravity of the evil, discounted by

its improbability, justifies such an invasion of free speech as is necessary to avoid danger.
(Dennis vs. US, 341 US 494 [1951])
e. O’Brien Test – in situations when ―speech‖ and ―non-speech‖ elements are combined in
the same course of conduct, whether there is a sufficiently important governmental interest
that warrants regulating the non-speech element, incidentally limiting the ―speech‖ element.
(Social Weather Station vs. Commission on Elections, G.R. No. 147571, May 5, 2002)
f. Direct Incitement Test – the words that a person uttered and the likely result of such
utterance. It emphasizes on the very words uttered and their ability to directly incite or
produce imminent lawless action. It criticizes the clear and present danger test for being too
dependent on the specific circumstances of each case.

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135. Under the Constitution, what are the State regulations of mass media?
a. The ownership and management of mass media shall be limited to citizens of the
Philippines, or to corporations, cooperatives or associations, wholly-owned and managed by
such citizens.
b. The Congress shall regulate or prohibit monopolies in commercial mass media when the
public interest so requires. No combinations in restraint of trade or unfair competition therein
shall be allowed.
c. The advertising industry is impressed with public interest, and shall be regulated by law for
the protection of consumers and the promotion of the general welfare.
d. Only Filipino citizens or corporations or associations at least seventy per centum of the
capital of which is owned by such citizens shall be allowed to engage in the advertising
industry.
e. The participation of foreign investors in the governing body of entities in such industry
shall be limited to their proportionate share in the capital thereof, and all the executive and
managing officers of such entities must be citizens of the Philippines . (Sec. 11(1), Art. XVI, 1987
Constitution)
136. Discuss instances of valid censorship in mass media.
Movie Censorship Television Censorship Radio Censorship
Censorship is allowable On the program of Dating The SC held that it is the duty of
only under the clearest Daan, Soriano made crude Far Eastern to require the
proof of a clear and remarks like ―lihitimong anak ng submission of a manuscript as a
present danger of a demonyo, sinungaling, etc.‖ requirement in broadcasting
substantive evil to public MTRCB preventively suspended speeches. For speeches, a
safety, morals, health or him and his show. SC held that manuscript or short gist must be
any other legitimate the State has a compelling submitted. (Santiago vs. Far
public interest: interest to protect the minds of Eastern Broadcasting, G.R. No. L-
the children who are exposed to 48683, November 8, 1941)
1. There should be no such materials. (Soriano vs.
doubt what is feared Laguardia, G.R. No. 164785,
may be traced to the April 29, 2009)
expression complained
of. The television camera is a
powerful weapon which
2. Also, there must be intentionally or inadvertently
reasonable can destroy an accused and his
apprehension about its case in the eyes of the public.
imminence. It does not Considering the prejudice it
suffice that the danger poses to the defendant‘s right
is only probable. to due process as well as to the
(Gonzales vs. Kalaw- fair and orderly administration
Katigbak, G.R. No. L- of justice, and considering
69500 July 22, 1985) further that the freedom of the
press and the right of the
Limited intrusion into a people to information may be
person‘s privacy is served and satisfied by less
permissible when that distracting, degrading and
person is a public figure prejudicial means, live radio

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and the information and television coverage of the

sought to be published is court proceedings shall not be
of a public character. allowed. No video shots or
What is protected is the photographs shall be permitted
right to be free from during the trial proper. Video
unwarranted publicity, footages of court hearings for
from the wrongful news purposes shall be limited
publicizing of the private and restricted. (Secretary of
affairs of an individual Justice vs. Sandiganbayan, A.M.
which are outside the No. 01-4-03-SC, September 13,
realm of public concern. 2001)
(Ayer Productions vs.
Capulong, G.R. No. 82380
April 29, 1988)
2. Types of regulation
a. Prior restraint and subsequent punishment
137. Define Prior Restraint on freedom of speech and expression.
Freedom from prior restraint is largely freedom from government censorship of publications,
whatever the form of censorship, and regardless of whether it is wielded by the executive,
legislative or judicial branch of the government. Thus, it precludes governmental acts that
required approval of a proposal to publish; licensing or permits as prerequisites to publication
including the payment of license taxes for the privilege to publish; and even injunctions
against publication. Even the closure of the business and printing offices of certain
newspaper, resulting in the discontinuation of their printing and publication, are deemed as
previous restraint or censorship. Any law or official that requires some form of permission to
be had before publication can be made, commits an infringement of the constitutional right,
and remedy can be had at the courts. (Chavez vs. Gonzalez, et al., G.R. No. 168338, February 15,
2008)
138. Is Freedom from Subsequent Punishment subject to police power?
Yes. It is subject to police power and may be regulated properly in the interest of the public.
The principle, therefore, does not grant an absolute license to authors or writers to destroy
the persons of candidate for public office by exposing the latter to public contempt or ridicule
by providing the general public with publications tainted with express or actual malice. In the
latter case, the remedy of the person allegedly libeled is to show proof that an article was
written with the author‘s knowledge that it was false or with reckless disregard of whether it
was false or not. (Baguio Midland Courier vs. Court of Appeals, G.R. No. 107566, November 25, 2004)

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b. Content based and content neutral
c. Incitement and advocacy
d. Specificity of regulation and overbreadth doctrine
139. Is a facial challenge to a penal statute allowed?
No. Facial challenges are not allowed in penal statutes. Criminal statutes have general in
terrorem effect resulting from their very existence, and, if facial challenge is allowed for this
reason alone, the State may well be prevented from enacting laws against socially harmful
conduct. In the area of criminal law, the law cannot take chances as in the area of free
speech. (KMU vs. Ermita, G.R. No. 178554, October 5, 2010 )
However, when a penal statute encroaches upon the freedom of speech, a facial challenge
grounded on the void-for-vagueness doctrine is acceptable. The rationale for this exception is
to counter the "chilling effect" on protected speech that comes from statutes violating free
speech. A person who does not know whether his speech constitutes a crime under an
overbroad or vague law may simply restrain himself from speaking in order to avoid being
charged of a crime. The overbroad or vague law thus chills him into silence. (Disini vs. SOJ,
G.R. No. 203335, February 11, 2014)
E. Speech regulation in relation to election
140. COMELEC issued Resolution No. 9674 which directed Social Weather Stations, Inc.
(SWS) and Pulse Asia, Inc. (Pulse Asia), as well as other survey firms of similar
circumstance to submit to COMELEC the names of all commissioners and payors of
all surveys published from February 12, 2013 to April 23, 2013, including those of
their subscribers. The Resolution was assailed on the ground that the requirement
to submit the names of the subscribers violates the right to free speech. Is
COMELEC Resolution No. 9674 valid?
Yes, COMELEC Resolution No. 9674 is valid. The requirement is a valid regulation in the
exercise of police power and effects the constitutional policy of guaranteeing equal access to
opportunities for public service.
First, the text of Sec. 5.2(a) of the Fair Election Act supports the inclusion of subscribers
among those persons who "paid for the survey". Thus, Resolution No. 9674 is a regulation
finding basis in statute. (Applying the O‘Brien‘s Test)
Second, not only an important or substantial state interest but even a compelling one
reasonably grounds Resolution No. 9674's inclusion of subscribers to election surveys. Thus,
regardless of whether an intermediate or a strict standard is used, Resolution No. 9674
passes scrutiny.
Third, Resolution No. 9674 addresses the reality that an election survey is formative as it is
descriptive. It can be a means to shape the preference of voters and, thus, the outcome of
elections. In the hands of those whose end is to get a candidate elected, it is a means for
such end and partakes of the nature of election propaganda. Accordingly, the imperative of
"fair" elections impels their regulation.
Lastly, Resolution No. 9674 is narrowly tailored to meet the objective of enhancing the
opportunity of all candidates to be heard and considering the primacy of the guarantee of
free expression and is demonstrably the least restrictive means to achieve that object.

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While it does regulate expression (i.e., petitioners' publication of election surveys), it does not
go so far as to suppress desired expression. There is neither prohibition nor censorship
specifically aimed at election surveys. The freedom to publish election surveys remains. All
Resolution No. 9674 does is articulate a regulation as regards the manner of publication, that
is, that the disclosure of those who commissioned and/or paid for, including those subscribed
to, published election surveys must be made. (SWS vs. COMELEC, G.R. No. 208062, April 7, 2015,
J. Leonen)
141. May published election surveys be subjected to regulation?
Yes. Election surveys, on their face, do not state or allude to preferred candidates. As a
means, election surveys are ambivalent. Election surveys thus become unambiguous only
when viewed in relation to the end for which they are employed. To those whose end is to
get a candidate elected, election surveys, when limited to their own private consumption, are
a means to formulate strategy. When published, however, the tendency to shape voter
preferences comes into play. In this respect, published election surveys partake of the nature
of election propaganda. It is then declarative speech in the context of an electoral campaign
properly subject to regulation. Hence, Sec. 5.2 of the Fair Election Act's regulation of
published surveys. (SWS vs. COMELEC, G.R. No. 208062, April 7, 2015, J. Leonen)
142. May speeches made by candidates or the members of their political parties be
regulated?
Yes. Speech in the context of electoral campaigns made by candidates or the members of
their political parties or their political parties may be regulated as to time, place, and manner
(content-neutral regulation). (The Diocese of Bacolod vs. COMELEC, G.R. No. 205728, January 21,
2015, J. Leonen)
143. May speeches in context of electoral campaigns made by persons who are
notcandidates or who do not speak as members of a political party be regulated?
No. Regulation of speech in the context of electoral campaigns made by persons who are not
candidates or who do not speak as members of a political party which are, taken as a whole,
principally advocacies of a social issue that the public must consider during elections is
unconstitutional. Such regulation is inconsistent with the guarantee of according the fullest
possible range of opinions coming from the electorate including those that can catalyze
candid, uninhibited, and robust debate in the criteria for the choice of a candidate. This does
not mean that there cannot be a specie of speech by a private citizen which will not amount
to an election paraphernalia to be validly regulated by law. (The Diocese of Bacolod vs.
COMELEC, G.R. No. 205728, January 21, 2015, J. Leonen)
144. Requisites for a valid regulation of election paraphernalia directed to private

persons.
a. What is regulated is declarative speech that, taken as a whole, has for its principal object
the endorsement of a candidate only.
b. The regulation should be:
i. provided by law,
ii. reasonable,
iii. narrowly tailored to meet the objective of enhancing the opportunity of all
candidates to be heard and considering the primacy of the guarantee of
free expression, and
iv. demonstrably the least restrictive means to achieve that object.
c. The regulation must only be with respect to the time, place, and manner of the rendition of
the message. In no situation may the speech be prohibited or censored on the basis of its

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content. For this purpose, it will not matter whether the speech is made with or on private
property. (The Diocese of Bacolod vs. COMELEC, G.R. No. 205728, January 21, 2015, J.
Leonen)
f. Speech regulation in relation to media
3. Judicial analysis, presumptions and levels and types of scrutiny
4. Special topics in free expression cases

A. Hate speech
B. Defamation and libel
C. Sedition and speech in relation to rebellion
D. Obscenity/pornography
E. Commercial speech
F. National emergencies
G. Speech of public officers
145. Discuss the following special topics in free expression cases.
As a general rule, words, written or printed, are

libelous per se if they tend to expose a person to
public hatred, contempt, ridicule, aversion, or
disgrace, induce an evil opinion of him in the minds
of right thinking persons, and deprive him of their
friendly intercourse in society, regardless of whether
they actually produce such results. Otherwise stated,
words published are libelous if they discredit plaintiff
in the minds of any considerable and respectable
class in the community, taking into consideration the
Hate Speech emotions, prejudices, and intolerance of mankind. It
has been held that it is not necessary that the
published statements make all or even a majority of
those who read them think any less of the person
defamed, but it is enough if a noticeable part of
those who do read the statements are made to hate,
despise, scorn or be contemptuous of the person
concerning whom the false statements are
published. (MVRS Publications, Inc. vs. Islamic
Da‗wah Council of the Phil, G.R. No. 135306,
January 28, 2003)
Libel is not protected speech. Art. 353 of the
Revised Penal Code defines libel as "a public and
malicious imputation of a crime, or of a vice or
defect, real or imaginary, or any act, omission,
Defamation And Libel condition, status, or circumstance tending to cause
the dishonor, discredit, or contempt of a natural or
juridical person, or to blacken the memory of one
who is dead. (Philippine Journalists, Inc. vs.
Thoenen G.R. No. 143372, December 13, 2005)
Not to be restrained is the privilege of any citizen to
criticize his government officials and to submit his
criticism to the "free trade of ideas" and to plead for
its acceptance in "the competition of the market."
Sedition And Speech In Relation To
However, let such criticism be specific and therefore
Rebellion
constructive, reasoned or tempered, and not a
contemptuous condemnation of the entire
government set-up. Such wholesale attack is nothing
less than an invitation to disloyalty to the

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government. . . When the use irritating language

centers not on persuading the readers but on
creating disturbances, the rationable of free speech
cannot apply and the speaker or writer is removed
from the protection of the constitutional guaranty.
(Espuelas vs. People, G.R. No. L-2990, December
17, 1951)
Obscenity is not within the area of constitutionally
protected speech or press. A thing is obscene if
considered as a whole, its predominant appeal is to
prurient interest , i.e., a shameful or morbid interest
Obscenity/Pornography
in nudity, sex, or excretion, and if it goes
substantially beyond customary limits of candor in
description or representation of such matters (Roth
vs. US, 354 U.S. 476, June 24, 1957)
Requirements for the protection of
commercial speech
a. Speech must not be false or misleading or
proposing an illegal activity
b. The governmental interest sought to be served by
Commercial Speech the regulation must be substantial
c. The regulation must directly advance the
governmental interest
d. The regulation must not be overboard (Central
Hudson Gas vs. Public Service Commission, 447 U.S.
557 [1980])
The ―calling out‖ power of the President under Sec.
18, Art. VII of the Constitution is not a sanction to
impose any form of prior restraint on the freedom of
National Emergencies the press or expression or to curtail the freedom to
peaceably assemble or frustrate fundamental
constitutional rights. (David vs. Macapagal-Arroyo,
G.R. No. 171396, May 3, 2006)
Government workers, whatever their ranks, have as
much right as any person in the land to voice out
their protests against what they believe to be a
violation of their rights and interests. Civil Service
does not deprive them of their freedom of
Speech Of Public Officers expression. It would be unfair to hold that by joining
the government service, the members thereof have
renounced or waived this basic liberty. This freedom
can be reasonably regulated only but can never be
taken away. (Davao City Water District vs. Aranjuez,
G.R. No. 194192, June 16, 2015)
5. Cognate rights
A. Freedom of assembly
146. Is the right to strike included in the right to form unions or freedom of assembly
by government employees?
No. The right to strike is not included in the right to form unions or freedom of assembly by
government employees. Their employment is governed by law. It is the Congress and
administrative agencies which dictate the terms and conditions of their employment. The
same is fixed by law and circulars and thus not subject to any collective bargaining
agreement. (GSIS vs. Kapisanan ng mga Manggagawa sa GSIS, G.R. No. 170132, December 6, 2006).

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B. Freedom of association
147. PROGUN assails the constitutionality of Sec. 4.10 of the 2013 IRR of R.A. No.
10951 which requires a sports shooter applicant to submit a certification from the
president of a recognized gun club or sports shooting association in order to
obtain a firearms license. It contends that the assailed provision is violative of Art.
III, Sec. 8 of the Constitution on the freedom of association as it compels the
applicant to join a gun club or sports shooting association against his or her will.
Is the contention correct?
No. The Court does not find Sec. 4.10 of the IRR of R.A. No. 10951 violative of Art. III, Sec. 8
of the Constitution on the freedom of association. It has been held that Art. III, Sec. 8 not
only guarantees the freedom to associate; it also protects the freedom not to associate. The
provision is not a basis to compel others to form or join an association.
All that Sec. 4.10 provides is that a person intending to apply as a sports shooter must submit
a certification from the president of a recognized gun club or sports shooting association that
he or she is joining the competition. The reason is that shooting competitions are usually
sponsored by gun clubs and sports associations which, in turn, must be duly registered with
and accredited in good standing by the Firearms and Explosive Office of the Philippine
National Police. This certification ensures that the extra ammunition is indeed granted to
legitimate sports shooters, which is remarkably more than that allowed to an ordinary owner
of a firearm. (PROGUN vs. PNP, G.R. No. 211567, G.R. No. 211559, October 15, 2019, J.
Leonen)
C. Freedom of information
148. Requisites for before the right to information may be compelled by writ of
mandamus.
a. The information sought must be in relation to matters of public concern or public interest;
b. It must not be exempt by law from the operation of the constitutional guarantee .(Sereno vs
CTRM, G.R. No. 175210, February 1, 2016)
149. What are the matters exempt from the right to access to information?
a. Information affecting national security, military and diplomatic secrets. It also includes
inter-government exchanges prior to consultation of treaties and executive;
b. Agreement as may reasonably protect the national interest;
c. Matters relating to investigation, apprehension, and detention of criminals which the
court may not inquire into prior to arrest, prosecution and detention;
d. Trade and industrial secrets and other banking transactions as protected by the
Intellectual Property Code and the Secrecy of Bank Deposits Act; and
e. Other confidential information falling under the scope of the Ethical Safety Act concerning
classified information. (Chavez vs. PCGG, G.R. No. 130716, December 9, 1998)

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G. Freedom of religion
1. Basic principles
a. Purpose
b. Concept of religion
150. Discuss the concept of religion, for purposes of the religion clauses.
The concept of religion, for purposes of the religion clauses, is clearly theistic. The term
―religion‖' has reference to one's views of his relations to his Creator, and to the obligations
they impose of reverence for his being and character, and of obedience to his will. It is often
confounded with the cultus or form of worship of a particular sect, but is distinguishable from
the latter.(Estrada vs. Escritor, A.M. No. P-02- 1651, August 4, 2003)
2. Principle of separation of church and state
151. Discuss the principle of separation of Church and State.
The principle of separation of Church and State is based on mutual respect. Generally, the
State cannot meddle in the internal affairs of the church, much less question its faith and
dogmas or dictate upon it. It cannot favor one religion and discriminate against another. On
the other hand, the church cannot impose its beliefs and convictions on the State and the
rest of the citizenry. It cannot demand that the nation follow its beliefs, even if it sincerely
believes that they are good for the country. (Imbong vs. Ochoa, G.R. No. 204819, April 8, 2014)
152. What is Benevolent Neutrality?
Benevolent neutrality recognizes that the government must pursue its secular goals and
interests but at the same time strives to uphold religious liberty to the greatest extent
possible within flexible constitutional limits. Thus, although the morality contemplated by laws
is secular, benevolent neutrality could allow for accommodation of morality based on religion,
provided it does not offend compelling state interests. (Estrada vs. Escritor, A.M. No. P-02-1651,
August 4, 2003)
3. Non-establishment clause
153. What are the exceptions to the Non-Establishment Clause?
a. Exemption from taxation of properties actually, directly, and exclusively used for religious
purposes (Sec. 28[3], Art. VI, 1987 Constitution);
b. Citizenship requirement of ownership of educational institutions, except those established

by religious groups and mission boards (Sec. 4[2], Art. XIV, 1987 Constitution);
c. Optional religious instruction in public elementary and high schools (Sec. 3[3], Art. XIV,
1987 Constitution); and
d. Appropriation allowed where minister or ecclesiastic is employed in the armed forces, in a

penal institution, or in a government-owned orphanage or leprosarium. (Sec. 29[2], Art.
VI, 1987 Constitution)

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154. Justice Dahon initiated the holding of Catholic masses in the Hall of Justice of
Kyusi. Justice Ugat filed a Complaint against the holding of masses contending
that such act is unconstitutional as it violates the non-establishment clause. Is
Justice Ugat correct?
No. The holding of Catholic masses at the Kyusi Hall of Justice is not a case of establishment,
but merely accommodation. First, there is no law, ordinance or circular issued by any duly
constitutive authorities expressly mandating that judiciary employees attend the Catholic
masses at the basement. Second, when judiciary employees attend the masses to profess
their faith, it is at their own initiative as they are there on their own free will and volition,
without any coercion from the judges or administrative officers. Third, no government funds
are being spent because the lightings and airconditioning continue to be operational even if
there are no religious rituals there. Fourth, the basement has neither been converted into a
Roman Catholic chapel nor has it been permanently appropriated for the exclusive use of its
faithful. Fifth, the allowance of the masses has not prejudiced other religions. (In Re: Letter of
Tony Q. Valenciano, Holding of Religious Rituals at the Hall of Justice Building in Quezon City, A.M. No.
10-4-19 SC, March 7, 2017, J. Mendoza)
4. Free exercise clause
H. Liberty of abode and freedom of movement
1. Scope and limitations
155. Following the campaign of President Rodrigo Duterte to implement a nationwide

curfew for minors, several local governments in Metro Manila started to strictly
implement their curfew ordinances on minors through police operations which
were publicly known as part of "Oplan Rody. Among those local governments that
implemented curfew ordinances was the City of Manila. The City of Manila enacted
an Ordinance entitled "An Ordinance Declaring the Hours from 10:00 P.M. to 4:00
A.M. of the Following Day as 'Barangay Curfew Hours' for Children and Youths
Below Eighteen (18) Years of Age; Prescribing Penalties Therefor; and for Other
Purposes.” The Ordinance provided exemptions from the coverage of the curfew,
to wit: (a) minors accompanied by their parents, family members of legal age, or
guardian; (b) those running lawful errands such as buying of medicines, using of
telecommunication facilities for emergency purposes and the like; (c) night school
students and those who, by virtue of their employment, are required in the streets
or outside their residence after 10:00 p.m.; and (d) those working at night. Is the
subject ordinance constitutional?
No. The ordinance violates minors‘ right to travel.
The State is justified in setting restrictions on the minors' exercise of their travel rights,
provided, they are singled out on reasonable grounds. To determine if the restriction is
reasonable, the strict scrutiny test shall be applied considering that the right to travel is a
fundamental right. Under the strict scrutiny test, a legislative classification that interferes with
the exercise of a fundamental right or operates to the disadvantage of a suspect class is
presumed unconstitutional. Thus, the government has the burden of proving that the
classification (i) is necessary to achieve a compelling State interest, and (ii) is the least
restrictive means to protect such interest or the means chosen is narrowly tailored to
accomplish the interest.
Here, the ultimate objective of the Curfew Ordinance is to keep unsupervised minors during
the late hours of night time off of public areas, so as to reduce - if not totally eliminate - their
exposure to potential harm, and to insulate them against criminal pressure and influences
which may even include themselves. As such, a compelling State interest exists.

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The second requirement of the strict scrutiny test stems from the fundamental premise that
citizens should not be hampered from pursuing legitimate activities in the exercise of their
constitutional rights. While rights may be restricted, the restrictions must be minimal or only to
the extent necessary to achieve the purpose or to address the State's compelling interest. When
it is possible for governmental regulations to be more narrowly drawn to avoid conflicts with
constitutional rights, then they must be so narrowly drawn. Here, the Manila Ordinance cites only
four (4) exemptions from the coverage of the curfew. This Ordinance is not narrowly drawn in
that the exceptions are inadequate and therefore, run the risk of overly restricting the minors'
fundamental freedoms. The Manila Ordinance do not account for the reasonable exercise of the
minors' rights of association, free exercise of religion, rights to peaceably assemble, and of free
expression, among others. The exceptions under the Manila Ordinance are too limited, and thus,
unduly trample upon protected liberties. (SPARK vs. Quezon City, G.R. No. 225442, August 8,
2017)
2. Watch-list and hold departure orders
156. Does the DOJ have the power to issue Hold Departure Orders (HDO)?
No. The power to issue HDO is inherent to the courts. The courts may issue a HDO against
an accused in a criminal case so that he may be dealt with in accordance with law. The DOJ
may not justify its imposition of restriction on the right to travel of the subjects of DOJ
Circular No. 41 by resorting to an analogy. Contrary to its claim, it does not have inherent
power to issue HDO, watchlist orders, or allow departure orders, unlike the courts, or to
restrict the right to travel in anyway. It is limited to the powers expressly granted to it by law
and may not extend the same on its own accord or by any skewed interpretation of its
authority. (Genuino vs. De Lima, G.R. No. 197930, April 17, 2018)
I. Eminent domain
1. Concept
157. What are the requisites of a valid taking?
a. The expropriator must enter a private property;

b. Entry must be for more than a momentary period;
c. Entry must be under warrant or color of legal authority;
d. Property must be devoted to public use or otherwise informally appropriated or
injuriously affected; and
e. Utilization of property must be in such a way as to oust the owner and deprive him of
beneficial enjoyment of the property (Republic vs. De Castellvi, G.R. No. L-20620, August 15,
1974).
158. Distinguish “possessory taking” from “regulatory taking”.
A "possessory" taking occurs when the government confiscates or physically occupies

property. A "regulatory" taking occurs when the government's regulation leaves no
reasonable economically viable use of the property. No formula or rule can be devised to
answer the questions of what is too far and when regulation becomes a taking. What is
crucial in judicial consideration of regulatory takings is that government regulation is a taking
if it leaves no reasonable economically viable use of property in a manner that interferes with
reasonable expectations for use. A regulation that permanently denies all economically
beneficial or productive use of land is, from the owner's point of view, equivalent to a
"taking" unless principles of nuisance or property law that existed when the owner acquired
the land make the use prohibitable. When the owner of real property has been called upon to
sacrifice all economically beneficial uses in the name of the common good, that is, to leave

