CASE #1:

G.R. No. L-63915 December 29, 1986

LORENZO M. TAÑADA, ABRAHAM F. SARMIENTO, and MOVEMENT OF ATTORNEYS FOR BROTHERHOOD, INTEGRITY
AND NATIONALISM, INC. (MABINI), petitioners,

vs.

HON. JUAN C. TUVERA, in his capacity as Executive Assistant to the President, HON. JOAQUIN VENUS, in his capacity as
Deputy Executive Assistant to the President, MELQUIADES P. DE LA CRUZ, ETC., ET AL., respondents.

RESOLUTION

CRUZ, J.:

Due process was invoked by the petitioners in demanding the disclosure of a number of presidential decrees which they claimed
had not been published as required by law. The government argued that while publication was necessary as a rule, it was not so
when it was "otherwise provided," as when the decrees themselves declared that they were to become effective immediately upon
their approval. In the decision of this case on April 24, 1985, the Court affirmed the necessity for the publication of some of these
decrees, declaring in the dispositive portion as follows:

WHEREFORE, the Court hereby orders respondents to publish in the Official Gazette all unpublished presidential issuances which
are of general application, and unless so published, they shall have no binding force and effect.

1
The petitioners are now before us again, this time to move for reconsideration/clarification of that decision. Specifically, they ask
the following questions:

1. What is meant by "law of public nature" or "general applicability"?

2. Must a distinction be made between laws of general applicability and laws which are not?

3. What is meant by "publication"?

4. Where is the publication to be made?

5. When is the publication to be made?

Resolving their own doubts, the petitioners suggest that there should be no distinction between laws of general applicability and
those which are not; that publication means complete publication; and that the publication must be made forthwith in the Official
Gazette. 2

In the Comment 3 required of the then Solicitor General, he claimed first that the motion was a request for an advisory opinion and
should therefore be dismissed, and, on the merits, that the clause "unless it is otherwise provided" in Article 2 of the Civil Code
meant that the publication required therein was not always imperative; that publication, when necessary, did not have to be made in
the Official Gazette; and that in any case the subject decision was concurred in only by three justices and consequently not binding.
This elicited a Reply 4 refuting these arguments. Came next the February Revolution and the Court required the new Solicitor
General to file a Rejoinder in view of the supervening events, under Rule 3, Section 18, of the Rules of Court. Responding, he
submitted that issuances intended only for the internal administration of a government agency or for particular persons did not have
to be 'Published; that publication when necessary must be in full and in the Official Gazette; and that, however, the decision under
reconsideration was not binding because it was not supported by eight members of this Court. 5

The subject of contention is Article 2 of the Civil Code providing as follows:

ART. 2. Laws shall take effect after fifteen days following the completion of their publication in the Official Gazette, unless it is
otherwise provided. This Code shall take effect one year after such publication.

After a careful study of this provision and of the arguments of the parties, both on the original petition and on the instant motion, we
have come to the conclusion and so hold, that the clause "unless it is otherwise provided" refers to the date of effectivity and not to
the requirement of publication itself, which cannot in any event be omitted. This clause does not mean that the legislature may make
the law effective immediately upon approval, or on any other date, without its previous publication.

Publication is indispensable in every case, but the legislature may in its discretion provide that the usual fifteen-day period shall be
shortened or extended. An example, as pointed out by the present Chief Justice in his separate concurrence in the original decision,
6
is the Civil Code which did not become effective after fifteen days from its publication in the Official Gazette but "one year after
such publication." The general rule did not apply because it was "otherwise provided. "

It is not correct to say that under the disputed clause publication may be dispensed with altogether. The reason. is that such
omission would offend due process insofar as it would deny the public knowledge of the laws that are supposed to govern the
legislature could validly provide that a law e effective immediately upon its approval notwithstanding the lack of publication (or after
an unreasonably short period after publication), it is not unlikely that persons not aware of it would be prejudiced as a result and they
would be so not because of a failure to comply with but simply because they did not know of its existence, Significantly, this is not
true only of penal laws as is commonly supposed. One can think of many non-penal measures, like a law on prescription, which
must also be communicated to the persons they may affect before they can begin to operate.

We note at this point the conclusive presumption that every person knows the law, which of course presupposes that the law has
been published if the presumption is to have any legal justification at all. It is no less important to remember that Section 6 of the Bill
of Rights recognizes "the right of the people to information on matters of public concern," and this certainly applies to, among others,
and indeed especially, the legislative enactments of the government.
The term "laws" should refer to all laws and not only to those of general application, for strictly speaking all laws relate to the people
in general albeit there are some that do not apply to them directly. An example is a law granting citizenship to a particular individual,
like a relative of President Marcos who was decreed instant naturalization. It surely cannot be said that such a law does not affect
the public although it unquestionably does not apply directly to all the people. The subject of such law is a matter of public interest
which any member of the body politic may question in the political forums or, if he is a proper party, even in the courts of justice. In
fact, a law without any bearing on the public would be invalid as an intrusion of privacy or as class legislation or as an ultra vires act
of the legislature. To be valid, the law must invariably affect the public interest even if it might be directly applicable only to one
individual, or some of the people only, and t to the public as a whole.

We hold therefore that all statutes, including those of local application and private laws, shall be published as a condition for their
effectivity, which shall begin fifteen days after publication unless a different effectivity date is fixed by the legislature.

Covered by this rule are presidential decrees and executive orders promulgated by the President in the exercise of legislative
powers whenever the same are validly delegated by the legislature or, at present, directly conferred by the Constitution.
administrative rules and regulations must a also be published if their purpose is to enforce or implement existing law pursuant also
to a valid delegation.

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

Accordingly, even the charter of a city must be published notwithstanding that it applies to only a portion of the national territory and
directly affects only the inhabitants of that place. All presidential decrees must be published, including even, say, those naming a
public place after a favored individual or exempting him from certain prohibitions or requirements. The circulars issued by the
Monetary Board must be published if they are meant not merely to interpret but to "fill in the details" of the Central Bank Act which
that body is supposed to enforce.

However, no publication is required of the instructions issued by, say, the Minister of Social Welfare on the case studies to be made
in petitions for adoption or the rules laid down by the head of a government agency on the assignments or workload of his personnel
or the wearing of office uniforms. Parenthetically, municipal ordinances are not covered by this rule but by the Local Government
Code.

We agree that publication must be in full or it is no publication at all since its purpose is to inform the public of the contents of the
laws. As correctly pointed out by the petitioners, the mere mention of the number of the presidential decree, the title of such decree,
its whereabouts (e.g., "with Secretary Tuvera"), the supposed date of effectivity, and in a mere supplement of the Official Gazette
cannot satisfy the publication requirement. This is not even substantial compliance. This was the manner, incidentally, in which the
General Appropriations Act for FY 1975, a presidential decree undeniably of general applicability and interest, was "published" by
the Marcos administration. 7 The evident purpose was to withhold rather than disclose information on this vital law.

Coming now to the original decision, it is true that only four justices were categorically for publication in the Official Gazette 8 and
that six others felt that publication could be made elsewhere as long as the people were sufficiently informed. 9 One reserved his
vote 10 and another merely acknowledged the need for due publication without indicating where it should be made. 11 It is therefore
necessary for the present membership of this Court to arrive at a clear consensus on this matter and to lay down a binding decision
supported by the necessary vote. There is much to be said of the view that the publication need not be made in the Official Gazette,
considering its erratic releases and limited readership. Undoubtedly, newspapers of general circulation could better perform the
function of communicating, the laws to the people as such periodicals are more easily available, have a wider readership, and come
out regularly. The trouble, though, is that this kind of publication is not the one required or authorized by existing law. As far as we
know, no amendment has been made of Article 2 of the Civil Code. The Solicitor General has not pointed to such a law, and we
have no information that it exists. If it does, it obviously has not yet been published.

At any rate, this Court is not called upon to rule upon the wisdom of a law or to repeal or modify it if we find it impractical. That is not
our function. That function belongs to the legislature. Our task is merely to interpret and apply the law as conceived and approved by
the political departments of the government in accordance with the prescribed procedure. Consequently, we have no choice but to
pronounce that under Article 2 of the Civil Code, the publication of laws must be made in the Official Gazett and not elsewhere, as a
requirement for their effectivity after fifteen days from such publication or after a different period provided by the legislature. We also
hold that the publication must be made forthwith or at least as soon as possible, to give effect to the law pursuant to the said Article
2. There is that possibility, of course, although not suggested by the parties that a law could be rendered unenforceable by a mere
refusal of the executive, for whatever reason, to cause its publication as required. This is a matter, however, that we do not need to
examine at this time.

Finally, the claim of the former Solicitor General that the instant motion is a request for an advisory opinion is untenable, to say the
least, and deserves no further comment.

The days of the secret laws and the unpublished decrees are over. This is once again an open society, with all the acts of the
government subject to public scrutiny and available always to public cognizance. This has to be so if our country is to remain
democratic, with sovereignty residing in the people and all government authority emanating from them.

Although they have delegated the power of legislation, they retain the authority to review the work of their delegates and to ratify or
reject it according to their lights, through their freedom of expression and their right of suffrage. This they cannot do if the acts of the
legislature are concealed.

Laws must come out in the open in the clear light of the sun instead of skulking in the shadows with their dark, deep secrets.
Mysterious pronouncements and rumored rules cannot be recognized as binding unless their existence and contents are confirmed
by a valid publication intended to make full disclosure and give proper notice to the people. The furtive law is like a scabbarded
saber that cannot feint parry or cut unless the naked blade is drawn.

WHEREFORE, it is hereby declared that all laws as above defined shall immediately upon their approval, or as soon thereafter as
possible, be published in full in the Official Gazette, to become effective only after fifteen days from their publication, or on another
date specified by the legislature, in accordance with Article 2 of the Civil Code.

SO ORDERED.
CASE #2:

G.R. No. 80718 January 29, 1988

FELIZA P. DE ROY and VIRGILIO RAMOS v. COURT OF APPEALS and LUIS BERNAL, SR., GLENIA BERNAL, LUIS
BERNAL, JR., HEIRS OF MARISSA BERNAL, namely, GLICERIA DELA CRUZ BERNAL and LUIS BERNAL, SR.

CORTES, J.:

This special civil action for certiorari seeks to declare null and void two (2) resolutions of the Special First Division of the Court of
Appeals in the case of Luis Bernal, Sr., et al. v. Felisa Perdosa De Roy, et al., CA-G.R. CV No. 07286. The first resolution
promulgated on 30 September 1987 denied petitioners' motion for extension of time to file a motion for reconsideration and directed
entry of judgment since the decision in said case had become final; and the second Resolution dated 27 October 1987 denied
petitioners' motion for reconsideration for having been filed out of time.

At the outset, this Court could have denied the petition outright for not being verified as required by Rule 65 section 1 of the Rules of
Court. However, even if the instant petition did not suffer from this defect, this Court, on procedural and substantive grounds, would
still resolve to deny it.

The facts of the case are undisputed. The firewall of a burned-out building owned by petitioners collapsed and destroyed the
tailoring shop occupied by the family of private respondents, resulting in injuries to private respondents and the death of Marissa
Bernal, a daughter. Private respondents had been warned by petitioners to vacate their shop in view of its proximity to the weakened
wall but the former failed to do so. On the basis of the foregoing facts, the Regional Trial Court. First Judicial Region, Branch
XXXVIII, presided by the Hon. Antonio M. Belen, rendered judgment finding petitioners guilty of gross negligence and awarding
damages to private respondents. On appeal, the decision of the trial court was affirmed in toto by the Court of Appeals in a decision
promulgated on August 17, 1987, a copy of which was received by petitioners on August 25, 1987. On September 9, 1987, the last
day of the fifteen-day period to file an appeal, petitioners filed a motion for extension of time to file a motion for reconsideration,
which was eventually denied by the appellate court in the Resolution of September 30, 1987. Petitioners filed their motion for
reconsideration on September 24, 1987 but this was denied in the Resolution of October 27, 1987.

This Court finds that the Court of Appeals did not commit a grave abuse of discretion when it denied petitioners' motion for extension
of time to file a motion for reconsideration, directed entry of judgment and denied their motion for reconsideration. It correctly applied
the rule laid down in Habaluyas Enterprises, Inc. v. Japzon, [G.R. No. 70895, August 5, 1985,138 SCRA 461, that the fifteen-day
period for appealing or for filing a motion for reconsideration cannot be extended. In its Resolution denying the motion for
reconsideration, promulgated on July 30, 1986 (142 SCRA 208), this Court en banc restated and clarified the rule, to wit:

Beginning one month after the promulgation of this Resolution, the rule shall be strictly enforced that no motion for extension of time
to file a motion for reconsideration may be filed with the Metropolitan or Municipal Trial Courts, the Regional Trial Courts, and the
Intermediate Appellate Court. Such a motion may be filed only in cases pending with the Supreme Court as the court of last resort,
which may in its sound discretion either grant or deny the extension requested. (at p. 212)

Lacsamana v. Second Special Cases Division of the intermediate Appellate Court, [G.R. No. 73146-53, August 26, 1986, 143 SCRA
643], reiterated the rule and went further to restate and clarify the modes and periods of appeal.

Bacaya v. Intermediate Appellate Court, [G.R. No. 74824, Sept. 15, 1986,144 SCRA 161],stressed the prospective application of
said rule, and explained the operation of the grace period, to wit:

In other words, there is a one-month grace period from the promulgation on May 30, 1986 of the Court's Resolution in the
clarificatory Habaluyas case, or up to June 30, 1986, within which the rule barring extensions of time to file motions for new trial or
reconsideration is, as yet, not strictly enforceable.

Since petitioners herein filed their motion for extension on February 27, 1986, it is still within the grace period, which expired on June
30, 1986, and may still be allowed. This grace period was also applied in Mission v. Intermediate Appellate Court [G.R. No. 73669,
October 28, 1986, 145 SCRA 306].]

In the instant case, however, petitioners' motion for extension of time was filed on September 9, 1987, more than a year after the
expiration of the grace period on June 30, 1986. Hence, it is no longer within the coverage of the grace period. Considering the
length of time from the expiration of the grace period to the promulgation of the decision of the Court of Appeals on August 25, 1987,
petitioners cannot seek refuge in the ignorance of their counsel regarding said rule for their failure to file a motion for reconsideration
within the reglementary period. Petitioners contend that the rule enunciated in the Habaluyas case should not be made to apply to
the case at bar owing to the non-publication of the Habaluyas decision in the Official Gazette as of the time the subject decision of
the Court of Appeals was promulgated. Contrary to petitioners' view, there is no law requiring the publication of Supreme Court
decisions in the Official Gazette before they can be binding and as a condition to their becoming effective. It is the bounden duty of
counsel as lawyer in active law practice to keep abreast of decisions of the Supreme Court particularly where issues have been
clarified, consistently reiterated, and published in the advance reports of Supreme Court decisions (G. R. s) and in such publications
as the Supreme Court Reports Annotated (SCRA) and law journals.

This Court likewise finds that the Court of Appeals committed no grave abuse of discretion in affirming the trial court's decision
holding petitioner liable under Article 2190 of the Civil Code, which provides that "the proprietor of a building or structure is
responsible for the damage resulting from its total or partial collapse, if it should be due to the lack of necessary repairs.

Nor was there error in rejecting petitioners argument that private respondents had the "last clear chance" to avoid the accident if
only they heeded the. warning to vacate the tailoring shop and , therefore, petitioners prior negligence should be disregarded, since
the doctrine of "last clear chance," which has been applied to vehicular accidents, is inapplicable to this case.

WHEREFORE, in view of the foregoing, the Court Resolved to DENY the instant petition for lack of merit.

Fernan (Chairman), Gutierrez, Jr., Feliciano and Bidin, JJ., concur.

CASE #3:

G.R. No. L-6791 March 29, 1954

THE PEOPLE OF THE PHILIPPINES v. QUE PO LAY

Prudencio de Guzman for appellant.

First Assistant Solicitor General Ruperto Kapunan, Jr., and Solicitor Lauro G. Marquez for appellee.

MONTEMAYOR, J.:

Que Po Lay is appealing from the decision of the Court of First Instance of Manila, finding him guilty of violating Central Bank
Circular No. 20 in connection with section 34 of Republic Act No. 265, and sentencing him to suffer six months imprisonment, to pay
a fine of P1,000 with subsidiary imprisonment in case of insolvency, and to pay the costs.

The charge was that the appellant who was in possession of foreign exchange consisting of U.S. dollars, U.S. checks and U.S.
money orders amounting to about $7,000 failed to sell the same to the Central Bank through its agents within one day following the
receipt of such foreign exchange as required by Circular No. 20. the appeal is based on the claim that said circular No. 20 was not
published in the Official Gazette prior to the act or omission imputed to the appellant, and that consequently, said circular had no
force and effect. It is contended that Commonwealth Act. No., 638 and Act 2930 both require said circular to be published in the
Official Gazette, it being an order or notice of general applicability. The Solicitor General answering this contention says that
Commonwealth Act. No. 638 and 2930 do not require the publication in the Official Gazette of said circular issued for the
implementation of a law in order to have force and effect.

We agree with the Solicitor General that the laws in question do not require the publication of the circulars, regulations and notices
therein mentioned in order to become binding and effective. All that said two laws provide is that laws, resolutions, decisions of the
Supreme Court and Court of Appeals, notices and documents required by law to be of no force and effect. In other words, said two
Acts merely enumerate and make a list of what should be published in the Official Gazette, presumably, for the guidance of the
different branches of the Government issuing same, and of the Bureau of Printing.

However, section 11 of the Revised Administrative Code provides that statutes passed by Congress shall, in the absence of special
provision, take effect at the beginning of the fifteenth day after the completion of the publication of the statute in the Official Gazette.
Article 2 of the new Civil Code (Republic Act No. 386) equally provides that laws shall take effect after fifteen days following the
completion of their publication in the Official Gazette, unless it is otherwise provided. It is true that Circular No. 20 of the Central
Bank is not a statute or law but being issued for the implementation of the law authorizing its issuance, it has the force and effect of
law according to settled jurisprudence. (See U.S. vs. Tupasi Molina, 29 Phil., 119 and authorities cited therein.) Moreover, as a rule,
circulars and regulations especially like the Circular No. 20 of the Central Bank in question which prescribes a penalty for its
violation should be published before becoming effective, this, on the general principle and theory that before the public is bound by
its contents, especially its penal provisions, a law, regulation or circular must first be published and the people officially and
specifically informed of said contents and its penalties.

Our Old Civil code, ( Spanish Civil Code of 1889) has a similar provision about the effectivity of laws, (Article 1 thereof), namely, that
laws shall be binding twenty days after their promulgation, and that their promulgation shall be understood as made on the day of
the termination of the publication of the laws in the Gazette. Manresa, commenting on this article is of the opinion that the word
"laws" include regulations and circulars issued in accordance with the same. He says:

El Tribunal Supremo, ha interpretado el articulo 1. del codigo Civil en Sentencia de 22 de Junio de 1910, en el sentido de que bajo
la denominacion generica de leyes, se comprenden tambien los Reglamentos, Reales decretos, Instrucciones, Circulares y Reales
ordenes dictadas de conformidad con las mismas por el Gobierno en uso de su potestad. Tambien el poder ejecutivo lo ha venido
entendiendo asi, como lo prueba el hecho de que muchas de sus disposiciones contienen la advertencia de que empiezan a regir el
mismo dia de su publicacion en la Gaceta, advertencia que seria perfectamente inutil si no fuera de aplicacion al caso el articulo 1.o
del Codigo Civil. (Manresa, Codigo Civil Español, Vol. I. p. 52).

In the present case, although circular No. 20 of the Central Bank was issued in the year 1949, it was not published until November
1951, that is, about 3 months after appellant's conviction of its violation. It is clear that said circular, particularly its penal provision,
did not have any legal effect and bound no one until its publication in the Official Gazzette or after November 1951. In other words,
appellant could not be held liable for its violation, for it was not binding at the time he was found to have failed to sell the foreign
exchange in his possession thereof.

But the Solicitor General also contends that this question of non-publication of the Circular is being raised for the first time on appeal
in this Court, which cannot be done by appellant. Ordinarily, one may raise on appeal any question of law or fact that has been
raised in the court below and which is within the issues made by the parties in their pleadings. (Section 19, Rule 48 of the Rules of
Court). But the question of non-publication is fundamental and decisive. If as a matter of fact Circular No. 20 had not been published
as required by law before its violation, then in the eyes of the law there was no such circular to be violated and consequently
appellant committed no violation of the circular or committed any offense, and the trial court may be said to have had no jurisdiction.
This question may be raised at any stage of the proceeding whether or not raised in the court below.

In view of the foregoing, we reverse the decision appealed from and acquit the appellant, with costs de oficio.