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his property economically idle, he has suffered a taking. (City of Manila vs. Judge Laguio,
G.R. No. 118127, April 12, 2005)
159. Explain the expansive concept of public use.
Public use does not necessarily mean ―use by the public at large.‖ Whatever may be
beneficially employed for the general welfare satisfies the requirement. Moreover, that only
few people benefit from the expropriation does not diminish its public use character because
the notion of public use now includes the broader notion of indirect public benefit or
advantage. (Manosca vs. CA, G.R. 166440, January 29, 1996)
2. Just compensation
160. What are the effects of delay in payment of just compensation?
a. For nonpayment, the remedy is the demand of payment of the fair market value of the
property and not the recovery of possession of the expropriated lots. (Reyes vs. National
Housing Authority, G.R. No. 147511, January 29, 2003)
Exception: When the government fails to pay just compensation within five years from the
finality of the judgment in the expropriation proceedings, the owners concerned shall have
the right to recover possession of their property. (Republic vs. Vicente Lim, G.R. No. 161656,
June 29, 2005)
b. The imposition of 12% interest rate from the time of taking when the property owner was
deprived of the property until July 1, 2013 - when the legal interest on loans and forbearance
of money was reduced from 12% to 6% per annum by BSP Circular No. 799. Accordingly,
from 1 July 2013 onwards, the legal interest on the difference between the final amount and
initial payment is 6% per annum. (Evergreen Manufacturing Corporation vs. Republic, G.R. No.
218628)
161. As part of the road widening project of the government, the DPWH
expropriated the land owned by Francisco. Out of the 278 Square meter (SQM)
land owned by Francisco, DPWC contends that only 41SQM is subject to just
compensation, and remaining 237SQM is not as it is already been withdrawn from
the commerce of man. In insisting to this contention, DPWH invokes the last
paragraph of Sec. 31 of Presidential Decree No. 957 which requires (as manifested
by its use of the word “shall”) subdivision developers to donate to the city or
municipality with territorial jurisdiction over the subdivision project all such
roads, alleys, sidewalks, and open spaces. The same law also imposes upon cities
and municipalities the concomitant obligation or compulsion to accept such
donations. Is the DPWH’s contention correct?
No. First, to be considered a donation, an act of conveyance must necessarily proceed freely
from the donor's own, unrestrained volition. A donation cannot be forced: it cannot arise from
compulsion, be borne by a requirement, or otherwise be impelled by a mandate imposed
upon the donor by forces that are external to him or her. Intent to do an act of liberality is an
indispensable element of a valid donation. Thus, Sec. 31's compulsion to donate (and
concomitant compulsion to accept) cannot be sustained as valid. Second, the local
government should first acquire them by donation, purchase, or expropriation, if they are to
be utilized as a public road. Here, the subject road lots have not actually been donated to the
government or that their transfer has otherwise been consummated by Sps. Llamas. It only
theorizes that they have been automatically transferred. Neither has expropriation ever been
fully effected. Hence, just compensation must be paid to Francisco as the government takes
the road lots in the course of a road widening project. (Republic vs. Spouses Llamas, G.R.
194190, January 25, 2017, J. Leonen)

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162. Spouses Asoque are the registered owners of a parcel of land. National
Power Corporation (NAPOCOR) entered the Spouses Asoque’s land to install
transmission lines for its Power Transmission Line Project. NAPOCOR utilized
4,352 square meters for the project, as a result, Spouses Asoque was prohibited
from introducing on such land any improvement that could rise by a few meters
from the ground. The period that NAPOCOR shall use the said land is indefinite.
NAPOCOR claims that it was only liable to pay for right-of-way at 10% of the
market value under Sec. 3-A of Republic Act No. 6395, as amended and not just
compensation. Is NAPOCOR correct?
No. Petitioner is liable to pay respondents just compensation and not merely an easement fee
on the basis that its acquisition of a right-of-way easement over the portion of respondents‘
land was a taking under the power of eminent domain. A right-of-way easement or burden
becomes a ―taking‖ under eminent domain when there is material impairment of the value of
the property or prevention of the ordinary uses of the property for an indefinite period. In
this case, considering the nature and effect of the installation of the transmission lines, the
limitation imposed by NPC against the use of the land for an indefinite period deprives private
respondents of its ordinary use, and the fact that the high-tension current poses a danger to
life and property within the vicinity, the easement of right-of-way is definitely a taking under
the power of eminent domain.(NAPOCOR vs. Spouses Asoque, G.R. 172507, September 14, 2016, J.
Leonen)
3. Abandonment of intended use and right of repurchase
163. What is the effect of abandonment of intended use behind the forced property
taking?
The expropriator should commit to use the property pursuant to the purpose stated in the
petition for expropriation filed, failing which, it should file another petition for the new
purpose. If not, it is then incumbent upon the expropriator to return the said property to its
private owner, if the latter desires to reacquire the same. Otherwise, the judgment of
expropriation suffers an intrinsic flaw, as it would lack one indispensable element for the
proper exercise of the power of eminent domain, namely, the particular public purpose for
which the property will be devoted. (MCIAA vs. Lozada, G.R. No. 176625, February 25, 2010, J.
Nachura)
If the particular purpose or intent is not initiated or not at all pursued, and is peremptorily
abandoned, then the former owners, if they so desire, may seek the reversion of the
property, subject to the return of the amount of just compensation received. (De Ouano vs.
Republic, G.R. No. 168770, February 9, 2011, J. Velasco Jr.)
4. Expropriation by local government units
164. What are the requisites before an LGU can exercise its power of Eminent Domain?
a) An ordinance is enacted by the local legislative council authorizing the local chief
executive, in behalf of the LGU, to exercise the power of eminent domain or pursue
expropriation proceedings over a particular private property;
b) The power of eminent domain is exercised for public use, purpose or welfare, or for the
benefit of the poor and the landless;
c) There is payment of just compensation; and
d) A valid and definite offer has been previously made to the owner of the property sought
to be expropriated, but said offer was not accepted. (Municipality of Paranaque vs. V.M.
Realty Corp., G.R. No. 127820, July 20, 1998)

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J. Non-impairment of contracts
165. When does a law impair the obligation of contracts?
a. It changes the terms and conditions of a legal contract either as to the time or mode of
performance; or
b. It imposes new conditions or dispenses with those expressed if it authorizes for its
satisfaction something different from that provided in its terms. (Clemens vs. Nolting, G.R.
No. L-17959, January 24, 1922)
166. COMELEC issued Resolution No. 9674 which directed Social Weather Stations, Inc.
(SWS) and Pulse Asia, Inc. (Pulse Asia), as well as other survey firms of similar
circumstance to submit to COMELEC the names of all commissioners and payors of
all surveys published from February 12, 2013 to April 23, 2013, including those of
their subscribers. The Resolution was assailed on the ground that it unduly
interferes with petitioner’s existing contracts by forcing them to disclose
information that, under the contracts, is confidential or privileged. Is the ground
valid?
No. It is settled that the constitutional guaranty of non-impairment of contracts is limited by

the exercise of the police power of the State, in the interest of public health, safety, morals
and general welfare. It is a basic rule in contracts that the law is deemed written into the
contract between the parties. The incorporation of regulations into contracts is a postulate of
the police power of the State.
Resolution No. 9674 does not involve a capricious, whimsical, unjust or unreasonable
regulation. It is not only an important or substantial state interest, but even a compelling one
that anchors Resolution No. 9674's requirement of disclosing subscribers to election surveys.
It effects the constitutional policy of guaranteeing equal access to opportunities for public
service and is impelled by the imperative of "fair" elections. As a valid exercise of COMELEC's
regulatory powers, Resolution No. 9674 is correctly deemed written into petitioners' existing
contracts. (SWS vs. COMELEC, G.R. No. 208062, April 7, 2015, J. Leonen)
K. Adequate legal assistance and free access to courts
167. When does the indigent litigants’ exemption from the payment of legal fees
become a matter of right and a matter of discretion?
When a matter of right: If the applicant for exemption meets the salary and property
requirements under Sec. 18 of Rule 141, then the grant of the application is mandatory.
When a matter of discretion: When the application does not satisfy one or both
requirements,then the application should not be denied outright; instead, the court should
apply the ―indigencytest under Sec. 21 of Rule 3 and use its own discretion in determining
the merits of the prayer forexemption. (Sps. Algura vs. LGU of Naga City, G.R. No. 150135,
October 30, 2006)

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L. Right against self-incrimination
1. Scope and coverage
168. Explain the scope of the right against self-incrimination.
a. Applies only to compulsory testimonial self-incrimination – refers to the use of mental

processes and the communicative faculties, and not to a merely physical activity . (Villaflor
vs. Summers, G.R. No. 16444, September 8, 1920) The constitutional right of an accused
against self-incrimination proscribes the use of physical or moral compulsion to extort
communications from the accused and not the inclusion of his body in evidence when it
may be material. Purely mechanical acts are not included in the prohibition as the
accused does not thereby speak his guilt, hence the assistance and guiding hand of
counsel is not required. (People vs. Olvis, G.R. No. 71092, September 30, 1987)
b. If the act is physical/mechanical, the accused can be compelled to allow or perform the
act, and the result can be used in evidence against him.
c. However, privilege protects the accused against any attempt to compel him to furnish a
specimen of his handwriting in connection with a prosecution for falsification.
d. Handwriting in connection with a prosecution for falsification is not allowed. (Beltran vs.
Samson, G.R. No. 32025 September 23, 1929)
e. The prohibition also extends to the compulsion for the production of documents, papers
and chattels that may be used as evidence against the witness, except where the State
has a right to inspect the same, under the police or taxing power.
f. Statements spontaneously made by a suspect to news reporters on a television interview

are admissible in evidence if voluntarily made. (People vs. Rondero, G.R. No. 125687,
December 9, 1999)
2. Application
169. What are the proceedings where the right against self-incrimination is available?
a. Criminal prosecutions: The accused may not be compelled to take the witness stand,
on the reasonable assumption that the purpose of the interrogation will be to incriminate him
(Chavez vs. Court of Appeals, G.R. No. L-29169, August 19, 1968)
b. Civil actions: The petitioner must wait until the incriminating question is asked (Bagadiong
vs. Gonzales, G.R. No. L-25966, December 28, 1979)
c. Administrative investigations: Where the hearing partakes of the nature of criminal

proceedings, such that the respondent may be subjected to sanctions of a penal character,
such a cancellation of his license to practice medicine (Pascual Jr. vs Board of Medical Examiners,
G.R. No. L-25018, May 26, 1969), or the forfeiture of property (Cabal vs. Kapunan Jr. G.R. No. L-19052,
December 29, 1962)
d. Legislative investigation: If we presently rule the petitioners may not be compelled by

the respondent Committee to appear, testify and produce evidence before it, it is only
because we hold that the questioned inquiry is not in aid of legislation and, if pursued, would
be violative of the principle of separation of powers between the legislative and the judicial
departments of government, ordained by the Constitution (Bengzon, Jr. vs. Senate Blue Ribbon
Committee, G.R. No. 89914, November 20, 1991)

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3. Immunity statutes
170. What are the immunities that may be granted to a witness?
a. Transactional Immunity – that which may be granted by the Commission on Human

Rights to any person whose testimony or whose possession of documents or other evidence
is necessary or convenient to determine the truth in any investigation conducted by it or
under its authority, which makes the witness immune from criminal prosecution for an
offense to which his compelled testimony relates (Sec. 18[8], Art. XIII, 1987 Constitution);
b. Use and Fruit Immunity – prohibits the use of witness‘ compelled testimony and its
fruits in any manner in connection with the criminal prosecution of the witness . (Galman vs.
Pamaran, G.R. No. 71208-09, August 30, 1985)
M. Rights of persons under custodial investigation
1. Availability
171. When does the right of persons under custodial investigation begin to operate?
The rule on custodial investigation begins to operate as soon as the investigation ceases to
be a general inquiry into an unsolved crime and the interrogation is then aimed on a
particular suspect who has been taken into custody and to whom the police would then direct
interrogatory questions that tend to elicit incriminating statements. (Luspo vs. People, G.R. No.
188487, October 22, 2014, J. Brion)
172. Is the right of persons under custodial investigation available during a police line-
up?
No. The right to counsel is deemed to have arisen at the precise moment custodial
investigation begins and being made to stand in a police line-up is not the starting point or a
part of custodial investigation.
Police line-up is not part of the custodial investigation; hence, the right to counsel guaranteed
by the Constitution cannot yet be invoked at this stage. This is because during a police line-
up, the process has not yet shifted from the investigatory to the accusatory and it is usually
the witness or the complainant who is interrogated and who gives a statement in the course
of the line-up. (People vs. Lara, G.R. No. 199877, August 13, 2012)
173. Should the police officer apprise a suspect of his Miranda rights in case of a
voluntary surrender?
Yes. Republic Act No. 7438 expanded the definition of custodial investigation to include the
practice of issuing an ‗invitation‘ to a person who is investigated in connection with an offense
he is suspected to have committed, without prejudice to the liability of the ‗inviting‘ officer for
any violation of law. This means that even those who voluntarily surrendered before a police
officer must be apprised of their Miranda rights. For one, the same pressures of a custodial
setting exist in this scenario. (People vs. Chavez, G.R. No. 207950, September 22, 2014, J. Leonen)
2. Requisites
174. What are the requisites of the Mirandadoctrine?
a. Any person under custodial investigation has the right to remain silent;
b. Anything he says can and will be used against him in a court of law;

ARELLANO UNIVERSITY
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c. He has the right to talk to an attorney before being questioned and to have his counsel
present when being questioned; and
d. If he cannot afford an attorney, one will be provided before any questioning if he so
desires. (People vs. Cabanada, G.R. No. 221424, July 19, 2017)
3. Waiver
175. X remained silent and passive despite being confronted by victim AAA with the
rape charge at the police station immediately after his arrest. The RTC ruled that
X’s silence at the police station despite being confronted by the victim is an
implied admission of guilt. On appeal, X claims that his silence in the police station
should not be used against him as he was just exercising his constitutional right
to remain silent. Is X’s claim tenable?
Yes. It should be borne in mind that when X was brought to the police station, he was
already a suspect to the crime of rape. As such, he was already under custodial investigation.
Clearly, when X remained silent when confronted by the accusation of AAA at the police
station, he was exercising his basic and fundamental right to remain silent. At that stage, his
silence should not be taken against him. Thus, it was an error on the part of the RTC to state
that X‘s silence should be deemed as implied admission of guilt. In fact, this right cannot be
waived except in writing and in the presence of counsel and any admission obtained in
violation of this rule shall be inadmissible in evidence. (People vs. Guillen, G.R. No. 191756,
November 25, 2013)
2. The Ombudsman and the Office of the Special Prosecutor
176. Qualifications for appointment as Ombudsman and his deputies
i. Natural born citizen of the Philippines;

ii. At least 40 years old (at the time of appointment);
iii. Professional attainment;
iv. Members of the Philippine Bar;
v. Specifically, for the Ombudsman: At least 10 years of experience as a judge of a lower
court or engaged in the practice of law in the Philippines;
vi. A person of proven competence and, integrity, probity, and independence; and
vii. Must not have been candidates for elective position in the elections immediately
preceding their appointment(Sec. 8, Art. XI, 1987 Constitution)
177. What are the functions of the Ombudsman?
a) Investigate any act or omission of any public official, employee, office or agency, when
such act or omission appears to be illegal, unjust, improper, or inefficient (Sec. 15(1), RA
No. 6770;
b) Direct any public official or employee of the Government, or any subdivision, agency or
instrumentality thereof, as well as any GOCC with original charter, to perform or expedite
any act or duty required by law, or to stop, prevent, and correct any abuse or impropriety
in the performance of duties (Sec. 15(2) R.A. No. 6770; Sec 13(2) Art. XI, 1987 Constitution);
c) Direct the officer concerned to take appropriate action against a public official or
employee at fault, and recommend his removal, suspension, demotion, fine, censure, or
prosecution, and ensure compliance therewith (Sec. 15(3) R.A. No. 6770; see also Sec 13(3),
Art. XI, 1987 Constitution);
d) Direct the officer concerned, in any appropriate case, and subject to such limitation as
may be provided by law, to furnish it with copies of documents relating to contracts or
transactions entered into by his office involving the disbursement or use of public funds

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or properties, and report any irregularity to the COA for appropriate action (Sec. 15(4) R.A.
No. 6770; see also Sec. 13(4), Art. XI, 1987 Constitution);
e) Request any government agency for assistance and information necessary in the
discharge of its responsibilities and examine, if necessary, pertinent records and
documents (Sec. 15(5), R.A. No.6770; see also Sec. 13(5), Art. XI, 1987 Constitution);
f) Publicize matters covered by its investigation when circumstances so warrant and with
due process (Sec 15(6) R.A. No. 6770; see also Sec 13(6), Art. XI, 1987 Constitution);
g) Determine the causes if inefficiency, red tape, mismanagement, fraud and corruption and
to make recommendations for their elimination and observance of high standards of
ethics and efficiency (Sec 15(7) R.A. No. 6770; see also Sec 13(7), Art. XI, 1987 Constitution);
h) Promulgate its rules of procedure and exercise such other powers or perform such
function or duties as may be provided by law (Sec 15(8), R.A. No. 6770);
i) i.The Office of the Ombudsman shall enjoy fiscal autonomy. Its approved annual
appropriations shall be automatically and regularly released (Sec 15(10), R.A. No. 6770).
178. Can the Supreme Court interfere with the finding of the Ombudsman of probable
cause?
No. An independent constitutional body, the Office of the Ombudsman is "beholden to no

one, acts as the champion of the people, and is the preserver of the integrity of the public
service." Thus, it has the sole power to determine whether there is probable cause to warrant
the filing of a criminal case against an accused. This function is executive in nature. The
Supreme Court will not interfere with the Office of the Ombudsman's determination of
probable cause except when it acted with grave abuse of discretion. (Elenita S. Binay vs Office
of the Ombudsman, G.R. No. 213957-58, August 7, 2019, Leonen J.)
179. What are the powers of the Office of the Special Prosecutor?
a. To conduct preliminary investigation and prosecute criminal cases within the jurisdiction
of the Sandiganbayan;
b. To enter into plea bargaining agreements; and
c. To perform such other duties assigned to it by the Ombudsman. (Sec.11, Par. 4, RA 6770)
3. The Sandiganbayan
180. May the Sandiganbayan acquire jurisdiction by way of conspiracy principle?
Yes. In Ambil Jr. vs. Sandiganbayan (G.R. No. 175457, July 6, 2011), the Supreme Court held
that even a public officer, specifically a provincial jail warden with a salary grade of 22, may
be under the jurisdiction of Sandiganbayan in line with the conspiracy principle.
Here, petitioner Apelado, Sr. a provincial jail warden with salary grade 22 was charged as a
co-principal with Governor Ambil, Jr., over whose position the Sandiganbayan has jurisdiction.
Accordingly, he was correctly tried jointly with said public officer in the proper court which
had exclusive original jurisdiction over them-the Sandiganbayan. Conspiracy was sufficiently
demonstrated by petitioner Apelado, Sr.‗s willful cooperation in executing petitioner Ambil,
Jr.‗s order to move Adalim from jail, despite the absence of a court order. (Ambil vs.
Sandiganbayan, G.R. No. 175457, July 6, 2011)

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NATIONAL ECONOMY AND PATRIMONY
A. Exploration, development, and utilization of natural resources
181. Are service contracts allowing foreign corporations to explore, develop, and
exploit petroleum resources in the Philippines to the detriment of the ecosystem
constitutional? If so, what are the rules on allowing service contracts of such
nature?
Yes. Subject to the strict limitations in the last two paragraphs of Sec. 2 Art. XII, financial and
technical agreements are a form of service contract. Such service contacts may be entered
into only with respect to minerals, petroleum, and other mineral oils. The grant of such
service contracts is subject to several safeguards, among them:
1. That the service contract be crafted in accordance with a general law setting standard of
uniform terms, conditions and requirements;
2. President be the signatory for the government; and
3. President reports the executed agreement to Congress within 30 days. (La Bugal B‗laan vs.
DENR, G.R. No. 127882, December 1, 2004).
B. Franchises, authorities, and certificates for public utilities
182. What is a public utility?
A business or service engaged in regularly supplying the public with some commodity or
service of public consequence, such as electricity, gas, water, transportation, telephone or
telegraph service. To constitute a public utility, the facility must be necessary for the
maintenance of life and occupation of the residents. As the name indicates, ―public utility‖
implies public use and service to the public.(J.G. Summit vs. CA, G.R. No. 124293, Sept. 24, 2003)
183. State the rules on the operation of public utilities.
No franchise, certificate, or any other form of authorization for the operation of a public utility
shall be granted except to citizens of the Philippines or to corporations or associations
organized under the laws of the Philippines, at least sixty per centum of whose capital is
owned by such citizens; nor shall such franchise, certificate, or authorization be exclusive in
character or for a longer period than fifty years [xxx] (Sec. 11, Art. XII, 1987 Constitution).
184. Does the term “capital” in Sec. 11, Art. XII of the 1987 Constitution refer to
outstanding capital stock?
No. The term "capital" appearing in Sec. 11, Art. XII of the 1987 Constitution refers only to
common shares or shares of stock entitled to vote in the election of the members of the
board of directors of a public utility, and not to the total outstanding capital stock. (Gamboa
vs. Teves, G.R. No. 176579, October 9, 2012)

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C. Acquisition, ownership, and transfer of public and private lands
185. Classifications of Lands of Public Domain
a. Agricultural
b. Forest of Timber
c. Mineral Lands
d. National parks (Sec. 3, Art XII, 1987 Constitution)
186. What are the rules on private lands?
As a general rule, no private lands shall be transferred or conveyed except to individuals,

corporations, or associations qualified to acquire or hold lands of the public domain (Sec. 7,
Art. XII, 1987 Constitution). The following are the recognized exceptions:
a. Hereditary succession (Sec. 7, Art XII, 1987 Constitution)

b. A natural-born citizen of the Philippines who has lost his Philippine citizenship may be a
transferee of private lands, subject to limitations provided by law (Sec. 8, Art. XII, 1987
Constitution)
D. Practice of professions
187. What is the rule on the practice of professions in the Philippines?
The practice of all professions in the Philippines shall be limited to Filipino citizens save in
cases prescribed by law (Sec. 14, Art. XII, 1987 Constitution).
E. Organization and regulation of private and public corporations
188. What are the tests employed to determine whether the Nationality Requirement
was met?
a. Control Test - Filipinos must own at least 60% of the corporation‘s capital. This test is
generally used, however when there is doubt as to the ―beneficial ownership‖ and
―control‖ of the corporation, it must be subject to the grandfather test.
b. Grandfather Test - Where percentage of Filipino equity in a corporation is computed by

attributing the nationality of the second or even subsequent tier of ownership to
determine the nationality of the corporate shareholder (Narra Nickel Mining Dev‘t Corp. vs.
Redmont Consolidated Mines Corp., G.R. No. 195580, January 28, 2015)
F. Monopolies, restraint of trade, and unfair competition
189. Are monopolies prohibited by the Constitution?
No. Monopolies are not per se prohibited by the Constitution. It may be permitted to exist to
aid the government in carrying on an enterprise or to aid in the interest of the public.
However, because monopolies are subject to abuses that can inflict severe prejudice to the
public, they are subjected toa higher level of State regulation than an ordinary business
undertaking. (Agan, Jr. vs. PIATCO, G.R. No. 155001, May 5, 2003)

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SOCIAL JUSTICE AND HUMAN RIGHTS
Concept of social justice
190. What is Social Justice?
Social Justice is neither communism nor despotism, nor atomism, nor anarchy, but rather the
humanization of laws and the equalization of the 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 the people and adoption by the
government of measures calculated to ensure economic stability of all the component
elements of the society through the maintenance of the 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 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. (Calalang vs. Williams, G.R. No. 47800, December 2, 1940)
Commission on Human Rights
1. Powers
191. Does the Commission on Human Rights have jurisdiction or adjudicatory powers
over, or the power to try and decide, or hear and determine, certain specific type
of cases, like alleged human rights violations involving civil or political rights?
No. The Commission on Human Rights to have no such power; it was not meant by the
fundamental law to be another court or quasi-judicial agency in this country, or duplicate
much less take over the functions of the latter. The most that may be conceded to the
Commission in the way of adjudicative power is that it may investigate, i.e., receive evidence
and make findings of fact as regards claimed human rights violations involving civil and
political rights. But fact finding is not adjudication, and cannot be likened to the judicial
function of a court of justice, or even a quasi-judicial agency or official. The function of
receiving evidence and ascertaining therefrom the facts of a controversy is not a judicial
function, properly speaking. (Cariño vs. CHR, G.R. No. 96681, December 2, 1991)
2. Composition and qualification of members
192. Is the Commission on Human Rights entitled to fiscal autonomy?
No. The CHR, although admittedly a constitutional creation is, nonetheless, not included in
the genus of offices accorded fiscal autonomy under the constitution. (CHR Employees‘
Association vs. CHR, G.R. No. 155336, November 25, 2004)
PUBLIC INTERNATIONAL LAW
A. Concepts
193. Concepts relevant to Public International Law
a. Ex aequo et bono – basis for decision by an international tribunal on the grounds of

justice and fairness. It is an alternate means of decision-making in place of the normally
employed legal rules of treaties and custom (Art. 38, Statute of International Court of
Justice).