Paras, C.J., Bengzon, Padilla, Reyes, Bautista Angelo, Labrador, Concepcion and Diokno, JJ., concur.
CASE #5:

G.R. No. 176006 March 26, 2010

NATIONAL POWER CORPORATION v. PINATUBO COMMERCIAL, represented by ALFREDO A. DY

DECISION

CORONA, J.:

The National Power Corporation (NPC)1 questions the decision dated June 30, 2006 rendered by the Regional Trial Court (RTC) of
Mandaluyong City, Branch 213 declaring items 3 and 3.1 of NPC Circular No. 99-75 unconstitutional. The dispositive portion of the
decision provides:

WHEREFORE then, in view of the foregoing, judgment is hereby rendered declaring item[s] 3 and 3.1 of NAPOCOR Circular No.
99-75, which [allow] only partnerships or corporations that

directly use aluminum as the raw material in producing finished products either purely or partly out of aluminum, to participate in the
bidding for the disposal of ACSR wires as unconstitutional for being violative of substantial due process and the equal protection
clause of the Constitution as well as for restraining competitive free trade and commerce.

The claim for attorney’s fees is denied for lack of merit.

No costs.

SO ORDERED.2

NPC also assails the RTC resolution dated November 20, 2006 denying its motion for reconsideration for lack of merit.3

In this petition, NPC poses the sole issue for our review:

WHETHER OR NOT THE RTC GRAVELY ERRED WHEN IT DECLARED ITEMS 3 AND 3.1 OF NAPOCOR CIRCULAR NO. 99-75
AS UNCONSTITUTIONAL FOR BEING VIOLATIVE OF SUBSTANTIAL DUE PROCESS AND THE EQUAL PROTECTION
CLAUSE OF THE CONSTITUTION AS WELL AS FOR RESTRAINING COMPETITIVE FREE TRADE AND COMMERCE. 4

NPC Circular No. 99-755 dated October 8, 1999 set the guidelines in the "disposal of scrap aluminum conductor steel-reinforced or
ACSRs in order to decongest and maintain good housekeeping in NPC installations and to generate additional income for NPC."
Items 3 and 3.1 of the circular provide:

3. QUALIFIED BIDDERS

3.1 Qualified bidders envisioned in this circular are partnerships or corporations that directly use aluminum as the raw material in
producing finished products either purely or partly out of aluminum, or their duly appointed representatives. These bidders may be
based locally or overseas.6

In April 2003, NPC published an invitation for the pre-qualification of bidders for the public sale of its scrap ACSR7 cables.
Respondent Pinatubo Commercial, a trader of scrap materials such as copper, aluminum, steel and other ferrous and non-ferrous
materials, submitted a pre-qualification form to NPC. Pinatubo, however, was informed in a letter dated April 29, 2003 that its
application for pre-qualification had been denied.8 Petitioner asked for reconsideration but NPC denied it.9

Pinatubo then filed a petition in the RTC for the annulment of NPC Circular No. 99-75, with a prayer for the issuance of a temporary
restraining order and/or writ of preliminary injunction.10 Pinatubo argued that the circular was unconstitutional as it violated the due
process and equal protection clauses of the Constitution, and ran counter to the government policy of competitive public bidding.11

The RTC upheld Pinatubo’s position and declared items 3 and 3.1 of the circular unconstitutional. The RTC ruled that it was violative
of substantive due process because, while it created rights in favor of third parties, the circular had not been published. It also
pronounced that the circular violated the equal protection clause since it favored manufacturers and processors of aluminum scrap
vis-à-vis dealers/traders in the purchase of aluminum ACSR cables from NPC. Lastly, the RTC found that the circular denied traders
the right to exercise their business and restrained free competition inasmuch as it allowed only a certain sector to participate in the
bidding.12

In this petition, NPC insists that there was no need to publish the circular since it was not of general application. It was addressed
only to particular persons or class of persons, namely the disposal committees, heads of offices, regional and all other officials
involved in the disposition of ACSRs. NPC also contends that there was a substantial distinction between manufacturers and traders
of aluminum scrap materials specially viewed in the light of RA 7832.13 According to NPC, by limiting the prospective bidders to
manufacturers, it could easily monitor the market of its scrap ACSRs. There was rampant fencing of stolen NPC wires. NPC likewise
maintains that traders were not prohibited from participating in the pre-qualification as long as they had a tie-up with a
manufacturer.14

The questions that need to be resolved in this case are:

(1) whether NPC Circular No. 99-75 must be published; and

(2) whether items 3 and 3.1 of NPC Circular No. 99-75 -

(a) violated the equal protection clause of the Constitution and

(b) restrained free trade and competition.

Tañada v. Tuvera15 stressed the need for publication in order for statutes and administrative rules and regulations to have binding
force and effect, viz.:

x x x all statutes, including those of local application and private laws, shall be published as a condition for their effectivity, which
shall begin fifteen days after publication unless a different effectivity is fixed by the legislature.

Covered by this rule are presidential decrees and executive orders promulgated by the President in the exercise of legislative power
or, at present, directly conferred by the Constitution. Administrative Rules and Regulations must also be published if their purpose is
to enforce or implement existing law pursuant also to a valid delegation.16

Tañada, however, qualified that:

Interpretative regulations and those merely internal in nature, that is, regulating only the personnel of the administrative agency
and not the public, need not be published. Neither is publication required of the so-called letters of instructions issued by
administrative superiors concerning the rules or guidelines to be followed by their subordinates in the performance of their duties.17
(emphasis ours)

In this case, NPC Circular No. 99-75 did not have to be published since it was merely an internal rule or regulation. It did not purport
to enforce or implement an existing law but was merely a directive issued by the NPC President to his subordinates to regulate the
proper and efficient disposal of scrap ACSRs to qualified bidders. Thus, NPC Circular No. 99-75 defined the responsibilities of the
different NPC personnel in the disposal, pre-qualification, bidding and award of scrap ACSRS.18 It also provided for the deposit of a
proposal bond to be submitted by bidders, the approval of the award, mode of payment and release of awarded scrap ACSRs.19 All
these guidelines were addressed to the NPC personnel involved in the bidding and award of scrap ACSRs. It did not, in any way,
affect the rights of the public in general or of any other person not involved in the bidding process. Assuming it affected individual
rights, it did so only remotely, indirectly and incidentally.

Pinatubo’s argument that items 3 and 3.1 of NPC Circular No. 99-75 deprived it of its "right to bid" or that these conferred such right
in favor of a third person is erroneous. Bidding, in its comprehensive sense, means making an offer or an invitation to prospective
contractors whereby the government manifests its intention to invite proposals for the purchase of supplies, materials and equipment
for official business or public use, or for public works or repair.20 Bidding rules may specify other conditions or require that the
bidding process be subjected to certain reservations or qualifications.21 Since a bid partakes of the nature of an offer to contract with
the government,22 the government agency involved may or may not accept it. Moreover, being the owner of the property subject of
the bid, the government has the power to determine who shall be its recipient, as well as under what terms it may be awarded. In
this sense, participation in the bidding process is a privilege inasmuch as it can only be exercised under existing criteria imposed by
the government itself. As such, prospective bidders, including Pinatubo, cannot claim any demandable right to take part in it if they
fail to meet these criteria. Thus, it has been stated that under the traditional form of property ownership, recipients of privileges or
largesse from the government cannot be said to have property rights because they possess no traditionally recognized proprietary
interest therein.23

Also, as the discretion to accept or reject bids and award contracts is of such wide latitude, courts will not interfere, unless it is
apparent that such discretion is exercised arbitrarily, or used as a shield to a fraudulent award. The exercise of that discretion is a
policy decision that necessitates prior inquiry, investigation, comparison, evaluation, and deliberation. This task can best be
discharged by the concerned government agencies, not by the courts. Courts will not interfere with executive or legislative discretion
exercised within those boundaries. Otherwise, they stray into the realm of policy decision-making.24

Limiting qualified bidders in this case to partnerships or corporations that directly use aluminum as the raw material in producing
finished products made purely or partly of aluminum was an exercise of discretion by the NPC. Unless the discretion was exercised
arbitrarily or used as a subterfuge for fraud, the Court will not interfere with the exercise of such discretion.

This brings to the fore the next question: whether items 3 and 3.1 of NPC Circular No. 99-75 violated the equal protection clause of
the Constitution.

The equal protection clause means that "no person or class of persons shall be deprived of the same protection of laws which is
enjoyed by other persons or other classes in the same place and in like circumstances."25 The guaranty of the equal protection of the
laws is not violated by a legislation based on a reasonable classification.26 The equal protection clause, therefore, does not preclude
classification of individuals who may be accorded different treatment under the law as long as the classification is reasonable and
not arbitrary.271avvphi1

Items 3 and 3.1 met the standards of a valid classification. Indeed, as juxtaposed by the RTC, the purpose of NPC Circular No.
99-75 was to dispose of the ACSR wires.28 As stated by Pinatubo, it was also meant to earn income for the government.29
Nevertheless, the disposal and revenue-generating objective of the circular was not an end in itself and could not bar NPC from
imposing conditions for the proper disposition and ultimately, the legitimate use of the scrap ACSR wires. In giving preference to
direct manufacturers and producers, it was the intent of NPC to support RA 7832, which penalizes the theft of ACSR in excess of
100 MCM.30 The difference in treatment between direct manufacturers and producers, on one hand, and traders, on the other, was
rationalized by NPC as follows:

x x x NAPOCOR can now easily monitor the market of its scrap ACSR wires and verify whether or not a person’s possession of
such materials is legal or not; and consequently, prosecute under R.A. 7832, those whose possession, control or custody of such
material is unexplained. This is based upon the reasonable presumption that if the buyer were a manufacturer or processor, the
scrap ACSRs end with him as the latter uses it to make finished products; but if the buyer were a trader, there is greater probability
that the purchased materials may pass from one trader to another. Should traders without tie-up to manufacturers or processors of
aluminum be allowed to participate in the bidding, the ACSRs bidded out to them will likely co-mingle with those already proliferating
in the illegal market. Thus, great difficulty shall be encountered by NAPOCOR and/or those authorities tasked to implement R.A.
7832 in determining whether or not the ACSRs found in the possession, control and custody of a person suspected of theft [of]
electric power transmission lines and materials are the fruit of the offense defined in Section 3 of R.A. 7832.31

Items 3 and 3.1 clearly did not infringe on the equal protection clause as these were based on a reasonable classification intended
to protect, not the right of any business or trade but the integrity of government property, as well as promote the objectives of RA
7832. Traders like Pinatubo could not claim similar treatment as direct manufacturers/processors especially in the light of their failure
to negate the rationale behind the distinction.
Finally, items 3 and 3.1 of NPC Circular No. 99-75 did not restrain free trade or competition.

Pinatubo contends that the condition imposed by NPC under items 3 and 3.1 violated the principle of competitiveness advanced by
RA 9184 (Government Procurement Reform Act) which states:

SEC. 3. Governing Principles on Government Procurement. – All procurement of the national government, its departments, bureaus,
offices and agencies, including state universities and colleges, government-owned and/or controlled corporations, government
financial institutions and local government units, shall, in all cases, be governed by these principles:

xxx

(b) Competitiveness by extending equal opportunity to enable private contracting parties who are eligible and qualified to
participate in public bidding. (emphasis ours)

The foregoing provision imposed the precondition that the contracting parties should be eligible and qualified. It should be
emphasized that the bidding process was not a "free-for-all" where any and all interested parties, qualified or not, could take part.
Section 5(e) of RA 9184 defines competitive bidding as a "method of procurement which is open to participation by any interested
party and which consists of the following processes: advertisement, pre-bid conference, eligibility screening of prospective
bidders, receipt and opening of bids, evaluation of bids, post-qualification, and award of contract x x x." The law categorically
mandates that prospective bidders are subject to eligibility screening, and as earlier stated, bidding rules may specify other
conditions or order that the bidding process be subjected to certain reservations or qualifications.32 Thus, in its pre-qualification
guidelines issued for the sale of scrap ACSRs, the NPC reserved the right to pre-disqualify any applicant who did not meet the
requirements for pre-qualification.33 Clearly, the competitiveness policy of a bidding process presupposes the eligibility and
qualification of a contestant; otherwise, it defeats the principle that only "responsible" and "qualified" bidders can bid and be
awarded government contracts.34 Our free enterprise system is not based on a market of pure and unadulterated competition where
the State pursues a strict hands-off policy and follows the let-the-devil-devour-the-hindmost rule.35

Moreover, the mere fact that incentives and privileges are granted to certain enterprises to the exclusion of others does not render
the issuance unconstitutional for espousing unfair competition.36 While the Constitution enshrines free enterprise as a policy, it
nonetheless reserves to the government the power to intervene whenever necessary to promote the general welfare.37 In the
present case, the unregulated disposal and sale of scrap ACSR wires will hamper the government’s effort of curtailing the pernicious
practice of trafficking stolen government property. This is an evil sought to be prevented by RA 7832 and certainly, it was well within
the authority of the NPC to prescribe conditions in order to prevent it.

WHEREFORE, the petition is hereby GRANTED. The decision of the Regional Trial Court of Mandaluyong City, Branch 213 dated
June 30, 2006 and resolution dated November 20, 2006 are REVERSED and SET ASIDE. Civil Case No. MC-03-2179 for the
annulment of NPC Circular No. 99-75 is hereby DISMISSED.

SO ORDERED.
CASE #5:

G.R. No. 180643 March 25, 2008

ROMULO L. NERI, petitioner,

vs.

SENATE COMMITTEE ON ACCOUNTABILITY OF PUBLIC OFFICERS AND INVESTIGATIONS, SENATE COMMITTEE ON

TRADE AND COMMERCE, AND SENATE COMMITTEE ON NATIONAL DEFENSE AND SECURITY, respondents.

DECISION

LEONARDO-DE CASTRO, J.:

At bar is a petition for certiorari under Rule 65 of the Rules of Court assailing the show cause Letter1 dated November 22, 2007 and
contempt Order2 dated January 30, 2008 concurrently issued by respondent

Senate Committees on Accountability of Public Officers and Investigations,3 Trade and Commerce,4 and National Defense and
Security5 against petitioner Romulo L. Neri, former Director General of the National Economic and Development Authority (NEDA).

The facts, as culled from the pleadings, are as follows:

On April 21, 2007, the Department of Transportation and Communication (DOTC) entered into a contract with Zhong Xing
Telecommunications Equipment (ZTE) for the supply of equipment and services for the National Broadband Network (NBN) Project
in the amount of U.S. $ 329,481,290 (approximately P16 Billion Pesos). The Project was to be financed by the People's Republic of
China.

In connection with this NBN Project, various Resolutions were introduced in the Senate, as follows:

(1) P.S. Res. No. 127, introduced by Senator Aquilino Q. Pimentel, Jr., entitled RESOLUTION DIRECTING THE BLUE RIBBON
COMMITTEE AND THE COMMITTEE ON TRADE AND INDUSTRY TO INVESTIGATE, IN AID OF LEGISLATION, THE
CIRCUMSTANCES LEADING TO THE APPROVAL OF THE BROADBAND CONTRACT WITH ZTE AND THE ROLE PLAYED BY
THE OFFICIALS CONCERNED IN GETTING IT CONSUMMATED AND TO MAKE RECOMMENDATIONS TO HALE TO THE
COURTS OF LAW THE PERSONS RESPONSIBLE FOR ANY ANOMALY IN CONNECTION THEREWITH AND TO PLUG THE
LOOPHOLES, IF ANY IN THE BOT LAW AND OTHER PERTINENT LEGISLATIONS.

(2) P.S. Res. No. 144, introduced by Senator Mar Roxas, entitled Á RESOLUTION URGING PRESIDENT GLORIA MACAPAGAL
ARROYO TO DIRECT THE CANCELLATION OF THE ZTE CONTRACT

(3) P.S. Res. No. 129, introduced by Senator Panfilo M. Lacson, entitled RESOLUTION DIRECTING THE COMMITTEE ON
NATIONAL DEFENSE AND SECURITY TO CONDUCT AN INQUIRY IN AID OF LEGISLATION INTO THE NATIONAL SECURITY
IMPLICATIONS OF AWARDING THE NATIONAL BROADBAND NETWORK CONTRACT TO THE CHINESE FIRM ZHONG XING
TELECOMMUNICATIONS EQUIPMENT COMPANY LIMITED (ZTE CORPORATION) WITH THE END IN VIEW OF PROVIDING
REMEDIAL LEGISLATION THAT WILL PROTECT OUR NATIONAL SOVEREIGNTY, SECURITY AND TERRITORIAL INTEGRITY.

(4) P.S. Res. No. 136, introduced by Senator Miriam Defensor Santiago, entitled RESOLUTION DIRECTING THE PROPER
SENATE COMMITTEE TO CONDUCT AN INQUIRY, IN AID OF LEGISLATION, ON THE LEGAL AND ECONOMIC
JUSTIFICATION OF THE NATIONAL BROADBAND NETWORK (NBN) PROJECT OF THE NATIONAL GOVERNMENT.

At the same time, the investigation was claimed to be relevant to the consideration of three (3) pending bills in the Senate, to wit:

1. Senate Bill No. 1793, introduced by Senator Mar Roxas, entitled AN ACT SUBJECTING TREATIES, INTERNATIONAL OR
EXECUTIVE AGREEMENTS INVOLVING FUNDING IN THE PROCUREMENT OF INFRASTRUCTURE PROJECTS, GOODS,
AND CONSULTING SERVICES TO BE INCLUDED IN THE SCOPE AND APPLICATION OF PHILIPPINE PROCUREMENT LAWS,
AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 9184, OTHERWISE KNOWN AS THE GOVERNMENT PROCUREMENT
REFORM ACT, AND FOR OTHER PURPOSES;

2. Senate Bill No. 1794, introduced by Senator Mar Roxas, entitled AN ACT IMPOSING SAFEGUARDS IN CONTRACTING
LOANS CLASSIFIED AS OFFICIAL DEVELOPMENT ASSISTANCE, AMENDING FOR THE PURPOSE REPUBLIC ACT NO. 8182,
AS AMENDED BY REPUBLIC ACT NO. 8555, OTHERWISE KNOWN AS THE OFFICIAL DEVELOPMENT ASSISTANCE ACT OF
1996, AND FOR OTHER PURPOSES; and

3. Senate Bill No. 1317, introduced by Senator Miriam Defensor Santiago, entitled AN ACT MANDATING CONCURRENCE TO
INTERNATIONAL AGREEMENTS AND EXECUTIVE AGREEMENTS.

Respondent Committees initiated the investigation by sending invitations to certain personalities and cabinet officials involved in the
NBN Project. Petitioner was among those invited. He was summoned to appear and testify on September 18, 20, and 26 and
October 25, 2007. However, he attended only the September 26 hearing, claiming he was "out of town" during the other dates.

In the September 18, 2007 hearing, businessman Jose de Venecia III testified that several high executive officials and power
brokers were using their influence to push the approval of the NBN Project by the NEDA. It appeared that the Project was initially
approved as a Build-Operate-Transfer (BOT) project but, on March 29, 2007, the NEDA acquiesced to convert it into a
government-to-government project, to be financed through a loan from the Chinese Government.

On September 26, 2007, petitioner testified before respondent Committees for eleven (11) hours. He disclosed that then
Commission on Elections (COMELEC) Chairman Benjamin Abalos offered him P200 Million in exchange for his approval of the NBN
Project. He further narrated that he informed President Arroyo about the bribery attempt and that she instructed him not to accept
the bribe. However, when probed further on what they discussed about the NBN Project, petitioner refused to answer, invoking
"executive privilege". In particular, he refused to answer the questions on (a) whether or not President Arroyo followed up the NBN
Project,6 (b) whether or not she directed him to prioritize it,7 and (c) whether or not she directed him to approve.8

Unrelenting, respondent Committees issued a Subpoena Ad Testificandum to petitioner, requiring him to appear and testify on
November 20, 2007.

However, in the Letter dated November 15, 2007, Executive Secretary Eduardo R. Ermita requested respondent Committees to
dispense with petitioner's testimony on the ground of executive privilege. The pertinent portion of the letter reads:

With reference to the subpoena ad testificandum issued to Secretary Romulo Neri to appear and testify again on 20 November 2007
before the Joint Committees you chair, it will be recalled that Sec. Neri had already testified and exhaustively discussed the ZTE /
NBN project, including his conversation with the President thereon last 26 September 2007.

Asked to elaborate further on his conversation with the President, Sec. Neri asked for time to consult with his superiors in line with
the ruling of the Supreme Court in Senate v. Ermita, 488 SCRA 1 (2006).

Specifically, Sec. Neri sought guidance on the possible invocation of executive privilege on the following questions, to wit:

a) Whether the President followed up the (NBN) project?

b) Were you dictated to prioritize the ZTE?

c) Whether the President said to go ahead and approve the project after being told about the alleged bribe?

Following the ruling in Senate v. Ermita, the foregoing questions fall under conversations and correspondence between the
President and public officials which are considered executive privilege (Almonte v. Vasquez, G.R. 95637, 23 May 1995; Chavez v.
PEA, G.R. 133250, July 9, 2002). Maintaining the confidentiality of conversations of the President is necessary in the exercise of her
executive and policy decision making process. The expectation of a President to the confidentiality of her conversations and
correspondences, like the value which we accord deference for the privacy of all citizens, is the necessity for protection of the public
interest in candid, objective, and even blunt or harsh opinions in Presidential decision-making. Disclosure of conversations of the
President will have a chilling effect on the President, and will hamper her in the effective discharge of her duties and responsibilities,
if she is not protected by the confidentiality of her conversations.

The context in which executive privilege is being invoked is that the information sought to be disclosed might impair our diplomatic
as well as economic relations with the People's Republic of China. Given the confidential nature in which these information were
conveyed to the President, he cannot provide the Committee any further details of these conversations, without disclosing the very
thing the privilege is designed to protect.

In light of the above considerations, this Office is constrained to invoke the settled doctrine of executive privilege as refined in
Senate v. Ermita, and has advised Secretary Neri accordingly.

Considering that Sec. Neri has been lengthily interrogated on the subject in an unprecedented 11-hour hearing, wherein he has
answered all questions propounded to him except the foregoing questions involving executive privilege, we therefore request that
his testimony on 20 November 2007 on the ZTE / NBN project be dispensed with.

On November 20, 2007, petitioner did not appear before respondent Committees. Thus, on November 22, 2007, the latter issued the
show cause Letter requiring him to explain why he should not be cited in contempt. The Letter reads:

Since you have failed to appear in the said hearing, the Committees on Accountability of Public Officers and Investigations (Blue
Ribbon), Trade and Commerce and National Defense and Security require you to show cause why you should not be cited in
contempt under Section 6, Article 6 of the Rules of the Committee on Accountability of Public Officers and Investigations (Blue
Ribbon).

The Senate expects your explanation on or before 2 December 2007.

On November 29, 2007, petitioner replied to respondent Committees, manifesting that it was not his intention to ignore the Senate
hearing and that he thought the only remaining questions were those he claimed to be covered by executive privilege, thus:

It was not my intention to snub the last Senate hearing. In fact, I have cooperated with the task of the Senate in its inquiry in aid of
legislation as shown by my almost 11 hours stay during the hearing on 26 September 2007. During said hearing, I answered all the
questions that were asked of me, save for those which I thought was covered by executive privilege, and which was confirmed by
the Executive Secretary in his Letter 15 November 2007. In good faith, after that exhaustive testimony, I thought that what remained
were only the three questions, where the Executive Secretary claimed executive privilege. Hence, his request that my presence be
dispensed with.

Be that as it may, should there be new matters that were not yet taken up during the 26 September 2007 hearing, may I be furnished
in advance as to what else I need to clarify, so that as a resource person, I may adequately prepare myself.

In addition, petitioner submitted a letter prepared by his counsel, Atty. Antonio R. Bautista, stating, among others that: (1) his
(petitioner) non-appearance was upon the order of the President; and (2) his conversation with President Arroyo dealt with delicate
and sensitive national security and diplomatic matters relating to the impact of the bribery scandal involving high government
officials and the possible loss of confidence of foreign investors and lenders in the Philippines. The letter ended with a reiteration of
petitioner's request that he "be furnished in advance" as to what else he needs to clarify so that he may adequately prepare for the
hearing.

In the interim, on December 7, 2007, petitioner filed with this Court the present petition for certiorari assailing the show cause Letter
dated November 22, 2007.

Respondent Committees found petitioner's explanations unsatisfactory. Without responding to his request for advance notice of the
matters that he should still clarify, they issued the Order dated January 30, 2008, citing him in contempt of respondent Committees
and ordering his arrest and detention at the Office of the Senate Sergeant-At-Arms until such time that he would appear and give his
testimony. The said Order states:

ORDER

For failure to appear and testify in the Committee's hearing on Tuesday, September 18, 2007; Thursday, September 20, 2007;
Thursday, October 25, 2007; and Tuesday, November 20, 2007, despite personal notice and Subpoenas Ad Testificandum sent to
and received by him, which thereby delays, impedes and obstructs, as it has in fact delayed, impeded and obstructed the inquiry into
the subject reported irregularities, AND for failure to explain satisfactorily why he should not be cited for contempt (Neri letter of 29
November 2007), herein attached) ROMULO L. NERI is hereby cited in contempt of this (sic) Committees and ordered
arrested and detained in the Office of the Senate Sergeant-At-Arms until such time that he will appear and give his
testimony.

The Sergeant-At-Arms is hereby directed to carry out and implement this Order and make a return hereof within twenty four (24)
hours from its enforcement.

SO ORDERED.

On the same date, petitioner moved for the reconsideration of the above Order.9 He insisted that he has not shown "any
contemptible conduct worthy of contempt and arrest." He emphasized his willingness to testify on new matters, however, respondent
Committees did not respond to his request for advance notice of questions. He also mentioned the petition for certiorari he filed on
December 7, 2007. According to him, this should restrain respondent Committees from enforcing the show cause Letter "through the
issuance of declaration of contempt" and arrest.

In view of respondent Committees' issuance of the contempt Order, petitioner filed on February 1, 2008 a Supplemental Petition for
Certiorari (With Urgent Application for TRO/Preliminary Injunction), seeking to restrain the implementation of the said contempt
Order.

On February 5, 2008, the Court issued a Status Quo Ante Order (a) enjoining respondent Committees from implementing their
contempt Order, (b) requiring the parties to observe the status quo prevailing prior to the issuance of the assailed order, and (c)
requiring respondent Committees to file their comment.

Petitioner contends that respondent Committees' show cause Letter and contempt Order were issued with grave abuse of discretion
amounting to lack or excess of jurisdiction. He stresses that his conversations with President Arroyo are "candid discussions
meant to explore options in making policy decisions." According to him, these discussions "dwelt on the impact of the bribery
scandal involving high government officials on the country's diplomatic relations and economic and military affairs and
the possible loss of confidence of foreign investors and lenders in the Philippines." He also emphasizes that his claim of
executive privilege is upon the order of the President and within the parameters laid down in Senate v. Ermita10 and United States v.
Reynolds.11 Lastly, he argues that he is precluded from disclosing communications made

to him in official confidence under Section 712 of Republic Act No. 6713, otherwise known as Code of Conduct and Ethical Standards
for Public Officials and Employees, and Section 2413 (e) of Rule 130 of the Rules of Court.

Respondent Committees assert the contrary. They argue that (1) petitioner's testimony is material and pertinent in the investigation
conducted in aid of legislation; (2) there is no valid justification for petitioner to claim executive privilege; (3) there is no abuse of their
authority to order petitioner's arrest; and (4) petitioner has not come to court with clean hands.

In the oral argument held last March 4, 2008, the following issues were ventilated:

1. What communications between the President and petitioner Neri are covered by the principle of 'executive privilege'?

1.a Did Executive Secretary Ermita correctly invoke the principle of executive privilege, by order of the President, to cover (i)
conversations of the President in the exercise of her executive and policy decision-making and (ii) information, which might impair
our diplomatic as well as economic relations with the People's Republic of China?

1.b. Did petitioner Neri correctly invoke executive privilege to avoid testifying on his conversations with the President on the NBN
contract on his assertions that the said conversations "dealt with delicate and sensitive national security and diplomatic
matters relating to the impact of bribery scandal involving high government officials and the possible loss of confidence of
foreign investors and lenders in the Philippines" x x x within the principles laid down in Senate v. Ermita (488 SCRA 1 [2006])?

1.c Will the claim of executive privilege in this case violate the following provisions of the Constitution:

Sec. 28, Art. II (Full public disclosure of all transactions involving public interest)

Sec. 7, Art. III (The right of the people to information on matters of public concern)

Sec. 1, Art. XI (Public office is a public trust)

Sec. 17, Art. VII (The President shall ensure that the laws be faithfully executed)

and the due process clause and the principle of separation of powers?

2. What is the proper procedure to be followed in invoking executive privilege?

3. Did the Senate Committees gravely abuse their discretion in ordering the arrest of petitioner for non-compliance with the
subpoena?

After the oral argument, the parties were directed to manifest to the Court within twenty-four (24) hours if they are amenable to the
Court's proposal of allowing petitioner to immediately resume his testimony before the Senate Committees to answer the other
questions of the Senators without prejudice to the decision on the merits of this pending petition. It was understood that petitioner
may invoke executive privilege in the course of the Senate Committees proceedings, and if the respondent Committees disagree
thereto, the unanswered questions will be the subject of a supplemental pleading to be resolved along with the three (3) questions
subject of the present petition.14 At the same time, respondent Committees were directed to submit several pertinent documents.15

The Senate did not agree with the proposal for the reasons stated in the Manifestation dated March 5, 2008. As to the required
documents, the Senate and respondent Committees manifested that they would not be able to submit the latter's "Minutes of all
meetings" and the "Minute Book" because it has never been the "historical and traditional legislative practice to keep them."16 They
instead submitted the Transcript of Stenographic Notes of respondent Committees' joint public hearings.

On March 17, 2008, the Office of the Solicitor General (OSG) filed a Motion for Leave to Intervene and to Admit Attached
Memorandum, founded on the following arguments:

(1) The communications between petitioner and the President are covered by the principle of "executive privilege."

(2) Petitioner was not summoned by respondent Senate Committees in accordance with the law-making body's power to conduct
inquiries in aid of legislation as laid down in Section 21, Article VI of the Constitution and Senate v. Ermita.

(3) Respondent Senate Committees gravely abused its discretion for alleged non-compliance with the Subpoena dated November
13, 2007.

The Court granted the OSG's motion the next day, March 18, 2008.

As the foregoing facts unfold, related events transpired.

On March 6, 2008, President Arroyo issued Memorandum Circular No. 151, revoking Executive Order No. 464 and Memorandum
Circular No. 108. She advised executive officials and employees to follow and abide by the Constitution, existing laws and
jurisprudence, including, among others, the case of Senate v. Ermita17 when they are invited to legislative inquiries in aid of
legislation.

At the core of this controversy are the two (2) crucial queries, to wit:

First, are the communications elicited by the subject three (3) questions covered by executive privilege?

And second, did respondent Committees commit grave abuse of discretion in issuing the contempt Order?

We grant the petition.

At the outset, a glimpse at the landmark case of Senate v. Ermita18 becomes imperative. Senate draws in bold strokes the distinction
between the legislative and oversight powers of the Congress, as embodied under Sections 21 and 22, respectively, of Article VI
of the Constitution, to wit:

SECTION 21. The Senate or the House of Representatives or any of its respective committees may conduct inquiries in aid of
legislation in accordance with its duly published rules of procedure. The rights of persons appearing in or affected by such inquiries
shall be respected.

SECTION 22. The heads of department may upon their own initiative, with the consent of the President, or upon the request of
either House, or as the rules of each House shall provide, appear before and be heard by such House on any matter pertaining to
their departments. Written questions shall be submitted to the President of the Senate or the Speaker of the House of
Representatives at least three days before their scheduled appearance. Interpellations shall not be limited to written questions, but
may cover matters related thereto. When the security of the state or the public interest so requires and the President so states in
writing, the appearance shall be conducted in executive session.

Senate cautions that while the above provisions are closely related and complementary to each other, they should not be considered
as pertaining to the same power of Congress. Section 21 relates to the power to conduct inquiries in aid of legislation. Its aim is to
elicit information that may be used for legislation. On the other hand, Section 22 pertains to the power to conduct a question hour,
the objective of which is to obtain information in pursuit of Congress' oversight function.19 Simply stated, while both powers allow
Congress or any of its committees to conduct inquiry, their objectives are different.

This distinction gives birth to another distinction with regard to the use of compulsory process. Unlike in Section 21, Congress
cannot compel the appearance of executive officials under Section 22. The Court's pronouncement in Senate v. Ermita20 is clear:

When Congress merely seeks to be informed on how department heads are implementing the statutes which it has issued, its right
to such information is not as imperative as that of the President to whom, as Chief Executive, such department heads must give a
report of their performance as a matter of duty. In such instances, Section 22, in keeping with the separation of powers, states that
Congress may only request their appearance. Nonetheless, when the inquiry in which Congress requires their appearance is 'in aid
of legislation' under Section 21, the appearance is mandatory for the same reasons stated in Arnault.

In fine, the oversight function of Congress may be facilitated by compulsory process only to the extent that it is performed
in pursuit of legislation. This is consistent with the intent discerned from the deliberations of the Constitutional Commission

Ultimately, the power of Congress to compel the appearance of executive officials under section 21 and the lack of it under Section
22 find their basis in the principle of separation of powers. While the executive branch is a co-equal branch of the legislature, it
cannot frustrate the power of Congress to legislate by refusing to comply with its demands for information. (Emphasis supplied.)

The availability of the power of judicial review to resolve the issues raised in this case has also been settled in Senate v. Ermita,
when it held:

As evidenced by the American experience during the so-called "McCarthy era," however, the right of Congress to conduct inquiries
in aid of legislation is, in theory, no less susceptible to abuse than executive or judicial power. It may thus be subjected to judicial
review pursuant to the Court's certiorari powers under Section 1, Article VIII of the Constitution.
Hence, this decision.

The Communications Elicited by the Three (3) Questions are Covered by Executive Privilege

We start with the basic premises where the parties have conceded.

The power of Congress to conduct inquiries in aid of legislation is broad. This is based on the proposition that a legislative body
cannot legislate wisely or effectively in the absence of information respecting the conditions which the legislation is intended to affect
or change.21 Inevitably, adjunct thereto is the compulsory process to enforce it. But, the power, broad as it is, has limitations. To be
valid, it is imperative that it is done in accordance with the Senate or House duly published rules of procedure and that the rights of
the persons appearing in or affected by such inquiries be respected.

The power extends even to executive officials and the only way for them to be exempted is through a valid claim of executive
privilege.22 This directs us to the consideration of the question -- is there a recognized claim of executive privilege despite the
revocation of E.O. 464?

A- There is a Recognized Claim

of Executive Privilege Despite the

Revocation of E.O. 464

At this juncture, it must be stressed that the revocation of E.O. 464 does not in any way diminish our concept of executive privilege.
This is because this concept has Constitutional underpinnings. Unlike the United States which has further accorded the concept with
statutory status by enacting the Freedom of Information Act23 and the Federal Advisory Committee Act,24 the Philippines has
retained its constitutional origination, occasionally interpreted only by this Court in various cases. The most recent of these is the
case of Senate v. Ermita where this Court declared unconstitutional substantial portions of E.O. 464. In this regard, it is worthy to
note that Executive Ermita's Letter dated November 15, 2007 limits its bases for the claim of executive privilege to Senate v. Ermita,
Almonte v. Vasquez,25 and Chavez v. PEA.26 There was never a mention of E.O. 464.

While these cases, especially Senate v. Ermita,27 have comprehensively discussed the concept of executive privilege, we deem it
imperative to explore it once more in view of the clamor for this Court to clearly define the communications covered by executive
privilege.

The Nixon and post-Watergate cases established the broad contours of the presidential communications privilege.28 In United
States v. Nixon,29 the U.S. Court recognized a great public interest in preserving "the confidentiality of conversations that take
place in the President's performance of his official duties." It thus considered presidential communications as "presumptively
privileged." Apparently, the presumption is founded on the "President's generalized interest in confidentiality." The privilege is
said to be necessary to guarantee the candor of presidential advisors and to provide "the President and those who assist him…
with freedom to explore alternatives in the process of shaping policies and making decisions and to do so in a way many
would be unwilling to express except privately."

In In Re: Sealed Case,30 the U.S. Court of Appeals delved deeper. It ruled that there are two (2) kinds of executive privilege; one is
the presidential communications privilege and, the other is the deliberative process privilege. The former pertains to
"communications, documents or other materials that reflect presidential decision-making and deliberations and that the
President believes should remain confidential." The latter includes 'advisory opinions, recommendations and deliberations
comprising part of a process by which governmental decisions and policies are formulated."

Accordingly, they are characterized by marked distinctions. Presidential communications privilege applies to decision-making of
the President while, the deliberative process privilege, to decision-making of executive officials. The first is rooted in the
constitutional principle of separation of power and the President's unique constitutional role; the second on common law privilege.
Unlike the deliberative process privilege, the presidential communications privilege applies to documents in their entirety,
and covers final and post-decisional materials as well as pre-deliberative ones31 As a consequence, congressional or judicial
negation of the presidential communications privilege is always subject to greater scrutiny than denial of the deliberative
process privilege.

Turning on who are the officials covered by the presidential communications privilege, In Re: Sealed Case confines the privilege
only to White House Staff that has "operational proximity" to direct presidential decision-making. Thus, the privilege is meant to
encompass only those functions that form the core of presidential authority, involving what the court characterized as "quintessential
and non-delegable Presidential power," such as commander-in-chief power, appointment and removal power, the power to grant
pardons and reprieves, the sole-authority to receive ambassadors and other public officers, the power to negotiate treaties, etc.32

The situation in Judicial Watch, Inc. v. Department of Justice33 tested the In Re: Sealed Case principles. There, while the presidential
decision involved is the exercise of the President's pardon power, a non-delegable, core-presidential function, the Deputy Attorney
General and the Pardon Attorney were deemed to be too remote from the President and his senior White House advisors to be
protected. The Court conceded that

functionally those officials were performing a task directly related to the President's pardon power, but concluded that an
organizational test was more appropriate for confining the potentially broad sweep that would result from the In Re: Sealed Case's
functional test. The majority concluded that, the lesser protections of the deliberative process privilege would suffice. That privilege
was, however, found insufficient to justify the confidentiality of the 4,341 withheld documents.

But more specific classifications of communications covered by executive privilege are made in older cases. Courts ruled early that
the Executive has a right to withhold documents that might reveal military or state secrets,34 identity of government informers in
some circumstances,,35 and information related to pending investigations.36 An area where the privilege is highly revered is in
foreign relations. In United States v. Curtiss-Wright Export Corp.37 the U.S. Court, citing President George Washington,
pronounced:
The nature of foreign negotiations requires caution, and their success must often depend on secrecy, and even when brought to a
conclusion, a full disclosure of all the measures, demands, or eventual concessions which may have been proposed or
contemplated would be extremely impolitic, for this might have a pernicious influence on future negotiations or produce immediate
inconveniences, perhaps danger and mischief, in relation to other powers. The necessity of such caution and secrecy was one
cogent reason for vesting the power of making treaties in the President, with the advice and consent of the Senate, the principle on
which the body was formed confining it to a small number of members. To admit, then, a right in the House of Representatives to
demand and to have as a matter of course all the papers respecting a negotiation with a foreign power would be to establish a
dangerous precedent.

Majority of the above jurisprudence have found their way in our jurisdiction. In Chavez v. PCGG38, this Court held that there is a
"governmental privilege against public disclosure with respect to state secrets regarding military, diplomatic and other security
matters." In Chavez v. PEA,39 there is also a recognition of the confidentiality of Presidential conversations, correspondences, and
discussions in closed-door Cabinet meetings. In Senate v. Ermita, the concept of presidential communications privilege is fully
discussed.

As may be gleaned from the above discussion, the claim of executive privilege is highly recognized in cases where the subject of
inquiry relates to a power textually committed by the Constitution to the President, such as the area of military and foreign relations.
Under our Constitution, the President is the repository of the commander-in-chief,40 appointing,41 pardoning,42 and diplomatic43
powers. Consistent with the doctrine of separation of powers, the information relating to these powers may enjoy greater
confidentiality than others.

The above cases, especially, Nixon, In Re Sealed Case and Judicial Watch, somehow provide the elements of presidential
communications privilege, to wit:

1) The protected communication must relate to a "quintessential and non-delegable presidential power."

2) The communication must be authored or "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.

3) The presidential communications privilege remains a qualified privilege that 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.44

In the case at bar, Executive Secretary Ermita premised his claim of executive privilege on the ground that the communications
elicited by the three (3) questions "fall under conversation and correspondence between the President and public officials"
necessary in "her executive and policy decision-making process" and, that "the information sought to be disclosed might impair our
diplomatic as well as economic relations with the People's Republic of China." Simply put, the bases are presidential
communications privilege and executive privilege on matters relating to diplomacy or foreign relations.

Using the above elements, we are convinced that, indeed, the communications elicited by the three (3) questions are covered by the
presidential communications privilege. First, the communications relate to a "quintessential and non-delegable power" of the
President, i.e. the power to enter into an executive agreement with other countries. This authority of the President to enter into
executive agreements without the concurrence of the Legislature has traditionally been recognized in Philippine jurisprudence.45
Second, the communications are "received" by a close advisor of the President. Under the "operational proximity" test, petitioner
can be considered a close advisor, being a member of President Arroyo's cabinet. And third, there is no adequate showing of a
compelling need that would justify the limitation of the privilege and of the unavailability of the information elsewhere by an
appropriate investigating authority.

The third element deserves a lengthy discussion.

United States v. Nixon held that a claim of executive privilege is subject to balancing against other interest. In other words,
confidentiality in executive privilege is not absolutely protected by the Constitution. The U.S. Court held:

[N]either the doctrine of separation of powers, nor the need for confidentiality of high-level communications, without more, can
sustain an absolute, unqualified Presidential privilege of immunity from judicial process under all circumstances.