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b. Jus ad bellum– the conditions under which one may resort to war or to force in general.
It has a subdivision known as jus contra bellum or the law on the prevention of war.
(ICRC publication, International Humanitarian Law, 2015)
c. Jus in bello – governs the conduct of belligerents during a war, and in a broader sense
comprises the rights and obligations ofneutral parties as well. (ICRC publication,
International Humanitarian Law, 2015)
d. Jus cogens – norms accepted and recognized by the international community of States
as a whole as norms from which no derogation is permitted and which can be modified
only by a subsequent norm of general international law having the same character
(Ocampo vs. Abando, GR. No. 176830, February 11, 2014). It is also called peremptory norm.
e. jus postliminium—when a foreign power occupies a state and exercises the powers of
government, the political laws of the said state are deemed automatically suspended but
the former government automatically comes to life and will be in force and in effect again
upon the re-establishment of the former government. (Taylor, International Law, p. 615.)
f. Obligations erga omnes – those obligations which, by virtue of their nature and
importance, are the concern of all States and for whose protection all States have a legal
interest (Belgium vs. Spain, 1970 I.C.J. 3, February 5, 1970).
g. Opinio juris – the belief that a certain form of behavior is obligatory .(Bernas, International
Law, 2009)
h. Pacta sunt servanda- – every treaty in force is binding upon the parties to it and must
be performed by them in good faith. (Art. 26, Vienna Convention on the Law on Treaties)
i. Par in parem non habet imperium – even the strongest State cannot assume
jurisdiction over another State, no matter how weak, or question the validity of its acts in
so far as they are made to take effect within its own territory . (Cruz, International Law,
2003)
j. Rebus sic stantibus–a fundamental change of circumstances which has occurred with
regard to those existing at the time of the conclusion of a treaty, and which was not
foreseen by the parties. (Art. 62, Vienna Convention on the Law on Treaties)
k. Restitutio in integrum – a Latin phrase meaning "returning everything to the state as

it was before". This principle is commonly followed by courts while awarding damages in
common law negligence cases. The amount of damages awarded should be sufficient
bring the plaintiff back to the position as if no tort has been committed .(Germany vs.
Poland, P.C.I.J. Ser. A, No. 9 [1927])

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B. Relationship between international and Philippine domestic law
194. What are the rules in resolving conflicts between international law and national
law?
From the point of International Law vs. Constitution: Uphold the Constitution
view municipal
tribunal Constitution vs. Treaty: Uphold the constitution
International vs. Statute: What comes last in time will usually be

upheld by the municipal tribunal.
From the point of Since the rights and obligations of a State in its international relations
view of international are determined by international law, it is this law, and not the municipal
tribunal law of the State, which provides the standards by which to determine
the legality of its conduct. (Briggs, The Law of Nations, 1982)
195. How does International Law become part of the Philippine Law?
It becomes part of the Philippine through the following:
a. Doctrine of Incorporation: The Philippines adopts the ―generally accepted principles of

international law‖ as part of the law of the land (Sec. 2, Art. II, 1987 Constitution).
Generally accepted principles of international law, by virtue of the incorporation clause of the
Constitution, form part of the laws of the land even if they do not derive from treaty
obligations; ―Generally accepted principles of international law‖ refers to norms of general or
customary international law which are binding on all states, i.e., renunciation of war as an
instrument of national policy, the principle of sovereign immunity, a person‘s right to life,
liberty and due process, and pacta sunt servanda, among others (Pharmaceutical and Health
Care Association of the Philippines vs. Duque III, G.R. No. 173034 October 9, 2007)
b. Doctrine of Transformation: Treaties or international agreements shall become valid

and effective upon concurrence by at least two-thirds of all the Members of the Senate (Sec.
21, Art. VII, 1987 Constitution).
196. Distinguish soft law from hard law.
Soft Law Hard Law
Refers to norms that are non-binding in Refers to binding international legal norms or
character but still have legal relevance. Usually those which have coercive character. (Bernas,
serves a precursor to hard law. Public International Law, 2009)
It is, however, an expression of non-binding

norms, principles, and practices that influence
state behavior. (Pharmaceutical and Health Care
Association of the Philippines vs. Duque III, G.R.
No. 173034 October 9, 2007)

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C. Sources of international law
1. Article 38, International Court of Justice Statute
197. What are the sources of international law?
Primary Sources
a. Treaties or conventions – must be concluded by a sizable number of states and thus

reflect the will or at least the consensus of the family of nations. (Cruz, International Law,
2003);
b. Customs – practice which has grown up between states and has come to be accepted as
binding by the mere fact of persistent usage over a long period of time. (Fenwick,
International Law, 1948); and
c. General principles of law – derived from the law of nature and are observed by the
majority of States because they are believed to be good and just. (Cruz, International Law,
2003)
Secondary Sources
a. Decisions of courts (Art. 38, Statute of International Court of Justice);
b. Writings of publicists(Cruz, International Law, 2003)
2. Effect of United Nations Declarations, Security Council Resolutions
198. What is the effect of the United Nations Declarations on its member states?
As a general rule, General Assembly resolutions are not binding on member states. But when
they are concerned with general norms of international law, acceptance by all or most
members constitute evidence of the opinions of governments in what is the widest forum for
the expression of such opinions.
199. Are Security Council Resolutions binding?
Yes. The Security Council is empowered to issue binding legal standards when acting under
Chapter VII of the UN Charter concerning action with respect to threats to peace, breaches of
the peace, and acts of aggression.
3. Effect of actions of organs of international organizations created by treaty
200. What is the effect of the actions of organs of international organizations created
by treaty?
The treaty constituting an international organization may entrust a body of the organization
to adopt binding legal standards The rules enacted shall be binding only to the member
states of the organization. It cannot bind third states.

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LABOR LAW
State policy towards labor
1. What is social justice?
It 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. Social justice,
therefore, must be founded on the recognition of the necessity of interdependence among
divers and diverse units of a society and of the protection that should be equally and evenly
extended to all groups as a combined force in our social and economic life, consistent with the
fundamental and paramount objective of the state of promoting the health, comfort, and quiet
of all persons, and of bringing about "the greatest good to the greatest number "(Calalang v.
Williams, G.R. No. 47800, December 2, 1940).
Illegal Recruitment
2. Discuss the types of illegal recruitment.
a. Simple – illegal recruitment committed by a person who has no valid license or authority
against one or two persons only.
Elements:
i. The offender has no valid license or authority required by law to enable one to lawfully
engage in recruitment and placement of workers; and
ii. He undertakes either any activity within the meaning of ―recruitment and placement‖
defined under Art. 13(b) or any prohibited practices under Art. 34 of the
Labor Code(Sec. 6 of RA No. 8042 as amended by Sec. 5 of RA 10022).
b. Illegal Recruitment as Economic Sabotage:
1. Syndicated – illegal recruitment committed by a syndicate if carried out by a group of

three (3) or more persons in conspiracy or confederation with one another.
Elements:
i. The accused have no valid license or authority required by law to enable them to lawfully
engaged in the recruitment and placement of workers;
ii. The accused engaged in this activity of recruitment and placement by actually recruiting,
deploying and transporting; and
iii. Illegal recruitment was committed by three (3) persons conspiring and confederating with
one another.(People vs. Hashim, G.R. No. 194255, June 13, 2012)
2. Large scale or qualified – illegal recruitment committed against three (3) or more
persons, individually or confederating with one another (People vs. Sadiosa, G.R. No. 107084,
May 15, 1998; P.D 2018, Sec 1 Art. 38 of PD 442, as amended)).

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Elements:
i. The offender has no valid license or authority required by law to enable him to lawfully
engage in recruitment and placement of workers;
ii. The offender undertakes any of the activities within the meaning of ―recruitment and
placement‖ under Art. 13 (b) of Labor Code, or any of the prohibited practices enumerated
under Art. 34 of the said Code (now Sec. 6 of the R.A. No. 8042); and
iii. The offender committed the same against three (3) or more persons, individually or as a
group(People vs. Taguinay, G.R. No. 186132, February 27, 2012).
Illegal recruitment as distinguished from estafa
3. Distinguish illegal recruitment from estafa.
Illegal Recruitment Estafa

As to nature of criminal offense
It is malum prohibitum. It is malum in se.
As to necessity of criminal intent
The criminal intent is not necessary. The criminal intent is imperative.
As to the law penalizing the act
It is penalized under the Labor Code. It is penalized under the Revised Penal Code.
As to scope
It is limited in scope. It is wider in scope and covers deceits whether
related or not to recruitment activities.
Note: Illegal recruitment and estafa cases may be filed simultaneously or separately. The filing
of charge for illegal recruitment does not bar the filing of estafa, and vice versa. An acquittal in
the illegal recruitment does not prove that she is not guilty of estafa. Illegal recruitment and
estafa are entirely different offenses and neither one necessarily includes or is necessarily
included in the other. Thus, conviction for illegal recruitment and estafa do not result in double
jeopardy (People vs. Bilaber, G.R. Nos. 114967-68, January 26, 2004).
Liability of local recruitment agency and foreign employer
4. What is the nature of the liabilities of the local recruitment agency vis-a-vis its
foreign principal?
The local recruitment agency is solidarily liable with the foreign principal; severance of
relations between the local agent and foreign principal does not affect the liability of the foreign
principal (Sec. 10, paragraph 2, RA 8042, as amended) .
5. What is the rule on personal liability of corporate officers for a corporate act
declared to be unlawful?
Personal liability attaches only when:
a. there is a willful and knowing assent to patently unlawful acts of the corporation;
b. there is gross negligence or bad faith in directing the affairs of the corporation, or
c. there is a conflict of interest resulting in damages to the corporation (Sec. 31 of the
Corporation Code).
The conferment of liability on officers for a corporation's obligations to labor is held to be an

exception to the general doctrine of separate personality of a corporation. It also bears
emphasis that in cases where personal liability attaches, not even all officers are made

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accountable. Rather, only the "responsible officer," i.e., the person directly responsible for and
who "acted in bad faith" in committing the illegal dismissal or any act violative of the Labor
Code, is held solidarily liable, in cases wherein the corporate veil is pierced (Guillermo vs. Uson,
G.R. No. 198967, March 7, 2016).
POST-EMPLOYMENT
Tests to determine EE-ER Relationship
6. What is the two-tiered test of employment relationship?
The two-tiered test is composed of:
a. The putative employer‘s power to control the employee with respect to the means and
methods by which the work is to be accomplished (control test); and
b. The underlying economic realities of the activity or relationship (broader economic reality
test).
These two-tiered tests apply to cases where there are several parties alleged to be employers
of one individual. The determinant factor is economic dependency of such individuals. In other
words, under the economic reality test, the question to ask is - among the parties alleged to be
the employer, to whom is the individual economically dependent ? (Francisco vs. NLRC, G.R. No.
170087 August 31, 2006).
7. What kind of control is needed to establish an employer-employee relationship?
Under the control test, in order to establish an employer-employee relationship, the employer
must have reserved the right to control the employee as to the result of the work to be done
and the means and methods by which the same is to be accomplished (Chan, Pre-week notes on
Labor Law, 2018, p. 40).
Note: The power of control refers to the existence of the power and not necessarily to the
actual exercise thereof. It is not essential, in other words, for the employer to actually
supervise the performance of duties of the employee; it is enough that the former has the right
to wield the power (Equitable Banking Corporations vs. NLRC, G.R. No. 102467, June 13, 1997; Felicilda
vs. Uy, G.R. No. 221241, September 14, 2016).
8. Distinguish managerial employees from supervisory employees.
A managerial employee is one who is vested with powers or prerogatives to lay down and
execute management policies and/or to hire, transfer, suspend, lay-off, recall, discharge,
assign, or discipline employees. Supervisory employees, on the other hand, are those who, in
the interest of the employer, effectively recommend such managerial actions if the exercise of
such authority is not merely routinary or clerical in nature but requires the use of independent
judgment (Art. 212[m], Labor Code).
Legitimate subcontracting as distinguished from labor-only contracting
9. When is there a trilateral relationship?
A legitimate job contracting is ―trilateral‖ in character if there are three parties involved:
A. The principal who farms out a job, work or service to a contractor;

B. The contractor who has the capacity to independently undertake the performance of the
job, work or service; and

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C. The contractor‘s workers engaged by the contractor and farmed out to the principal to
accomplish the job, work or service (Department Order No. 174, Series of 2017).
10. What are the contracts involved in this trilateral relationship?
Only two contracts are involved, namely:
A. Service agreement between the principal and and the contractor wherein the obligation
arising therefrom is civil in nature and thus cognizable by the regular courts.
B. Employment contract between the contractor and the worker supplied to the principal
(Chan, Pre-week notes on Labor Law, 2018, p. 44).
11. When is there labor-only contracting?
There is ―labor-only contracting‖ where the person supplying workers to an employer does not
have substantial capital or investment in the form of tools, equipment, machineries, work
premises, among others, and the workers recruited and placed by such person are performing
activities which are directly related to the principal business of such employer. In such cases,
the person or intermediary shall be considered merely as an agent of the employer who shall
be responsible to the workers in the same manner and extent as if the latter were directly
employed by him [Art. 106(4), Labor Code]
12. What is the liability of the principal when there is labor-only contracting?
The principal is jointly and severally or solidarily liable with the labor-only contractor to the
latter‗s employees in the same manner and extent that the principal is liable to employees
directly hired by him/her (Art. 106, as amended).
NOTE: In the event of violation of any provision of the Labor Code, including the failure to pay
wages, there exists a solidary liability on the part of the principal and the contractor for
purposes of enforcing the provisions of the Labor Code and other social legislations, to the
extent of the work performed under the employment contract (Sec. 10, Department Order No. 174,
Series of 2017, Rules Implementing Articles 106 to 109 of the Labor Code, as amended).
Termination of Employment
13. What is the procedure to be followed in terminating the employment of an erring

seafarer?
The Master shall comply with the following disciplinary procedures against an erring seafarer:
a. The Master shall furnish the seafarer with a written notice containing the following:
1. Grounds for the charges as listed in Section 31 of this Contract.

2. Date, time and place for a formal investigation of the charges against the seafarer
concerned.
b. The Master or his authorized representative shall conduct the investigation or hearing,
giving the seafarer the opportunity to explain or defend himself against the charges. An
entry on the investigation shall be entered into the ship's logbook.
c. If, after the investigation or hearing, the Master is convinced that imposition of a penalty
is justified, the Master shall issue a written notice of penalty and the reasons for it to the
seafarer, with copies furnished to the Philippine agent(Sec. 17, POEA-SEC).

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14. Is there an instance when the Master can dispense with the notices requirement
stated above?
Yes. Dismissal for just cause may be effected by the Master without furnishing the seafarer
with a notice of dismissal if doing so will prejudice the safety of the crew or the vessel. This
information shall be entered in the ship's logbook. The Master shall send a complete report to
the manning agency substantiated by witnesses, testimonies and any other documents in
support thereof (Sec. 17, POEA-SEC).
15. What are the distinctions between Just Causes and Authorized Causes in the Labor
Code?
Just Causes Authorized Causes

Just causes refer to the following grounds: serious Authorized causes refer to the following grounds:
misconduct, gross and habitual negligence, fraud or installation of labor-saving devices, redundancy,
willful breach of the employee of the trust reposed retrenchment to prevent losses, and disease.
in him by the employer, commission of a crime or
offense by the employee against the employer or
representative, and analogous causes.
Must comply with the Twin Notice Rule Written notice to the DOLE and the employee at least
30 days prior to the effective date thereof
Payment of separation pay is not required (Sec. 7, Except in case of closure or cessation of business due
Rule I, Book VI, Title I, Omnibus Rules to serious business losses, payment of separation pay
Implementing the Labor Code), except if separation is required(Art. 298, Labor Code as amended).
pay is provided for by way of company practice,
company policy or contract
For failure to comply with the due process For the violation of due process requirement by the
requirement in just cause dismissal, the employer is employer in authorized cause dismissal, he is liable to
liable to pay indemnity amounting to Php30,000, pay indemnity in the amount of Php 50,000, which is
which is tempered (Agabon vs. NLRC, G. R. No. stiffer (Jaka Food Processing Corporation vs. Pacot,
158693, November 17, 2004). G.R. No. 151378, March 28, 2005).
Just causes
16. What are the just causes under the Labor Code?
a. Article 297 [282] (Termination by the Employer) -which provides for the following
grounds:
1. Serious misconduct or willful disobedience by the employee of the lawful orders of his
employer or representative in connection with his work;
2. Gross and habitual neglect by the employee of his duties;
3. Fraud or willful breach by the employee of the trust reposed in him by his employer
or duly authorized representative;
4. Commission of a crime or offense by the employee against the person of his
employer or any immediate member of his family or his duly authorized
representatives; and
5. Other causes analogous to the foregoing;
b. Article 279(a) [264(a)] (Prohibited Activities) - which provides for the

termination of the following:
1. Union officers who knowingly participate in an illegal strike and therefore deemed to
have lost their employment status; and
2. Any employee, union officer or ordinary member who knowingly participates in the
commission of illegal acts during a strike (irrespective of whether the strike is legal or
illegal), is also deemed to have lost his employment status;

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c. Article 278(g) [263(g)] (National Interest Cases) - where strikers who violate orders,
prohibitions and/or injunctions as are issued by the DOLE Secretary or the NLRC, may be
imposed immediate disciplinary action, including dismissal or loss of employment status; and
d. Article 259(e) [248(e)] (Union Security Clause) - where violation of the union security
agreement in the CBA may result in termination of employment. Under this clause, the
bargaining union can demand from the employer the dismissal of an employee who commits
a breach of union security arrangement, such as failure to join the union or to maintain his
membership in good standing therein. The same union can also demand the dismissal of a
member who commits an act of disloyalty against it, such as when the member organizes a
rival union.
17. What are the conditions for the valid termination of employment due to union
security clause?
a. The union security clause is applicable;

b. The union is requesting for the enforcement of the union security provision in the CBA; and
c. There is sufficient evidence to support the Union‘s decision to expel the employee from the
union or company (Inguillo vs. First Philippines Scales, Inc., G.R. No. 165407, June 5, 2009See
also: PICOP Resources, Inc. (PRI) vs. Anacleto Taneca et.al, G.R. No. 160828, 09 August 2010).
Authorized causes
18. What are the authorized causes under the Labor Code?
a. Article 298 [283] (Business-related causes) –

1. Installation of labor-saving device;
2. Redundancy;
3. Retrenchment;
4. Closure or cessation of business operations not due to serious business losses or
financial reverses; and
5. Closure or cessation of business operations due to serious business losses or
financial reverses; and
b. Article 299 [284] (Health-related causes)
19. What are the requisites to effect a valid authorized cause under Articles Article 298
[293] and 299 [284]?
1. Installation of labor-saving devices

a. There must be introduction of machinery, equipment or other devices;
b. The introduction must be done in good faith;
c. The purpose for such introduction must be valid such as to save, cost, enhance
efficiency, and other justifiable economic reasons;
d. There is no other option available to the employer than the introduction of machinery,
equipment or device and the consequent termination of employment of those affected
thereby; and
e. There must be fair and reasonable criteria in selecting employees to be terminated
(Sec. 5.4(a), D.O. No. 147-15).
2. Redundancy
a. There must be superfluous positions or services of employees;
b. The positions or services are in excess of what is reasonably demanded by the actual
requirements of the enterprise to operate in an economical and efficient manner;
c. There must be good faith in abolishing redundant positions;
d. There must be fair and reasonable criteria in selecting the employees to be terminated;

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and
e.There must be an adequate proof of redundancy such as but not limited to the new
staffing pattern, feasibility studies/proposal, on the viability of the newly created
positions, job description and the approval by the management of the restructuring
(Sec. 5.4(b), D.O. No. 147-15).
3. Retrenchment
a. The retrenchment must be reasonably necessary and likely to prevent business losses;
b. The losses, if already incurred, are not merely de minimis, but substantial, serious,
actual and real, or if only expected, are reasonably imminent;
c. The expected or actual losses must be proved by sufficient and convincing evidence;
d. The retrenchment must be in good faith for the advancement for the advancement of
its interest and not to defeat or circumvent the employees‘ right to security of tenure;
and
e. There must be fair and reasonable criteria in ascertaining who would be dismissed and
who would be retained among the employees, such as status, efficiency, seniority,
physical fitness, age, and financial hardship for certain workers (Sec. 5.4(c), D.O. No. 147-
15).
4. Closure or Cessation of Operation
a. There must be a decision to close or cease operation of the enterprise by the
management;
b. The decision was made in good faith; and
c. There is no other option available to the employer except to close or cease operations
(Sec. 5.4(d), D.O. No. 147-15).
5. Disease
a. The employee must be suffering from any disease;
b. The continued employment of the employee is prohibited by law or prejudicial to
his/her health as well as to the health of his/her co-employees; and
c. There must be certification by a competent public health authority that the disease is
incurable within a period of six (6) months even with proper medical treatment (Sec.
5.4(e), D.O. No. 147-15).
20. What is the “Last-In, First-Out (LIFO) Rule”?
When there are two employees occupying the same position in the company affected by the
retrenchment program, the last one employed will necessarily be the first to go (Maya Farms
Employees Organization v. NLRC, G.R. No. 106256, December 28, 1994).
In cases of labor-saving devices, redundancy, and retrenchment, this rule shall apply except
when an employee volunteers to be separated from employment (Sec. 5.4, D.O. No. 147-15).
21. What is the duty of the employer when the employee, who was afflicted with
disease, was cured within six months?
If the disease or ailment can be cured within the period, the employee shall not terminate the
employee but shall ask the employee to take a leave of absence. The employer shall reinstate
such employee to his former position immediately upon the restoration of his normal health
(Sec. 8, Book VI, Title I, Omnibus Rules Implementing the Labor Code).
22. What is the Deoferio Doctrine?
This doctrine states that there are two requisites that must be complied with before termination
of employment due to disease may be justified, namely:
a. Substantive requisites; and

b. Procedural requisites.

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The following are the three (3) substantive requisites:
a. An employee has been found to be suffering from any disease;

b. His continued employment is prohibited by law or prejudicial to his health, as well as to the
health of his co-employees; and
c. A competent public health authority issues a medical certificate that the disease is of such
nature or at such a stage that it cannot be cured within a period of six (6) months even
with proper medical treatment.
Meanwhile, the following are the Procedural Requirements or Two-Notice Requirement:
a. The notice to apprise the employee of the ground for which his dismissal is sought; and
b. The notice informing the employee of his dismissal, to be issued after the employee has
been given reasonable opportunity to answer and to be heard on his defense (Deoferio vs.
Intel Technology Philippines, Inc. G.R. No. 202996, June 18, 2014).
Procedural due process
23. What are the kinds of procedural due process that may be asserted in labor cases?
a. Statutory Due Process – This refers to the due process provision in Article 292(b) of the
Labor Code, which provides: ―Subject to the constitutional right of workers to security of
tenure and their right to be protected against dismissal except for a just and authorized
cause and without prejudice to the requirement of notice under Article 283 of this Code,
the employer shall furnish the worker whose employment is sought to be terminated a
written notice containing a statement of the causes for termination and shall afford the
latter ample opportunity to be heard and to defend himself with the assistance of his
representative if he so desires in accordance with company rules and regulations
promulgated pursuant to guidelines set by the Department of Labor and Employment‖
(Agabon vs. NLRC, G. R. No. 158693, November 17, 2004).
b. Contractual Due Process – This refers to the specific company policy and procedure in
evaluating the performance of an employee. The Supreme Court has ruled that a company
policy partakes of the nature of an implied contract between the employer and employee
(Abbott Laboratories vs. Alcaraz, G. R. No. 192571, July 23, 2013).
24. What are the seven (7) standard situations in termination cases?
1. The dismissal was for a just cause under Article 282, Termination is LEGAL
for an authorized cause under Article 283, or for
health reasons under Article 284, and due process
was observed.
2. The dismissal was without a just or authorized cause Termination is ILLEGAL
but due process was observed.
3. The dismissal was without a just or authorized cause Termination is ILLEGAL
and due process was not observed.
4. The dismissal was for a just or authorized cause but Termination is LEGAL but the employer is
due process was not observed. liable to pay indemnity in the form of
nominal damages. The amount of nominal
damages varies from case to case:
If dismissal
If dismissal is for an
is for a just
authorized cause
cause
P30,000.00 P50,000.00 (Penalty is
(Per Agabon stiffer per Jaka Food
Case because Processing Corporation
employee vs. Pacot, G.R. No.
has 151378, March 28,

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committed a 2005, because

wrongful act) employee dismissed
has not committed any
wrongful act)
5. The dismissal was for a non-existent cause. Termination is ILLEGAL

6. The dismissal was not supported by any evidence of Termination is NEITHER LEGAL NOR
termination. ILLEGAL as there is no dismissal to speak
of. Remedy is reinstatement but without
backwages. (Asia Fancy Plywood Corp.
vs. NLRC, G.R. No. 113099, January 20,
1999)
7. The dismissal was brought about by the Termination is LEGAL

implementation of a law.
Preventive suspension
25. When is preventive suspension justified?
Preventive suspension is justified when the employee‘s continued employment poses a serious
and imminent threat to the life or property of the employer or of the employee‘s co-workers
(Section 8, Rule XXIII, Book V, Omnibus Rules Implementing the Labor Code).
Illegal dismissal
26. Distinguish illegal dismissal and constructive dismissal.
In illegal dismissal, the employer openly shows his intention to dismiss the employee. In fact,
the employer, in compliance with due process, asks the employee to explain why he should not
be dismissed for committing a wrongful act and he is given due process prior to terminating
him. On the other hand, constructive dismissal is an employer‘s act amounting to dismissal
but made to appear as if it were not – a dismissal in disguise. In most cases of constructive
dismissal, the employee is allowed to continue to work, but is simply reassigned, demoted, or
his pay diminished without a valid reason to do so. It does not always involve forthright
dismissal or diminution in rank, compensation, benefit and privileges. There may be
constructive dismissal if an act of clear discrimination, insensibility or disdain by an employer
becomes so unbearable on the part or the employee that it could foreclose any choice by him
except to forego his continued employment (Hyatt Taxi Services case, G.R. No. 143204, June
26, 2001).
27. What are the reliefs of an employee who was illegally dismissed?
As a general rule, an illegally dismissed employee is entitled to the following:
Reinstatement OR separation pay in lieu of reinstatement, if reinstatement is not viable; and

Payment of full backwages.
However, the doctrine on strained relations cannot be applied indiscriminately since every labor
dispute almost invariably results in ―strained relations‖; otherwise, reinstatement can never be
possible. Strained relations must be demonstrated as a fact and adequately supported by
substantial evidence (Holcim Philippines, Inc. vs. Obra, G.R. No. 220998, August 8, 2016).

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28. What is the Doctrine of Strained Relations?
When the employer can no longer trust the employee and vice-versa, reinstatement could not
effectively serve as a remedy. This applies only to (1) positions which require trust and
confidence, or (2) managerial employees. It does not apply to rank-and-file employees (Globe-
Mackay Cable and Radio Corporation vs. NLRC, G.R. No. 82511, March 3, 1992).
29. When may reinstatement of an illegally dismissed employee without backwages be

considered proper?
As a general rule, an illegally dismissed employee is entitled to reinstatement (or separation

pay, if reinstatement is not viable) and payment of full backwages. An exception is the
reinstatement of the employee without backwages on account of: (a) the fact that the dismissal
of the employee would be too harsh of a penalty; and (b) that the employer was in good faith
in terminating the employee.
Only employees discriminately dismissed are entitled to backpay (Integrated Microelectronics, Inc.
vs. Pionilla, G.R. No. 200222, August 28, 2013).
30. What is the new rule on reinstatement pending appeal abandoning the refund
doctrine?
The employer is given (2) options under the law, that is, to reinstate the employee actually or
in the payroll. If the Supreme Court finally finds legal dismissal and sets aside the decision a
quo finding illegal dismissal, the employee reinstated in the payroll is not required to reimburse
the salaries received pending appeal because the principle of social justice renders inapplicable
to the civil law the doctrine of unjust enrichment(Garcia vs. PAL, G.R. 164856, January 20, 2009).
31. What is the prescriptive period for filing an illegal dismissal complaint?
The prescriptive period for filing an illegal dismissal complaint is four years from the time the
cause of action accrued. This is pursuant to Art. 1146 of the Civil Code which governs an action
based upon an injury to the rights of a plaintiff. Indeed, when one is arbitrarily and unjustly
deprived of his job or means of livelihood, the action instituted to contest the legality of one‘s
dismissal from employment constitutes, in essence, an action predicated ―upon an injury to the
rights of the plaintiff‖ (Arriola vs. Pilipino Star Ngayon, Inc., G. R. No. 175689, August 13, 2014).
Money claims arising from employer-employee relationship
32. Under what circumstances or instances may an employee who is found to have been
illegally dismissed and, therefore, entitled to reinstatement, be nevertheless, NOT
ordered reinstated but merely awarded (a) separation pay in lieu of reinstatement
and (b) back wages?
An employee who is found to have been illegally dismissed shall be awarded separation pay in
lieu of reinstatement if reinstatement is no longer viable in view of the strained relations
between the employee and his employer (Valenzuela vs Alexandra Mining , G.R. No. 222419,
October 5, 2016). Also, when reinstatement is no longer feasible in view of the advanced age of
the employees who were illegally dismissed, they should instead receive separation pay
(Benguet Corporation vs. NLRC and Felizardo A. Guianan, G. R. No. 124166, Nov. 16, 1999).