The foregoing is consistent with the earlier case of Nixon v. Sirica,46 where it was held that presidential communications are
presumptively privileged and that the presumption can be overcome only by mere showing of public need by the branch seeking
access to conversations. The courts are enjoined to resolve the competing interests of the political branches of the government "in
the manner that preserves the essential functions of each Branch."47 Here, the record is bereft of any categorical explanation from
respondent Committees to show a compelling or citical need for the answers to the three (3) questions in the enactment of a law.
Instead, the questions veer more towards the exercise of the legislative oversight function under Section 22 of Article VI rather than
Section 21 of the same Article. Senate v. Ermita ruled that the "the oversight function of Congress may be facilitated by
compulsory process only to the extent that it is performed in pursuit of legislation." It is conceded that it is difficult to draw the
line between an inquiry in aid of legislation and an inquiry in the exercise of oversight function of Congress. In this regard, much will
depend on the content of the questions and the manner the inquiry is conducted.

Respondent Committees argue that a claim of executive privilege does not guard against a possible disclosure of a crime or
wrongdoing. We see no dispute on this. It is settled in United States v. Nixon48 that "demonstrated, specific need for evidence in
pending criminal trial" outweighs the President's "generalized interest in confidentiality." However, the present case's distinction
with the Nixon case is very evident. In Nixon, there is a pending criminal proceeding where the information is requested and it is the
demands of due process of law and the fair administration of criminal justice that the information be disclosed. This is the reason
why the U.S. Court was quick to "limit the scope of its decision." It stressed that it is "not concerned here with the balance
between the President's generalized interest in confidentiality x x x and congressional demands for information." Unlike in
Nixon, the information here is elicited, not in a criminal proceeding, but in a legislative inquiry. In this regard, Senate v. Ermita
stressed that the validity of the claim of executive privilege depends not only on the ground invoked but, also, on the procedural
setting or the context in which the claim is made. Furthermore, in Nixon, the President did not interpose any claim of need to
protect military, diplomatic or sensitive national security secrets. In the present case, Executive Secretary Ermita categorically claims
executive privilege on the grounds of presidential communications privilege in relation to her executive and policy
decision-making process and diplomatic secrets.
The respondent Committees should cautiously tread into the investigation of matters which may present a conflict of interest that
may provide a ground to inhibit the Senators participating in the inquiry if later on an impeachment proceeding is initiated on the
same subject matter of the present Senate inquiry. Pertinently, in Senate Select Committee on Presidential Campaign Activities v.
Nixon,49 it was held that since an impeachment proceeding had been initiated by a House Committee, the Senate Select
Committee's immediate oversight need for five presidential tapes should give way to the House Judiciary Committee which has the
constitutional authority to inquire into presidential impeachment. The Court expounded on this issue in this wise:

It is true, of course, that the Executive cannot, any more than the other branches of government, invoke a general confidentiality
privilege to shield its officials and employees from investigations by the proper governmental institutions into possible criminal
wrongdoing. The Congress learned this as to its own privileges in Gravel v. United States, as did the judicial branch, in a sense, in
Clark v. United States, and the executive branch itself in Nixon v. Sirica. But under Nixon v. Sirica, the showing required to
overcome the presumption favoring confidentiality turned, not on the nature of the presidential conduct that the subpoenaed
material might reveal, but, instead, on the nature and appropriateness of the function in the performance of which the
material was sought, and the degree to which the material was necessary to its fulfillment. Here also our task requires and
our decision implies no judgment whatever concerning possible presidential involvement in culpable activity. On the
contrary, we think the sufficiency of the Committee's showing must depend solely on whether the subpoenaed evidence is
demonstrably critical to the responsible fulfillment of the Committee's functions.

In its initial briefs here, the Committee argued that it has shown exactly this. It contended that resolution, on the basis of the
subpoenaed tapes, of the conflicts in the testimony before it 'would aid in a determination whether legislative involvement in political
campaigns is necessary' and 'could help engender the public support needed for basic reforms in our electoral system.' Moreover,
Congress has, according to the Committee, power to oversee the operations of the executive branch, to investigate instances of
possible corruption and malfeasance in office, and to expose the results of its investigations to public view. The Committee says that
with respect to Watergate-related matters, this power has been delegated to it by the Senate, and that to exercise its power
responsibly, it must have access to the subpoenaed tapes.

We turn first to the latter contention. In the circumstances of this case, we need neither deny that the Congress may have, quite
apart from its legislative responsibilities, a general oversight power, nor explore what the lawful reach of that power might be under
the Committee's constituent resolution. Since passage of that resolution, the House Committee on the Judiciary has begun an
inquiry into presidential impeachment. The investigative authority of the Judiciary Committee with respect to presidential conduct
has an express constitutional source. x x x We have been shown no evidence indicating that Congress itself attaches any
particular value to this interest. In these circumstances, we think the need for the tapes premised solely on an asserted
power to investigate and inform cannot justify enforcement of the Committee's subpoena.

The sufficiency of the Committee's showing of need has come to depend, therefore, entirely on whether the subpoenaed materials
are critical to the performance of its legislative functions. There is a clear difference between Congress' legislative tasks and the
responsibility of a grand jury, or any institution engaged in like functions. While fact-finding by a legislative committee is
undeniably a part of its task, legislative judgments normally depend more on the predicted consequences of proposed
legislative actions and their political acceptability, than on precise reconstruction of past events; Congress frequently
legislates on the basis of conflicting information provided in its hearings. In contrast, the responsibility of the grand jury turns entirely
on its ability to determine whether there is probable cause to believe that certain named individuals did or did not commit specific
crimes. If, for example, as in Nixon v. Sirica, one of those crimes is perjury concerning the content of certain conversations, the
grand jury's need for the most precise evidence, the exact text of oral statements recorded in their original form, is undeniable. We
see no comparable need in the legislative process, at least not in the circumstances of this case. Indeed, whatever force
there might once have been in the Committee's argument that the subpoenaed materials are necessary to its legislative judgments
has been substantially undermined by subsequent events. (Emphasis supplied)

Respondent Committees further contend that the grant of petitioner's claim of executive privilege violates the constitutional
provisions on the right of the people to information on matters of public concern.50 We might have agreed with such contention if
petitioner did not appear before them at all. But petitioner made himself available to them during the September 26 hearing, where
he was questioned for eleven (11) hours. Not only that, he expressly manifested his willingness to answer more questions from the
Senators, with the exception only of those covered by his claim of executive privilege.

The right to public information, like any other right, is subject to limitation. Section 7 of Article III provides:

The right of the people to information on matters of public concern shall be recognized. Access to official records, and to documents,
and papers pertaining to official acts, transactions, or decisions, as well as to government research data used as basis for policy
development, shall be afforded the citizen, subject to such limitations as may be provided by law.

The provision itself expressly provides the limitation, i.e. as may be provided by law. Some of these laws are Section 7 of Republic
Act (R.A.) No. 6713,51 Article 22952 of the Revised Penal Code, Section 3 (k)53 of R.A. No. 3019, and Section 24(e)54 of Rule 130 of
the Rules of Court. These are in addition to what our body of jurisprudence classifies as confidential55 and what our Constitution
considers as belonging to the larger concept of executive privilege. Clearly, there is a recognized public interest in the confidentiality
of certain information. We find the information subject of this case belonging to such kind.

More than anything else, though, the right of Congress or any of its Committees to obtain information in aid of legislation cannot be
equated with the people's right to public information. The former cannot claim that every legislative inquiry is an exercise of the
people's right to information. The distinction between such rights is laid down in Senate v. Ermita:

There are, it bears noting, clear distinctions between the right of Congress to information which underlies the power of inquiry and
the right of people to information on matters of public concern. For one, the demand of a citizen for the production of documents
pursuant to his right to information does not have the same obligatory force as a subpoena duces tecum issued by Congress.
Neither does the right to information grant a citizen the power to exact testimony from government officials. These powers belong
only to Congress, not to an individual citizen.

Thus, while Congress is composed of representatives elected by the people, it does not follow, except in a highly qualified
sense, that in every exercise of its power of inquiry, the people are exercising their right to information.

The members of respondent Committees should not invoke as justification in their exercise of power a right properly belonging to the
people in general. This is because when they discharge their power, they do so as public officials and members of Congress. Be
that as it may, the right to information must be balanced with and should give way, in appropriate cases, to constitutional precepts
particularly those pertaining to delicate interplay of executive-legislative powers and privileges which is the subject of careful review
by numerous decided cases.

B- The Claim of Executive Privilege

is Properly Invoked

We now proceed to the issue -- whether the claim is properly invoked by the President. Jurisprudence teaches that for the claim
to be properly invoked, there must be a formal claim of privilege, lodged by the head of the department which has control over the
matter."56 A formal and proper claim of executive privilege requires a "precise and certain reason" for preserving their
confidentiality.57

The Letter dated November 17, 2007 of Executive Secretary Ermita satisfies the requirement. It serves as the formal claim of
privilege. There, he expressly states that "this Office is constrained to invoke the settled doctrine of executive privilege as
refined in Senate v. Ermita, and has advised Secretary Neri accordingly." Obviously, he is referring to the Office of the
President. That is more than enough compliance. In Senate v. Ermita, a less categorical letter was even adjudged to be sufficient.

With regard to the existence of "precise and certain reason," we find the grounds relied upon by Executive Secretary Ermita specific
enough so as not "to leave respondent Committees in the dark on how the requested information could be classified as privileged."
The case of Senate v. Ermita only requires that an allegation be made "whether the information demanded involves military or
diplomatic secrets, closed-door Cabinet meetings, etc." The particular ground must only be specified. The enumeration is not even
intended to be comprehensive."58 The following statement of grounds satisfies the requirement:

The context in which executive privilege is being invoked is that the information sought to be disclosed might impair our diplomatic
as well as economic relations with the People's Republic of China. Given the confidential nature in which these information were
conveyed to the President, he cannot provide the Committee any further details of these conversations, without disclosing the very
thing the privilege is designed to protect.

At any rate, as held further in Senate v. Ermita, 59 the Congress must not require the executive to state the reasons for the claim with
such particularity as to compel disclosure of the information which the privilege is meant to protect. This is a matter of respect to a
coordinate and co-equal department.

II

Respondent Committees Committed Grave Abuse of Discretion

in Issuing the Contempt Order

Grave abuse of discretion means "such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction, or, in
other words where the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility and it must
be so patent and gross as to amount to an evasion of positive duty or to a virtual refusal to perform the duty enjoined or to act at all
in contemplation of law."60

It must be reiterated that when respondent Committees issued the show cause Letter dated November 22, 2007, petitioner replied
immediately, manifesting that it was not his intention to ignore the Senate hearing and that he thought the only remaining questions
were the three (3) questions he claimed to be covered by executive privilege. In addition thereto, he submitted Atty. Bautista's letter,
stating that his non-appearance was upon the order of the President and specifying the reasons why his conversations with
President Arroyo are covered by executive privilege. Both correspondences include an expression of his willingness to testify
again, provided he "be furnished in advance" copies of the questions. Without responding to his request for advance list of
questions, respondent Committees issued the Order dated January 30, 2008, citing him in contempt of respondent Committees and
ordering his arrest and detention at the Office of the Senate Sergeant-At-Arms until such time that he would appear and give his
testimony. Thereupon, petitioner filed a motion for reconsideration, informing respondent Committees that he had filed the present
petition for certiorari.

Respondent Committees committed grave abuse of discretion in issuing the contempt Order in view of five (5) reasons.

First, there being a legitimate claim of executive privilege, the issuance of the contempt Order suffers from constitutional infirmity.

Second, respondent Committees did not comply with the requirement laid down in Senate v. Ermita that the invitations should
contain the "possible needed statute which prompted the need for the inquiry," along with "the usual indication of the subject of
inquiry and the questions relative to and in furtherance thereof." Compliance with this requirement is imperative, both under
Sections 21 and 22 of Article VI of the Constitution. This must be so to ensure that the rights of both persons appearing in or
affected by such inquiry are respected as mandated by said Section 21 and by virtue of the express language of Section 22.
Unfortunately, despite petitioner's repeated demands, respondent Committees did not send him an advance list of questions.

Third, a reading of the transcript of respondent Committees' January 30, 2008 proceeding reveals that only a minority of the
members of the Senate Blue Ribbon Committee was present during the deliberation. 61 Section 18 of the Rules of Procedure
Governing Inquiries in Aid of Legislation provides that:

"The Committee, by a vote of majority of all its members, may punish for contempt any witness before it who disobeys any order of
the Committee or refuses to be sworn or to testify or to answer proper questions by the Committee or any of its members."

Clearly, the needed vote is a majority of all the members of the Committee. Apparently, members who did not actually participate in
the deliberation were made to sign the contempt Order. Thus, there is a cloud of doubt as to the validity of the contempt Order dated
January 30, 2008. We quote the pertinent portion of the transcript, thus:

THE CHAIRMAN (SEN. CAYETANO, A). For clarification. x x x The Chair will call either a caucus or will ask the Committee
on Rules if there is a problem. Meaning, if we do not have the sufficient numbers. But if we have a sufficient number, we
will just hold a caucus to be able to implement that right away because…Again, our Rules provide that any one held in
contempt and ordered arrested, need the concurrence of a majority of all members of the said committee and we have
three committees conducting this.
So thank you very much to the members…

SEN. PIMENTEL. Mr. Chairman.

THE CHAIRMAN (SEN. CAYETANO,A). May I recognize the Minority Leader and give him the floor, Senator Pimentel.

SEN. PIMENTEL. Mr. Chairman, there is no problem, I think, with consulting the other committees. But I am of the opinion
that the Blue Ribbon Committee is the lead committee, and therefore, it should have preference in enforcing its own
decisions. Meaning to say, it is not something that is subject to consultation with other committees. I am not sure that is
the right interpretation. I think that once we decide here, we enforce what we decide, because otherwise, before we know it,
our determination is watered down by delay and, you know, the so-called "consultation" that inevitably will have to take
place if we follow the premise that has been explained.

So my suggestion, Mr. Chairman, is the Blue Ribbon Committee should not forget it's the lead committee here, and therefore, the
will of the lead committee prevails over all the other, you, know reservations that other committees might have who are only
secondary or even tertiary committees, Mr. Chairman.

THE CHAIRMAN (SEN. CAYETANO, A.) Thank you very much to the Minority Leader. And I agree with the wisdom of his
statements. I was merely mentioning that under Section 6 of the Rules of the Committee and under Section 6, "The Committee by a
vote of a majority of all its members may punish for contempt any witness before it who disobeys any order of the Committee."

So the Blue Ribbon Committee is more than willing to take that responsibility. But we only have six members here today, I am the
seventh as chair and so we have not met that number. So I am merely stating that, sir, that when we will prepare the
documentation, if a majority of all members sign and I am following the Sabio v. Gordon rule wherein I do believe, if I am not
mistaken, Chairman Gordon prepared the documentation and then either in caucus or in session asked the other members to sign.
And once the signatures are obtained, solely for the purpose that Secretary Neri or Mr. Lozada will not be able to legally question
our subpoena as being insufficient in accordance with law.

SEN. PIMENTEL. Mr. Chairman, the caution that the chair is suggesting is very well-taken. But I'd like to advert to the fact that the
quorum of the committee is only two as far as I remember. Any two-member senators attending a Senate committee hearing provide
that quorum, and therefore there is more than a quorum demanded by our Rules as far as we are concerned now, and acting as
Blue Ribbon Committee, as Senator Enrile pointed out. In any event, the signatures that will follow by the additional members will
only tend to strengthen the determination of this Committee to put its foot forward – put down on what is happening in this country,
Mr. Chairman, because it really looks terrible if the primary Committee of the Senate, which is the Blue Ribbon Committee, cannot
even sanction people who openly defy, you know, the summons of this Committee. I know that the Chair is going through an
agonizing moment here. I know that. But nonetheless, I think we have to uphold, you know, the institution that we are representing
because the alternative will be a disaster for all of us, Mr. Chairman. So having said that, I'd like to reiterate my point.

THE CHAIRMAN (SEN. CAYETANO, A.) First of all, I agree 100 percent with the intentions of the Minority Leader. But let me very
respectfully disagree with the legal requirements. Because, yes, we can have a hearing if we are only two but both under
Section 18 of the Rules of the Senate and under Section 6 of the Rules of the Blue Ribbon Committee, there is a need for a
majority of all members if it is a case of contempt and arrest. So, I am simply trying to avoid the court rebuking the Committee,
which will instead of strengthening will weaken us. But I do agree, Mr. Minority Leader, that we should push for this and show the
executive branch that the well-decided – the issue has been decided upon the Sabio versus Gordon case. And it's very clear that we
are all allowed to call witnesses. And if they refure or they disobey not only can we cite them in contempt and have them arrested. x
x x 62

Fourth, we find merit in the argument of the OSG that respondent Committees likewise violated Section 21 of Article VI of the
Constitution, requiring that the inquiry be in accordance with the "duly published rules of procedure." We quote the OSG's
explanation:

The phrase 'duly published rules of procedure' requires the Senate of every Congress to publish its rules of procedure governing
inquiries in aid of legislation because every Senate is distinct from the one before it or after it. Since Senatorial elections are held
every three (3) years for one-half of the Senate's membership, the composition of the Senate also changes by the end of each term.
Each Senate may thus enact a different set of rules as it may deem fit. Not having published its Rules of Procedure, the subject
hearings in aid of legislation conducted by the 14th Senate, are therefore, procedurally infirm.

And fifth, respondent Committees' issuance of the contempt Order is arbitrary and precipitate. It must be pointed out that
respondent Committees did not first pass upon the claim of executive privilege and inform petitioner of their ruling. Instead, they
curtly dismissed his explanation as "unsatisfactory" and simultaneously issued the Order citing him in contempt and ordering his
immediate arrest and detention.

A fact worth highlighting is that petitioner is not an unwilling witness. He manifested several times his readiness to testify before
respondent Committees. He refused to answer the three (3) questions because he was ordered by the President to claim executive
privilege. It behooves respondent Committees to first rule on the claim of executive privilege and inform petitioner of their finding
thereon, instead of peremptorily dismissing his explanation as "unsatisfactory." Undoubtedly, respondent Committees' actions
constitute grave abuse of discretion for being arbitrary and for denying petitioner due process of law. The same quality afflicted their
conduct when they (a) disregarded petitioner's motion for reconsideration alleging that he had filed the present petition before this
Court and (b) ignored petitioner's repeated request for an advance list of questions, if there be any aside from the three (3)
questions as to which he claimed to be covered by executive privilege.

Even the courts are repeatedly advised to exercise the power of contempt judiciously and sparingly with utmost self-restraint with
the end in view of utilizing the same for correction and preservation of the dignity of the court, not for retaliation or vindication.63
Respondent Committees should have exercised the same restraint, after all petitioner is not even an ordinary witness. He holds a
high position in a co-equal branch of government.

In this regard, it is important to mention that many incidents of judicial review could have been avoided if powers are discharged with
circumspection and deference. Concomitant with the doctrine of separation of powers is the mandate to observe respect to a
co-equal branch of the government.

One last word.

The Court was accused of attempting to abandon its constitutional duty when it required the parties to consider a proposal that
would lead to a possible compromise. The accusation is far from the truth. The Court did so, only to test a tool that other jurisdictions
find to be effective in settling similar cases, to avoid a piecemeal consideration of the questions for review and to avert a
constitutional crisis between the executive and legislative branches of government.

In United States v. American Tel. & Tel Co.,64 the court refrained from deciding the case because of its desire to avoid a resolution
that might disturb the balance of power between the two branches and inaccurately reflect their true needs. Instead, it remanded the
record to the District Court for further proceedings during which the parties are required to negotiate a settlement. In the subsequent
case of United States v. American Tel. &Tel Co.,65 it was held that "much of this spirit of compromise is reflected in the generality of
language found in the Constitution." It proceeded to state:

Under this view, the coordinate branches do not exist in an exclusively adversary relationship to one another when a conflict in
authority arises. Rather each branch should take cognizance of an implicit constitutional mandate to seek optimal accommodation
through a realistic evaluation of the needs of the conflicting branches in the particular fact situation.

It thereafter concluded that: "The Separation of Powers often impairs efficiency, in terms of dispatch and the immediate
functioning of government. It is the long-term staying power of government that is enhanced by the mutual
accommodation required by the separation of powers."

In rendering this decision, the Court emphasizes once more that the basic principles of constitutional law cannot be subordinated to
the needs of a particular situation. As magistrates, our mandate is to rule objectively and dispassionately, always mindful of Mr.
Justice Holmes' warning on the dangers inherent in cases of this nature, thus:

"some accident of immediate and overwhelming interest…appeals to the feelings and distorts the judgment. These immediate
interests exercise a kind of hydraulic pressure which makes what previously was clear seem doubtful, and before which even well
settled principles of law will bend."66

In this present crusade to "search for truth," we should turn to the fundamental constitutional principles which underlie our tripartite
system of government, where the Legislature enacts the law, the Judiciary interprets it and the Executive implements it. They are
considered separate, co-equal, coordinate and supreme within their respective spheres but, imbued with a system of checks and
balances to prevent unwarranted exercise of power. The Court's mandate is to preserve these constitutional principles at all times to
keep the political branches of government within constitutional bounds in the exercise of their respective powers and prerogatives,
even if it be in the search for truth. This is the only way we can preserve the stability of our democratic institutions and uphold the
Rule of Law.

WHEREFORE, the petition is hereby GRANTED. The subject Order dated January 30, 2008, citing petitioner Romulo L. Neri in
contempt of the Senate Committees and directing his arrest and detention, is hereby nullified.

SO ORDERED.
CASE #6:

G.R. No. 170338 December 23, 2008

VIRGILIO O. GARCILLANO v. THE HOUSE OF REPRESENTATIVES COMMITTEES ON PUBLIC INFORMATION, PUBLIC

ORDER AND SAFETY, NATIONAL DEFENSE AND SECURITY, INFORMATION AND COMMUNICATIONS TECHNOLOGY, and
SUFFRAGE AND ELECTORAL REFORMS

NACHURA, J.:

More than three years ago, tapes ostensibly containing a wiretapped conversation purportedly between the President of the
Philippines and a high-ranking official of the Commission on Elections (COMELEC) surfaced. They captured unprecedented public
attention and thrust the country into a controversy that placed the legitimacy of the present administration on the line, and resulted in
the near-collapse of the Arroyo government. The tapes, notoriously referred to as the "Hello Garci" tapes, allegedly contained the
President’s instructions to COMELEC Commissioner Virgilio Garcillano to manipulate in her favor results of the 2004 presidential
elections. These recordings were to become the subject of heated legislative hearings conducted separately by committees of both
Houses of Congress.1

In the House of Representatives (House), on June 8, 2005, then Minority Floor Leader Francis G. Escudero delivered a privilege
speech, "Tale of Two Tapes," and set in motion a congressional investigation jointly conducted by the Committees on Public
Information, Public Order and Safety, National Defense and Security, Information and Communications Technology, and Suffrage
and Electoral Reforms (respondent House Committees). During the inquiry, several versions of the wiretapped conversation
emerged. But on July 5, 2005, National Bureau of Investigation (NBI) Director Reynaldo Wycoco, Atty. Alan Paguia and the lawyer
of former NBI Deputy Director Samuel Ong submitted to the respondent House Committees seven alleged "original" tape recordings
of the supposed three-hour taped conversation. After prolonged and impassioned debate by the committee members on the
admissibility and authenticity of the recordings, the tapes were eventually played in the chambers of the House.2

On August 3, 2005, the respondent House Committees decided to suspend the hearings indefinitely. Nevertheless, they decided to
prepare committee reports based on the said recordings and the testimonies of the resource persons.3

Alarmed by these developments, petitioner Virgilio O. Garcillano (Garcillano) filed with this Court a Petition for Prohibition and
Injunction, with Prayer for Temporary Restraining Order and/or Writ of Preliminary Injunction4 docketed as G.R. No. 170338. He
prayed that the respondent House Committees be restrained from using these tape recordings of the "illegally obtained" wiretapped
conversations in their committee reports and for any other purpose. He further implored that the said recordings and any reference
thereto be ordered stricken off the records of the inquiry, and the respondent House Committees directed to desist from further using
the recordings in any of the House proceedings.5

Without reaching its denouement, the House discussion and debates on the "Garci tapes" abruptly stopped.

After more than two years of quiescence, Senator Panfilo Lacson roused the slumbering issue with a privilege speech, "The
Lighthouse That Brought Darkness." In his discourse, Senator Lacson promised to provide the public "the whole unvarnished truth –
the what’s, when’s, where’s, who’s and why’s" of the alleged wiretap, and sought an inquiry into the perceived willingness of
telecommunications providers to participate in nefarious wiretapping activities.

On motion of Senator Francis Pangilinan, Senator Lacson’s speech was referred to the Senate Committee on National Defense and
Security, chaired by Senator Rodolfo Biazon, who had previously filed two bills6 seeking to regulate the sale, purchase and use of
wiretapping equipment and to prohibit the Armed Forces of the Philippines (AFP) from performing electoral duties. 7

In the Senate’s plenary session the following day, a lengthy debate ensued when Senator Richard Gordon aired his concern on the
possible transgression of Republic Act (R.A.) No. 42008 if the body were to conduct a legislative inquiry on the matter. On August 28,
2007, Senator Miriam Defensor-Santiago delivered a privilege speech, articulating her considered view that the Constitution
absolutely bans the use, possession, replay or communication of the contents of the "Hello Garci" tapes. However, she
recommended a legislative investigation into the role of the Intelligence Service of the AFP (ISAFP), the Philippine National Police or
other government entities in the alleged illegal wiretapping of public officials.9

On September 6, 2007, petitioners Santiago Ranada and Oswaldo Agcaoili, retired justices of the Court of Appeals, filed before this
Court a Petition for Prohibition with Prayer for the Issuance of a Temporary Restraining Order and/or Writ of Preliminary Injunction,10
docketed as G.R. No. 179275, seeking to bar the Senate from conducting its scheduled legislative inquiry. They argued in the main
that the intended legislative inquiry violates R.A. No. 4200 and Section 3, Article III of the Constitution. 11

As the Court did not issue an injunctive writ, the Senate proceeded with its public hearings on the "Hello Garci" tapes on September
7,12 1713 and October 1,14 2007.

Intervening as respondents,15 Senators Aquilino Q. Pimentel, Jr., Benigno Noynoy C. Aquino, Rodolfo G. Biazon, Panfilo M. Lacson,
Loren B. Legarda, M.A. Jamby A.S. Madrigal and Antonio F. Trillanes filed their Comment 16 on the petition on September 25, 2007.

The Court subsequently heard the case on oral argument.17

On October 26, 2007, Maj. Lindsay Rex Sagge, a member of the ISAFP and one of the resource persons summoned by the Senate
to appear and testify at its hearings, moved to intervene as petitioner in G.R. No. 179275.18

On November 20, 2007, the Court resolved to consolidate G.R. Nos. 170338 and 179275.19

It may be noted that while both petitions involve the "Hello Garci" recordings, they have different objectives–the first is poised at
preventing the playing of the tapes in the House and their subsequent inclusion in the committee reports, and the second seeks to
prohibit and stop the conduct of the Senate inquiry on the wiretapped conversation.

The Court dismisses the first petition, G.R. No. 170338, and grants the second, G.R. No. 179275.

-I-
Before delving into the merits of the case, the Court shall first resolve the issue on the parties’ standing, argued at length in their
pleadings.

In Tolentino v. COMELEC,20 we explained that "‘[l]egal standing’ or locus standi refers to a personal and substantial interest in a
case such that the party has sustained or will sustain direct injury because of the challenged governmental act x x x," thus,

generally, a party will be allowed to litigate only when (1) he can show that he has personally suffered some actual or threatened
injury because of the allegedly illegal conduct of the government; (2) the injury is fairly traceable to the challenged action; and (3) the
injury is likely to be redressed by a favorable action.21

The gist of the question of standing is whether a party has "alleged such a personal stake in the outcome of the controversy as to
assure that concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for
illumination of difficult constitutional questions."22

However, considering that locus standi is a mere procedural technicality, the Court, in recent cases, has relaxed the stringent direct
injury test. David v. Macapagal-Arroyo23 articulates that a "liberal policy has been observed, allowing ordinary citizens, members of
Congress, and civic organizations to prosecute actions involving the constitutionality or validity of laws, regulations and rulings."24
The fairly recent Chavez v. Gonzales25 even permitted a non-member of the broadcast media, who failed to allege a personal stake
in the outcome of the controversy, to challenge the acts of the Secretary of Justice and the National Telecommunications
Commission. The majority, in the said case, echoed the current policy that "this Court has repeatedly and consistently refused to
wield procedural barriers as impediments to its addressing and resolving serious legal questions that greatly impact on public
interest, in keeping with the Court’s duty under the 1987 Constitution to determine whether or not other branches of government
have kept themselves within the limits of the Constitution and the laws, and that they have not abused the discretion given to
them."26

In G.R. No. 170338, petitioner Garcillano justifies his standing to initiate the petition by alleging that he is the person alluded to in the
"Hello Garci" tapes. Further, his was publicly identified by the members of the respondent committees as one of the voices in the
recordings.27 Obviously, therefore, petitioner Garcillano stands to be directly injured by the House committees’ actions and charges
of electoral fraud. The Court recognizes his standing to institute the petition for prohibition.

In G.R. No. 179275, petitioners Ranada and Agcaoili justify their standing by alleging that they are concerned citizens, taxpayers,
and members of the IBP. They are of the firm conviction that any attempt to use the "Hello Garci" tapes will further divide the country.
They wish to see the legal and proper use of public funds that will necessarily be defrayed in the ensuing public hearings. They are
worried by the continuous violation of the laws and individual rights, and the blatant attempt to abuse constitutional processes
through the conduct of legislative inquiries purportedly in aid of legislation.28

Intervenor Sagge alleges violation of his right to due process considering that he is summoned to attend the Senate hearings
without being apprised not only of his rights therein through the publication of the Senate Rules of Procedure Governing Inquiries in
Aid of Legislation, but also of the intended legislation which underpins the investigation. He further intervenes as a taxpayer
bewailing the useless and wasteful expenditure of public funds involved in the conduct of the questioned hearings.29

Given that petitioners Ranada and Agcaoili allege an interest in the execution of the laws and that intervenor Sagge asserts his
constitutional right to due process,30 they satisfy the requisite personal stake in the outcome of the controversy by merely being
citizens of the Republic.

Following the Court’s ruling in Francisco, Jr. v. The House of Representatives,31 we find sufficient petitioners Ranada’s and Agcaoili’s
and intervenor Sagge’s allegation that the continuous conduct by the Senate of the questioned legislative inquiry will necessarily
involve the expenditure of public funds.32 It should be noted that in Francisco, rights personal to then Chief Justice Hilario G. Davide,
Jr. had been injured by the alleged unconstitutional acts of the House of Representatives, yet the Court granted standing to the
petitioners therein for, as in this case, they invariably invoked the vindication of their own rights–as taxpayers, members of
Congress, citizens, individually or in a class suit, and members of the bar and of the legal profession–which were also supposedly
violated by the therein assailed unconstitutional acts.33

Likewise, a reading of the petition in G.R. No. 179275 shows that the petitioners and intervenor Sagge advance constitutional issues
which deserve the attention of this Court in view of their seriousness, novelty and weight as precedents. The issues are of
transcendental and paramount importance not only to the public but also to the Bench and the Bar, and should be resolved for the
guidance of all.34

Thus, in the exercise of its sound discretion and given the liberal attitude it has shown in prior cases climaxing in the more recent
case of Chavez, the Court recognizes the legal standing of petitioners Ranada and Agcaoili and intervenor Sagge.

- II -

The Court, however, dismisses G.R. No. 170338 for being moot and academic. Repeatedly stressed in our prior decisions is the
principle that the exercise by this Court of judicial power is limited to the determination and resolution of actual cases and
controversies.35 By actual cases, we mean existing conflicts appropriate or ripe for judicial determination, not conjectural or
anticipatory, for otherwise the decision of the Court will amount to an advisory opinion. The power of judicial inquiry does not extend
to hypothetical questions because any attempt at abstraction could only lead to dialectics and barren legal questions and to sterile
conclusions unrelated to actualities.36 Neither will the Court determine a moot question in a case in which no practical relief can be
granted. A case becomes moot when its purpose has become stale.37 It is unnecessary to indulge in academic discussion of a case
presenting a moot question as a judgment thereon cannot have any practical legal effect or, in the nature of things, cannot be
enforced.38

In G.R. No. 170338, petitioner Garcillano implores from the Court, as aforementioned, the issuance of an injunctive writ to prohibit
the respondent House Committees from playing the tape recordings and from including the same in their committee report. He
likewise prays that the said tapes be stricken off the records of the House proceedings. But the Court notes that the recordings were
already played in the House and heard by its members.39 There is also the widely publicized fact that the committee reports on the
"Hello Garci" inquiry were completed and submitted to the House in plenary by the respondent committees.40 Having been overtaken
by these events, the Garcillano petition has to be dismissed for being moot and academic. After all, prohibition is a preventive
remedy to restrain the doing of an act about to be done, and not intended to provide a remedy for an act already accomplished.41
 - III -

As to the petition in G.R. No. 179275, the Court grants the same. The Senate cannot be allowed to continue with the conduct of the
questioned legislative inquiry without duly published rules of procedure, in clear derogation of the constitutional requirement.

Section 21, Article VI of the 1987 Constitution explicitly provides that "[t]he Senate or the House of Representatives, or any of its
respective committees may conduct inquiries in aid of legislation in accordance with its duly published rules of procedure." The
requisite of publication of the rules is intended to satisfy the basic requirements of due process.42 Publication is indeed imperative,
for it will be the height of injustice to punish or otherwise burden a citizen for the transgression of a law or rule of which he had no
notice whatsoever, not even a constructive one.43 What constitutes publication is set forth in Article 2 of the Civil Code, which
provides that "[l]aws shall take effect after 15 days following the completion of their publication either in the Official Gazette, or in a
newspaper of general circulation in the Philippines."44

The respondents in G.R. No. 179275 admit in their pleadings and even on oral argument that the Senate Rules of Procedure
Governing Inquiries in Aid of Legislation had been published in newspapers of general circulation only in 1995 and in 2006.45 With
respect to the present Senate of the 14th Congress, however, of which the term of half of its members commenced on June 30,
2007, no effort was undertaken for the publication of these rules when they first opened their session.

Recently, the Court had occasion to rule on this very same question. In Neri v. Senate Committee on Accountability of Public
Officers and Investigations,46 we said:

Fourth, we find merit in the argument of the OSG that respondent Committees likewise violated Section 21 of Article VI of the
Constitution, requiring that the inquiry be in accordance with the "duly published rules of procedure." We quote the OSG’s
explanation:

The phrase "duly published rules of procedure" requires the Senate of every Congress to publish its rules of procedure governing
inquiries in aid of legislation because every Senate is distinct from the one before it or after it. Since Senatorial elections are held
every three (3) years for one-half of the Senate’s membership, the composition of the Senate also changes by the end of each term.
Each Senate may thus enact a different set of rules as it may deem fit. Not having published its Rules of Procedure, the subject
hearings in aid of legislation conducted by the 14th Senate, are therefore, procedurally infirm.

Justice Antonio T. Carpio, in his Dissenting and Concurring Opinion, reinforces this ruling with the following rationalization:

The present Senate under the 1987 Constitution is no longer a continuing legislative body. The present Senate has twenty-four
members, twelve of whom are elected every three years for a term of six years each. Thus, the term of twelve Senators expires
every three years, leaving less than a majority of Senators to continue into the next Congress. The 1987 Constitution, like the
1935 Constitution, requires a majority of Senators to "constitute a quorum to do business." Applying the same reasoning in Arnault v.
Nazareno, the Senate under the 1987 Constitution is not a continuing body because less than majority of the Senators continue into
the next Congress. The consequence is that the Rules of Procedure must be republished by the Senate after every expiry of the
term of twelve Senators.47

The subject was explained with greater lucidity in our Resolution48 (On the Motion for Reconsideration) in the same case, viz.:

On the nature of the Senate as a "continuing body," this Court sees fit to issue a clarification. Certainly, there is no debate that the
Senate as an institution is "continuing," as it is not dissolved as an entity with each national election or change in the composition
of its members. However, in the conduct of its day-to-day business the Senate of each Congress acts separately and independently
of the Senate of the Congress before it. The Rules of the Senate itself confirms this when it states:

RULE XLIV

UNFINISHED BUSINESS

SEC. 123. Unfinished business at the end of the session shall be taken up at the next session in the same status.

All pending matters and proceedings shall terminate upon the expiration of one (1) Congress, but may be taken by the
succeeding Congress as if present for the first time.

Undeniably from the foregoing, all pending matters and proceedings, i.e., unpassed bills and even legislative investigations, of the
Senate of a particular Congress are considered terminated upon the expiration of that Congress and it is merely optional on the
Senate of the succeeding Congress to take up such unfinished matters, not in the same status, but as if presented for the first
time. The logic and practicality of such a rule is readily apparent considering that the Senate of the succeeding Congress (which will
typically have a different composition as that of the previous Congress) should not be bound by the acts and deliberations of the
Senate of which they had no part. If the Senate is a continuing body even with respect to the conduct of its business, then pending
matters will not be deemed terminated with the expiration of one Congress but will, as a matter of course, continue into the next
Congress with the same status.

This dichotomy of the continuity of the Senate as an institution and of the opposite nature of the conduct of its business is reflected
in its Rules. The Rules of the Senate (i.e. the Senate’s main rules of procedure) states:

RULE LI

AMENDMENTS TO, OR REVISIONS OF, THE RULES

SEC. 136. At the start of each session in which the Senators elected in the preceding elections shall begin their term of office, the
President may endorse the Rules to the appropriate committee for amendment or revision.

The Rules may also be amended by means of a motion which should be presented at least one day before its consideration, and the
vote of the majority of the Senators present in the session shall be required for its approval.

RULE LII
 DATE OF TAKING EFFECT

SEC. 137. These Rules shall take effect on the date of their adoption and shall remain in force until they are amended or repealed.

Section 136 of the Senate Rules quoted above takes into account the new composition of the Senate after an election and the
possibility of the amendment or revision of the Rules at the start of each session in which the newly elected Senators shall begin
their term.

However, it is evident that the Senate has determined that its main rules are intended to be valid from the date of their adoption until
they are amended or repealed. Such language is conspicuously absent from the Rules. The Rules simply state "(t)hese Rules shall
take effect seven (7) days after publication in two (2) newspapers of general circulation." The latter does not explicitly provide for the
continued effectivity of such rules until they are amended or repealed. In view of the difference in the language of the two sets of
Senate rules, it cannot be presumed that the Rules (on legislative inquiries) would continue into the next Congress. The Senate of
the next Congress may easily adopt different rules for its legislative inquiries which come within the rule on unfinished business.

The language of Section 21, Article VI of the Constitution requiring that the inquiry be conducted in accordance with the duly
published rules of procedure is categorical. It is incumbent upon the Senate to publish the rules for its legislative inquiries in each
Congress or otherwise make the published rules clearly state that the same shall be effective in subsequent Congresses or until
they are amended or repealed to sufficiently put public on notice.

If it was the intention of the Senate for its present rules on legislative inquiries to be effective even in the next Congress, it could
have easily adopted the same language it had used in its main rules regarding effectivity.

Respondents justify their non-observance of the constitutionally mandated publication by arguing that the rules have never been
amended since 1995 and, despite that, they are published in booklet form available to anyone for free, and accessible to the public
at the Senate’s internet web page.49

The Court does not agree. The absence of any amendment to the rules cannot justify the Senate’s defiance of the clear and
unambiguous language of Section 21, Article VI of the Constitution. The organic law instructs, without more, that the Senate or its
committees may conduct inquiries in aid of legislation only in accordance with duly published rules of procedure, and does not make
any distinction whether or not these rules have undergone amendments or revision. The constitutional mandate to publish the said
rules prevails over any custom, practice or tradition followed by the Senate.

Justice Carpio’s response to the same argument raised by the respondents is illuminating:

The publication of the Rules of Procedure in the website of the Senate, or in pamphlet form available at the Senate, is not sufficient
under the Tañada v. Tuvera ruling which requires publication either in the Official Gazette or in a newspaper of general circulation.
The Rules of Procedure even provide that the rules "shall take effect seven (7) days after publication in two (2) newspapers of
general circulation," precluding any other form of publication. Publication in accordance with Tañada is mandatory to comply with the
due process requirement because the Rules of Procedure put a person’s liberty at risk. A person who violates the Rules of
Procedure could be arrested and detained by the Senate.

The invocation by the respondents of the provisions of R.A. No. 8792,50 otherwise known as the Electronic Commerce Act of 2000,
to support their claim of valid publication through the internet is all the more incorrect. R.A. 8792 considers an electronic data
message or an electronic document as the functional equivalent of a written document only for evidentiary purposes.51 In other
words, the law merely recognizes the admissibility in evidence (for their being the original) of electronic data messages and/or
electronic documents.52 It does not make the internet a medium for publishing laws, rules and regulations.

Given this discussion, the respondent Senate Committees, therefore, could not, in violation of the Constitution, use its unpublished
rules in the legislative inquiry subject of these consolidated cases. The conduct of inquiries in aid of legislation by the Senate has to
be deferred until it shall have caused the publication of the rules, because it can do so only "in accordance with its duly published
rules of procedure."