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LABOR RELATIONS
A. Right to self-organization
33. Differentiate between government employees’ right of self-organization with that of

employees in the private sector?
The private sector employees‘ right of self-organization includes the right to deal and negotiate
with their respective employers in order to fix the terms and conditions of employment and
also, to engage in concerted activities for the attainment of their objectives, such as strikes,
picketing or boycotts. Meanwhile, the right of government employees to self-organization is not
regarded as available for ―purposes of collective bargaining,‖ but simply for the furtherance and
protection of their interests (Arizala vs. CA, G. R. No. 43633-34, September 14, 1990).
34. Who cannot join a labor organization?
a. Supervisors cannot join a rank-and-file union, co-mingling is prohibited;

b. Employees-members of a cooperative cannot join a labor organization. An employee cannot
bargain with himself or his co-ownerConfidential employees performing managerial
functions;
c. Confidential employees who have access to confidential matters of persons who exercise
managerial functions in the field of labor relations (NATU vs. Torres, G.R. No. 93468, December
29, 1994).
NOTE:However, confidential employees without access to confidential labor relations

matters can join labor organizations;
d. In the government sector, the following cannot form or join a rank and file union:
1. Members of the AFP, PNP, BJMP, BFP; and

2. High level employees exercising managerial function (Executive Order 180);
e. Alien employees, unless their country extends the right to self-organization and join or
assist labor unions for purposes of collective bargaining to Filipino workers (D.O. 40-03);
and
f. Managerial employees (Article 251, Labor Code).
35. What is the remedy of the employer in case of alleged inclusion of disqualified
employees in a union?
The proper procedure for an employer is to directly file a petition for cancellation of the union‘s
certificate of registration due to misrepresentation, false statement or fraud (Asian Institute
Management vs. Asian Institute of Management Faculty Association, G. R. No. 207971, January 23, 2017).
Rights of labor organizations
Check off, assessment, agency fees
36. What are the requisites for validity of union and special assessments?
The following requisites must concur in order for union dues and special assessments for the
union‘s incidental expenses, attorney‘s fees and representation expenses to be valid, namely:
a. Authorization by a written resolution of the majority of all members at the general

membership meeting duly called for that purpose;

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b. Secretary‘s record of the minutes of said meeting which must include the:
1. List of members present;
2. Votes cast;
3. Purpose of the special assessments;
4. Recipient of such assessments; and
c. Individual written authorizations for check-off duly signed by the employees concerned
(Art. 250 [241], Labor Code, as amended).
37. In case there is an absence of a stipulation for agency fee, can the union exercise its
right to a check-off?
Yes. The union‘s right to a check-off of any fee, being a legal right, arises even in the absence
of a stipulation for agency fee, provided the requisites are present: (1) authorization by a
written resolution of the majority of all members at the general membership meeting duly
called for that purpose; (2) secretary‘s record of the minutes of said meeting; and (3) individual
written authorizations for check-off duly signed by the employees concerned. The basis of
agency fee is that non-union employees are enjoying the benefits of the CBA, which was
obtained by the union, without providing financial or other support to the union, since they are
not union members. Hence, agency fee is justified as the consideration for the benefits they
enjoy under the CBA (JA. Sibal, Labor Jurisprudence and Practice, 4thEd., p. 12).
MANAGEMENT PREROGATIVE
38. Discuss the concept of management prerogative.
Under the doctrine of management prerogative, every employer as the inherent right to
regulate, according to his own discretion and judgement, all aspects of employment, including
hiring, work assignments, working methods, time, place and manner of work, work supervision,
transfer of employees, lay-off of workers, and discipline, dismissal, and recall of employees
(Poquiz, Labor Relations and Law on Dismissal with Notes and Comments, 2018, p. 434-435).
39. What is the proportionality rule in employee discipline?
The proportionality rulesimply means that the penalty to be imposed should be commensurate
to the offense committed. For example, dismissal for committing tardiness or absence for the
first time is too harsh a penalty. A warning, a reprimand would suffice for the first offense,
punitive suspension of a day or two, for the second offense, a longer suspension for a third
offense, and finally, dismissal for a fourth offense. Meanwhile, for committing serious offenses,
such as stealing a company-owned property, or stabbing a co-employee, because of their
nature, would certainly deserve the imposition of the supreme penalty of dismissal, and not just
a warning, a reprimand or punitive suspension (Chan, Bar Reviewer on Labor Law, 2017, p. 71).
Transfer or employees
40. What are the two (2) concepts of transfers?
a. The transfer from one (1) position to another of equivalent rank, level or salary, without a
break in the service; or
b. Transfer from one (1) office to another within the same business establishment.
The right to transfer covers movement of personnel in terms of reorganization, promotion and
demotion (Poquiz, Labor Relations and Law on Dismissal with Notes and Comments, 2018, p. 438).

ARELLANO UNIVERSITY
SCHOOL OF LAW
41. Distinguish promotion from demotion.
Promotion is the advancement from one position to another with an increase in duties and
responsibilities as authorized by law, and usually accompanied by an increase in salary.
Demotion, on the other hand, involves a situation where an employee, is relegated to a

subordinate or less important position constituting reduction to a lower grade or rank, with a
corresponding decrease in duties and responsibilities, and usually accompanied by a decrease
in salary (Poquiz, Labor Relations and Law on Dismissal with Notes and Comments, 2018, p. 439).
42. Is demotion a valid management prerogative?
Yes. The employer has the right to demote and transfer an employee who has failed to observe
proper diligence in his work and incurred habitual tardiness and absences and indolence in his
assigned work. Also, demotion may be validly imposed due to failure to comply with
productivity standards and quota (Petrophil Corp. vs. NLRC, G.R. No. L-64048, August 29, 1986;
Leonardo vs. NLRC, G.R. No. 125303, June 16, 2000).
43. Discuss the correlation of security of tenure with management prerogative.
The employee‘s right to security of tenure does not give him such a vested right in his position
as would deprive the company of its prerogative to change his assignment or transfer him
where he will be most useful. When his transfer is not unreasonable, inconvenient, or
prejudicial to him and it does not involve a demotion in rank or diminution of his salaries,
benefits and other privileges, the employee may not complain that it amounts to a constructive
dismissal (Phil. Japan Active Carbon Corp. vs. NLRC, G.R. No. 83239, March 8, 1989).
Productivity standards
44. Does the employer have the right to prescribe productivity standards or quota?
Yes. The employer has the right to prescribe productivity standards or quotas which the
employees should comply with. These are designed to increase company viability and
profitability. These standards may be used as an incentive or as disciplinary measures. If an
employee was able to attain his work goals, the management may provide some incentives and
benefits. However, failure to observe the prescribed standards of work, because of inefficiency,
may constitute just cause for dismissal. An employee‘s failure to meet sales or work quotas falls
under the concept of gross inefficiency, which in turn is analogous to gross neglect of duty that
is a just cause for dismissal under Art. 297 of the Labor Code. However, in order for the quota
imposed to be considered a valid productivity standard and thereby validate a dismissal,
management‘s prerogative of fixing the quota must be exercised in good faith for the
advancement of its interest (Aliling vs. Feliciano, G.R. No. 185829, April 25, 2012).
Bonus
45. Does an employer have the obligation to grant bonuses?
No. Bonus, as a general rule, is an amount granted and paid ex gratia to the employee. Its
payment constitutes an act of enlightened generosity and self-interest on the part of the
employer rather than as a demandable obligation. It is an amount granted and paid to an
employee for his industry and loyalty which contributed to the success of the employer‘s
business and made possible the realization of profits (Producer‘s Bank vs. NLRC,G.R. No. 100701,
March 28, 2001; UST Faculty Union vs. NLRC G.R. No. 90445 October 2, 1990).

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46. When does a bonus become demandable?
Bonus becomes demandable in the following instances:

a. When it is stipulated in an employment contract or CBA; it becomes a contractual obligation;
(Lepanto Ceramics, Inc. vs. Lepanto Ceramics Employees Association, G.R. No. 180866, March 2,
2010);
b. When the grant of bonus is a company policy or practice; and
c. When it is granted as an additional compensation which the employer agreed to give not
contingent on profit becomes part of a wage; therefore a demandable obligation (Poquiz,
Labor Relations and Law on Dismissal with Notes and Comments, 2018, p. 443-444).
Bona fide occupational qualifications
47. What arebona fide occupational qualification?
BONAFIDE OCCUPATIONAL QUALIFICATIONrefers to the general rule where the job itself
necessarily requires a particular qualification, then the job applicant or worker who does not
possess it may be disqualified on that basis, and such will not be considered unlawful
discrimination.
To justify a BFOQ, the employer must prove that:

1. The employment qualification is reasonably related to the essential operation of the job
involved; and
2. There is a factual basis for believing that all or substantially all persons meeting the
qualification would be unable to properly perform the duties of the job (Star Paper Corporation, et.
al. vs. Simbol, et. al., G.R. No. 164774, April 12, 2006).
Marriage between employees of competitor-employers
48. X was hired by Yang Industries as an industrial engineer. Upon reading the
company policy, she came across the provision prohibiting Yang Industries
employees from having a relationship with an employee of a competitor company.
Since X has a suitor who works as an industrial engineer in Burke Industries, she
questioned the management regarding the validity of the said policy. If you were
the legal counsel of Yang Industries, what would you tell X?
I would tell X that the policy prohibiting the employees from having a relationship with an
employee of a competitor company is a valid exercise of management prerogative. It is
reasonable under the circumstances because relationships of that nature might compromise the
interests of the company. Yang only aims to protect its interests against the possibility that a
competitor company will gain access to its secrets and procedures (Duncan Association of
Detailman- PTGWO v. Glaxo Wellcome Philippines, Inc., G.R. No. 162994, September 17, 2004).
DEPARTMENT OF LABOR AND EMPLOYMENT REGIONAL DIRECTORS
Recovery and adjudicatory power
49. What is covered by the recovery and adjudicatory power of the DOLE Regional
Directors?
The recovery and adjudicatory power granted under Art. 129 of the Labor Code empowers the
DOLE Regional Directors through summary proceeding and after due notice to hear and decide:
a. matters involving recovery of wages; and

b. other monetary claims and benefits, including legal interest

ARELLANO UNIVERSITY
SCHOOL OF LAW
DEPARTMENT OF LABOR AND EMPLOYMENT SECRETARY
Visitorial and enforcement powers
50. What are the requirements for the valid exercise of the visitorial and enforcement
powers by the DOLE Secretary or any of his duly authorized representatives?
For a valid exercise by the DOLE Secretary or any of his duly authorized representatives of the
visitorial and enforcement powers, the following requisites must concur:
a. The EE-ER relationship should still exist;

b. The findings in question were made in the course of the inspection by the labor inspectors;
and
c. The employee has not yet initiated any claim or complaint with the DOLE Regional Director
under Art.129, or the LA under Art. 224.
Power to suspend effects of termination
51. What are the grounds in order for SOLE to suspend the effects of termination?
1. Termination may cause a serious labor dispute; and

2. Termination is in implementation of a mass lay-off (Art. 292, Labor Code).
Remedies
52. What are the remedies that may be granted by the DOLE Secretary?
The acts that may be granted by the DOLE secretary are the following:
1. Assumption of jurisdiction;
2. Appeal; and
3. Voluntary arbitration (Art. 278[g], Labor Code).
LABOR STANDARDS VIOLATIONS
53. How are complaints for violation of labor standards instituted?
EMPLOYMENT RELATIONSHIP SUBSISTING SEVERED EE-ER RELATIONSHIP

Complaint before the Regional Director with territorial Before the DOLE regional office, provided, that the
jurisdiction over the workplace claim involves recovery of wages and other monetary
(Art. 128) claims and benefits, including legal interest, provided
further, the following requisites are present: a) the
claim is presented by an employee, or a person
employed in domestic or household service, or house
helper; b) the claim arise from employer-employee
relations; c) the claimant does not seek reinstatement;
and d) the aggregate money claim of each claimant
does not exceed P5,000.00 (Art. 129)
-OR-
Before the Regional Arbitration Branch of the National
Labor Relations Commission, in the absence of any of
the above enumerated requisites, except claims for
employee‘s compensation and social security benefits
(Art. 217)

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TAXATION LAW
GENERAL PRINCIPLES
A. CONCEPT AND PURPOSE OF TAXATION
1. What is taxation?
Taxation is the power by which the sovereign, through its law-making body, raises revenue to
defray the necessary expenses of the government. It is a way of apportioning the cost of
government among those who, in some measure, are privileged to enjoy its benefits and must
bear its burdens. (51 Am. Jur 34)
2. What are the purposes of taxation?
The purposes of taxation are the following:
1. Primary – to raise revenues; to support the existence of the State and enable the state
topromote the general welfare.
2. Secondary – non-revenue or special or regulatory (PR2EP)
a. Promotion of general welfare – used to implement police power.

b. Regulation – levied on excises or privileges for purposes of rehabilitation or stabilization
of threatened industry which is affected by public interest or to discourage consumption
of harmful products.
c. Reduction of Social Inequity – made possible through the progressive system of
taxation where the objective is to prevent the undue concentration of wealth in the
hands of few individuals.
d. Encouragement of economic growth – tax incentives and reliefs may be granted to
encourage investment.
e. Protectionism – for the protection of local industries, in case of foreign importations,
protective tariffs and customs duties and fees. (Soriano, et.al, The Tax Reviewer, 2021, p. 5)
3. Distinguish Tax from Other Forms of Exactions.
Tax vs. License Fee
Tax License Fee

As to Basis Power of Taxation Police power
As to Purpose To generate revenue Regulatory
As to Limitations Generally, unlimited; Subject to Limited to costs of issuing the license;
inherent and constitutional limitations Necessary inspection or police
surveillance
Effect of Non- Does not make the business illegal Makes the business illegal
payment
If generating revenue is the primary purpose and regulation is merely incidental, the imposition
is a tax; but if regulation is the primary purpose, the fact that revenue is incidentally obtained
does not make it a tax. (Ingles, Tax Made Less Taxing, 2018, p. 4)

ARELLANO UNIVERSITY
SCHOOL OF LAW
Tax vs. Toll
Tax Toll
As to Definition Demand of sovereignty for raising A demand of proprietorship.Amount
revenue charged for the cost and maintenance of
property used
As to Purpose For support of the government As compensation for use of another‘s
property
As to Determined by the sovereign Determined by the cost of the property,
Determination of its improvement or maintenance
Amount
As to who may Imposed by the State Imposed either by the government or by
impose private individuals or entities
Tax vs. Penalty
Tax Penalty
As to Definition Enforced proportional contributions Sanction imposed for violation of laws
from persons and property
As to purpose For revenue To regulate conduct
As to Authority Imposed only by the government Imposed either by the government or by
private individuals or entities
Tax vs. Special Assessment
Tax Special Assessment

As to Definition Demand of sovereignty for raising Special levy on lands comprised within
revenue the territorial jurisdiction of a Province,
City or Municipality specially benefitted
by public works, projects, improvements
funded by the LGU concerned
As to subject Imposed on lands, persons, property, Imposed on land only
business, etc.
As to liability Personal Non-personal
As to basis Based on necessity (and partially on Based solely on benefits
benefits)
As to application General Special to a particular time and place
Tax vs. Customs Duties
Tax Customs Duties

As to Purpose Raising revenue Controlling the flow of the goods of the
country
As to Broadness Broader term Tariff or tax on the importation or
exportation of goods
Tax vs. Debt
Tax Debt
As to Basis Law Contract / Judgment
As to effect of Civil and criminal liability Civil liability only
failure to pay
As to mode of Money Money, property, or service
payment
As to No Yes
assignability
As to subjectivity No Yes
to Compensation
/ set-off
As to interest Yes, if deficient or delinquent General rule: No, unless expressly

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stipulated
As to authority Public authority Private individuals
Prescription Determined by the Tax Code Determined by the Civil Code
B. DISTINGUISH: POWER OF TAXATION, POLICE POWER, AND EMINENTDOMAIN
4. Distinguish Power of Taxation, Police Power, and Eminent Domain.
Taxation Police Power Eminent Domain

As to Purpose Raise revenue Promote public welfare Facilitate the taking of
through regulations private property for public
purpose
As to the No limit BUT must be Limited to the cost of No specific amount BUT just
Amount of equal to the needs of the regulation and issuance compensation must be paid
Exaction government of license or surveillance to the owner which is
fees equivalent to the market
value of the property.
As to Benefits No direct benefit; only No direct benefit; only a Direct benefit in the form of
Received general benefit of healthy economic just compensation
protection standard of society
As to Non- Contract MAY NOT be Contracts MAY be Contracts MAY be impaired
impairment of impaired impaired
Contracts
As to Transfer Taxes become part of the No transfer but only Transfer in favor of the State
of Property public funds restraint in its exercise or public service/utility
Rights companies
As to Scope All persons, property, and All persons, property, Only upon a particular
excises and privileges property
As to who Only the government and Only the government May be by (1) the
exercises the its political subdivisions and its political government of its political
power subdivisions subdivisions OR (2) public
service companies or public
utilities granted with such
power
(Soriano, et.al, The Tax Reviewer, 2021, p. 23)
C. THEORY AND BASIS OF TAXATION
5. What are the theories and bases of taxation?
a. Lifeblood Theory – Taxes are the lifeblood of the government and so should be collected
without unnecessary hindrance. On the other hand, such collection should be made in
accordance with law as any arbitrariness will negate the very reason for government itself.
(Commissioner of Internal Revenue vs. Algue, Inc, G.R. No. L-28896, February 17, 1988)
b. Necessity Theory – The State cannot continue without the means of paying for its
existence; hence, it has the right to compel all citizens and property within its power to
contribute for the same purpose (71 Am. Jur. 2d 346)
c. Benefits-Protection Theory (Doctrine of Symbiotic Relationship) – Taxation arises

because of the reciprocal relation of protection and support between the state and the
taxpayers. The state givesprotection and for it to continue giving protection, it must be
supported by taxpayers in the form of taxes. (Commissioner of Internal Revenue vs. Algue, Inc,
Ibid.)

ARELLANO UNIVERSITY
SCHOOL OF LAW
D. JURISDICTION OVER SUBJECT AND OBJECTS
6. Over what subjects and objects does a State have the power to tax?
The taxing power of the state does not extend beyond its territorial limits, but within such limits it
may tax persons, property, income, or business. No state may tax anything not within its jurisdiction
without violating the due process clause of the constitution. (Manila Gas Corp. vs. Collector of Internal
Revenue, G.R. No. 42780, January 17, 1936)
E. PRINCIPLES OF A SOUND TAX SYSTEM
7. What are the principles of a Sound Tax System?
The following are the principles of a Sound Tax System: (FAT)
a. Fiscal Adequacy – revenue raised must be sufficient to meet government / public

expenditures and other public needs. (Chavez vs. Ongpin, G.R. No. 76778, June 6, 1990)
b. Administrative Feasibility – Tax laws must be capable of effective and efficient

enforcement. They must not obstruct business growth and economic development. They
must also be convenient as to the place and manner of payment. (Diaz vs. Sec. of Finance,
GR. No. 193007,July 19,2011)
c. Theoretical Justice – must take into consideration the taxpayer‘s ability to pay ( Ability to
Pay Theory). Art. VI, Sec. 28 (1) of the 1987 Constitution mandates that the rule on
taxation must be uniform and equitable and that the State evolve a progressive system of
taxation.
NOTE: Non-observance of Fiscal Adequacy and Administrative Feasibility will render the tax
measure unsound but not unconstitutional. However, non-observance of the Principle of
Theoretical Justice may render the tax measure unconstitutional because the Constitution itself
requires that taxation must be equitable. (Soriano, et.al, The Tax Reviewer, 2021, p. 6)
F. INHERENT AND CONSTITUTIONAL LIMITATIONS ON TAXATION
8. What are the Inherent Limitations on Taxation?
(PI2TE)
a. Public Purpose;
b. Inherently Legislative;
c. International Comity
d. Territorial; and
e. Exemptions of Government Entities, Agencies, and Instrumentalities.
9. Explain why government entities, agencies and instrumentalities are generally

exempt from taxation. What is the exception to this rule.
There is no point in national and local government taxing each other, unless a sound and
compelling policy requires such transfer of public funds from one government pocket to
another. However, while government instrumentalities are exempt from real property taxes,
government owned or controlled corporations are not exempt from real property taxes. (Manila
International Airport Authority vs. City of Paranaque, G.R. No. 155650, July 20, 2006)

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10. What are the Constitutional Limitations on Taxation?
The following are the constitutional limitations as provided by the 1987 Constitutions: (UNDER
TALL SHIVER)
a. Due Process (Sec.1, Art. III)

b. Equal Protection of Laws (Sec. 1, Art. III)
c. Religious Freedom (Sec. 5, Art. III)
d. Non-Impairment of Contracts (Sec. 10, Art. III)
e. Prohibition against Imprisonment for Non-payment of Poll Tax (Sec. 20, Art. III)
f. Uniformity and Equality of Taxation and Progressive System of Taxation (Sec. 28, Art. VI)
g. Delegated Authority to the President to Impose Tariff Rates [Sec. 28 (2), Art. VI]
h. Prohibition against Taxation of Real Property of Charitable Institutions, Churches,
Parsonages or Convents, Mosques and Non-profit Cemeteries [Sec. 28 (3), Art. VI]
i. Prohibition against Taxation on Non-stock Non-Profit Educational Institutions [Sec. 4(3),
Art. XIV]
j. Absolute Majority Vote of Congress for Grants of Tax Exemptions [Sec. 28 (4), Art. VI]
k. Prohibition against the use of Tax Levied for Special Purpose [Sec. 29(3), Art. VI]
l. Tax Bills should originate exclusively in the House of Representatives [Sec. 24, Art. VI]
m. President‘s Veto Power on Appropriation, Revenue, and Tariff Bills [Sec. 27 (2), Art. VI]
n. Judicial Power to Review Legality of Tax (Sec. 5, Art. VIII)
o. Grant of Power to Local Government Units to Create its Own Sources of Revenue (Sec. 5,
Art. X)
11. What are the tax exemptions protected by the non-impairment clause?
The tax exemptions protected by the non-impairment clause are contractual tax exemptions,
not those granted by franchises or licenses. Contractual tax exemptions are: (a) those entered
into by the taxing authority; (b) lawfully entered into them under enabling laws; and (c)
wherein the government acts in its private capacity and sheds its cloak of authority and
immunity. (Manila Electric Co. vs. Province of Laguna, G.R. No. 131359, May 5, 1999)
G. STAGES OR ASPECTS OF TAXATION
12. What are the Stages or Aspects of Taxation?
(LAPR)
a. Levy or Imposition - pertains to the enactment of tax laws and statute by Congress.
These tax laws of statutes determined the subject and object of taxation, how much is to
be collected, as well as the rate and base of tax.
b. Assessment & Collection - refers to the acts of administration and implementation of the
tax law by the executive department through its administrative agencies(Bureau of Internal
Revenue or Bureau of Custom)
c. Payment – the act of compliance by the taxpayer, including such options, schemes or
remedies as may be legally open or available to him.
d. Refund – the recovery of any tax alleged to be erroneously or illegally collected, or of any
penalty claimed to have been collected without authority or any sum alleged to have been
excessively

ARELLANO UNIVERSITY
SCHOOL OF LAW
H. REQUISITES OF A VALID TAX
13. What are the requisites of a valid tax?
a. It must be for public purpose;

b. It must be uniform;
c. The party being taxed must be within the jurisdiction of the taxing authority;
d. The tax must not impugn on the inherent and constitutional limitations on the power of
taxation; and
e. Assessment and collection of certain kinds of taxes guarantee against injustice to
individuals, especially by providing notice and opportunity for hearing.
I. KINDS OF TAXES
14. Enumerate the kinds of taxes.
a. As to Object – personal tax, property tax, excise/privilege tax

b. As to Burden or Incidence – direct tax, indirect tax
c. As to Tax Rates – specific tax, ad valorem tax, mixed
d. As to Purpose – general tax, special tax
e. As to Scope of Authority to Impose – national, local
f. As to Graduation – progressive, regressive, proportionate
15. Distinguish “direct taxes” from “indirect taxes. Give examples of each.
Direct Taxes are demandable from the very person who, as intended, should pay the tax
which cannot shift to another; while an indirect taxis demanded in the first instance from one
person with the expectation that he can shift the burden to someone else, not as tax, but as
part of purchase price. (Maceda vs. Macaraig, Jr., G.R. No. 882891, June 8, 1993)
Examples of direct taxes are income tax, estate tax and donor‘s tax. Examples of indirect tax
are value-added tax, percentage tax and excise tax on excisable articles.
16. Distinguish indirect taxes as against withholding taxes.
Indirect taxes Withholding Taxes

The incidence of taxation falls on one person The incidence and burden of taxation fall on the same
but the burden thereof can be shifted or entity, the statutory taxpayer. The burden of taxation
passed on to another person, such as when is not shifted to the withholding agent who merely
the tax is imposed upon goods before collects, by withholding, the tax due from income
reaching the consumer who ultimately pays payments to entities arising from certain transactions
for it. and remits the same to the government. (Asia
International Auctioneers, Inc. (AIA) vs. Commissioner
of Internal Revenue (CIR), G.R. No. 179115,
September 26, 2012, J. Perlas-Bernabe)
J. GENERAL CONCEPTS IN TAXATION
17. What is the Doctrine of Situs of Taxation?
No state may tax anything not within its jurisdiction without violating the due process clause of
the constitution. The taxing power of a estate does not extend beyond its territorial limits, but
within such limits it may tax persons, property, income or business . (Manila Gas Corp. v. CIR, G.R.
No. 42780, January 17, 1930).