Very recently, the Senate caused the publication of the Senate Rules of Procedure Governing Inquiries in Aid of Legislation in the
October 31, 2008 issues of Manila Bulletin and Malaya. While we take judicial notice of this fact, the recent publication does not cure
the infirmity of the inquiry sought to be prohibited by the instant petitions. Insofar as the consolidated cases are concerned, the
legislative investigation subject thereof still could not be undertaken by the respondent Senate Committees, because no published
rules governed it, in clear contravention of the Constitution.

With the foregoing disquisition, the Court finds it unnecessary to discuss the other issues raised in the consolidated petitions.

WHEREFORE, the petition in G.R. No. 170338 is DISMISSED, and the petition in G.R. No. 179275 is GRANTED. Let a writ of
prohibition be issued enjoining the Senate of the Republic of the Philippines and/or any of its committees from conducting any
inquiry in aid of legislation centered on the "Hello Garci" tapes.

SO ORDERED.
CASE #7:

G.R. No. 187714 March 8, 2011

AQUILINO Q. PIMENTEL, JR., MANUEL B. VILLAR, JOKER P. ARROYO, FRANCIS N. PANGILINAN, PIA S. CAYETANO, and
ALAN PETER S. CAYETANO v. SENATE COMMITTEE OF THE WHOLE represented by SENATE PRESIDENT JUAN PONCE
ENRILE

DECISION

CARPIO, J.:

The Case

Before the Court is a petition for prohibition1 with prayer for issuance of a writ of preliminary injunction and/or temporary restraining
order filed by Senators Aquilino Q. Pimentel, Jr. (Senator Pimentel), Manuel B. Villar (Senator Villar), Joker P. Arroyo, Francis N.
Pangilinan, Pia S. Cayetano, and Alan Peter S. Cayetano (petitioners). Petitioners seek to enjoin the Senate Committee of the
Whole (respondent) from conducting further hearings on the complaint filed by Senator Maria Ana Consuelo A.S. Madrigal (Senator
Madrigal) against Senator Villar pursuant to Senate Resolution No. 706 (P.S. Resolution 706) on the alleged double insertion of
₱200 million for the C-5 Road Extension Project in the 2008 General Appropriations Act.

The Antecedents

On 15 September 2008, Senator Panfilo Lacson (Senator Lacson) delivered a privilege speech entitled "Kaban ng Bayan,
Bantayan!"2 In his privilege speech, Senator Lacson called attention to the congressional insertion in the 2008 General
Appropriations Act, particularly the ₱200 million appropriated for the construction of the President Carlos P. Garcia Avenue
Extension from Sucat Luzon Expressway to Sucat Road in Parañaque City including Right-of-Way (ROW), and another ₱200 million
appropriated for the extension of C-5 road including ROW. Senator Lacson stated that C-5 is what was formerly called President
Carlos P. Garcia Avenue and that the second appropriation covers the same stretch – from Sucat Luzon Expressway to Sucat Road
in Parañaque City. Senator Lacson inquired from DBM Secretary Rolando Andaya, Jr. about the double entry and was informed that
it was on account of a congressional insertion. Senator Lacson further stated that when he followed the narrow trail leading to the
double entry, it led to Senator Villar, then the Senate President.

On 8 October 2008, Senator Madrigal introduced P.S. Resolution 706,3 the full text of which reads:

WHEREAS the Senate President has repeatedly and publicly "advocated" (sic) the construction of the C-5
Road/Pres. C.P. Garcia Avenue Extension linking Sucat Road in Parañaque City to the South Luzon Expressway;

WHEREAS it was discovered that there was a double insertion of ₱200 million for the C-5 Road Extension project
in the 2008 General Appropriations Act;

WHEREAS Committee on Finance Chair Sen. Juan Ponce Enrile confirmed that the double insertion for the C-5
Road Extension Project was made by the Senate President;

WHEREAS this double insertion is only the tip of the iceberg;

WHEREAS there is overwhelming evidence to show that the Senate President, from the time he was member of
the House of Representatives, used his influence on the executive to cause the realignment of the C-5 Road
Extension project to ensure that his properties in Barangay San Dionisio, Parañaque City and Barangays Pulang
Lupa and Mayuno Uno, Las Piñas would be financially benefited by the construction of the new road;

WHEREAS there is overwhelming evidence to show that the Senate President, through his corporations,
negotiated the sale of his properties as roads right of way to the government, the same properties affected by the
projects he proposed;

WHEREAS there is overwhelming evidence to show that the Senate President caused the sale of his landholdings
to government as a grossly overpriced cost prejudicial to other lot owners in the area, the government, and the
Filipino people;

WHEREAS there is overwhelming evidence to show that the Senate President, in the overpriced sale of another
property, used his power and influence to extort from the original landowner the profit made from the overprice by
the Villar owned corporations;

WHEREAS these acts of the Senate President are in direct violation of the Constitution, the Anti-Graft and Corrupt
Practices Act, the Code of Conduct and Ethical Standards of Public Officers;

WHEREAS the Senate President has violated the public trust of the people in order to serve his personal interests
thereby sacrificing the people’s welfare;

WHEREAS the illegal and unethical conduct of the Senate President has betrayed the trust of the people, and by
doing so has shamed the Philippine Senate;

WHEREAS it is incumbent upon the members of the Senate now to reclaim the people’s trust and confidence and
show that the illegal conduct of any of its member, even of its leaders, shall not go unpunished;

WHEREFORE, BE IT RESOLVED AS IT IS HEREBY RESOLVED, TO DIRECT THE COMMITTEE ON ETHICS

AND PRIVILEGES TO INVESTIGATE THE CONDUCT OF SENATE PRESIDENT MANUEL B. VILLAR, JR. FOR
USING HIS POSITION OF POWER TO INFLUENCE PUBLIC OFFICIALS IN RELOCATING THE C-5 ROAD
EXTENSION PROJECT TO DELIBERATELY PASS THRU HIS PROPERTIES, AND TO NEGOTIATE THE
OVERPRICED PURCHASE OF ROAD RIGHTS OF WAY THRU SEVERAL PROPERTIES ALSO OWNED BY HIS
 CORPORATIONS REDOUNDING IN HUGE PERSONAL FINANCIAL BENEFITS FOR HIM TO THE DETRIMENT
OF THE FILIPINO PEOPLE, THEREBY RESULTING IN A BLATANT CONFLICT OF INTEREST.

Adopted,

(Sgd.)

M.A. MADRIGAL4

On even date, P.S. Resolution 706 was referred to the Committee on Ethics and Privileges (Ethics Committee) which at that time
was composed of the following members:

Sen. Pia S. Cayetano - Chairperson

Sen. Loren Legarda - Member in lieu of Sen. Madrigal

Sen. Joker Arroyo - Member

Sen. Alan Peter Cayetano- Member

Sen. Miriam Defensor-Santiago- Member

Sen. Gregorio Honasan - Member

Sen. Panfilo Lacson - Inhibited and replaced by Sen. Rodolfo Biazon

On 17 November 2008, Senator Juan Ponce Enrile (Senator Enrile) was elected Senate President. The Ethics Committee was
reorganized with the election of Senator Lacson as Chairperson, and Senators Richard Gordon, Gregorio Honasan, Loren Legarda,
and Mar Roxas as members for the Majority. On 16 December 2008, Senator Lacson inquired whether the Minority was ready to
name their representatives to the Ethics Committee.5 After consultation with the members of the Minority, Senator Pimentel informed
the body that there would be no member from the Minority in the Ethics Committee.6 On 26 January 2009, Senator Lacson reiterated
his appeal to the Minority to nominate their representatives to the Ethics Committee.7 Senator Pimentel stated that it is the stand of
the Minority not to nominate any of their members to the Ethics Committee, but he promised to convene a caucus to determine if the
Minority’s decision on the matter is final.8 Thereafter, the Senate adopted the Rules of the Senate Committee on Ethics and
Privileges (Committee Rules) which was published in the Official Gazette on 23 March 2009.9

On 20 April 2009, Senator Villar delivered a privilege speech10 where he stated that he would answer the accusations against him on
the floor and not before the Ethics Committee. On 27 April 2009, Senator Lacson delivered another privilege speech11 where he
stated that the Ethics Committee was not a kangaroo court. However, due to the accusation that the Ethics Committee could not act
with fairness on Senator Villar’s case, Senator Lacson moved that the responsibility of the Ethics Committee be undertaken by the
Senate, acting as a Committee of the Whole. The motion was approved with ten members voting in favor, none against, and five
abstentions.12

Respondent Senate Committee of the Whole conducted its hearings on 4 May 2009, with eleven Senators present, and on 7 May
2009, with eight Senators present. On both hearings, petitioners objected to the application of the Rules of the Ethics Committee to
the Senate Committee of the Whole. In particular, petitioners questioned the determination of the quorum. On 11 May 2009,
petitioners proposed 11 amendments to the Rules of the Ethics Committee that would constitute the Rules of the Senate Committee
of the Whole, out of which three amendments were adopted. On 14 May 2009, Senator Pimentel raised as an issue the need to
publish the proposed amended Rules of the Senate Committee of the Whole. On even date, respondent proceeded with the
Preliminary Inquiry on P.S. Resolution 706. On 18 May 2009, the Chairman submitted a report on the Preliminary Inquiry with a
directive to all Senators to come up with a decision on the preliminary report on 21 May 2009. On 21 May 2009, respondent
declared that there was substantial evidence to proceed with the adjudicatory hearing. The preliminary conference was set on 26
May 2009.

Petitioners came to this Court for relief, raising the following grounds:

1. The transfer of the complaint against Senator Villar from the Ethics Committee to the Senate Committee of the Whole is violative
of Senator Villar’s constitutional right to equal protection;

2. The Rules adopted by the Senate Committee of the Whole for the investigation of the complaint filed by Senator Madrigal against
Senator Villar is violative of Senator Villar’s right to due process and of the majority quorum requirement under Art. VI, Sec. 16(2) of
the Constitution; and

3. The Senate Committee of the Whole likewise violated the due process clause of the Constitution when it refused to publish the
Rules of the Senate Committee of the Whole in spite of its own provision [which] require[s] its effectivity upon publication.13

In its Comment, respondent argues that:

1. The instant petition should be dismissed for failure to join or implead an indispensable party. In the alternative, the instant petition
should be archived until such time that the said indispensable party has been joined or impleaded and afforded the opportunity to be
heard;

2. There was no grave abuse of discretion on the part of respondent Committee;

3. Petitioners are not entitled to a writ of prohibition for failure to prove grave abuse of discretion on the part of respondent
Committee of the Whole;

4. The principle of separation of powers must be upheld;

5. The instant petition must be dismissed for being premature. Petitioners failed to observe the doctrine or primary jurisdiction or
prior resort;

6. It is within the power of Congress to discipline its members for disorderly behavior;

7. The determination of what constitutes disorderly behavior is a political question which exclusively pertains to Congress;

8. The Internal Rules of the Senate are not subject to judicial review in the absence of grave abuse of discretion; [and]

9. The Rules of the Ethics Committee, which have been duly published and adopted[,] allow the adoption of supplementary rules to
govern adjudicatory hearings.14

The Issues

The issues for the Court’s resolution are the following:

1. Whether Senator Madrigal, who filed the complaint against Senator Villar, is an indispensable party in this petition;

2. Whether the petition is premature for failure to observe the doctrine of primary jurisdiction or prior resort;

3. Whether the transfer of the complaint against Senator Villar from the Ethics Committee to the Senate Committee of the Whole is
violative of Senator Villar’s right to equal protection;

4. Whether the adoption of the Rules of the Ethics Committee as Rules of the Senate Committee of the Whole is a violative of
Senator Villar’s right to due process and of the majority quorum requirement under Art. VI, Section 16(2) of the Constitution; and

5. Whether publication of the Rules of the Senate Committee of the Whole is required for their effectivity.

The Ruling of this Court

Indispensable Party

Section 7, Rule 3 of the 1997 Rules of Civil Procedure provides:

SEC. 7 – Compulsory joinder of indispensable parties. - Parties in interest without whom no final determination can be had of an
action shall be joined as plaintiffs or defendants.

The test to determine if a party is an indispensable party is as follows:

An indispensable party is a party who has an interest in the controversy or subject matter that a final adjudication cannot be made,
in his absence, without injuring or affecting that interest, a party who has not only an interest in the subject matter of the controversy,
but also has an interest of such nature that a final decree cannot be made without affecting his interest or leaving the controversy in
such a condition that its final determination may be wholly inconsistent with equity and good conscience. It has also been
considered that an indispensable party is a person in whose absence there cannot be a determination between the parties already
before the court which is effective, complete or equitable. Further, an indispensable party is one who must be included in an action
before it may properly go forward.

A person who is not an indispensable party, however, if his interest in the controversy or subject matter is separable from the interest
of the other parties, so that it will not necessarily be directly or injuriously affected by a decree which does complete justice between
them. Also, a person is not an indispensable party if his presence would merely permit a complete relief between him and those
already parties to the action, or if he has no interest in the subject matter of the action. It is not a sufficient reason to declare a
person to be an indispensable party that his presence will avoid multiple litigation.15

In this case, Senator Madrigal is not an indispensable party to the petition before the Court. While it may be true that she has an
interest in the outcome of this case as the author of P.S. Resolution 706, the issues in this case are matters of jurisdiction and
procedure on the part of the Senate Committee of the Whole which can be resolved without affecting Senator Madrigal’s interest.
The nature of Senator Madrigal’s interest in this case is not of the nature that this case could not be resolved without her
participation.1awphi1

Doctrine of Primary Jurisdiction

Respondent asserts that the doctrine of primary jurisdiction "simply calls for the determination of administrative questions, which are
ordinarily questions of fact, by administrative agencies rather than by courts of justice."16 Citing Pimentel v. HRET,17 respondent
avers that primary recourse of petitioners should have been to the Senate and that this Court must uphold the separation of powers
between the legislative and judicial branches of the government.

The doctrine of primary jurisdiction does not apply to this case. The Court has ruled:

x x x It may occur that the Court has jurisdiction to take cognizance of a particular case, which means that the matter involved is also
judicial in character. However, if the case is such that its determination requires the expertise, specialized skills and knowledge of
the proper administrative bodies because technical matters or intricate questions of fact are involved, then relief must first be
obtained in an administrative proceeding before a remedy will be supplied by the courts even though the matter is within the proper
jurisdiction of the court. x x x18

The issues presented here do not require the expertise, specialized skills and knowledge of respondent for their resolution. On the
contrary, the issues here are purely legal questions which are within the competence and jurisdiction of the Court, and not an
administrative agency or the Senate to resolve.19

As regards respondent’s invocation of separation of powers, the Court reiterates that "the inviolate doctrine of separation of powers
among the legislative, executive or judicial branches of government by no means prescribes for absolute autonomy in the discharge
by each of that part of the governmental power assigned to it by the sovereign people."20 Thus, it has been held that "the power of
judicial review is not so much power as it is [a] duty imposed on this Court by the Constitution and that we would be remiss in the
performance of that duty if we decline to look behind the barriers set by the principle of separation of powers."21 The Court,
therefore, is not precluded from resolving the legal issues raised by the mere invocation by respondent of the doctrine of separation
of powers. On the contrary, the resolution of the legal issues falls within the exclusive jurisdiction of this Court.

Transfer of the Complaint from the Ethics Committee

to the Senate Committee on the Whole

Petitioners allege that the transfer of the complaint against Senator Villar to the Senate Committee of the Whole violates his
constitutional right to equal protection. Petitioners allege that the Senate Committee of the Whole was constituted solely for the
purpose of assuming jurisdiction over the complaint against Senator Villar. Petitioners further allege that the act was discriminatory
and removed Senator Villar’s recourse against any adverse report of the Ethics Committee to the Senate as a body.

We do not agree with petitioners.

Reviewing the events that led to the constitution of the Senate Committee of the Whole, the Court notes that upon the election of
Senator Enrile as Senate President on 17 November 2008, the Ethics Committee was also reorganized. Senator Lacson, who first
called the Senate’s attention to the alleged irregularities committed by Senator Villar, was elected as Chairperson. On 16 December
2008, when Senator Lacson inquired whether the Minority was ready to name their representatives to the Ethics Committee,
Senator Pimentel informed the body that there would be no member from the Minority in the Ethics Committee. On 26 January 2009,
Senator Lacson reiterated his appeal to the Minority to nominate their representatives to the Ethics Committee. Senator Pimentel
informed him that it is the stand of the Minority not to nominate any of their members to the Ethics Committee. Senator Pimentel
promised to convene a caucus to determine if the Minority’s decision on the matter is final but the records did not show that a
caucus was convened.

On 20 April 2009, Senator Villar delivered a privilege speech where he stated that he would answer the accusations against him on
the floor and not before the Ethics Committee. It was because of the accusation that the Ethics Committee could not act with
fairness on Senator Villar’s case that Senator Lacson moved that the responsibility of the Ethics Committee be undertaken by the
Senate acting as a Committee of the Whole, which motion was approved with ten members voting in favor, none against, and five
abstentions.

The Rules of the Ethics Committee provide that "all matters relating to the conduct, rights, privileges, safety, dignity, integrity and
reputation of the Senate and its Members shall be under the exclusive jurisdiction of the Senate Committee on Ethics and
Privileges."22 However, in this case, the refusal of the Minority to name its members to the Ethics Committee stalled the
investigation. In short, while ordinarily an investigation about one of its members’ alleged irregular or unethical conduct is within the
jurisdiction of the Ethics Committee, the Minority effectively prevented it from pursuing the investigation when they refused to
nominate their members to the Ethics Committee. Even Senator Villar called the Ethics Committee a kangaroo court and declared
that he would answer the accusations against him on the floor and not before the Ethics Committee. Given the circumstances, the
referral of the investigation to the Committee of the Whole was an extraordinary remedy undertaken by the Ethics Committee and
approved by a majority of the members of the Senate.

Adoption of the Rules of the Ethics Committee

by the Senate Committee of the Whole

Petitioners allege that the adoption of the Rules of the Ethics Committee by the Senate Committee of the Whole is violative of
Senator Villar’s right to due process.

We do not agree.

Again, we reiterate that, considering the circumstances of this case, the referral of the investigation by the Ethics Committee to the
Senate Committee of the Whole is an extraordinary remedy that does not violate Senator Villar’s right to due process. In the same
manner, the adoption by the Senate Committee of the Whole of the Rules of the Ethics Committee does not violate Senator Villar’s
right to due process.

The Constitutional right of the Senate to promulgate its own rules of proceedings has been recognized and affirmed by this Court.
Thus:

First. Section 16(3), Article VI of the Philippine Constitution states: "Each House shall determine the rules of its proceedings."

This provision has been traditionally construed as a grant of full discretionary authority to the House of Congress in the formulation,
adoption and promulgation of its own rules. As such, the exercise of this power is generally exempt from judicial supervision and
interference, except on a clear showing of such arbitrary and improvident use of the power as will constitute a denial of due process.

x x x. The issue partakes of the nature of a political question which, under the Constitution, is 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. Further, pursuant to his constitutional grant of virtually unrestricted authority to determine its own rules, the Senate is at
liberty to alter or modify these rules at any time it may see fit, subject only to the imperatives of quorum, voting and publication.23

The only limitation to the power of Congress to promulgate its own rules is the observance of quorum, voting, and publication when
required. As long as these requirements are complied with, the Court will not interfere with the right of Congress to amend its own
rules.

Prior Publication

Petitioners assail the non-publication of the Rules of the Senate Committee of the Whole. Respondent counters that publication is
not necessary because the Senate Committee of the Whole merely adopted the Rules of the Ethics Committee which had been
published in the Official Gazette on 23 March 2009. Respondent alleges that there is only one set of Rules that governs both the
Ethics Committee and the Senate Committee of the Whole.
In Neri v. Senate Committee on Accountability of Public Officers and Investigations,24 the Court declared void unpublished rules of
procedure in Senate inquiries insofar as such rules affect the rights of witnesses. The Court cited Section 21, Article VI of the
Constitution which mandates:

Sec. 21. The Senate or the House of Representatives or any of its respective Committees may conduct inquiries in aid of legislation
in accordance with its duly published rules of procedure. The rights of persons appearing in or affected by such inquiries shall be
respected. (Emphasis supplied)

The Court explained in the Resolution25 denying the motion for reconsideration:

The language of Section 21, Article VI of the Constitution requiring that the inquiry be conducted in accordance with the duly
published rules of procedure is categorical. It is incumbent upon the Senate to publish the rules of its legislative inquiries in each
Congress or otherwise make the published rules clearly state that the same shall be effective in the subsequent Congresses or until
they are amended or repealed to sufficiently put public on notice.

If it was the intention of the Senate for its present rules on legislative inquiries to be effective even in the next Congress, it could
have easily adopted the same language it had used in its main rules regarding effectivity.

Lest the Court be misconstrued, it should likewise be stressed that not all orders issued or proceedings conducted pursuant to the
subject Rules are null and void. Only those that result in violation of the rights of witnesses should be considered null and
void, considering that the rationale for the publication is to protect the rights of the witnesses as expressed in Section 21,
Article VI of the Constitution. Sans such violation, orders and proceedings are considered valid and effective.26 (Emphasis
supplied)

In the recent case of Gutierrez v. The House of Representatives Committee on Justice, et al.,27 the Court further clarified:

x x x inquiries in aid of legislation under Section 21, Article VI of the Constitution is the sole instance in the Constitution where there
is a categorical directive to duly publish a set of rules of procedure. Significantly notable in Neri is that with respect to the issue of
publication, the Court anchored its ruling on the 1987 Constitution’s directive, without any reliance on or reference to the 1986 case
of Tañada v. Tuvera. Tañada naturally could neither have interpreted a forthcoming 1987 Constitution nor had kept a tight rein on the
Constitution’s intentions as expressed through the allowance of either a categorical term or a general sense of making known the
issuances.28

The Constitution does not require publication of the internal rules of the House or Senate. Since rules of the House or the Senate
that affect only their members are internal to the House or Senate, such rules need not be published, unless such rules expressly
provide for their publication before the rules can take effect.

In this case, the proceedings before the Senate Committee of the Whole affect only members of the Senate since the proceedings
involve the Senate’s exercise of its disciplinary power over one of its members. Clearly, the Rules of the Senate Committee of the
Whole are internal to the Senate. However, Section 81, Rule 15 of the Rules of the Senate Committee of the Whole provides:

Sec. 81. EFFECTIVITY. These Rules shall be effective after publication in the Official Gazette or in a newspaper of general
circulation.29

Hence, in this particular case, the Rules of the Senate Committee of the Whole itself provide that the Rules must be published
before the Rules can take effect. Thus, even if publication is not required under the Constitution, publication of the Rules of the
Senate Committee of the Whole is required because the Rules expressly mandate their publication. The majority of the members of
the Senate approved the Rules of the Senate Committee of the Whole, and the publication requirement which they adopted should
be considered as the will of the majority. Respondent cannot dispense with the publication requirement just because the Rules of the
Ethics Committee had already been published in the Official Gazette. To reiterate, the Rules of the Senate Committee of the Whole
expressly require publication before the Rules can take effect. To comply with due process requirements, the Senate must follow its
own internal rules if the rights of its own members are affected.

Incidentally, we note that Section 4, Rule 1 of the Rules of the Senate Committee of the Whole30 is an exact reproduction of Section
4, Rule 1 of the Rules of the Senate Committee on Ethics and Privileges31 which states that the Ethics Committee shall be
composed of seven members, contrary to the fact that the Senate Committee of the Whole consists of all members of the Senate. In
addition, Section 5(B), Rule 1 of the Rules of the Senate Committee of the Whole32 is an exact reproduction of Section 5(B), Rule 1
of the Rules of the Senate Committee on Ethics and Privileges33 which states that only two members of the Ethics Committee shall
constitute a quorum, contrary to respondent’s allegation in its Comment that eight members of the Senate Committee of the Whole
shall constitute a quorum.34

However, if the Senate is constituted as a Committee of the Whole, a majority of the Senate is required to constitute a quorum to do
business pursuant to Section 16(2), Article VI of the Constitution.35 Otherwise, there will be a circumvention of this express provision
of the Constitution on quorum requirement. Obviously, the Rules of the Senate Committee of the Whole require modification to
comply with requirements of quorum and voting which the Senate must have overlooked in this case. In any event, in case of conflict
between the Rules of the Senate Committee of the Whole and the Constitution, the latter will of course prevail.

WHEREFORE, we GRANT the petition in part. The referral of the complaint by the Committee on Ethics and Privileges to the
Senate Committee of the Whole shall take effect only upon publication of the Rules of the Senate Committee of the Whole.

SO ORDERED.
CASE #8:

G.R. No. 164815 September 3, 2009

SR. INSP. JERRY C. VALEROSO v. COURT OF APPEALS and PEOPLE OF THE PHILIPPINES

RESOLUTION

NACHURA, J.:

For resolution is the Letter-Appeal1 of Senior Inspector (Sr. Insp.) Jerry C. Valeroso (Valeroso) praying that our February 22, 2008
Decision2 and June 30, 2008 Resolution3 be set aside and a new one be entered acquitting him of the crime of illegal possession of
firearm and ammunition.

The facts are briefly stated as follows:

Valeroso was charged with violation of Presidential Decree No. 1866, committed as follows:

That on or about the 10th day of July, 1996, in Quezon City, Philippines, the said accused without any authority of law, did then and
there willfully, unlawfully and knowingly have in his/her possession and under his/her custody and control

One (1) cal. 38 "Charter Arms" revolver bearing serial no. 52315 with five (5) live ammo.

without first having secured the necessary license/permit issued by the proper authorities.

CONTRARY TO LAW. 4

When arraigned, Valeroso pleaded "not guilty."5 Trial on the merits ensued.

During trial, the prosecution presented two witnesses: Senior Police Officer (SPO)2 Antonio Disuanco (Disuanco) of the Criminal
Investigation Division of the Central Police District Command; and Epifanio Deriquito (Deriquito), Records Verifier of the Firearms
and Explosives Division in Camp Crame. Their testimonies are summarized as follows:

On July 10, 1996, at around 9:30 a.m., Disuanco received a Dispatch Order from the desk officer directing him and three (3) other
policemen to serve a Warrant of Arrest, issued by Judge Ignacio Salvador, against Valeroso for a case of kidnapping with ransom. 6

After a briefing, the team conducted the necessary surveillance on Valeroso checking his hideouts in Cavite, Caloocan, and
Bulacan. Eventually, the team members proceeded to the Integrated National Police (INP) Central Police Station in Culiat, Quezon
City, where they saw Valeroso about to board a tricyle. Disuanco and his team approached Valeroso. They put him under arrest,
informed him of his constitutional rights, and bodily searched him. They found a Charter Arms revolver, bearing Serial No. 52315,
with five (5) pieces of live ammunition, tucked in his waist.7

Valeroso was then brought to the police station for questioning. Upon verification in the Firearms and Explosives Division in Camp
Crame, Deriquito presented a certification8 that the subject firearm was not issued to Valeroso, but was licensed in the name of a
certain Raul Palencia Salvatierra of Sampaloc, Manila.9

On the other hand, Valeroso, SPO3 Agustin R. Timbol, Jr. (Timbol), and Adrian Yuson testified for the defense. Their testimonies are
summarized as follows:

On July 10, 1996, Valeroso was sleeping inside a room in the boarding house of his children located at Sagana Homes, Barangay
New Era, Quezon City. He was awakened by four (4) heavily armed men in civilian attire who pointed their guns at him and pulled
him out of the room.10 The raiding team tied his hands and placed him near the faucet (outside the room) then went back inside,
searched and ransacked the room. Moments later, an operative came out of the room and exclaimed, "Hoy, may nakuha akong baril
sa loob!"11

Disuanco informed Valeroso that there was a standing warrant for his arrest. However, the raiding team was not armed with a
search warrant.12

Timbol testified that he issued to Valeroso a Memorandum Receipt13 dated July 1, 1993 covering the subject firearm and its
ammunition, upon the verbal instruction of Col. Angelito Moreno. 14

On May 6, 1998, the Regional Trial Court (RTC), Branch 97, Quezon City, convicted Valeroso as charged and sentenced him to
suffer the indeterminate penalty of four (4) years, two (2) months and one (1) day, as minimum, to six (6) years, as maximum. The
gun subject of the case was further ordered confiscated in favor of the government.15

On appeal, the Court of Appeals (CA) affirmed16 the RTC decision but the minimum term of the indeterminate penalty was lowered
to four (4) years and two (2) months.

On petition for review, we affirmed17 in full the CA decision. Valeroso filed a Motion for Reconsideration18 which was denied with
finality19 on June 30, 2008.

Valeroso is again before us through this Letter-Appeal20 imploring this Court to once more take a contemplative reflection and
deliberation on the case, focusing on his breached constitutional rights against unreasonable search and seizure.21

Meanwhile, as the Office of the Solicitor General (OSG) failed to timely file its Comment on Valeroso’s Motion for Reconsideration, it
instead filed a Manifestation in Lieu of Comment.22

In its Manifestation, the OSG changed its previous position and now recommends Valeroso’s acquittal. After a second look at the
evidence presented, the OSG considers the testimonies of the witnesses for the defense more credible and thus concludes that
Valeroso was arrested in a boarding house. More importantly, the OSG agrees with Valeroso that the subject firearm was obtained
by the police officers in violation of Valeroso’s constitutional right against illegal search and seizure, and should thus be excluded
from the evidence for the prosecution. Lastly, assuming that the subject firearm was admissible in evidence, still, Valeroso could not
be convicted of the crime, since he was able to establish his authority to possess the gun through the Memorandum Receipt issued
by his superiors.

After considering anew Valeroso’s arguments through his Letter-Appeal, together with the OSG’s position recommending his
acquittal, and keeping in mind that substantial rights must ultimately reign supreme over technicalities, this Court is swayed to
reconsider.23

The Letter-Appeal is actually in the nature of a second motion for reconsideration. While a second motion for reconsideration is, as a
general rule, a prohibited pleading, it is within the sound discretion of the Court to admit the same, provided it is filed with prior leave
whenever substantive justice may be better served thereby.24

This is not the first time that this Court is suspending its own rules or excepting a particular case from the operation of the rules. In
De Guzman v. Sandiganbayan,25 despite the denial of De Guzman’s motion for reconsideration, we still entertained his Omnibus
Motion, which was actually a second motion for reconsideration. Eventually, we reconsidered our earlier decision and remanded the
case to the Sandiganbayan for reception and appreciation of petitioner’s evidence. In that case, we said that if we would not
compassionately bend backwards and flex technicalities, petitioner would surely experience the disgrace and misery of incarceration
for a crime which he might not have committed after all.26 Also in Astorga v. People,27 on a second motion for reconsideration, we set
aside our earlier decision, re-examined the records of the case, then finally acquitted Benito Astorga of the crime of Arbitrary
Detention on the ground of reasonable doubt. And in Sta. Rosa Realty Development Corporation v. Amante,28 by virtue of the
January 13, 2004 En Banc Resolution, the Court authorized the Special First Division to suspend the Rules, so as to allow it to
consider and resolve respondent’s second motion for reconsideration after the motion was heard on oral arguments. After a
re-examination of the merits of the case, we granted the second motion for reconsideration and set aside our earlier decision.

Clearly, suspension of the rules of procedure, to pave the way for the re-examination of the findings of fact and conclusions of law
earlier made, is not without basis.

We would like to stress that rules of procedure are merely tools designed to facilitate the attainment of justice. They are conceived
and promulgated to effectively aid the courts in the dispensation of justice. Courts are not slaves to or robots of technical rules,
shorn of judicial discretion. In rendering justice, courts have always been, as they ought to be, conscientiously guided by the norm
that, on the balance, technicalities take a backseat to substantive rights, and not the other way around. Thus, if the application of the
Rules would tend to frustrate rather than to promote justice, it would always be within our power to suspend the rules or except a
particular case from its operation.29

Now on the substantive aspect.

The Court notes that the version of the prosecution, as to where Valeroso was arrested, is different from the version of the defense.
The prosecution claims that Valeroso was arrested near the INP Central Police Station in Culiat, Quezon City, while he was about to
board a tricycle. After placing Valeroso under arrest, the arresting officers bodily searched him, and they found the subject firearm
and ammunition. The defense, on the other hand, insists that he was arrested inside the boarding house of his children. After
serving the warrant of arrest (allegedly for kidnapping with ransom), some of the police officers searched the boarding house and
forcibly opened a cabinet where they discovered the subject firearm.

After a thorough re-examination of the records and consideration of the joint appeal for acquittal by Valeroso and the OSG, we find
that we must give more credence to the version of the defense.

Valeroso’s appeal for acquittal focuses on his constitutional right against unreasonable search and seizure alleged to have been
violated by the arresting police officers; and if so, would render the confiscated firearm and ammunition inadmissible in evidence
against him.

The right against unreasonable searches and seizures is secured by Section 2, Article III of the Constitution which states:

SEC. 2. The right of the people to be secure in their persons, houses, papers, and effects against unreasonable searches and
seizures of whatever nature and for any purpose shall be inviolable, and no search warrant or warrant of arrest shall issue except
upon probable cause to be determined personally by the judge after examination under oath or affirmation of the complainant and
the witnesses he may produce, and particularly describing the place to be searched and the persons or things to be seized.

From this constitutional provision, it can readily be gleaned that, as a general rule, the procurement of a warrant is required before a
law enforcer can validly search or seize the person, house, papers, or effects of any individual.30

To underscore the significance the law attaches to the fundamental right of an individual against unreasonable searches and
seizures, the Constitution succinctly declares in Article III, Section 3(2), that "any evidence obtained in violation of this or the
preceding section shall be inadmissible in evidence for any purpose in any proceeding."31

The above proscription is not, however, absolute. The following are the well-recognized instances where searches and seizures are
allowed even without a valid warrant:

1. Warrantless search incidental to a lawful arrest;

2. [Seizure] of evidence in "plain view." The elements are: 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 have
the right to be where they are; c) the evidence must be immediately apparent; and d) "plain view" justified mere seizure of evidence
without further search;

3. Search of a moving vehicle. Highly regulated by the government, the vehicle’s inherent mobility reduces expectation of privacy
especially when its transit in public thoroughfares furnishes a highly reasonable suspicion amounting to probable cause that the
occupant committed a criminal activity;

4. Consented warrantless search;

5. Customs search;

6. Stop and Frisk;

7. Exigent and emergency circumstances.32

8. Search of vessels and aircraft; [and]

9. Inspection of buildings and other premises for the enforcement of fire, sanitary and building regulations.33

In the exceptional instances where a warrant is not necessary to effect a valid search or seizure, what constitutes a reasonable or
unreasonable search or seizure is purely a judicial question, determinable from the uniqueness of the circumstances involved,
including the purpose of the search or seizure, the presence or absence of probable cause, the manner in which the search and
seizure was made, the place or thing searched, and the character of the articles procured.34

In light of the enumerated exceptions, and applying the test of reasonableness laid down above, is the warrantless search and
seizure of the firearm and ammunition valid?

We answer in the negative.

For one, the warrantless search could not be justified as an incident to a lawful arrest. Searches and seizures incident to lawful
arrests are governed by Section 13, Rule 126 of the Rules of Court, which reads:

SEC. 13. Search incident to lawful arrest. – A person lawfully arrested may be searched for dangerous weapons or anything which
may have been used or constitute proof in the commission of an offense without a search warrant.

We would like to stress that the scope of the warrantless search is not without limitations. In People v. Leangsiri,35 People v.
Cubcubin, Jr.,36 and People v. Estella,37 we had the occasion to lay down the parameters of a valid warrantless search and seizure
as an incident to a lawful arrest.

When an arrest is made, it is reasonable for the arresting officer to search the person arrested in order to remove any weapon that
the latter might use in order to resist arrest or effect his escape. Otherwise, the officer’s safety might well be endangered, and the
arrest itself frustrated. In addition, it is entirely reasonable for the arresting officer to search for and seize any evidence on the
arrestee’s person in order to prevent its concealment or destruction.38

Moreover, in lawful arrests, it becomes both the duty and the right of the apprehending officers to conduct a warrantless search not
only on the person of the suspect, but also in the permissible area within the latter’s reach.39 Otherwise stated, a valid arrest allows
the seizure of evidence or dangerous weapons either on the person of the one arrested or within the area of his immediate control.40
The phrase "within the area of his immediate control" means the area from within which he might gain possession of a weapon or
destructible evidence.41 A gun on a table or in a drawer in front of one who is arrested can be as dangerous to the arresting officer
as one concealed in the clothing of the person arrested.42

In the present case, Valeroso was arrested by virtue of a warrant of arrest allegedly for kidnapping with ransom. At that time,
Valeroso was sleeping inside the boarding house of his children. He was awakened by the arresting officers who were heavily
armed. They pulled him out of the room, placed him beside the faucet outside the room, tied his hands, and then put him under the
care of Disuanco.43 The other police officers remained inside the room and ransacked the locked cabinet44 where they found the
subject firearm and ammunition.45 With such discovery, Valeroso was charged with illegal possession of firearm and ammunition.

From the foregoing narration of facts, we can readily conclude that the arresting officers served the warrant of arrest without any
resistance from Valeroso. They placed him immediately under their control by pulling him out of the bed, and bringing him out of the
room with his hands tied. To be sure, the cabinet which, according to Valeroso, was locked, could no longer be considered as an
"area within his immediate control" because there was no way for him to take any weapon or to destroy any evidence that could be
used against him.

The arresting officers would have been justified in searching the person of Valeroso, as well as the tables or drawers in front of him,
for any concealed weapon that might be used against the former. But under the circumstances obtaining, there was no comparable
justification to search through all the desk drawers and cabinets or the other closed or concealed areas in that room itself.46

It is worthy to note that the purpose of the exception (warrantless search as an incident to a lawful arrest) is to protect the arresting
officer from being harmed by the person arrested, who might be armed with a concealed weapon, and to prevent the latter from
destroying evidence within reach. The exception, therefore, should not be strained beyond what is needed to serve its purpose.47 In
the case before us, search was made in the locked cabinet which cannot be said to have been within Valeroso’s immediate control.
Thus, the search exceeded the bounds of what may be considered as an incident to a lawful arrest.48

Nor can the warrantless search in this case be justified under the "plain view doctrine."

The "plain view doctrine" may not be used to launch unbridled searches and indiscriminate seizures or to extend a general
exploratory search made solely to find evidence of defendant’s guilt. The doctrine is usually applied where a police officer is not
searching for evidence against the accused, but nonetheless inadvertently comes across an incriminating object.49

As enunciated in People v. Cubcubin, Jr.50 and People v. Leangsiri:51

What the "plain view" cases have in common is that the police officer in each of them had a prior justification for an intrusion in the
course of which[,] he came inadvertently across a piece of evidence incriminating the accused. The doctrine serves to supplement
the prior justification – whether it be a warrant for another object, hot pursuit, search incident to lawful arrest, or some other
legitimate reason for being present unconnected with a search directed against the accused – and permits the warrantless seizure.
Of course, the extension of the original justification is legitimate only where it is immediately apparent to the police that they have
evidence before them; the "plain view" doctrine may not be used to extend a general exploratory search from one object to another
until something incriminating at last emerges.52
Indeed, the police officers were inside the boarding house of Valeroso’s children, because they were supposed to serve a warrant of
arrest issued against Valeroso. In other words, the police officers had a prior justification for the intrusion. Consequently, any
evidence that they would inadvertently discover may be used against Valeroso. However, in this case, the police officers did not just
accidentally discover the subject firearm and ammunition; they actually searched for evidence against Valeroso.

Clearly, the search made was illegal, a violation of Valeroso’s right against unreasonable search and seizure. Consequently, the
evidence obtained in violation of said right is inadmissible in evidence against him.1avvphi1

Unreasonable searches and seizures are the menace against which the constitutional guarantees afford full protection. While the
power to search and seize may at times be necessary for public welfare, still it may be exercised and the law enforced without
transgressing the constitutional rights of the citizens, for no enforcement of any statute is of sufficient importance to justify
indifference to the basic principles of government. Those who are supposed to enforce the law are not justified in disregarding the
rights of an individual in the name of order. Order is too high a price to pay for the loss of liberty.53

Because a warrantless search is in derogation of a constitutional right, peace officers who conduct it cannot invoke regularity in the
performance of official functions.54

The Bill of Rights is the bedrock of constitutional government. If people are stripped naked of their rights as human beings,
democracy cannot survive and government becomes meaningless. This explains why the Bill of Rights, contained as it is in Article III
of the Constitution, occupies a position of primacy in the fundamental law way above the articles on governmental power.55

Without the illegally seized firearm, Valeroso’s conviction cannot stand. There is simply no sufficient evidence to convict him.56 All
told, the guilt of Valeroso was not proven beyond reasonable doubt measured by the required moral certainty for conviction. The
evidence presented by the prosecution was not enough to overcome the presumption of innocence as constitutionally ordained.
Indeed, it would be better to set free ten men who might probably be guilty of the crime charged than to convict one innocent man
for a crime he did not commit.57

With the foregoing disquisition, there is no more need to discuss the other issues raised by Valeroso.

One final note. The Court values liberty and will always insist on the observance of basic constitutional rights as a condition sine qua
non against the awesome investigative and prosecutory powers of the government.58

WHEREFORE, in view of the foregoing, the February 22, 2008 Decision and June 30, 2008 Resolution are RECONSIDERED and
SET ASIDE. Sr. Insp. Jerry Valeroso is hereby ACQUITTED of illegal possession of firearm and ammunition.