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18. What are the two kinds of double taxation?
A. Double Taxation in the Strict Sense or Direct Double Taxation

a. Same property is taxed twice when it should be taxed only once;
b. both taxes are imposed on the same property or subject matter for the same purpose;
c. taxed by the same State, Government or taxing authority;
d. taxed within the same jurisdiction or taxing district;
e. taxed during the same taxing period; and
f. covering the same kind of character of tax.
It violates the equal protection clause of the constitution. (Villanueva vs. City of Iloilo, G.R. No. L-
26521, December 28, 1968)
B. Double Taxation in the Broad Sense or Indirect DoubleTaxation – means indirect

duplicate taxation. It extends to all cases in which there are two or more pecuniary impositions.
The Constitution does not prohibit the imposition of double taxation in the broad sense.
(Mamalateo & Mamalateo-Jusay, Reviewer on Taxation, 2019, p. 25)
19. The Municipality of Z has an existing ordinance that all restaurants and other
establishments selling liquor should pay a fixed annual fee of P15,000.
Subsequently, the municipal board proposed an ordinance imposing a 5% sales tax
of the amount paid for the consumption or purchase of liquor in restaurants and
other establishments.However, Mr. Y, municipal mayor, refused to sign the
ordinance alleging that the ordinance will constitute double taxation. Is the refusal
of the mayor justified?
No. The impositions are of different nature. The fixed annual fee is in the nature of a license
fee imposed through the exercise of police power, while the 5% tax on consumption or
purchase is a local tax imposed through the exercise of taxing powers. Both a license fee and a
tax may be imposed on the same business or occupation, or for selling the same article and this
is not a violation of the rule against double taxation.
(Compania General de Tabacos de Filipinas vs. City of Manila, G.R. No. L-16619, June 29,1963)
20. The Municipality of Z has an existing ordinance that all restaurants and other
establishments selling liquor should pay a fixed annual fee of P15,000.
Subsequently, the municipal board proposed an ordinance imposing a 5% sales tax
of the amount paid for the consumption or purchase of liquor in restaurants and
other establishments.However, Mr. Y, municipal mayor, refused to sign the
ordinance alleging that the ordinance will constitute double taxation. Is the refusal
of the mayor justified?
No. The impositions are of different nature. The fixed annual fee is in the nature of a license
fee imposed through the exercise of police power, while the 5% tax on consumption or
purchase is a local tax imposed through the exercise of taxing powers. Both a license fee and a
tax may be imposed on the same business or occupation, or for selling the same article and this
is not a violation of the rule against double taxation.
(Compania General de Tabacos de Filipinas vs. City of Manila, G.R. No. L-16619, June 29,1963)

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SCHOOL OF LAW
21. What are the usual methods of avoiding the occurrence of double taxation?
The usual methods of avoiding the occurrence of double taxation are: (CReED)
a. Allowing reciprocal exemption either by law or by treaty;
b. Allowance of a tax credit for foreign taxes paid;
c. Allowance of deduction for foreign taxes paid; and,
d. Reduction of the Philippine tax rate. (Dimaampao, Tax Principles and Remedies, 2011 Edition)
22. A Corporation filed a claim for refund of its excess final withholding taxes allegedly
erroneously withheld and remitted from interest payments paid to a non-resident
Foreign Corporation (NRFC) lender whose country has an existing tax treaty with
the Philippines which provide for a lower tax rate.
The BIR, however, alleged that an International Tax Affairs Division (ITAD) ruling
must be obtained prior to availing a preferential tax rate prescribed by Revenue
Memorandum Order (RMO) 1-2000, and failure to comply with the administrative
requirements of the said RMO is fatal to the availment of tax treaty relief. Is the
contention of BIR correct?
No. The obligation to comply with a tax treaty must take precedence over the objective of RMO
No. 1-2000. While the consequences sought to be prevented by RMO No. 1-2000 involve an
administrative procedure, these may be remedied through other system management
processes, e.g., the imposition of a fine or penalty. More so, the period of application for the
availment of tax treaty relief as required by RMO No. 1-2000 should not operate to divest
entitlement to the relief as it would constitute a violation of the duty required by good faith in
complying with a tax treaty (pacta sunt servanda). The denial of the availment of tax relief for
the failure of a taxpayer to apply within the prescribed period under the administrative issuance
would impair the value of the tax treaty. At most, the application for a tax treaty relief from the
BIR should merely operate to confirm the entitlement of the taxpayer to the relief. (Deutsche
Bank AG Manila Branch vs. CIR, G.R. No. 188550, August 19, 2013)
23. What are the ways of shifting tax burden?
a. Forward shifting- transfer of the tax burden from a factor of production through the
factors of distribution until finally rests on the consumer.
b. Backward shifting- transfer of the tax burden from the consumer through the factors of
distribution to the factor of production.
c. Onward shifting- transfer of the tax burden two or more times either forward or
backward. (Valencia & Roxas, Income Taxation, 2016, p.34)
24. Define tax avoidance and tax evasion
Tax Avoidance/Tax Minimization Tax Evasion/Tax Dodging

The tax saving device within the means A scheme used outside of those lawful means and
sanctioned by law. This method should be when availed of, it usually subjects the taxpayer to
used by the taxpayer in good faith and at further or additional civil or criminal liabilities.
arm‗s length.
Tax evasion connotes the integration of three factors:
(1) the end to be achieved, i.e., the payment of less
than that known by the taxpayer to be legally due, or
the non-payment of tax when it is shown that a tax is
due; (2) an accompanying state of mind which is
described as being "evil," in "bad faith," "willfull," or
"deliberate and not accidental"; and (3) a course of
action or failure of action which is unlawful.. (CIR vs.
Estate of Benigno Toda, G.R. No. 147188, September
14,2004)

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25. What is the difference between tax assumption and tax exemption?
Tax Assumption Tax Exemption

To "assume" means to take on, become bound On the other hand, Tax Exemption is the " freedom
as another is bound or put oneself in place of from a duty, liability or other requirement" or " a
another as to an obligation or liability. This privilege given to a judgment debtor by law, allowing
means that the obligation or liability remains, the debtor to retain a certain property without
although the same is merely passed on to a liability." (Mitsubishi Corp. vs. CIR, G.R. No. 175772,
different person. June 5, 2017)
26. What is the Doctrine of Equitable Recoupment?
The Doctrine of Equitable Recoupment is where the refund of a tax illegally or erroneously
collected or overpaid by a taxpayer is barred by prescription, a tax being assessed against a
taxpayer may be recouped or set-off against the tax whose refund is now barred by
prescription. This, however, is not allowed in the Philippines. (Collector of Internal Revenue vs.
University of Santo Tomas and the Court of Tax Appeals, G.R. No. L-11274, November 28, 1958)
27. Are taxes subject to set -off?
No. There can be no off-setting of taxes against the claims that the taxpayer may have against
the government. (Ingles, 2015) A person cannot refuse to pay a tax on the ground that the
government owes him an amount equal to or greater than the tax being collected. The
collection of tax cannot await the results of a lawsuit against the government. (Francia vs.
Intermediate Appellate Court, G.R. No. L-67649, June 28, 1988) The taxpayer cannot take law into its own
hands, and the claim compensation because it has pending refund with the CIR. (Philex Mining Corp. vs.
CIR, G.R No. 125704, August 28, 1998)
However, when the claims of the government and the taxpayer against each other have already
become due, demandable and fully liquidated, and the amount due to the taxpayer has already
been appropriated by law, compensation will follow by operation of law. (Domingo vs. Garlitos,
G.R. No. L-18994, June 29, 1963)
28. What is a tax amnesty? How it is construed?
Tax amnesty is a general pardon or the intentional overlooking by the State of its authority to
impose penalties on persons otherwise guilty of violating a tax law. It partakes of an absolute
waiver by the government of its right to collect what is due it and to give tax evaders who wish
to relent a chance to start with a clean slate.
A tax amnesty, much like a tax exemption, is never favored or presumed in law. The grant of a
tax amnesty, similar to a tax exemption, must be construed strictly against the taxpayer and
liberally in favor of the taxing authority. (Asia International Auctioneers, Inc. (AIA) vs. Commissioner
of Internal Revenue (CIR), G.R. No. 179115, September 26, 2012, J. Perlas-Bernabe)
29. Distinguish tax amnesty from tax exemption.
Tax Amnesty Tax Exemption

Immunity from all criminal, civil and immunity from civil liability only
administrative liabilities arising from non-
payment of taxes
Applies only to past tax periods, hence of Prospective application
retroactive application (Philippine Banking Corporation vs. CIR, G.R. No,
170574, January 30, 2009)

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K. CONSTRUCTION AND INTERPRETATION OF TAX LAWS, RULES AND REGULATIONS
30. Why are tax exemptions strictly construed against the taxpayer?
Tax exemption is strictly construed against the taxpayer because such provisions are highly
disfavored and may almost be said odious to the law. (Manila Electric Co. vs. Vera, G.R. No. L-
29987, October 22, 1975). It is strictly construed because the law does not look with favor on tax
exemptions, they being contrary to the life-blood theory which is the underlying basis for taxes.
INCOME TAX
31. Define Income Tax.
Income Tax is a tax on all yearly profits arising from property, professions, trade or offices or
as a tax on person‗s income, emolument, profits and the like (LG Electronics Philippines, Inc. vs.
CIR, G.R. No. 16541, December 3,2014,penned by J. Leonen)
32. What are the different types of Income tax systems?
a. Global Tax System is a system employed where the tax system views indifferently the tax
base and generally treats in common all categories of taxable income of the individual. All
items of gross income, deductions, personal and additional exemptions are reported in one
income tax return and a single tax is imposed on all income received or earned, regardless
of the activities which produces the income.
b. Schedular Tax System is a system employed where the income tax treatment varies and
is made to depend on the kind or category of taxable income of the taxpayer. The tax rates
depend on the classification of taxable income and activities which produced the income.
c. Semi-Schedular or Semi-Global Tax System is a system of taxation wherein both
global and schedular tax system is being applied, depending on the kind of income. It is the
system being followed in the Philippines.
33. What are the basic features of Philippine Income taxation?
a. It is comprehensive since it is imposed on practically all forms of income irrespective of

nature, whether compensation.
b. It is progressive since the tax rate increases as the tax base increases.
c. It follows semi-schedular or semi-global tax system.
34. What are the criteria in imposing Philippine income tax?
a. Citizenship Principle
- Resident citizens are taxable both for income from sources within and income without
the Philippines
- Non-resident citizens are taxable only for income from sources within the Philippines
b. Residence Principle
- Resident aliens are taxable only for income from sources within the Philippines and
exempt from sources outside.
c. Source principle
- Non-resident aliens are subject to Philippine income tax only on income from sources
within the Phil this is despite of the fact that he never set foot in the Phil.

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35. What are the different kinds of taxpayers for income tax purposes?
Individuals Corporations Others
Resident Citizen (RC) Domestic Corporation (DC) Joint Venture

and
Consortium
Nonresident Citizen (NRC) Resident Foreign Corporation (RFC) Partnership
Resident Alien (RA) Nonresident Foreign Corporation Estate

(NRFC)
Nonresident alien not engaged in trade or Trust

business (NRA-NETB)
Nonresident alien engaged in trade or

business (NRA-ETB)
Note: A NRA who shall come to the

Philippines and stay for an aggregate of
more than 180 days shall be deemed a
NRAETB.
36. What are the general principles of income taxation?
Summaryof General Principles of Income Taxation

(Under Sec. 23, NIRC, as amended)
Taxable Income Sourced within AND Taxable ONLY from income sourced within
outside
Citizen residing in the Philippines / Resident Non – Resident Citizens

Citizens
Domestic Corporations Overseas Contract Worker /Seamen aboard a

vessel engaged exclusively in international Trade
Aliens
Foreign Corporations
37. What are the different tax periods?
The different tax periods are:

1. Calendar period pertains to the accounting period from January 1 to December 31.
Taxable income is computed based on calendar year if: (BONI)
(a) Accounting period is other than fiscal year.
(b) Taxpayer has no accounting period.
(c) Taxpayer does not keep books.
(d) Taxpayer is an individual.
2. Fiscalperiod is the accounting period of 12 months ending on the last day of any
month other than December. (e.g., July 1, 2019-June 30, 2020)
3. Shortperiod is when a taxpayer may have a taxable period of less than 12
months when: (D2NA -T)
(a) Taxpayer dies
(b) Corporation is newly organized

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(c) Corporation changes its accounting period

(d) Corporation is dissolved; and
(e) Tax period has been terminated by the Commissioner by authority of law(Sec.47, NIRC)
38. What is an income?
An income is the return in money from one's business, labor, or capital invested; gains, profit or
private revenue. (Black‗s Law Dictionary)
Income is a flow of service rendered by capital by the payment of money from it or any other
benefit rendered by the fund through a period of time. (Madrigal vs. Rafferty, G.R.No. 12287,
August 7, 1918)
39. When is income taxable?
An income is taxable when there is an existing income, realization of income and recognition of
income.
As to Existence of Income, a primary consideration in income taxation is that there must be

income before there could be income taxation. (Domondon, 2013)There must be gain or profit
whether in cash or equivalent.
As to Realization of Income, revenue is generally recognized when both of the following

conditions are met:
1. The earning is complete or virtually complete; and
2. An exchange has taken place. (Manila Mandarin Hotels v. CIR, CTA Case. No.5046, March 24 1997)
As to Recognition of Income, receipt of income for purposes of taxation may actual or

constructive. (CIR vs. BPI, G.R. No. 147375, June 25, 2006)Income is received not only when it is
actually handed to a person but also when it is merely constructively received by him.
40. What are the tests in determining whether income is earned for tax purposes?
1. Realization Test. There is no taxable income unless income is deemed realized. Revenue
is generally recognized when both conditions are met:
a. The earning process is complete or virtually complete; and
b. An exchange has taken place. (Manila Mandarin Hotels, Inc. vs. CIR, CTA Case No. 5046,
March 24, 1997)
2. Claim of Right Doctrine/Doctrine of Ownership, Command, or Control – A taxable
gain is conditioned upon the presence of a claim of right to the alleged gain and the
absence of a definite unconditional obligation to return or repay.
3. Economic-Benefit test/Doctrine of Proprietary Interest – Taking into consideration
the pertinent provisions of law, income realized is taxable only to the extent that the
taxpayer is economically benefited.
4. Severance test – Income is recognized when there is separation of something which is of
exchangeable value.(Eisner vs. Macomber, 252 US 189)
41. On November 18, 2021, Mr. A, owner of a repair shop, billed Ms. B the amount of
P2,000 in relation to the repair services by the former. However, Ms. B told Mr. A
she that she will pay by December 2021.
On the same day, Mr. A received his electricity bill of his shop for October 2021
amounting to P1,500 but due to be paid next month.

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a. Under the accrual method, how much Mr. A should recognize as income and
expense in the month of November 2021?
Mr. A will record an income of P2,000 regardless of the fact that he has not yet received any
payment. This is because he has already the right to receive payment upon completion of his
service. Mr. A will also record the expense of P1,000 as the utility service provider has already
the right receive payment after it has provided electricity last month.
The accrual method of accounting relies upon the taxpayer‘s right to receive amounts or its
obligation to pay them. Amounts of income accrue where the right to receive them become
fixed, where there is created an enforceable liability. Similarly, liabilities are accrued when fixed
and determinable in amount, without regard to indeterminacy merely of time of payment. (CIR
vs. Isabel Cultural Corporation, G.R. No. 172231, February 12, 2007)
Under the accrual method, it requires: (1) fixing of a right to income or liability to pay; and (2)
the availability of the reasonable accurate determination of such income or liability. (ING Bank
N.V. vs. CIR, G.R. No. 167679, July 22, 2015, penned by J. Leonen)
b. Under the cash method, how much Mr. A should recognize as income and
expense in the month of November 2021?
Zero (0) for both income and expense. Mr. A will only record the income once collected and
expense once paid which will be in December 2021.
The cash method of accounting provides that income is realized upon receipt of cash or its
equivalent including those constructively received (such as deposits to taxpayer‗s account by
customers) but not including gifts or donations.(Revenue Audit Memorandum Order 1- 2000).
42. Define Situs of Taxation.
The place or authority that has the right to impose and collect taxes. (CIR vs. Marubeni, G.R.
No.137377, December 18,2001)
The factors that determine Situs are as follows:

1. Citizenship or nationality of the taxpayer;
2. Residence or domicile of the taxpayer; and
3. Source of income.
Summary of Situs of Income Taxation
(Under Sec. 42, NIRC, as amended)
Income Situs of Taxation
Interest Residence of the debtor or obligor
Dividends If received from a domesticcorporation – Income from Within the
Philippines.
If received from a foreign corporation – Income from Within the

Philippines unless less than 50% of the gross income of such
foreign corporation for the 3-year period ending with the close of
its taxable year preceding the declaration of dividends was derived
from sources within the Philippines.
Services Place of performance of the service
Rentals and Royalties Location or use of the property or interest in such property
Sale of Real Property Location of the real property
Sale of personal property Place of sale
Gain on sale of shares of stock in Income from within the Philippines regardless of where the
a domestic corporation shares are sold

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SCHOOL OF LAW
43. Define Gross Income.
All income derived from whatever source, including (but not limited to) the following items:
1. Compensation for services in whatever form paid, including, but not limited to fees, salaries,
wages, commissions, and similar items;
2. Gross income derived from the conduct of trade of business or the exercise of a profession;
3. Gains derived from dealings in property;
4. Interests;
5. Rents;
6. Royalties;
7. Dividends;
8. Annuities;
9. Prizes and winnings;
10. Pensions; and,
11. Partner‗s distributive share from the net income of the general professional partnership.
(Sec. 32[A] of the NIRC)
BASIC FORMULA OF INCOME TAX COMPUTATION
FOR INDIVIDUALS
a. Pure Compensation Income Earner
Gross Compensation xx
Less: Non-Taxable/Exempt Compensation Income* xx
Taxable Compensation Income xx
*This includes de minimis benefits (not in excess of the limit per items) including salaries & other
forms of compensation which are exempted from income tax. This includes SSS/GSIS, PhilHealth,
Pag-Ibig contributions and union dues.
b. Pure Business/Professional Income Earner (Availing the Graduated Tax Rate)
Gross Receipts/Gross Sales xx

Less: Sales Returns, Allowances and Discounts xx
Net Sales/Net Revenue xx
Less: Itemized Deductions or Optional Standard Deduction (OSD) xx
Net Income xx
Add: Other Non-Operating Income xx
Total Taxable Income xx
Less: Allowed Deduction under Sec. 24 (A)(2)(b) P250,000.00
Taxable Income (Loss) xx
c. Pure Business/Professional Income Earner (Availing the 8% Tax Rate)

Add: Other Non-Operating Income xx
Less: Allowed Deduction under Sec. 24 (A)(2)(b) P250,000.00
Taxable Income (Loss) xx
Note: If the qualified individual taxpayer is availing of the 8% income tax, the itemized deductions or
OSD will not be considered in determining the taxable income.

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FOR CORPORATION

Less: Cost of Sales or Cost of Services xx
Gross Income from Operation xx
Add: Other Taxable Income not Subjected to Final Tax xx
Less: Itemized Deductions & Other Special Deductions including NOLCOOR OSD xx
Net Taxable Income (Loss)
Xx
44. What are the sources of income subject to tax?
The sources of income subject to tax are as follows:

a) Compensation income – all renumerations for services performed by an employee under an
employer – employee relationship, unless expressly excluded by NIRC. (Sec. 2, RR. No. 8- 18)
b) Fringe benefits – It means any good, service or other benefit furnished in cash or in kind by
an employer to an individual employee. (Sec. 33 (B) of the NIRC)
c) Professional income – fees derived from engaging in an endeavour requiring special training
as professional as a means of livelihood such as but limited to fees of C.P.A.s, doctors,
lawyers and engineers. (RR No. 2-98)
d) Income from business – it arises from habitual engagement in any commercial activity
involving regular sales of goods or services by an individual or a corporation.
e) Income from dealings in property – income on sale of properties whether ordinary or
capital asset.
45. Define capital asset and ordinary asset.
Capital Asset Ordinary Asset

Includes all property held by the taxpayer The following are considered ordinary assets:
whether or not connected with his trade a. Stock in trade of the taxpayer or other property
or business except those considered as of a kind which would properly be included in the
ordinary asset. inventory of the taxpayer if on hand at the close
of the taxable year.
b. Property held by taxpayer primarily for sale to
customers in the ordinary course of trade or
business.
c. Property used in the trade or business of a
character which is subject to the allowance of
depreciation.
d. Real property used in trade or business of the
taxpayer. (Sec. 39, NIRC, as amended)
46. What are the special rules pertaining to income or loss from dealings in property
classified as capital asset?
The Special Rules are Loss Limitation Rule, Net Capital Loss Carry-Over Rule and Holding Period
Rule.
The Loss Limitation Rule is applicable when the capital losses are allowed only to the extent
of capital gains.
The Net Capital Loss Carry-Over Rule is applicable if any taxpayer, other than a
corporation, sustains in any taxable year a net capital loss, such loss (in an amount not in

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SCHOOL OF LAW
excess of the net income for such year) shall be treated in the succeeding taxable year as a
loss from the sale or exchange of a capital asset held for not more than 12 months. (Sec. 39 (D)
of the NIRC)
The Holding Period Rule is applicable to individual taxpayers when the capital asset was held
for more than 12 months (Long Term Gain), the net capital gain or loss is reported at 50% of
the amount realized gain or loss. If the Capital asset was held for less than 12 months
(ShortTerm Gain), the net capital gain or loss is reported at 100% of realized gain or loss.
47. What type of income tax are passive income subject to?
Generally, passive incomes such as interest, dividend, royalties, prizes, and winnings are
subject to graduated tax rates of 0 - 35% if received by individuals or 30% if received by
corporations.
However, certain passive incomes are not subject to basic tax since they are already subjected
to final withholding tax such as the following:
(a) Interest from bank deposits in the Philippines;
(b) Royalties from sources within the Philippines except those generated in the active pursuit
and performance of the corporation‘s primary purpose (BIR Ruling No. 069-2016 dated
February 29, 2016);
(c) Cash and/or Property dividends received by individuals from domestic corporations or share
in the business partnership; and
(d) Prizes received by individual (except NRA-NETB) in the Philippines if the amount exceeds
P10,000.00.
48. What is the rationale for the rule prohibiting the deduction of capital losses from
ordinary gains? Explain.
It is to ensure that only cost or expenses incurred in earning the income shall be deductible for
income tax purposes consonant with the requirement of the law that only necessary expenses
are allowed as deduction from gross income. The term ―necessary expenses‖ presupposes that
in order to be allowed as deduction, the expense must be business connected, which is not the
case insofar as capital losses is concerned. (Sec. 36(A)(1), NIRC)
49. What is the taxability of pensions?
Pensions, in general, are subject to income tax, except pensions and retirement benefits
exempt under the law such as:
(a) Retirement benefits received under Republic Act No. 7641; and
(b) Those received by officials and employees of private firms, whether individual or corporate,
in accordance with a reasonable private benefit plan maintained by the employer.
50. What is Tax-Benefit Rule?
Subsequent recovery of a bad debt previously written off in the books is a taxable income
provided that the write-off of the account resulted to a lower taxable income at the time of
write-off. This rule also applies with respect to refund or credit for taxes. Thus, tax refunds are
taxable if the tax, when paid, was deducted from the gross income.
51. What is the rationale behind exclusion?
There are various reasons why an income is excluded from the gross income such as when:
(a) They represent return of capital or are not income, gain or profit. – (e.g., life insurance
proceeds paid to the heirs or beneficiaries upon death of insured)

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(b) They are subject to another kind of internal revenue tax (e.g., passive income subject to
final tax)
(c) They are income, gain or profit that is expressly exempt from income tax (MAMALATEO,
Income Tax)
52. Define exclusions, deductions, and tax credits.
a) Exclusion is the amount received as an income or gain but does not form part of gross
income.
b) Deductions are amounts which the law allows to be subtracted from gross income in
order to arrive at the net income.
c) Tax Credit is the amount representing a tax previously paid which may be deducted from
a tax liability to arrive at the tax still due.
53. Under what conditions are retirement benefits received by officials and employees
of private firms excluded from gross income and exempt from taxation?
Retirement benefits received under RA 4917 and those received by officials and employees of
private firms, whether, individual or corporate, in accordance with the employer‘s reasonable
private benefit plan approved by the BIR, are excluded from gross income and exempt from
income taxation if the retiring official or employees was : (a) in service of the same employer
for at least 10 years; (b) not less than 50 years old at the time of retirement; (c) availed of the
benefit of exclusion only once (Sec.32 (B)(6)(a), NIRC); (d) the retiring official or employee
should not have previously availed of the privilege under the retirement plan of the same or
another employer. (RR 2-98, Section 2.78 (B)(1), 1st par.)
54. What are Deductions?
Amounts allowed by law to reduce the gross income to taxable income. Amounts allowed to
taxpayers by law and the taxpayer, in order to claims such deductions must prove compliance
with the law authorizing such. (Tax Made Less Taxing, Ingles 2018)
55. Difference between Itemized Deductions and Optional Standard Deduction.
Unless not allowed by law, taxpayers may opt to either avail of the Itemized Deduction or
Optional Standard Deductions (OSD).
ITEMIZED DEDUCTIONS OPTIONAL STANDARD DEDUCTIONS

Expenses and losses which is related to trade or An individual subject to tax, other than a non-
business or the practice of a profession; does resident alien, may elect a standard deduction in an
not apply to taxpayers earning compensation amount not exceeding 40% of gross sales or gross
income from an employer-employee receipts. If individual opted these deductions,
relationship. taxpayer no longer is allowed to deduct cost of sales
or cost of services.
Corporations may elect a standard deduction in an
amount not exceeding 40% of its gross income.
56. The following are itemized deductions, among others:
A. Ordinary and Necessary Trade, Business or Professional Expenses

B. Interest
C. Taxes
D. Losses
E. Bad debts
F. Depreciation

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G. Depletion of oil and gas wells and mines

H. Charitable and other contributions
I. Research and development
J. Pension trusts (Section 34 (A), NIRC)
57. Under the TRAIN Law, how will the income of an individual earning income purely
from compensation, purely from self-employment and/or practice of profession, or
mixed income (compensation and self-employment and/or practice of profession)
be taxed?
Amount of
Gross Sales
and/or
Gross Purely
Income from Self-
Receipts Compensation Mixed Income
Employment
and other Income
non-
operating
income
Income from
Compensation
Self-
Graduated Rates (0 - Income
Employment
Not more 35%) or 8% SEP, in
Graduated Rates (0 - Graduated
than excess of P250,000.00,
35%) Rates (0 - 35%)
P3,000,000.00 at the option of the Graduated
or 8% SEP at
taxpayer Rates (0 - 35%)
the option of
the taxpayer
More than Graduated Rates (0 - Graduated Rates (0 -
Graduated Rates (0 - 35%)
P3,000,000.00 35%) 35%)
58. Who are not qualified for the 8% flat income tax rate option based on gross sales
and/or receipts?
The 8% income tax rate applies ONLY to income from business or practice of profession earned
by individuals whose the gross sales or receipts do not exceed P3,000,000.
The above rate does not apply to the following:

a. Pure compensation income earners;
b. VAT-registered taxpayers;
c. Non-VAT taxpayers whose gross receipts/sales exceed P3,000,000.00;
d. Taxpayers subject to other percentage taxes except Section 116;
e. Partners of General Professional Partnerships; and
f. Individuals enjoying income tax exemption such as those registered with Barangay Micro
BusinessEnterprise since taxpayers are not allowed to avail of double or multiple tax
exemptions under different tax laws unless specifically provided by law. (RR 8-2018) (RMC
50-2018)
59. C, a non-VAT taxpayer, is a freelance architect. By the end of 2018, he had gross
receipts of P1,000,000.00. May C avail of the 8% income tax rate? How much will
be the taxable income subject to the 8% tax?
Yes. If C has opted to avail the 8% flat income tax rate on the 1 st quarter of the year, he may
avail of the 8% income tax regime. Section 24 of the NIRC, as amended by RA 10963 and as
implemented in RR 8-2018, allows persons who are self-employed to have the option to be
taxed at 8% of his Gross Sales/Receipts in excess of P250,000.00. Provided, such person's
Gross Sales/Gross Receipts does not exceed the VAT threshold of P3 million or has not
optionally registered as a VAT taxpayer. The taxable income of C is P750,000.00 which is
obtained by deducting the P250,000.00 tax exemption from his P1 million gross receipts.

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60. E, a non-VAT taxpayer, is a freelance engineer. His 1st to 3rd Quarter Income Tax
Returns (ITRs) for the year 2018 showed that he paid income tax based on the
graduated rates. By the end of 2018, he had gross receipts of P1,000,000.00.
a. May E opt to pay 8% income tax in his annual ITR for the year 2018?
No. E cannot opt to be taxed at 8% income tax. Taxpayer must signify his intention to avail
of the 8% income tax rate in the 1st Quarter ITR, or on the initial quarter return of the
taxable year after the commencement of a new business/practice of profession. Otherwise,
taxpayer is considered to have availed of the graduated rates. (Section 24, NIRC as amended
by TRAIN Law)
b. May E amend his quarterly ITRs and avail of the 8% income tax?
No. E cannot amend his returns to change his taxing regime from graduated tax rates to
8% income tax rate. As per RR 8-2018, such option shall be irrevocable and cannot be
subject to any amendment for the covered taxable year.
61. L, a non-VAT taxpayer, is a practicing lawyer. He is also employed as a part time

professor. During the year 2018, he had the following gross receipts:
 For Practicing law – P1,000,000.00;

 For being a part-time professor - P5,500,000.00
a. How much taxable income will be subject to 8% tax?
If L opted to avail the 8% flat income tax rate on the income derived from his practice of
profession, his P1,000,000 income derived from practice of law will be his taxable income
subject to 8% income tax rate. Taxable income of persons who has two sources of income
which are earnings coming from his trade and/or profession and compensation, such base for
the 8% tax regime shall be the gross sales or receipts from trade/profession including non-
operating income without the benefit of deducting the first Php250,000. (Section 3D(2a), RR 8-
2018)
b. How much taxable income will be subject to the graduated tax rates?
The taxable income subject to graduated tax rates is P5,500,000 less mandatory deductions
and non-taxable/exempt compensation, if any.
The provision under Section 24(A)(2)(b) of the Tax Code, as amended, which allows an option
of 8% income tax rate on gross sales/receipts and other non-operating income in excess of
P250,000.00 is available only to purely self-employed individuals and/or professionals. The
P250,000.00 mentioned is not applicable to mixed income earners since it is already
incorporated in the first tier of the graduated income tax rates applicable to compensation
income. Under the said graduated rates' the excess of the P250,000.00 over the actual taxable
compensation income is not deductible against the taxable income from business/practice of
profession under the 8%o income tax rate option. (Sec. 3D(2), RR 8-2018)

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62. In 2018, AM owns a nightclub and videoke bar, with gross sales/receipts of
P2,500,000.00. His cost of sales and operating expenses are P1,000,000.00 and
P600,000.00, respectively, and with non-operating income of P100,000.00. Is AM
entitled to avail of the 8% income tax rate?
No. RR 8-2018 provides that persons, regardless of the amount of gross sales or receipts, who
are liable for Other Percentage Tax under Title V of the NIRC as amended shall not be entitled
to the option of availing the 8% income regime, except for those taxed under Sec. 116 of the
same Title.
Here, AM's business which is a night club falls within the ambit of income taxed under Section
125 of Title V of the NIRC (Amusement Taxes) and not covered by the exception. Hence, he is
not entitled to the 8% tax regime although his gross sales/receipts including non-operating
income does not exceed the threshold.
63. RR owns a farm, with gross sales of P3,500,000.00. His cost of sales and operating
expenses are P1,000,000.00 and P600,000.00, respectively, and with non-operating
income of P100,000.00. Is RR entitled to avail of the 8% income tax rate?
No. Since Gross Sales or Gross Receipts and Other Non-operating Income of RR from the farm
(self-employment) exceeded the P3 Million Value-Added Tax (VAT) threshold, he is not entitled
to the 8% tax rate. (Section 3C, RR 8-2018)
64. Determine the changes made by the TRAIN Law regarding Income Tax with the
following:
a. Graduated Tax Rates;

b. Basic Allowed Personal Exemption and Additional Personal Exemptions;
c. Premium Payment on Health and/or Hospitalization Insurance for Individuals;
d. 13th Month Pay and Other Benefits;
e. Fringe Benefit Tax;
f. Corporate Income Tax of Government owned or controlled corporations, agencies or
instrumentalities;
g. Passive income on interest from Expanded Foreign Currency Deposit;
h. Capital gains from sale of shares of stock not traded in the local stock exchange of
domestic corporations;
i. Stock Transaction Tax on Listed Shares of a Domestic Corporation;
j. PCSO and Lotto Winnings;
k. Creditable Withholding Tax Rates.
As to: NIRC of 1997 TRAIN LAW

Graduated Tax Rates 5-32% 0-35%
Basic Allowed Personal Basic Personal P50,000; Additional Repealed; no longer considered
Exemption and Additional Personal P25,000 each child not as Allowable Deductions
Personal Exemptions exceeding four (4)
Premium Payment on Health P2,400 per annum Repealed; no longer considered
and/or Hospitalization as Allowable Deductions
Insurance for Individuals
13th Month Pay and Other P82,000 per annum P90,000 per annum (Sec.
Benefits 32(B)(7)(e), NIRC as amended
by TRAIN Law)
Fringe Benefit Tax 15%;25%;32% 35% (Sec. 33(A), NIRC as
amended by TRAIN Law)
Corporate Income Tax of The following are exempt from Income tax exemption of the
Government Owned or corporate income tax: following was removed:
Controlled Corporations, 1. Government Service Insurance 1. PCSO
Agencies or Instrumentalities System (GSIS);
2. Social Security System (SSS);

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3. Philippine Health Insurance

Corporation (PHIC);
4. Local Water Districts; and
5. Philippine Charity Sweepstakes
Office (PCSO).
Passive income on interest Final tax of 7.5% (Sec. 27(D)(1) Final tax of 15% for Resident
from Expanded Foreign of NIRC of 1997) Citizen, Resident Alien and
Currency Deposit Domestic Corporation
Capital gains from sale of Capital Gains Tax of: Capital Gains Tax of 15% flat
shares of stock not traded in 5% on the first P100,000; and rate for all individuals and
the local stock exchange of 10% in excess of P100,000 (Sec. Domestic Corporation
domestic corporations 27(D)(2) of NIRC of 1997)
Stock Transaction Tax on Income tax rate of ½ of 1% 6/10 of1% (Sec. 127, NIRC as
Listed Shares of a Domestic amended by TRAIN Law)
Corporation
PCSO and Lotto Winnings Exempt Exemption is limited only to
P10,000 or less
Creditable Withholding Tax CWT rate is not less than one 1% Beginning Jan 1, 2019, CWT
(CWT) Rates but not more than 32% of the shall not be less than 1% but
income payment not more than 15% of the
income payment (Sec. 57(B),
NIRC as amended by TRAIN
Law)
65. What are the information required in Individual Income Tax Return in accordance
with R.A. 10963 or TRAIN Law?
The income tax return (ITR) shall consist of a maximum of four (4) pages in paper form or
electronic form, and shall only contain the following information:
a.Personal profile and information;

b. Total gross sales, receipts or income from compensation for services rendered, conduct of
trade or business or the exercise of a profession, except income subject to final tax as provided
under this Code;
c. Allowable deductions under this Code;
d. Taxable income as defined in Section 31 of this Code; and
e.Income tax due and payable. (Sec. 51(A)(5), NIRC as amended by TRAIN Law)
66. What is Substituted Filing of Income Tax Return?
Individual taxpayers receiving pure compensation income, regardless of amount, from only one
employer in the Philippines for the calendar year, the income tax of which has been withheld
correctly by the said employer (tax due equals tax withheld) shall not be required to file an
annual income tax return. The certificate of withholding filed by the respective employers, duly
stamped ―received‟ by the BIR, shall be tantamount to the substituted filing of income tax
returns by said employees. (Sec. 51-A, NIRC as amended by TRAIN Law)
67. What are the new rules with regard to MWEs receiving 13th month pay and other
benefits?
a. Statutory Minimum Wage (SMW), Holiday Pay, Overtime Pay, Night Differential Pay and
Hazard Pay are exempt from income and withholding tax.
b. Additional compensation such as commissions, honoraria, fringe benefits, benefits in excess
of the allowable statutory amount of P90,000.00, taxable allowances, and other taxable
income given to MWE by the same employer other than those which are expressly exempt
from income tax shall be subject to income tax and withholding tax.

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c. MWEs receiving other income from other sources in addition to compensation income, such
as income from other concurrent employers, from the conduct of trade, business or practice
of profession, except income subject to final tax, are subject to income tax only to the
extent of income other than SMW, holiday pay, overtime pay, night shift differential pay, and
hazard pay earned during the taxable year.
d. Any reduction or diminution of wages for purposes of exemption from income tax shall
constitute misrepresentation and therefore, shall result to the automatic disallowance of
expense, i.e., compensation and benefits account, on the part of the employer. The
offenders may be criminally prosecuted under existing laws. (RR 11-2018)
68. What are the De Minimis Benefits under the TRAIN Law?
De minimis benefits (as defined under Sec. 2.78 (A)(3)(c) of RR No. 2-98, as amended by RR
No. 10-2008, as further amended by RR No.5-2011)are facilities or privileges furnished or
offered by an employer to his employees that are of relatively small value and are offered or
furnished by the employer merely as a means of promoting the health, goodwill, contentment
or efficiency of his employees, including:
De Minimis Benefits Limit per Year per Employee

1. Monetized unused vacation leave (VL) credits Equivalent to 10 days VL
2. Medical cash allowance to dependents, per P3,000
employee (P1,500 per employee per semester or P250 per
month) (as amended by RR No. 11-18)
3. Rice subsidy P24,000
(P2,400 or 1 sack of 50kg rice per month) (as
amended by RR No. 11-18)
4. Uniform and clothing allowance P6,000 (as amended by RR No. 11-18)
5. Actual medical assistance/allowance P10,000
6. Laundry allowance P3,600 (P300 per month)
7. Employee achievement awards P10,000
Note: Must be in the form of tangible personal

property other than cash or gift certificate, received
by employees under an established written plan
which does not discriminate in favor of highly paid
employees
8. Gifts given during Christmas and major P5,000
anniversaries
9. Daily meal allowance for overtime or 25% of basic minimum pay on a per region basis
night/graveyard work
10. Benefits received by an employee by virtue P10,000
of a collective bargaining agreement (CBA) and
productivity incentive schemes (RR No. 1-2015)
69. What is the rule on excess De Minimis Benefits?
The benefits given in excess of the maximum amount allowed as "de minimis" benefits shall be
included as part of "other benefits" which is subject to the P90,000.00 ceiling. Any amount in
excess of the P90,000.00 shall be subject to income tax, and consequently, to the withholding
tax on compensation. (RMC 50-2018)
70. What is Improperly Accumulated Taxable Income?
Section 29 (D) of the NIRC provides that the term 'improperly accumulated taxable income'
means taxable income adjusted by:
a. Income exempt from tax;
b. Income excluded from gross income;

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c. Income subject to final tax; and

d. The amount of net operating loss carry-over deducted;
And reduced by the sum of:

a. Dividends actually or constructively paid; and
b. Income tax paid for the taxable year.
71. What are the distinctions between regular corporate income tax and minimum
corporate income tax?
As to: Regular Corporate Income Tax Minimum Corporate Income Tax

(RCIT) (MCIT)
Taxpayer All ordinary corporate taxpayers Domestic corporations and resident
foreign corporations
Rate 30% 2%
Tax Base Based on net taxable income except Based on Gross income
non-resident foreign corporation which
is based on gross income
Period of applicability Applicable once the corporation Applicable beginning on the fourth
commenced its operation taxable year immediately following the
year of commencement of business
operation.
DONOR’S TAX
72. What are the elements of donation for tax purposes? (CA-IWD)
Donation has the following elements:

a. There must be a donor who must have the Capacity to donate at the time of making the
donation
b. There must be a donee who should Accept it
c. There must be an intent to do an act of liberality or animus donandi
d. The donation must be in writing fully executed in favor of the done
e. There must be an actual or constructive delivery of the gift to the done to someone else for him
(Abello vs. CIR , G.R. No. 120721, February 23, 2005)
73. Is the provision for “strangers” in payment of donor’s tax under the old Tax Code
still applicable with the advent of RA 10963?
No. Upon the passage of the TRAIN law, the latter repealed the provision of the old Tax Code
mandating a 30% tax rates for donors and donees who are not related. As such, a flat rate of
6% on the excess of P250,000.00 of net gifts per calendar year shall be applicable. (Sec.99,
NIRC as amended by TRAIN law)
74. What is the rule on political donations or contributions?
Any contribution in cash or in kind to any candidate, political party or coalition of parties for
campaign purposes shall be governed by the Election Code, as amended (Sec.99(b), NIRC as
amended by TRAIN law) which provides that said contributions should be exempt from donor‘s
tax provided that the recipient candidates and political parties comply with the requirements of
filing of returns contributions with the COMELEC.

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75. Are the donations made to the National Government or any entity or agencies
exempt from donor’s tax?
Yes. Under Sec. 101(A)(1) of the Tax Code, as amended by TRAIN law, donations made to or
for use of the National Government or any entity created by any of its agencies which is not
conducted for profit, or to any political subdivision of the Government, are exempt from donor‘s
tax. Moreover, Section 17 of RA 9167, the law creating FDCP (Film Development Council of the
Philippines), exempts from taxes any donation, contribution, subsidy or financial aide made to
FDCP, and allows these donations to be deducted in full from the income of the donors for
income tax purposes. (BIR Ruling 316-14 dated August 11, 2014)
76. Are all gifts made by a resident to an educational and/or charitable, religious,
cultural or social welfare corporation, institution, accredited non government
organization, trust or philanthropic organization or research institution or
organization, exempted from the payment of donor’s tax?
No. Under Sec. 101(a)(2) of RA 10963, it provides that to be exempted for the payment of
donor‘s tax, not more than thirty percent (30%) of such gifts shall be used by the donee for
administration purposes.
77. What are the requisites to avail the exemption of Section 101(a)(2) of the Tax
Code?
a. The gift is given to a:

i. School, college, or university, and/or charitable organization; or
ii. Accredited non-government organization; or
iii. Trust or philanthropic organization and/or research institution or organization;
b. Such organization is incorporated as a non-stock non-profit entity that:

i. Pays no dividends;
ii. Governed by trustees who receive no compensation; and
iii. It devotes all its income to the accomplishment and promotion of the purposes
enumerated in its Articles of Incorporation; and
c. Not more than thirty percent (30%) of the gifts shall be used by the donee for
78. Does a transfer of a property, other than real property considered as capital assets,
for less than adequate and full consideration be deemed as a gift if the same was
made in the ordinary course of business?
No. Sale, exchange, or other transfer of property made in the ordinary course of business (a
transaction which is a bona fide, at arm‘s length, and free from any donative intent), will be
considered as made for an adequate and full consideration in money or money‘s worth. Thus, it
shall not be deemed as a gift subject to donor‘s tax. (Sec. 100, NIRC as amended by TRAIN Law)
79. Are transfers in compliance to a Supreme Court order subject to donor’s tax?
No. The donor‘s tax under Section 98 of the Tax Code is generally imposed on the transfer by
any person of property by gift. There is no intention to donate as the transfer was only made in
compliance with the Supreme Court decisions. (BIR Ruling 824-18 dated May 17, 2018)

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80. Sps. S and T has real properties under their name which they sold to their three
minor children for P5.4 million. As proof of such sale, a Certificate Authorizing
Registration (CAR) was issued under the names of their children. The BIR, having
knowledge of the transaction examined the records and assessed the Sps. S and
Twith deficiency tax on donor’s tax. Is the BIR correct in assessing S and T for
deficiency donor’s tax?
Yes. Section 98 of the Tax Code of 1997 provides that the transfer of property by gift is
taxable, whether the same is direct or indirect, real or personal, tangible or intangible. The true
intention of the parties is ascertained to determine whether or not there is a donation. True,
children can save money from their allowances and would be able to purchase properties from
their savings; however, the three minor children would not be able to save such substantial
amount, even if they were receiving enormous allowances from their parents. Thus, without a
source of income or an acceptable form of acquisition of a substantial amount to purchase the
properties, the inclusion of the names of the minor children in the CARs was deemed a
donation and subject to donor‘s tax. (Sps. Evono vs. Department of Finance, CTA EB Case 705, June
4, 2012)
81. Is the renunciation or waiver subject to donor’s tax?
No. General renunciation by an heir including the surviving spouse, of his/her share in the
hereditary estate left by the decedent is NOT subject to donor‘s tax, unless specifically and
categorically done in favor of identified heir/s to the exclusion or disadvantage of other co –
heirs in the hereditary estate. (Sec.12, RR 2- 2018)
82. Mrs. S, being critically ill in her deathbed called his husband and told him that
because of the advance stage of her illness she will leave all her properties to him.
True enough after the call, Mrs. S died leaving all her properties to his husband. Mr.
S without any living heir, however, renounced his share of the net estate coming
from the conjugal/absolute community to his longtime trusted driver Mr. T. Is the
renunciation of the share of the conjugal property / absolute community made by
Mr. S subject to donor’s tax?
Yes. Renunciation by the surviving spouse of his/her share in the conjugal partnership or
absolute community after the dissolution of the marriage in favor of the heirs of the deceased
spouse or any other person/s is subject to donor‘s tax. (Sec. 12, RR 12-2018)
83. What is the law that governs the imposition of donor’s tax?
It is the law at the time of the perfection and/or completion that will govern the imposition of
the donor‘s tax. The gift is perfected from the moment of acceptance by the donee, and it is
completed at the time of delivery. The delivery can either be constructive or actual.
A gift that is incomplete because of reserved powers become complete when either:
a. The donor renounces the power; or
b. His right to exercise ceased because of the happening of some event or contingency or the
fulfillment of some condition, other than the death of the donor.(RR No. 02-03)
84. What transfer may be considered as donations?
The following transfers may be treated as donations:

a. Debt condoned or remitted (in which case the amount of the debt is a gift from the creditor
to the debtor and need not be included in the latter‘s gross income). (Sec. 50, RR No. 02-40)
b. Transfers made in trust for another person; and

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c. Renunciation by the surviving spouse of his/her share in the conjugal partnership or

absolute community after the dissolution of the marriage in favor of the heirs of the
deceased spouse or any other person.
With regard to item (c) above, note that a general renunciation by an heir, including the
surviving spouse, of his/her share in the hereditary estate left by the decedent is not subject to
donor‘s tax, unless the renunciation is specifically and categorically done in favor of identified
heir‘s to the exclusion or disadvantage of the other co-heirs in the hereditary estate.(RR No. 02-
03)
85. Summarize the differences between the old NIRC and the TRAIN Law with regard to
Donors Tax.
NIRC NIRC, as amended by TRAIN Law

As to Rate
0-15% for relatives; 30% for strangers (Sec.99 Flat tax rate of 6% regardless whether or not
(B)) donation is made to a relative or stranger (Sec. 99
(A))
Amount of Exempt Gifts
Php 100,000 (Sec.99 (A)) Php 250,000 (Sec. 99 (A))
Transfer less than Adequate and Full Consideration
Automatically subject to donor‘s tax (Sec. 100) If such transaction is made (1) in the ordinary
course of the business ; (2) at arm‘s length NOT
subject to donor‘s tax and (3) free from donative
intent (RR 13-2018, Sec.16)
Dowries
Donations on account of marriage of his/her No longer exempt. Sec. 101(A)
children are exempt from donor‘s tax up to Php
10,000 (Sec. 101 (A)(1))
86. Differentiate Donor’s Tax between Estate Tax (As amended)
DONOR’S TAX ESTATE TAX

Nature of transfer
During the lifetime of the donor After death of decedent
May take place between natural and juridical persons Transfer takes place only between natural persons
Amount exempt
P250,000 Zero/None (0)
Rate of tax
6% of Taxable Net Gifts in excess of Php 250,000 6% of Taxable NetEstate
Grant of exemption
Sec. 101, NIRC Sec .87, NIRC
Grant of deductions
None Yes. Sec 86, NIRC
Notice requirement
General Rule:
Notice of donation is not required Notice of death is no longer required
Exceptions:
1. Donations to NGO worth at least P50,000. Provided,

not more than 30% of which will be used for
2. Donation to any candidate, political party, or coalition

of parties (RR No. 13-2018)
Filing of return

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All transfers by gift except those which under Sec. 101 of 1. A transfer subject to estate tax
the NIRC which are exempt from tax (Sec. 103, NIRC)
3. Estate consists of registered or registrable
property, regardless of value of gross estate
Contents of return
1. Each gift made during the calendar year which is to be 1. Value of the gross estate
included in computing net gifts 2. Deductions under Sec. 86, NIRC
2. The deductions claimed and allowable 3. Other pertinent information
3. Any previous net gifts made during the same calendar 4. If Gross estate exceeds P5M, certified by a CPA
year as to assets, deductions, tax due, whether paid or
4. The name of the donee not
5. Such further information as may be required by rules
and regulations made pursuant to law
Time of filing Return
Within 30 days after donation was made Within 1 year from death of decedent.
Extension for filing return
None 30 days in meritorious cases
Payment of tax due

Pay as you file Pay as you file or could be paid in installments
Extension of payment
None General Rule:
Extension of payment is not allowed
Exception:
When it would impose undue hardship upon the

estate or any of the heirs, extension may be
allowed but not to exceed 5 years in case of
judicial settlement or 2years in case of extra
judicial settlement.
Exception to the exception:
When taxpayer is guilty of:

1. Negligence
2. Intentional disregard of rules and regulations
3. Fraud
VALUE-ADDED TAX
87. Is VAT a Sales Tax?
Yes. VAT is a tax on the taxable sale, barter or exchange of goods, properties or services. A
barter or exchange has the same tax consequence as a sale. A sale may be an actual sale or a
deemed sale, or an export sale or a local sale (Mamalateo, Reviewer, supra at 491).
88. X Corporation is primarily engaged in the business of conversion of steam to

electricity. Its property, plant and equipment account includes a fully depreciated
patrol cars used by the Corporation. To get rid of the fully depreciated car, the
Corporation decided to sell them to a related party. Is the sale of the car subject to
VAT?
Yes, the sale is subject to 12% VAT. A reading of Section 105 of the Tax Code would show
that a transaction ―in the course of trade or business‖ includes ―transactions incidental thereto‖.
In this case, since the patrol cars are part of the Corporation‘s property, plant and equipment,
the sale of the patrol car is an incidental transaction made in the course of trade or business.

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Thus, the transaction should be subject to VAT. (Mindanao Geothermal vs. CIR, G.R. No. 193301,
March 11, 2013)
89. Z Company, a domestic corporation, rendered services on a no mark-up and

reimbursement of cost basis to its affiliate, A Company, also a domestic corporation.
Is the transaction subject to VAT even if there is no profit element?
Yes. The sale of services on a reimbursement-on/of-cost basis is subject to VAT. Even if such
corporation was organized without any intention of realizing profit, any income or profit
generated by the entity in the conduct of its activities was subject to income tax. Hence, it is
immaterial whether the primary purpose of a corporation indicates that it receives payments for
services rendered to its affiliates on a reimbursement-on-cost basis only, without realizing
profit, for purposes of determining liability for VAT on services rendered.(CIR vs. CA and
COMASERCO, G.R. No. 125355, March 30, 2000)
90. When is Mandatory VAT Registration applicable?
Any person who, in the course of trade or business, sells, barters or exchanges goods or
properties, or engages in the sale or exchange of services, shall be liable to register for value-
added tax if:
a. His gross sales or receipts for the past twelve (12) months, other than those that are
exempt under Section 109(A) to (BB), have exceeded Three million pesos (P3,000,000); or
b. There are reasonable grounds to believe that his gross sales or receipts for the next twelve
(12) months, other than those that are exempt under Section 109(A) to (BB), will exceed
Three million pesos (P3,000,000).(Sec. 236(G), NIRC as amended by TRAIN Law)
91. What is the effect of failure to register when required?
Any person who is required to register but failed to do so shall be liable to pay VAT as if he
were a VAT-registered person, but without the benefit of input tax credits for the period in
which he was not properly registered (Sec. 236 (G)(2), NIRC as amended by TRAIN Law)
92. What are the differences between VAT and Non- VAT registration as to tax
implications?
VAT Non – VAT

As to Rate and Basis
12% Output VAT on Sales /Gross Receipts 3% on Gross Sales/Gross Receipts
Can be applied with deduction
Yes, can be with valid deduction for sales No deduction can be applied
discounts and sales returns
Applicability of Input VAT
Input VAT can be applied as long as valid and No application of Input VAT
substantiated properly
93. B came to you and would like to clarify what is difference between a VAT Sale of
Goods and VAT Sale of Service?
Sale of Goods Sale of Services

Basis/Timing of OUTPUT VAT
Based on sales whether paid or unpaid Based on collection only (cash basis)
(accrual basis)
Can be applied reduction
Yes but only for: No reduction could be applied except for receipts of
security deposits

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a. Sales returns and allowances

b. Sales discounts, provided:
(1) The sales discount granted is

indicated in the invoice at the time of sale; and
(2) The grant of which does not depend
upon the happening of a future event.
Primary source document to be issued

Sales invoice Official Receipt
94. G, a seller of goods, came to you and clarified as to who will shoulder the output
VAT on his sale of goods and his services. Discuss the difference between impact
and incidence of VAT?
G as a seller will only be liable to REMIT the output VAT collected from his buyers but the
amount shall be shouldered by his BUYERS
Impact Incidence
The impact of tax in VAT is with the seller Incidence of tax in VAT is with the buyer
Directly and legally liable for payment Burden of the same tax
In adding or including the VAT due to the selling price, the seller remains the person primarily
and legally liable for the payment of the tax. What is shifted only to the intermediate buyer and
ultimately to the final purchaser is the burden of the tax. (Contex vs. CIR, G.R. No. 151135, July 2,
2004).
95. What is Tax Credit Method (or Invoice Method)?
The input taxes shifted by the sellers to the buyer‘s output taxes when in turn sells the taxable
goods, properties or services (Sec. 105 and 110(A),NIRC).
The law that originally imposed the VAT in the country as well as the subsequent amendments
of that law, has been drawn from the tax credit method. Under the present method that relies
on invoices, an entity can credit against or subtract from the VAT charged on its sales or
outputs the VAT paid on its purchases, inputs and imports . (CIR vs. Seagate Technology
(Philippines), G.R No. 153866, 11 February 2005)
96. Define Destination Principle and the Cross Border Doctrine.
Destination Principle Cross Border Doctrine

Goods and services are taxed only in the Mandates that no VAT shall be imposed to form part of
country where these are consumed. the cost of the goods destined for consumption outside
the territorial border of the taxing authority. Hence,
actual export of goods and services from the
Philippines to a foreign country must be free from VAT.
Conversely, those destined for use or consumption
within the Philippines shall be imposed with the 12%
VAT. (CIR v. Seagate Technology (Philippines), G.R.
No. 153866, Feb. 11, 2005)
97. What is the rule in the substantiation requirement as to claim of input taxes?
Strict compliance with substantiation and invoicing requirements is necessary considering VAT's
nature and VAT system's tax credit method, where tax payments are based on output and input
taxes and where the seller's output tax becomes the buyer's input tax that is available as tax
credit or refund in the same transaction. It ensures the proper collection of taxes at all stages

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of distribution, facilitates computation of tax credits, and provides accurate audit trail or
evidence for BIR monitoring purposes(Team Energy Corporation vs. CIR,G.R. No. 197663, March 14,
2018,penned by J. Leonen)
98. When is amortization of Input Vat on Capital Goods available?
Purchase or importation of capital goods, which are depreciable assets for income tax purposes,
the aggregate acquisition cost of which (exclusive of VAT) in a calendar month exceeds P1
Million, regardless of the acquisition cost of each capital good:
a. If the estimated useful life of a capital good is five (5) years or more — The input tax shall
be spread evenly over a period of sixty (60) months;
b. If the estimated useful life of a capital good is less than five (5) years — The input tax shall
be spread evenly on a monthly basis by dividing the input tax by the actual number of
months comprising the estimated useful life of a capital good.
Aggregate Cost of Useful life is 5years ormore? Amortize?

CG>P1M(net
Of VAT
Yes Yes Yes over 60months

Yes No Yes over
equivalent no. of months
No. Regardless No.
Provided, further, That the amortization of the input VAT shall only be allowed until December
31, 2021 after which taxpayers with unutilized input VAT on capital goods purchased or
imported shall be allowed to apply the same as scheduled until fully utilized . (Sec. 110(A)(2),
NIRC as amended by TRAIN)
99. Differentiate Automatic and Effectively Zero-Rated Sales.
Zero-rated transactions (Automatic) Effectively Zero-rated Transactions

Generally refer to the export sale of goods and Refer to the local sale of goods or supply of
supply of services. services to persons (made by a VAT-registered
person) or entities whose exemption under
special laws or international agreements to
which the Philippines is a signatory effectively
subjects such transactions to a zero rate.
Primarily intended to be enjoyed by the seller who is Intended to benefit the purchaser who, not
directly and legally liable for the VAT, making such being directly and legally liable for the
seller internationally competitive by allowing the payment of the VAT, will ultimately bear the
refund or credit of input taxes that are attributable burden of the tax shifted by the suppliers.
to export sales.
(CIR vs. Seagate Technology (Philippines), Ibid.)
100. Differentiate Exempt Transaction and Exempt Party.
Exempt Person Exempt Transaction

Exemption is on the parties either they Involves goods or services which, by their
are: nature, are specifically listed in and expressly
 Exempted by Tax Code exempted from the VAT under the Tax Code,
 Exempted by a special law without regard to the tax status
 Exemptedbyinternationalagreement
Not subject to the VAT, but may be Not subject to the VAT, but the seller is not
allowed a tax refund of or credit for input allowed any tax refund of or credit for any input
taxes paid, depending on its registration taxes paid.
as a VAT or non-VAT taxpayer

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(CIR vs. Seagate Technology (Philippines), Ibid.)
101. Enumerate the additional VAT exempt transactions pursuant to TRAIN.
a. Transfer of property pursuant to Section 40(C)(2) of the NIRC, as amended; (Sec. 109 (1)(X),
NIRC as amended by TRAIN)
b. Association dues, membership fees, and other assessments and charges collected by
homeowners associations and condominium corporations; (Sec.109 (1)(Y), NIRC as amended
by TRAIN)
c. Sale of drugs and medicines prescribed for diabetes, high cholesterol, and hypertension
beginning January 1, 2019; (Sec.109 (1)(AA), NIRC as amended by TRAIN)
d. Sale of Gold to BSP. Deleted as zero-rated transaction. Now an exempt transaction; (Sec.
109(1)(Z), NIRC as amended by TRAIN)
e. Sale of goods or services, leases which gross annual sales or receipts do not exceed P3
million. (Sec.109 (1)(BB), NIRC as amended by TRAIN)
102. What is the VAT rate for the sale of goods, supplies, equipment and fuel to persons
engaged in international shipping or international air transport operations?
Under Sec. 106(A)(2)(a)(6) of NIRC as amended by TRAIN, the transaction is zero-rated

provided that the goods, supplies, equipment and fuel shall be used exclusively for
international shipping or air transport operations.
103. ABC Law Office, a general professional partnership in the Philippines, received a
query through electronic mail from DEF Corporation, a corporation organized under
the laws of Delaware. DEF Corporation has no office in the Philippines and is not
engaged to do business in the Philippines. Upon ABC Law Office’s reply to the query,
it billed DEF Corporation US$1,500. Within 15 days, the latter remitted its payment
through GHI Bank which converted the amount to peso and deposited the
converted amount in the account of ABC Law Offices. What is the VAT implication of
the payment to ABC Law Office by DEF Corporation?
Payment to ABC Law Office is subject to 0% VAT. As provided for under the law, services other
than processing, manufacturing or repacking rendered in the Philippines to a person engaged in
business conducted outside the Philippines or to a non-resident person not engaged in business
who is outside the Philippines when the services are performed, the consideration for which is
paid for in acceptable foreign currency and accounted for in accordance with the rules and
regulations of the BSP shall be subject to 0% VAT. (Section 108(B)(2) of the Tax Code)
104. Mr. V owns a row of residential apartments which he puts out on lease. 3 out of his
5 apartments are being leased out for Php 10,000 per month while the remaining 2
apartments are leased out for 25,000 per month. Is Mr. Valdez’s business subject to
VAT?
No. RR 16 -2005 as amended by RR No. 13-2018, prescribes the rule on VAT on leases which
are as follows:
Lease of residential units with a monthly rental per unit of not exceeding P15,000 is not subject
to VAT. In cases where a lessor has several residential units for lease, some are leased out for
a monthly rental of P15,000 or below, and some are leased out for more than 15,000 are as
follows:
1. The gross receipts from rentals not exceeding P15,000.00 per month per unit shall be exempt
from VAT regardless of the aggregate annual gross receipts. It is also exempt from the 3%
percentage tax.
2. The gross receipts from rentals exceeding P15,000.00 per month per unit shall be subject to
VAT if the aggregate annual gross receipts from said units only exceeds

ARELLANO UNIVERSITY
SCHOOL OF LAW
P3,000,000.00.Otherwise, the gross receipts will be subject to the 3% tax imposed under
Section 116 of the Tax Code.
Here, Mr. V although having some apartments being leased out for more than the VAT
threshold of Php 15,000, its business is still not subject to VAT since the annual gross receipts
coming from the two (2) apartments being rented for Php 50,000 still did not exceed the VAT
threshold of more than P3,000,000 annual gross receipts.
105. What are the requisites for a claim for refund or tax credit for unutilized input VAT?
A claim for refund or tax credit for unutilized input VAT may be allowed only if the following requisites
concur, namely: (VEIN-NAAP-2)
a. the taxpayer is VAT-registered;

b. the taxpayer is engaged in zero-rated or effectively zero-rated sales;
c. the input taxes are due or paid;
d. the input taxes are not transitional input taxes;
e. the input taxes have not been applied against output taxes during and in the succeeding
quarters;
f. the input taxes claimed are attributable to zero-rated or effectively zero-rated sales;
g. for zero-rated sales under Section 106(A)(2)(1) and (2); 106(B); and 108(B)(1) and (2), the
acceptable foreign currency exchange proceeds have been duly accounted for in accordance with
the rules and regulations of the BangkoSentral ng Pilipinas;
h. where there are both zero-rated or effectively zero-rated sales and taxable or exempt sales, and
the input taxes cannot be directly and entirely attributable to any of these sales, the input taxes
shall be proportionately allocated on the basis of sales volume; and
i. the claim is filed within 2 years after the close of the taxable quarter when such sales were
made. (Luzon Hydro Corporation vs. CIR, G.R. No.188260, November 13, 2013)
106. What is the period within which an administrative claim for tax refund of input
taxes shall be made?
In proper cases, the Commissioner shall grant a refund for creditable input taxes within ninety
(90) days from the date of submission of the official receipts or invoices and other documents
in support of the application filed: Provided, That should the Commissioner find that the grant
of refund is not proper, the Commissioner must state in writing the legal and factual basis for
the denial. (Sec. 112(C) of NIRC as amended by TRAIN)

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107. What are the differences between the on the old NIRC and TRAIN Law as to VAT
Refund?
Prior TRAIN TRAIN Law

Period to file Admin Claim
Same, within 2 years from the close of sale of the taxable quarter
Period to Decide on the Claim
120 days from date of receipt of the written claim for 90 days from date of receipt of the written claim for
refund refund
Deemed Denial, applicable?
Yes, after the lapse of the 120 days to decide on the
refund claim taxpayer. Such inaction shall be No, this has been deleted by TRAIN Law
considered as ―deemed denial‖
Action after lapse of the period to decide
The taxpayer may elevate the refund claim to the CTA The taxpayer has no recourse to elevate, taxpayer
within 30 days after the lapse of the 120 day period to shall wait or compel the BIR officer to decide on the
decide claim.
Should there be a denial by the BIR on the claim
Same, taxpayer must elevate its claim to the CTA within 30 days after the receipt of the denial.
108. Discuss the proper procedure and applicable time periods for filing administrative
and judicial claims for refund of unutilized excess input VAT under the TRAIN Law.
I. Administrative Claim
a. What must be filed?

I. A written claim for VAT refund
II. Proof of VAT zero rated sales and input tax to be refunded:
1. Sales invoices or receipts with the word zero rated imprinted on it. (Microsoft
Philippines, Inc. vs. CIR, G.R. 180173, April 6,2011)
2. Purchase invoices or receipts from another VAT registered taxpayer. (Microsoft
Philippines, Inc. vs. CIR, G.R. 180173, April 6,2011) . Invoices or receipts must be
compliant to the invoicing requirements as prescribed in Section 113 of NIRC.
3. Evidence of actual receipt of Goods.
4. Import entry documents and confirmation receipt on imported goods, if any.
5. Proof of a valid zero -rated sales. PEZA, BOI or other certifications showing that
buyer is not exempt from being passed on VAT.
b. When must the claim be filed?

Within two (2) years from the close of the taxable quarter were the zero – rated sales
were made
c. Time Frame to process VAT refund claim?
 The 90 day period prescribed under Section 112 (C) of the Tax Code, as amended, shall start
from the actual date of filing of application with complete documents duly received by the
processing officer.(RMC 17-2018, March 8, 2018)
 The 90 day period shall be applied prospectively.(RMC 17-2018)

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Remedy in case of denial:
II. Filing of Judicial Claim
The effectivity of the 1997 NIRC on 1 January 1998, the procedure has always been definite:
the 120-day (now 90 days) period is mandatory and jurisdictional. Accordingly, a
taxpayer can file a judicial claim (1) only within thirty days from the receipt of the
decision of the Commissioner partially or fully denying the claim within the 120-day
period (now 90 days).
109. What is the difference between Section 112 and Section 229 of the Tax Code, as
amended, which both set for two-year prescriptive period in claiming for refund?
As to Section 112 Section 229

Reckoning Period Reckoned from the close of the Reckoned from the date of
taxable quarter when the relevant payment of the tax or penalty
sales or transactions were made or
reckoned close of taxable quarter
when the importation or purchase
was made in case of capital goods.
Object Refund of creditable input tax Refund of erroneous payment or
illegal collection of internal
revenue taxes
Type of claim Refers only to administrative claim Includes the judicial claims (i.e.
CTA).
When to elevate to CA Needs to wait for CIR‘s decision. Only requires that an
CIR‘s inaction to decide within 90 administrative claim should first
days is punishable. be filed to the BIR.
110. What is the enhanced VAT refund system?
It grants refunds of creditable input tax within ninety (90) days from the filing of the VAT
refund application with the Bureau: Provided, That, to determine the effectivity of the enhanced
VAT refund system, all applications filed from January 1, 2018 shall be processed and must be
decided within ninety (90) days from the filing of the VAT refund application. (Sec. 106(B)(1) of
the NIRC)
VAT refund Timeline for Refund for Excess Input VAT PRIOR TRAIN LAW (applying SAN
ROQUE -AICHI DOCTRINE)- 120+30 RULE
A. Denial made by the Commissioner

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The refund claim must be first filed within 2 years from the close of sales of taxable quarter (ADMIN
CLAIM) .The 2-year period rule applies only for filing of ADMIN CLAIM.PRIORthe TRAIN Law, the
BIR officer has only 120 days to decide from the date of receipt on the input VAT refund claim by the
taxpayer which is July 29,2016.Here, the BIR denied the claim within the 120 day period which was
on April 15, 2016.After denial and receipt thereof, the taxpayer has 30 days from the receipt of the
denial or until June 15,2016 to file a JUDICIAL CLAIM.
VAT refund Timeline for Refund for Excess Input VAT PRIOR TRAIN LAW (applying SAN
ROQUE -AICHI DOCTRINE)- 120+30 RULE
B. Inaction by the Commissioner
The refund claim must be first filed within 2 years from the close of sales of taxable quarter(ADMIN
CLAIM).The 2 year period rule applies only for filing of ADMIN CLAIM.PRIOR TRAIN Law, the BIR
officer has only 120 days to decide from the date of receipt on the input VAT refund claim by the
taxpayer which is July 29,2016.The taxpayer has to wait for the decision of the BIR or the lapse of
the 120-day period to decide (here July 29,2016) BEFORE filing a judicial claim with the BIRAfter the
LAPSE of the 120 period which is considered (then) DEEM DENIAL, only then can the taxpayer
proceed to file the JUDICIAL CLAIM within 30 days from the last lapse of the 120 day period, here
until August 8,2016.The waiting of the lapse on the 120 day period is MANDATORY and
JURISDICTIONAL before filing a JUDICIAL CLAIM with the CTA. Filing with the CTA, prior to the lapse
of the 120 day period is a cause for dismissal for the claim.

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SCHOOL OF LAW
VAT refund Timeline for Refund for Excess Input VAT under TRAIN LAW -ENHANCE VAT
REFUND SYSTEM
The refund claim must be first filed within 2 years from the close of sales of taxable quarter(ADMIN
CLAIM)Under the TRAIN Law, the BIR officer has only 90 days to decide on the input vat refund claim
by the taxpayer. Under RR 13-2018 and RR 26-2018 the officers are compelled to decide within the
90 day decide failure to decide within the shall be cause for criminal and administrative charges.
There is no deemed denial under the TRAIN Law hence failure to act by the BIR within the 90 day
period the taxpayer does not have any recourse but to await decision or compel the BIR officer and
file charges. After denial and receipt thereof, the taxpayer has 30 days from the receipt of the denial
to file a JUDICIAL CLAIM with the CTA this is REGARDLESS of the fact that the period is BEYOND the
2 YEARS. The 2 year period rule applies only for filing of ADMIN CLAIM.
Changes made by TRAIN Law:
• The option to be given a Tax Credit Certificate has been now repealed and only refund by means
of cash is allowed.
• The proviso with regards to the implementation of an enhanced 90- day VAT refund system.
• If the BIR does not act on the application within the 90-day period, the relevant official, agent, or
employee shall be liable under Sec.269 of NIRC.
111. X filed an administrative claim for refund for excess input VAT attributable to his
export sale of goods to Japan. The claim for refund was filed on April 10, 2018. On
June 10, 2018, X filed an appeal with the Court of Tax Appeals (CTA) without
waiting for the BIR’s decision on his pending claim for refund. Does the CTA have
jurisdiction over Kiko’s appeal?
No. X‘s appeal filed with the CTA was premature. Sec. 112(C) of the NIRC, as amended by the
TRAIN Law, provides that the taxpayer has 30 days to appeal to the CTA from receipt of a
decision on his claim for refund. Here, there was no decision yet on his claim for refund. This
also cannot be construed as inaction since the 90-day period, counted from the filing of the
administrative claim for refund, within which to decide has not yet lapsed.

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112. Summarize the difference between old NIRC and the TRAIN Law as to VAT
NIRC NIRC, as amended by TRAIN Law

VAT Threshold
General: Gross annual receipts/ revenues General: Gross annual receipts / revenues exceeding
exceeding Php 1,919,500 (Sec. 236(G)(1)) Php 3M (Sec. 236(G)(1))
Exception:
Rental Income (RR 16-2011, Sec. 109(P) Exception:
NIRC) Rental Income (RR 13-2018)
Sale of house and lot Sale of house and lot (RR 13 -2018)
(RR 16 – 2011)(Sec.109(P))
Sale of Gold to BSP

Zero –Rated (Sec. 106 (A)(2)(a)(4)) VAT exempt (Sec 109(1)(z))
Sale of Good, supplies, equipment and fuel to persons engaged in international shipping
or international air transport operations
Zero –Rated (Sec. 106 (A)(2)(a)(6)) Retained and added proviso that the sale of goods,
supplies, equipment and fuel are to be used for
international shipping or air transport operations (Sec.
106(A)(2)(a)(6))
Foreign Currency Denominated Sales
Zero –Rated (Sec. 106 (A)(2)(b)) Deleted
Enhanced VAT refund system
No provision Sunset provisions where certain transactions will be
subject to 12% VAT, hence, no longer considered export
sales subject to zero rating upon satisfaction of the
following conditions:
1. The successful establishment and implementation of

an enhanced VAT refund system that grants refunds of
creditable input tax within 90 days from filling of the
VAT refund application.
2.Provided that all applications filed from January
1,2018 shall be processed and must be decided within
the 90 days from the filing of the VAT refund application
3.All pending VAT refund claims as of December 31,
2017 shall be fully paid in cash by December
31,2019.(Sec. 106(A)(2)(a)(6))
These transactions are:

1. sale of raw materials or packaging materials to a
nonresident buyer for delivery to a resident local export-
oriented enterprise to be used in manufacturing,
processing, packing or repacking in the Philippines of
the said buyer‘s goods, paid for in acceptable foreign
currency, and accounted for in accordance with the
rules and regulations of the BSP
2. Sale of raw materials or packaging materials to an
export-oriented enterprise whose export sales exceed
70% of the total annual production
3. Transactions considered export sales under Omnibus
Investments Code of 1987 (EO No. 226) and other
special laws
4. Processing, manufacturing or repacking goods for
other persons doing business outside the Philippines
which goods are subsequently exported, where the
services are paid in acceptable foreign currency and
accounted for in accordance with the rules and
regulations of the BSP
5. Services performed by subcontractors and/or

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contractors in processing, converting or manufacturing

goods for an enterprise whose export sales exceed 70%
of total annual production
DOF shall establish a VAT refund center in the BIR and

in the BOC that will handle the processing and granting
of cash refunds of creditable input tax.
5% of the total collection of BIR and BOC from the

immediately preceding year shall be automatically
appropriated annually and shall be treated as a special
account in the general fund or as trust receipts for the
purpose of funding claims for VAT refund. Any unused
fund at the end of the year shall revert to the general
fund.
BIR and BOC shall be required to submit to the

Congressional Oversight Committee in the
Comprehensive Tax Reform Program a quarterly report
of all pending claims for refund and any unused fund.
Threshold of Exempt Monthly Rental on Residential Units
VAT exempt if monthly rental does not VAT exempt if monthly rental does not exceed Php
exceed Php 12,800 (RR 16-2011) 15,000 (RR 13-2018)
Threshold on Sale of Residential Lot and House & Lot
VAT exempt if value does not exceed
P1,919,500and P3,199,200 for residential Staring Jan 1, 2021, sale of house & lot is VAT exempt
lot and house and lot, respectively (RR 16- if selling price does not exceed P2,000,000
2011)
Sale of Real Properties Utilized for Low-Cost and Socialized Housing
Starting Jan 1, 2021 Sale of socialized housing –
exempt;
VAT exempt (Sec. 109(P)
Sale of low cost housing -subject to VAT
(Sec. 109(P))
Other VAT exempt transactions
(1)Saleof goods & services to Senior (1) Sale of goods & services to Senior Citizens;
Citizens –VAT exempt but not found in the (2) Transfer of property pursuant to Sec 40(C)(2);
Tax Code; (3) Association Dues, membership fees, and other
assessments and charges collected by homeowners
(2)Association Dues, membership fees, associations and condominium corporation;
and other assessments and charges (4) Sale of Gold to BSP
collected by homeowners associations and (5) Sale of Drugs and medicines prescribed for:
condominium corporation; - VATable (a)diabetes, (b) high cholesterol (c)hypertension
beginning Jan. 1, 2019
(3)Sale of Gold to BSP – Zero Rated (6) Sale of goods or services, leases which gross annual
sales or receipts do not exceed Php 3M
Amortization of Input Vat on Capital Goods
Shall be spread evenly over the month of
Retained but with added proviso that the amortization
acquisition and the fifty-nine (59)
of the input VAT shall be only allowed until December
succeeding months
31, 2021 after which taxpayers with unutilized input VAT
on capital goods purchased or imported shall be allowed
if the aggregate acquisition cost exceeds
to apply the same as scheduled until fully utilized. (Sec.
Php 1M or over its estimated useful life if
110(A)(2))
such is less than 5 years (Sec. 110(A)(2))
Refund or Tax Credit of Input Taxes
The Commissioner shall grant a refund or The Commissioner shall grant a refund for creditable
issue the tax credit certificate for input taxes within ninety (90) days from the date of
creditable input taxes within 120 days from submission of the official receipts or invoices and other
the date of submission of complete documents in support of the application. Sec. 112(C))
documents in support of the application The option to be given a Tax Credit Certificate is now
(Sec. 112(C)) repealed and only refund by means of cash is allowed.
Filing of VAT Return and Payment

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Filing of Quarterly Return is within 25 days

following the close of each taxable quarter, Beginning January 1, 2023, the filing and payment shall
however, payment for VAT-registered be done within 25 days after the close of each taxable
persons is on a monthly basis. (Sec. quarter.(Sec. 114(A))
114(A))
I. TAX REMEDIES UNDER THE NATIONAL INTERNAL REVENUE CODE
113. What are the differences between Letter of Authority (LOA) and Letter Notice (LN)?
As to LOA LN
Purpose and Required under NIRC before an Not found in NIRC and is only for the
basis examination of taxpayer may be had. purpose of notifying the taxpayer
that a discrepancy is found based on
the BIR‘s RELIEF System
(computerized matching of 3rd party
information).
Validity Valid only for 30 days from the date of No limitation.
issue.
Limitation as to Revenue officer only has a period of 120 No limitation.
the revenue days from receipt of LOA to conduct his
officer examination of taxpayer.
Simply put, LN is entirely different and serves a different purpose than a LOA. Due process
demands that after a LN has served its purpose, the revenue officer should have properly
secured an LOA before proceeding with the further examination and assessment of the
taxpayer. (MEDICARD vs CIR, G.R. No. 222743, April 5, 2017)
114. Is a LOA without indicating the year/s to be audited valid?
A Letter of Authority should cover a taxable period not exceeding one taxable year. The
practice of issuing LOAs covering audit of unverified prior years is hereby prohibited. If the audit of a
taxpayer shall include more than one taxable period, the other periods or years shall be specifically
indicated in the LOA. (CIR vs. Sony Philippines, Inc., G.R. No. 178697, November 17, 2010)
115. Discuss the assessment process.

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Effect of inaction of
Stage of Revenue Action to be taken by
Description taxpayer or action
Assessment Issuance taxpayer
by TP is denied
Notice of RR 7-2018, RR Discussion shall be Should the TP disagree If it is found that
Informal 12-99 made between the with the findings. The the taxpayer is still
Conference taxpayer (TP) and TP shall within 30 days liable for deficiency tax
(NIC) the revenue officer present reconciliations or taxes after
(RO) handling the and present presenting his
audit to show his documentary evidence side, and the taxpayer
findings to which will in order for the TP to is not amenable, the
be the amount present his case. Revenue District Officer
assessed as or the
deficiency tax or Chief of the Special
taxes. In no case Investigation Division
that the NIC extend of the Revenue
beyond 30 days. Regional Office,
or the Chief of Division
in the National Office,
as the case may be,
shall
endorse the case
within seven (7) days
from the conclusion of
the NIC to the
Assessment Division of
the Revenue Regional
Office or to the
Commissioner or his
duly authorized
representative for
issuance of a deficiency
tax assessment.
Preliminary RMO 26-2016, A PAN* will be If TP accepts the A Formal Letter of
Assessment RR 18-2013, issued if after review deficiency TP shall pay Demand/ Formal
Notice (PAN) RMC 11-2014, and evaluation of the amount assessed Assessment Notice
RR 12-99 the Commissioner or which will terminate the shall be issued 15
its duly authorized audit days from the date
representative that of receipt PAN
there exists If the TP disagrees with whether the same is
sufficient basis to the findings, TP may at protested or not.
assess the TP PAN his option make a reply
shall show in detail within 15 days from
the facts and law, date of receipt of PAN to
jurisprudence, refute the findings made
revenue issuance by the RO by presenting
such assessment reconciliations,
was based jurisprudence, laws to
present his case.
Protest/Reply is not
mandatory (RMO 26-
2016)

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Final RMO 26-2016, The Formal Letter of If TP agrees it shall pay The assessment shall
Assessment RR 18-2013, Demand and Final the amount assessed become final and
Notice (FAN) RMC 11-2014, Assessment and which shall cause executory when:
/Formal RR 12-99, Notice(FLD/FAN) the termination of the
Letter of shall be issued by audit. 1. Failure to file
Demand the Commissioner or a Protest 30 days from
his duly authorized If the TP disagrees with receipt of FAN/FLD.
representative. The the amount assessed, it
FLD/FAN calling for can within 30 days 2. Failure to
payment of the from receipt of submit supporting
taxpayer's deficiency FAN/FLD file a documents within the
tax or taxes shall PROTEST LETTER either 60-day period given if
state the facts, the ask for: request for
law, rules and reinvestigation is
regulations, or 1. Request for made.
jurisprudence Reconsideration – no
on which the need to present
assessment is supporting documents 3. Failure of the
based; otherwise, taxpayer to receive any
the assessment shall 2. Request for assessment notice
be void Reinvestigation – need because it was served
to present supporting in the address
documents 60 days from indicated in the BIR‘s
filing of protest letter registration database
not updated through
All protest shall be BIR Form 1905 -
considered as Application for
request for registration
RECONSIDERATION
unless TP clearly
indicates the request
for reinvestigation
Final RMO 26-2016, The If TP agrees it shall pay The assessment shall
Decision on RR 18-2013, decision of the the amount assessed become final and
Disputed RMC 11-2014, Commissioner or his and which shall cause executory when:
Assessment RR 12-99 duly authorized the termination of the
(FDDA) representative shall audit. 1. Failure to appeal to
state the Commissioner or to
the (i) facts, the In case of denial: CTA within 30 days
applicable law, rules from receipt of FDDA
and regulations, or a. Denial made issued by the duly
jurisprudence on by the Commissioner authorized
which himself – appeal to the representative of the
such decision is Court of Tax Appeals Commissioner
based, and that it is (CTA) within 30 days 2. Failure to appeal to
the final decision, from the receipt of the the CTA within 30 days
otherwise, the denial. from receipt of FDDA
decision shall be b. Denial made issued by the
void. by duly authorized Commissioner
representative of the 3. Failure to TP to
Commissioner timely file a motion for
(i) appeal to the reconsideration or new
Court of Tax Appeals trial before the CTA
(CTA) within thirty (30) Division or CTA En
days from date of Banc and Supreme
receipt of the said Court
decision; or
(ii) elevate his
protest through request
for reconsideration to
the Commissioner within
thirty (30) days from

ARELLANO UNIVERSITY
SCHOOL OF LAW
date of receipt of the

said decision.
If the BIR does not
render a decision
within the 180-day
period, the taxpayer
has two options,
either:
a) File a petition for
review with the CTA
within 30 days after the
expiration of the 180-
day period; or
b) Await the final
decision of the
Commissioner on the
disputed assessment
and appeal such final
decision to the CTA
within 30 days after the
receipt of a copy of such
decision, these options
are mutually exclusive
and resort to one bars
the application of the
other. (Lascona Land vs.
CIR, G.R. No. 171251,
March 5, 2012; RCBC vs.
CIR, G.R. No. 168498,
April 24, 2007)
116. What is the purpose of the Notice of Informal Conference?
Notice of Informal Conference is being issued to taxpayer as part of due process requirement in
the issuance of a deficiency tax assessment. Under the new Revenue Regulation which restored
its use (RR No. 7-2018), it now expressly provides that the informal conference shall not extend
beyond 30 days from the taxpayer‘s receipt of the Notice for Informal Conference.
The Notice of Informal Conference and the Preliminary Assessment Notice are a part of due
process. They give both the taxpayer and the Commissioner the opportunity to settle the case
at the earliest possible time without the need for the issuance of a Final Assessment Notice.
The law imposes a substantive, not merely a formal, requirement. As such, the taxpayer should
be able to present his case and adduce supporting evidence. (CIR vs. Avon Products
Manufacturing,G.R. Nos. 201398-99, October 03, 2018,penned by J. Leonen)
117. AZ Company, received a Formal Assessment Notice for the Taxable Year 2012 which
includes the following statement
“Please note, however, that the interest and the total amount due will have to be
adjusted if paid prior or beyond April 15, 2012.”
Is the assessment valid?
No. It lacks the definite amount of tax liability for which respondent is accountable. It does not
purport to be a demand for payment of tax due, which a final assessment notice should
supposedly be. Although the disputed notice provides for the computations of AZ Company‘s

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tax liability, the amount remains indefinite. It only provides that the tax due is still subject to
modification, depending on the date of payment. (Commissioner vs. Fitness by Design,G.R. No.
215957, November 09, 2016,penned by J. Leonen)
118. G was issued a FAN/FLD. However in the said FAN/FLD no legal basis in the
assessment given. Is the FAN/FLD void?
No. The formal letter of demand and assessment notice shall state the facts, jurisprudence, and
law on which the assessment was based; otherwise, these shall be void. The word "shall" in
Section 228 of the National Internal Revenue Code and Revenue Regulations No. 12-99 means
the act of informing the taxpayer of both the legal and factual bases of the assessment is
mandatory. The law requires that the bases be reflected in the formal letter of demand and
assessment notice. This cannot be presumed. (Commissioner vs. Fitness by Design,Ibid.)
119. H was able to timely submit his reply to the NIC and PAN to the BIR. However upon
receipt of the FAN, the BIR did not consider his arguments much less did not
provide any legal basis for denying it. Should be the FAN/FLD be voided?
Yes. The Commissioner's inaction and omission to give due consideration to the arguments and
evidence submitted before her by H are deplorable transgressions of H's right to due process.
The right to be heard, which includes the right to present evidence, is meaningless if the
Commissioner can simply ignore the evidence without reason. (CIR vs. Avon Products
Manufacturing, Ibid.)
120. F Corporation, in March 2017, received a Letter of Authority (LOA) covering the
taxable year 2015. On July 25, 2017, the BIR issued a Preliminary Assessment
Notice (PAN) and sent it the same day thru registered mail. The BIR then after 15
days even without waiting for the reply of F Corporation, it sent a Final Assessment
Notice (FAN) dated August 9, 2017 again through registered mail. F Corporation
received the PAN and FAN on the same day, August 15, 2017. Is the assessment
valid ?
No. In issuing the FAN when the taxpayer has not yet received the PAN, the CIR effectively
disregarded ABC‘s right to be notified as well as the right to respond to the PAN. Thus, the
assessment is void. (CIR vs. Yumex Philippines Corporation, CTA EB No. 1139, August 11, 2015)
121. What are the options of the taxpayer in case of inaction of by the Commissioner on
the protest?
In case the CIR failed to act on a disputed assessment within the 180-day period, the taxpayer
can either:
(1) file petition for review with CTA within 30 days, or
(2) await the final decision of the CIR on disputed assessments and appeal such final decision
to CTA within 30 days after receipt of the copy of the decision.
These options are mutually exclusive.(CIR vs. Avon Products Manufacturing, Supra.)
122. When will a Final Decision on Disputed Assessment (FDDA) be declared void? And in
the event that the FDDA is found void, what would be its effect on the tax
assessment?
An FDDA that does not inform the taxpayer in writing of the facts and law, the rules and
regulations and jurisprudence, if there is any, on which the FDDA is based renders the decision
void. It should also state that it is the final decision of the CIR. Therefore, it is as if there was

ARELLANO UNIVERSITY
SCHOOL OF LAW
no decision rendered by the CIR. It is tantamount to a denial by inaction by the CIR, which may
still be appealed before the CTA and the assessment evaluated on the basis of the available
evidence and documents.
The assessment remains valid notwithstanding the nullity of the FDDA because the assessment
itself differs from a decision on the disputed assessment.(CIR vs. Liquigaz Philippines Corporation,
G.R. Nos. 215534 & 215557, April 18, 2016)
123. Differentiate Tax Deficiency from Tax Delinquency.
As to: Tax Deficiency Tax Delinquency

When exists When the amount imposed by law (as When (i) the self-assessed tax is
determined by CIR or his authorized not paid at all or was only
representative) exceeds the amount partially paid on the prescribed
shown as tax upon taxpayer‘s return. date, or (ii) when deficiency tax
assessed by the BIR has become
final and executor
When may be collected Has to go through the assessment Can be immediately collected
process
Filing of civil action The filing of civil action during the The filing of civil action for
pendency of protest is a ground for collection of taxes is the proper
motion to dismiss remedy
Imposition of penalties Subject to 25% surcharge, although Subject to surcharges and
subject to interest and compromise administrative penalties.
penalty. (Sec. 248(A)(3), NIRC)
124. What is the new rule on delinquency interest and deficiency interest under the
TRAIN Law?
Upon the effectivity of the TRAIN Law (January 1, 2018), in no case shall the deficiency
and delinquency interest be imposed simultaneously. In cases where the tax liability/ies
or deficiency tax/es became due before the effectivity of the TRAIN Law on January 1, 2018,
and where the full payment thereof will only be accomplished after the said effective date, the
interest rates shall be applied as follows:
Period Applicable Interest Type and Rate

Prior to effectivity of TRAIN Law Deficiency and /or delinquency interest at 20%
(For the period up to December 31, 2017)
Upon the effectivity of TRAIN Law Deficiency and/or delinquency interest at 12%
(For the period January 1, 2018 until full payment of
the tax liability)
The double imposition of both deficiency and delinquency interest under Section 249 prior to its
amendment will still apply in so far as the period between the date prescribed for payment until
December 31, 2017.
NIRC TRAIN Law (Sec. 75 of RA 10963)
Interest imposed on unpaid amount of taxes Interest imposed on unpaid amount of taxes
(delinquency/deficiency) is at twenty percent (deficiency/delinquency) is at DOUBLE THE
(20%) per annum LEGAL INTEREST RATE* for loans or
forbearance of any money as set by the
BangkoSentral ng Pilipinas
*As the law stands now – the legal interest rate is

at 6%. Thus the current interest on unpaid
amount of taxes is at 12% (double the current
legal interest rate)
When Applicable?
From the date prescribed payment of tax due until From effectivity of RA 10963 which is January
December 2017 1,2018

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After TRAIN Law:
125. What are the period of limitation upon assessment and collection?
Prescriptive Assessment Collection Legal Basis

period
Regular 3 years from filing of return 3 years Section 203 of the
or last day prescribed for NIRC. Note that NIRC
filing, whichever comes is silent as to the
later period for collection.
Exceptional (with 3 years 5 years As to the period of
prior assessment) collection, the
applicable legal basis
is Sections 222 (C)
and (D) of NIRC.
Exceptional Tax may be assessed at Proceeding in court Section 222 (A) of
(without prior any time within 10 years (judicial proceeding) for NIRC.
assessment) from discovery of the collection of such tax
falsity, fraud or may be filed without
omission. assessment at any time
within 10 years from
discovery of falsity,
fraud or omission.
126. What are the significant changes brought about by the revised policies on the
execution of waiver pursuant to RMO No. 14-2016 dated April 4, 2016?
RMO 14-2016 dated Apr. 4, 2016 repeal the very strict requirements for a valid waiver
prescribed in RMO No. 20-1990, RDAO No. 05-2001 and RMC No. 06-2005.
RMO 20 -1990 RMO 14 -2016

Form
Must STRICTLY conform with the requirements May or may not conform with the requirements set
set in RMO 20-90 out in RMO 20-90
Taxes covered?
Must clearly indicate what taxes are included in Can simply state ―all internal revenue taxes‖
the waiver

ARELLANO UNIVERSITY
SCHOOL OF LAW
When executed?
Must be EXECUTED BEFORE the expiration of the 3-year prescriptive period to audit or lapse of the
previously agreed upon date (in cases where there was a previous issuance of audit)
Signed by the taxpayer or duly authorized Signed by the taxpayer or duly authorized
representative. For corporations by any of its representative. For corporations by any of its
responsible officials responsible officials.
Taxpayer CANNOT now impugn the validity of the

waiver as to the signatory of the waiver.
Material Dates
1. Date of execution 1. Date of Execution
2.Expiration of the waiver 2. Expiration of issued waiver
3. Notarization
4. Acceptance by the BIR
BIR officials authorized to accept
The CIR or authorized revenue official shall sign Can be accepted by the group supervisors
the waiver, indicating the agreement to the designated LOA indicate the thee acceptance by
waiver signing the waiver.
Number of copies and duly accepted copy of waiver
Executed in three (3) copies and taxpayer must Taxpayer shall have the duty to retain a copy of the
have a receiving copy of the waiver duly signed waiver
by the BIR
Notarization
Required Not required
127. Is the requirement to furnish the taxpayer a copy of the waiver mandatory?
Yes. The requirement to furnish the taxpayer with a copy of the waiver is not only to give
notice of the existence of the document but of the acceptance by the [Bureau of Internal
Revenue] and the perfection of the agreement. (CIR vs. Avon Products Manufacturing, Supra).
128. Give at least 5 instances where the running of Statute of Limitations on Assessment
may be suspended.
a. When taxpayer cannot be located in the address given by him in the return, unless he
informs the CIR of any change in his address or the BIR became aware of his new address;
b. When the taxpayer is out of the Philippines (Sec. 223, NIRC);
c. Where the CIR is prohibited from making the assessment or levy or a proceeding in court
for 60 days thereafter, such as where there is a pending petition for review in the CTA from
the decision on the protested assessment (Republic vs. Ker & Co., G.R. No. L-21609, September
29, 1966);
d. Where CIR and the taxpayer agreed in writing for the extension of the assessment, the tax
may be assessed within the period so agreed upon (Sec. 222 [b], NIRC);
e. When the taxpayer requests for reinvestigation which is granted by the Commissioner.
(Collector vs. Suyoc Consolidated Mining Co., G.R. No. L-11527, Nov. 25, 1958)
Note: A request for reconsideration alone does not suspend the period to assess/collect.

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129. G Company changed its address but failed to notify the BIR. It continued filing its
returns with the BIR with the new address despite lack of notice. The BIR issued an
assessment against G Company beyond the prescriptive period claiming that the
period of assessment has been suspended for failure of G Company to inform the
BIR of its new address. Is the BIR correct?
No. The suspension of the three-year period to assess applies only if the BIR Commissioner is
not aware of the whereabouts of the taxpayer. Hence, despite the absence of a formal written
notice of G Company's change of address, the fact remains that BIR became aware of its new
address as shown by documents replete in its records. As a consequence, the running of the
three-year period to assess G Company was not suspended and has already prescribed. (CIR vs.
BASF Coating + Inks Phils., G.R. No. 198677, November 26, 2014)
130. Distinguish compromise from abatement of taxes.
Distinction as to Compromise Abatement

Purpose Reduction of the taxpayer‘s liability Cancellation of the taxpayer‘s
liability
Grounds
(1) reasonable doubt as to the (1) Tax or any portion thereof
validity of the claim against the appears to be unjustly or
taxpayer exist; excessively assessed; or
(2) when the financial position of (2) The administration and

the taxpayer demonstrates a clear collection costs involved do not
inability to pay the assessed tax. justify the collection of the amount
due.
Basis Section 204 (A), NIRC, as Section 204 (B), NIRC, as

amended. amended.
Who is authorized to enter
CIR, the National Evaluation Board CIR only.
and Regional Evaluation Board.
Application for tax abatement is
deemed approved only upon the
issuance of a TERMINATION
LETTER by the BIR. (Asiatrust vs.
CIR, G.R. No. 201530, April 19,
2017)
131. Differentiate false, fraudulent and non –filing of returns.
False Returns Fraudulent Returns Non-Filing of Returns

There is a deviation from Implies intentional or Failure/Omission to file a return
the truth, whether deceitful entry with intent to
intentional or not. It may evade the taxes due
be due to mistake,
ignorance, or carelessness
Fraud is a question of fact that should be alleged and duly proven. The willful neglect to file the
required tax return or the fraudulent intent to evade the payment of taxes, considering that the
same is accompanied by legal consequences, cannot be presumed. Fraud entails corresponding
sanctions under the tax law. Therefore, it is indispensable for the Commissioner of Internal
Revenue to include the basis for its allegations of fraud in the assessment notice.Here, he (the
BIR investigating officer) admitted that the gathered information did not show that respondent
deliberately failed to reflect its true income in 1995. (Commissioner vs. Fitness by Design, Ibid)

ARELLANO UNIVERSITY
SCHOOL OF LAW
132. Is the allegation of fraud in the assessment notice enough to sustain the application
of the 10 year prescriptive period?
No. For the ten-year period under Section 222(a) to apply, it is not enough that fraud is alleged
in the complaint, it must be established by clear and convincing evidence. The petitioner,
having failed to discharge the burden of proving fraud, cannot invoke Section 222(a) of the
NIRC, as amended.(Republic v. GMCC United Development Corp,G.R. No. 191856,December 7,
2016,penned by J. Leonen)
133. What are the requisites for claiming excess creditable withholding taxes?
The requisites for claiming a refund of excess creditable withholding taxes are:
1. The claim is filed with the CIR within 2 years from the payment of the tax;
2. It is shown in the return of the recipient that the income payment received was declared as
part of the gross income; and
3. The fact of withholding is established by a copy of statement duly issued by the payor to
the payee showing the amount paid and the amount of the tax withheld therefrom (BIR
Form No. 2307).
134. What are the available options of a corporation when it overpays its income tax
liability at the close of the taxable year?
There are two options available to the corporation whenever it overpays its income tax for the
taxable year:
a. to carry over and apply the overpayment as tax credit against the estimated quarterly
income tax liabilities of the succeeding taxable years (also known as automatic tax credit)
until fully utilized (meaning there is no prescriptive period); and
b. to apply for a cash refund or issuance of tax certification within 2 years from the date of
payment of taxes in the Final Adjustment Return. (University Physicians Services, Inc. vs. CIR,
Ibid.)
135. What is a tax lien?
A tax lien is a legal claim or charge on property (whether real or personal) established by law
as a sort of security for the payment of tax obligations. (HSBC vs. Rafferty, G.R. No. L-13188,
November 15, 1918)
136. Which is more superior between government’s tax lien or private litigant’s claim?
A tax lien created in favor of the government is superior to all other claims or preferences.
(Republic vs. Peralta, G.R. No. L-56568, May 20, 1987)
The lien is, however, not valid against any mortgagee, purchases, or judgment creditor until
notice of such lien shall have been filed in the register of deed of the province or city where the
property of the taxpayer is located. (CIR v. NLRC, G.R. No. 74965, November 9, 1994)
137. What is the distinction between forfeiture and seizure?
In seizure for the enforcement of tax lien, the residue, after deducting the tax liability and
expenses, will go to the taxpayer (BPI vs. Trinidad, G.R. No. L-16014, October 4, 1921).
In forfeiture, all the proceeds of the sale will go to the coffers of the government. (U.S. vs. Suria,
G.R. No. 6536, September 2, 1911)

20 21
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138. Is injunction available to restrain collection of tax?
No. An injunction is not available to restrain collection of tax. No court shall have the authority
to grant an injunction to restrain the collection of any national internal revenue tax, fee, or
charge imposed by the NIRC. (Sec. 218, NIRC)
Only the CTA can issue an injunction and it is only allowed when the following conditions
concur:
a. There is an appeal to the CTA, and

b. In the opinion of the court, the collection by the government agencies may jeopardize the
interest of the Government and/or the taxpayer, and
c. Taxpayer is willing either to deposit the amount claimed or to file a surety bond for not more
than the double the amount with the Court. (Sec. 11 of R.A. 1125, as amended by R.A. 9282)
139. What are the instances when the CIR can place the property of the taxpayer under
constructive distraint?
a. Retiring from any business subject to tax;

b. Intending to leave the Philippines;
c. Intending to remove his property therefrom;
d. Intending to hide or conceal his property; or
e. Intending to perform any act tending to obstruct the proceedings for collecting the tax due
or which may be due from him (Sec. 206, NIRC).
140. What are the grounds for the compromise of payment of internal revenue taxes?
a. A reasonable doubt as to the validity of the claim against the taxpayer exists; or
b. The financial position of the taxpayer demonstrates a clear inability to pay the assessed tax
(Sec. 204, NIRC).
141. What are the elements for the violation for failure to make or file a return?
a. The accused is a person required to make or file a return;

b. The accused failed to make or file the return at the time required by law; and
c. The failure to make or file the return was willful (Sec. 255, NIRC).
142. Should the filing of a criminal complaint be preceded by assessment?
No. An assessment of a deficiency is not necessary to a criminal prosecution for willful attempt
to defeat and evade the income tax. A crime is complete when the violator has knowingly and
willfully filed a fraudulent return with intent to evade and defeat the tax. The perpetration of
the crime is grounded upon knowledge on the part of the taxpayer that he has made an
inaccurate return, and the government‘s failure to discover the error and promptly to assess
has no connections with the commission of the crime. (Ungab vs. Cusi, G.R. No. L-41919-24, May
30, 1980)
143. Is the filing of the criminal action an implied assessment?
No. The filing of a criminal action is not an implied assessment. An assessment contains not
only a computation of tax liabilities but also a demand for payment within the prescribed
period. An affidavit, which was executed by revenue officers stating the tax liabilities of a
taxpayer and attached to the criminal complaint for tax evasion cannot be deemed an
assessment that can be questioned before the CTA. (CIR vs. Pascor Realty, G.R. No. 128215, June
29, 1999)

ARELLANO UNIVERSITY
SCHOOL OF LAW
144. Is a decision on a request for reinvestigation a condition precedent to the filing of

an action of taxes already assessed?
No. A decision on a request for reinvestigation is not a condition precedent to the filing of an
action of taxes already assessed. Nowhere in the Tax Code is the CIR required to rule first on a
taxpayer‘s request for reinivistegation before he can go to court for the purpose of collecting
the tax assessed. (Republic vs. Lim Tian Teng Songs & Co, G.R. No. L-21731, March 31, 1966)
The requirement to rule on disputed assessments before bringing action for collection is
applicable only on where the assessment was actually disputed, adducing reasons in support
thereto. In this case, the taxpayer did not actually contest the assessment by stating the basis
thereof. (Dayrit vs. Cruz, G.R. No. L-39910, September 26, 1988)
IV. JUDICIAL REMEDIES
145. May the courts enjoin the collection of revenue taxes? Explain your answer.
No. As a general rule, the courts have no authority to enjoin the collection of revenue taxes
(Sec. 218, NIRC). However, the Court of Tax Appeals is empowered to enjoin the collection of
taxes through administrative remedies when collection could jeopardize the interest of the
government or taxpayer (Sec. 11, RA 1125).
146. Paras, Inc. received the Final Decision on Disputed Assessment issued by the
Commissioner of Internal Revenue (CIR) dismissing the protest of Paras, Inc. and
affirming the assessment against said corporation. Paras, Inc. filed a Petition for
Review with the Court of Tax Appeals (CTA) Division. The CTA Division dismissed
Paras, Inc.’s petition. Paras, Inc. immediately filed a Petition for Review with the
CTA En Banc. Is the immediate appeal by Paras, Inc. to the CTA En Banc of the
adverse Decision of the CTA Division the proper remedy?
No. Paras, Inc. should have filed a Motion for Reconsideration with the CTA Division first. The
CTA Rules state that a Motion for Reconsideration is a prerequisite before elevating the case to
the CTA En Banc.(Ingles, Tax Made Less Taxing, 2018, p. 487)
147. In criminal cases under CTA exclusive original jurisdiction, is there a right to reserve
the filing of a separate civil action for the recovery of taxes?
No. Under Sec. 11 Rule 9 of RRCTA, the filing of the criminal action shall necessarily carry with
it the filing of the civil action. No right to reserve the filing of such civil action separately from
the criminal action shall be allowed or recognized
148. In cases appealed before the CTA, what are the conditions in order that CTA may
suspend the collection of tax?
a. In the opinion of the Court the collection will jeopardize the interest of the Government
and/or the taxpayer; and
b. The taxpayer either deposit the amount claimed or file a surety bond for not more than the
amount. (Sec. 9, R.A. 9282 as amended)
149. After filing an Information for violation of Section 254 of NIRC (Attempt to Evade or
Defeat Tax) with the CTA, the Public Prosecutor manifested that the People is
reserving the right to file the corresponding civil action for the recovery of the civil
liability for taxes. As counsel for the accused, comment on the People’s
manifestation.
The public prosecutor is wrong. CTA Rules states that the filing of the criminal action shall
necessarily carry with it the filing of the civil action and no right to reserve the filing of the civil

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action separately shall be allowed. (Ingles, Tax Made Less Taxing, 2018, page 488)
- END -

AUSL The Law Pertaining To The State and Its Relationship With Its Citizens

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AUSL The Law Pertaining To The State and Its Relationship With Its Citizens

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EXECUTIVE COUNCIL

JAYSON FRANCISCO JULIAN PAOLO FABROS LOUIE JOHN BAYON

REA MAY HERMOSURA MA. ISIS DANIELLE VOLANTE CRISTOBAL RABINO

MIKYLA CORDERO TIMOTHY JAMES PACSON ARRIANE SANGALANG

CIVIL LAW COMMISSION

COMMERCIAL LAW COMMISSION

ATTY. ANTONY PARREÑO

ALL RIGHTS RESERVED © 2021

THE 1987 CONSTITUTION

1. What are the tests to determine whether a proposed change is an amendment or a

2. Distinguish Amendment from Revision.

Scope Envisages a change of only a few Involves alterations of different portions of

Who may The Congress, a Constitutional Only the Congress or a Constitutional

3. What are the methods in interpreting the Constitution?

Center for Legal Education And Research |1

Declaration of principles and state policies

5. What happens when there’s a change in sovereignty?

6. What happens when there’s a belligerent occupation?

Bar Operations Commissions |2

Checks and balances

Center for Legal Education And Research |3

d. Principle of accountability: An accountability mechanism with which the proper

Bar Operations Commissions |4

11. What are the tests of a valid delegation of power?

Fundamental powers of the State

POLICE POWER POWER OF EMINENT DOMAIN POWER OF TAXATION

1.Lawful subject 1.Private property; 1.Public purpose;

POLICE POWER POWER OF EMINENT POWER OF TAXATION

Center for Legal Education And Research |5

1. Scope and limitations of Legislative Power

b. Regional/Local Legislative Power

Limitations on the legislative power of Congress:

2. Principle of non-delegability; exceptions

15. Discuss the Principle of Non-Delegability of Powers.

Bar Operations Commissions |6

18. What is a legislative veto? Is it unconstitutional?

Legislative veto is a statutory provision requiring the President or an administrative agency to

Yes. It is unconstitutional in three respects:

a. In exercising discretion to approve or disapprove IRRs based on a determination of whether

B. Chambers of Congress; composition; qualifications

a. District representatives and questions of apportionment

Center for Legal Education And Research |7

SENATORS DISTRICT PARTY-LIST NOMINEES

Bar Operations Commissions |8

a. a.Natural-born citizen of a. a.Natural-born citizen of the a. a.Natural-born citizen of the

20. Who may participate in the Party-List elections?

b. National parties or organizations and regional parties or organizations do not need to

Center for Legal Education And Research |9

d. Sectoral parties or organizations may either be ―marginalized and under-represented‖ or

e. .A majority of the members of sectoral parties or organizations that represent the

There are two steps in the second round of seat allocation:

Bar Operations Commissions |10

Legislative privileges, inhibitions, and disqualifications

Center for Legal Education And Research |11

instrumentality thereof, including any government-owned or controlled corporation, or its

Quorum and voting majorities

26. Enumerate the quorum and voting requirements in Congress.

NATURE OF PROCEEDING REQUIRED VOTE

Senate Concurrence in a treaty or 2/3 of ALL the Members of the

Conviction in impeachment cases 2/3 of ALL the Members of the

House of Affirm/Override a Resolution to 1/3 of ALL the Members of the House

Common to both Election of President or Speaker of the Absolute majority or MAJORITY of

Quorum to do business Simple Majority or MAJORITY of each