SO ORDERED.
CASE #9:

G.R. No. 104528 January 18, 1996

PHILIPPINE NATIONAL BANK v. OFFICE OF THE PRESIDENT, HOUSING AND LAND USE REGULATORY BOARD, ALFONSO
MAGLAYA, ANGELINA MAGLAYA P. REYES, JORGE C. BERNARDINO, CORAZON DE LEON, VICTORIANO ACAYA,
FLORENCIA CULTURA, MARIA CAMPOS, ERNESTO SARMIENTO SANTIAGO TAMONAN, APOLONIA TADIAQUE, SIMEON
DE LEON, NATIVIDAD J. CRUZ, NATIVIDAD B. LORESCO, FELICIDAD GARCIA, ANA ANITA TAN, LUCAS SERVILLION,
JOSE NARAWAL, represented by their duly authorized Attorney-in-Fact, CORAZON DE LEON AND SPOUSES LEOPOLDO
AND CARMEN SEBASTIAN

RESOLUTION

PANGANIBAN, J.:

May a buyer of a property at a foreclosure sale dispossess prior purchasers on installment of individual lots therein, or compel them
to pay again for the lots which they previously bought from the defaulting mortgagor-subdivision developer, on the theory that P.D.
957, "The Subdivision and Condominium Buyers' Protective Decree", is not applicable to the mortgage contract in question, the
same having been executed prior to the enactment of P.D. 957? This is the question confronting the Court in this Petition
challenging the Decision dated March 10, 1992 of the Office of the President of the Philippines in O.P. Case No. 4249, signed by the
Executive Secretary, Franklin M. Drilon, "by authority of the President."

Private respondents were buyers on installment of subdivision lots from Marikina Village, Inc. (represented by spouses Antonio and
Susana Astudillo). Notwithstanding the land purchase agreements it executed over said lots, the subdivision developer mortgaged
the lots in favor of the petitioner, Philippine National Bank. Unaware of this mortgage, private respondents duly complied with their
obligations as lot buyers and constructed their houses on the lots in question.

Subsequently, the subdivision developer defaulted and PNB foreclosed on the mortgage. As highest bidder at the foreclosure sale,
the bank became owner of the lots.

Acting on suits brought by private respondents (which were later consolidated), the HLURB Office of Appeals, Adjudication and
Legal Affairs (OAALA) in a decision rendered on October 28, 1988 ruled that PNB - without prejudice to seeking relief against
Marikina Village, Inc. - may collect from private respondents only the "remaining amortizations, in accordance with the land purchase
agreements they had previously entered into with" Marikina Village, Inc., and cannot compel private respondents to pay all over
again for the lots they had already bought from said subdivision developer. On May 2, 1989, the Housing and Land Use Regulatory
Board affirmed this decision. On March 10, 1992, the Office of the President, invoking P.D. 957, likewise concurred with the HLURB.
Hence, the present recourse to this Court.

Under Revised Administrative Circular No. 1-95, "appeals from judgments or final orders of the . . . Office of the President . . . may
be taken to the Court of Appeals . . ." However, in order to hasten the resolution of this case, which was deemed submitted for
decision three years ago, the Court resolved to make an exception to the said Circular in the interest of speedy justice.

Petitioner bank raised the following issues:

1. The Office of the President erred in applying P.D. 957 because said law was enacted only on July 12, 1976, while the subject
mortgage was executed on December 18, 1975; and

2. Petitioner Bank is not privy to the contracts between private respondents and mortgagor-subdivision developer, hence, the Office
of the President erred in ordering petitioner Bank to accept private respondents' remaining amortizations and issue the
corresponding titles after payment thereof.

Normally, pursuant to Article 4 of the Civil Code, "(l)aws shall have no retroactive effect, unless the contrary is provided." However, it
is obvious and indubitable that P.D. 957 was intended to cover even those real estate mortgages, like the one at issue here,
executed prior to its enactment, and such intent (as succinctly captured in the preamble quoted below) must be given effect if the
laudable purpose of protecting innocent purchasers is to be achieve:

WHEREAS, it is the policy of the State to afford its inhabitants the requirements of decent human settlement and to provide them
with ample opportunities for improving their quality of life;

WHEREAS, numerous reports reveal that many real estate subdivision owners, developers, operators, and/or sellers have reneged
on their representations and, obligations to provide and maintain properly subdivision roads, drainage, sewerage, water systems,
lighting systems, and other similar basic requirements, thus endangering the health and safety of home and lot buyers;

WHEREAS, reports of alarming magnitude also show cases of swindling and fraudulent manipulations perpetrated by unscrupulous
subdivision and condominium sellers and operators, such as failure to deliver titles to the buyers or titles free from liens and
encumbrances, and to pay real estate taxes, and fraudulent sales of the same subdivision lots to different innocent purchasers for
value;1 (Emphasis supplied).

While P.D. 957 did not expressly provide for retroactivity in its entirety, yet the same can be plainly inferred from the unmistakable
intent of the law to protect innocent lot buyers from scheming subdivision developers. As between these small lot buyers and the
gigantic financial institutions which the developers deal with, it is obvious that the law - as an instrument of social justice - must
favors the weak. Indeed, the petitioner Bank had at its disposal vast resources with which it could adequately protect its loan
activities, and therefore is presumed to have conducted the usual "due diligence" checking and ascertained (whether thru ocular
inspection or other modes of investigation) the actual status, condition, utilization and occupancy of the property offered as
collateral. It could not have been unaware that the property had been built on by small lot buyers. On the other hand, private
respondents obviously were powerless to discover the attempt of the land developer to hypothecate the property being sold to them.
It was precisely in order to deal with this kind of situation that P.D. 957 was enacted, its very essence and intendment being to
provide a protective mantle over helpless citizens who may fall prey to the razzmatazz of what P.D. 957 termed "unscrupulous
subdivision and condominium sellers."
The intent of the law, as culled from its preamble and from the situation, circumstances and condition it sought to remedy, must be
enforced. Sutherland, in his well-known treatise on Statutory Construction (quoted with approval by this Court in an old case of
consequence, Ongsiako vs. Gamboa2 ), says:

The intent of a statute is the law. If a statute is valid it is to have effect according to the purpose and intent of the lawmaker. The
intent is the vital part, the essence of the law, and the primary rule of construction is to ascertain and give effect to the intent. The
intention of the legislature in enacting a law is the law itself, and must be enforced when ascertained, although it may not be
consistent with the strict letter of the statute. Courts will not follow the letter of a statute when it leads away from the true intent and
purpose of the legislature and to conclusions inconsistent with the general purpose of the act. Intent is the spirit which gives life to a
legislative enactment. In construing statutes the proper course is to start out and follow the true intent of the legislature and to adopt
that sense which harmonizes best with the context and promotes in the fullest manner the apparent policy and objects of the
legislature.3

Truly, this Court cannot allow the injustice that will be wrought by a strictly prospective application of the law. Little people who have
toiled for years through blood and tears would be deprived of their homes through no fault of their own. As the Solicitor General, in
his comment, argues:

Verily, if P.D. 957 were to exclude from its coverage the aforecited mortgage contract, the vigorous regulation which P.D. 957 seeks
to impose on unconscientious subdivision sellers will be translated into a feeble exercise of police power just because the iron hand
of the State cannot particularly touch mortgage contracts badged with the fortunate accident of having been constituted prior to the
enactment of P.D. 957. Indeed, it would be illogical in the extreme if P.D. 957 is to be given full force and effect and yet, the
fraudulent practices and manipulations it seeks to curb in the first instance can nevertheless be liberally perpetrated precisely
because P.D. 957 cannot be applied to existing antecedent mortgage contracts. The legislative intent could not have conceivably
permitted a loophole which all along works to the prejudice of subdivision lot buyers (private respondents).4

Likewise noteworthy are certain provisions of P.D. 957, which themselves constitute strong arguments in favor of the retroactivity of
P.D. 957 as a whole. These are Sections 20, 2l and 23 thereof, which by their very terms have retroactive effect and will impact upon
even those contracts and transactions entered into prior to P.D. 957's enactment:

Sec. 20. Time of Completion. - Every owner or developer or shall construct and provide the facilities, improvements, infrastructures
and other forms of development, including water supply and lighting facilities, which are offered and indicated in the approved
subdivision or condominiun plans, brochures, prospectus, printed matters, letters or in any form of advertisement, within one year
from the date of the issuance of the license for the subdivision or condominium project or such other period of time as may be fixed
by the Authority.

Sec. 21. Sales Prior to Decree. - In cases of subdivision lots or condominium units sold or disposed of prior to the effectivity of this
Decree, it shall be incumbent upon the owner or developer of the subdivision or condominium project to complete compliance with
his or its obligations as provided in the preceding section within two years from the date of this Decree unless otherwise extended by
the Authority or unless an adequate performance bond is filed in accordance with Section 6 hereof.

Failure of the owner or developer to comply with the obligations under this and the preceding provisions shall constitute a violation
punishable under Section 38 and 39 of this Decree.

Sec. 23. Non-Forfeiture of Payments. - No installment payment made by a buyer in a subdivision or condominium project for, the lot
or unit he contracted to buy shall be forfeited in favor, of the owner or developer when the buyer, after, due notice to the owner or
developer, desist from further payment due to the failure of the owner or developer to develop the subdivision or condominium
project according to the approved plans and within the time limit for complying with the same. Such buyer may, at this option, be
reimbursed the total amount paid including amortization interests but excluding delinquency interests, with interest thereon at the
legal rate. (emphasis supplied)

As for objections about a possible violation of the impairment clause, we find the following statements of Justice Isagani Cruz
enlightening and pertinent to the case at bench:

Despite the impairment clause, a contract valid at the time of its execution may be legally modified or even completely invalidated by
a subsequent law. If the law is a proper exercise of the police power, it will prevail over the contract.

Into each contract are read the provisions of existing law and, always, a reservation of the police power as long as the agreement
deals with a matter, affecting the public welfare. Such a contract, it has been held, suffers a congenital infirmity, and this is its
susceptibility to change by the legislature as a postulate of the legal order.5

This Court ruled along similar lines in Juarez vs. Court of Appeals 6 :

The petitioner complains that the retroactive application of the law would violate the impairment clause. The argument does not
impress. The impairment clause is now no longer inviolate; in fact, there are many who now believe it, is an anachronism in the
present-day society. It was quite useful before in protecting the integrity of private agreements from government meddling, but that
was when such agreements did not affect the community in general. They were indeed purely private agreements then. Any
interference with them at that time was really an unwarranted intrusion that could properly struck down.

But things are different now. More and more, the interests of the public have become involved in what are supposed to be still
private agreements, which have, as a result been removed from the protection of the impairment clause. These agreements have
come within the embrace of the police power, that obtrusive protector of the public interest. It is a ubiquitous policeman indeed. As
long as the contract affects the public welfare one way or another so as to require the interference of the State, then must the police
power be asserted, and prevail, over the clause.

The decision of the Court of Appeals in Breta and Hamor vs. Lao, et al.7 penned by then Court of Appeals Associate Justice Jose A.
R. Melo, now a respected member of this Court, is persuasive, the factual circumstances therein being of great similarity to the
antecedent facts of the case at bench:

Protection must be afforded small homeowners who toil and save if only to purchase on installment a tiny home lot they can call
their own. The consuming dream of every Filipino is to be able to buy a lot, no matter how small, so that he may somehow build a
house. It has, however, been seen of late that these honest, hard-living individuals are taken advantage of, with the delivery of titles
delayed, the subdivision facilities, including the most essential such as water installations not completed, or worse yet, as in the
instant case, after almost completing the payments for the property and after constructing a house, the buyer is suddenly confronted
by the stark reality, contrived or otherwise, in which another person would now appear to be owner.

xxx xxx xxx

We cannot over emphasize the fact that the BANK cannot barefacedly argue that simply because the title or titles offered as security
were clean of any encumbrance or lien, that it was thereby relieved of taking any other step to verify the over-reaching implications
should the subdivision be auctioned on foreclosure. The BANK could not have closed its eyes that it was dealing over a subdivision
where there were already houses constructed. Did it not enter the mind of the responsible officers of the BANK that there may even
be subdivision residents who have almost completed their installment payments? (id., pp. 7 & 9).

By the foregoing citation, this Court, thus adopts by reference the foregoing as part of this Decision.

The real estate mortgage in the above cited case, although constituted in 1975 and outside the beneficial aegis of P.D. 957, was
struck down by the Court of Appeals which found in favor of subdivision lot buyers when the rights of the latter clashed with the
mortgagee bank's right to foreclose the property. The Court of Appeals in that case upheld the decision of the trial court declaring
the real estate mortgage as null and void.

As to the second issue of non-privity, petitioner avers that, in view of the provisions of Article 1311 of the Civil Code, PNB, being a
"total stranger to the land purchase agreement," cannot be made to take the developer's place.

We disagree, P.D. 957 being applicable, Section 18 of said law obliges petitioner Bank to accept the payment of the remaining
unpaid amortizations tendered by private respondents.

Sec. 18. Mortgages. - No mortgage on any unit or lot shall be made by the owner or developer without prior written approval of the
Authority, Such approval shall not be granted unless it is shown that the proceeds of the mortgage loan shall be used for the
development of the condominium or subdivision project and effective measures have been provided to ensure such utilization. The
loan value of each lot or unit covered by the mortgage shall be determined and the buyer thereof, if any, shall be notified before the
release of the loan. The buyer may, at his option, pay his installment for the lot or unit directly to the mortgagee who shall apply the
payments to the corresponding mortgage indebtedness secured by the particular lot or unit being paid for, with a view to enabling
said buyer to obtain title over the lot or unit promptly after full payment thereof. (emphasis supplied)

Privity of contracts as a defense does not apply in this case for the law explicitly grants to the buyer the option to pay the installment
payment for his lot or unit directly to the mortgagee (petitioner), which is required to apply such payments to reduce the
corresponding portion of the mortgage indebtedness secured by the particular lot or unit being paid for. And, as stated earlier, this is
without prejudice to petitioner Bank's seeking relief against the subdivision developer.

Finally, before closing this Resolution, we enjoin petitioner Bank to focus not only on the strictly legal issues involved in this case but
also to take another look at the larger issues including social justice and the protection of human rights as enshrined in the
Constitution; firstly, because legal issues are raised and decided not in a vacuum but within the context of existing social, economic
and political conditions, law being merely a brick in the up- building of the social edifice; and secondly, petitioner, being THE state
bank, is for all intents and purposes an instrument for the implementation of state policies so cherished in our fundamental law.
These consideration are obviously far more weighty than the winning of any particular suit or the acquisition of any specific property.
Thus, as the country strives to move ahead towards economic self-sufficiency and to achieve dreams of "NIC-hood" and social
well-being for the majority of our countrymen, we hold that petitioner Bank, the premier bank in the country, which has in recent
years made record earnings and acquired an enviable international stature, with branches and subsidiaries in key financial centers
around the world, should be equally as happy with the disposition of this case as the private respondents, who were almost deprived
and dispossessed of their very homes purchased through their hard work and with their meager savings.

WHEREFORE, in view of the foregoing considerations, the petition is hereby DENIED, petitioner having failed to show any
REVERSIBLE ERROR or GRAVE ABUSE OF DISCRETION in the assailed decision. No costs.

SO ORDERED.
CASE #10:

G.R. No. 168129 April 24, 2007

COMMISSIONER OF INTERNAL REVENUE v. PHILIPPINE HEALTH CARE PROVIDERS, INC., Respondent.

DECISION

SANDOVAL-GUTIERREZ, J.:

For our resolution is the instant Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended,
seeking to reverse the Decision1 dated February 18, 2005 and Resolution dated May 9, 2005 of the Court of Appeals (Fifteenth
Division) in CA-G.R. SP No. 76449.

The factual antecedents of this case, as culled from the records, are:

The Philippine Health Care Providers, Inc., herein respondent, is a corporation organized and existing under the laws of the
Republic of the Philippines. Pursuant to its Articles of Incorporation,2 its primary purpose is "To establish, maintain, conduct and
operate a prepaid group practice health care delivery system or a health maintenance organization to take care of the sick and
disabled persons enrolled in the health care plan and to provide for the administrative, legal, and financial responsibilities of the
organization."1^vvphi1.net

On July 25, 1987, President Corazon C. Aquino issued Executive Order (E.O.) No. 273, amending the National Internal Revenue
Code of 1977 (Presidential Decree No. 1158) by imposing Value-Added Tax (VAT) on the sale of goods and services. This E.O. took
effect on January 1, 1988.

Before the effectivity of E.O. No. 273, or on December 10, 1987, respondent wrote the Commissioner of Internal Revenue (CIR),
petitioner, inquiring whether the services it provides to the participants in its health care program are exempt from the payment of the
VAT.

On June 8, 1988, petitioner CIR, through the VAT Review Committee of the Bureau of Internal Revenue (BIR), issued VAT Ruling
No. 231-88 stating that respondent, as a provider of medical services, is exempt from the VAT coverage. This Ruling was
subsequently confirmed by Regional Director Osmundo G. Umali of Revenue Region No. 8 in a letter dated April 22, 1994.

Meanwhile, on January 1, 1996, Republic Act (R.A.) No. 7716 (Expanded VAT or E-VAT Law) took effect, amending further the
National Internal Revenue Code of 1977. Then on January 1, 1998, R.A. No. 8424 (National Internal Revenue Code of 1997)
became effective. This new Tax Code substantially adopted and reproduced the provisions of E.O. No. 273 on VAT and R.A. No.
7716 on E-VAT.

In the interim, on October 1, 1999, the BIR sent respondent a Preliminary Assessment Notice for deficiency in its payment of the
VAT and documentary stamp taxes (DST) for taxable years 1996 and 1997.

On October 20, 1999, respondent filed a protest with the BIR.

On January 27, 2000, petitioner CIR sent respondent a letter demanding payment of "deficiency VAT" in the amount of
₱100,505,030.26 and DST in the amount of ₱124,196,610.92, or a total of ₱224,702,641.18 for taxable years 1996 and 1997.
Attached to the demand letter were four (4) assessment notices.

On February 23, 2000, respondent filed another protest questioning the assessment notices.

Petitioner CIR did not take any action on respondent's protests. Hence, on September 21, 2000, respondent filed with the Court of
Tax Appeals (CTA) a petition for review, docketed as CTA Case No. 6166.

On April 5, 2002, the CTA rendered its Decision, the dispositive portion of which reads:

WHEREFORE, in view of the foregoing, the instant Petition for Review is PARTIALLY GRANTED. Petitioner is hereby ORDERED
TO PAY the deficiency VAT amounting to ₱22,054,831.75 inclusive of 25% surcharge plus 20% interest from January 20, 1997 until
fully paid for the 1996 VAT deficiency and ₱31,094,163.87 inclusive of 25% surcharge plus 20% interest from January 20, 1998 until
paid for the 1997 VAT deficiency.1awphi1.nét Accordingly, VAT Ruling No. 231-88 is declared void and without force and effect. The
1996 and 1997 deficiency DST assessment against petitioner is hereby CANCELLED AND SET ASIDE. Respondent is ORDERED
to DESIST from collecting the said DST deficiency tax.

SO ORDERED.

Respondent filed a motion for partial reconsideration of the above judgment concerning its liability to pay the deficiency VAT.

In its Resolution3 dated March 23, 2003, the CTA granted respondent's motion, thus:

WHEREFORE, in view of the foregoing, the instant Motion for Partial Reconsideration is GRANTED. Accordingly, the VAT
assessment issued by herein respondent against petitioner for the taxable years 1996 and 1997 is hereby WITHDRAWN and SET
ASIDE.

SO ORDERED.

The CTA held:

Moreover, this court adheres to its conclusion that petitioner is a service contractor subject to VAT since it does not actually render
medical service but merely acts as a conduit between the members and petitioner's accredited and recognized hospitals and clinics.
However, after a careful review of the facts of the case as well as the Law and jurisprudence applicable, this court resolves to grant
petitioner's "Motion for Partial Reconsideration." We are in accord with the view of petitioner that it is entitled to the benefit of
non-retroactivity of rulings guaranteed under Section 246 of the Tax Code, in the absence of showing of bad faith on its part. Section
246 of the Tax Code provides:

Sec. 246. Non-Retroactivity of Rulings. - Any revocation, modification or reversal of any of the rules and regulations promulgated
in accordance with the preceding Sections or any of the rulings or circulars promulgated by the Commissioner shall not be given
retroactive application if the revocation, modification or reversal will be prejudicial to the taxpayers, x x x.

Clearly, undue prejudice will be caused to petitioner if the revocation of VAT Ruling No. 231-88 will be retroactively applied to its
case. VAT Ruling No. 231-88 issued by no less than the respondent itself has confirmed petitioner's entitlement to VAT exemption
under Section 103 of the Tax Code. In saying so, respondent has actually broadened the scope of "medical services" to include the
case of the petitioner. This VAT ruling was even confirmed subsequently by Regional Director Ormundo G. Umali in his letter dated
April 22, 1994 (Exhibit M). Exhibit P, which served as basis for the issuance of the said VAT ruling in favor of the petitioner
sufficiently described the business of petitioner and there is no way BIR could be misled by the said representation as to the real
nature of petitioner's business. Such being the case, this court is convinced that petitioner's reliance on the said ruling is premised
on good faith. The facts of the case do not show that petitioner deliberately committed mistakes or omitted material facts when it
obtained the said ruling from the Bureau of Internal Revenue. Thus, in the absence of such proof, this court upholds the application
of Section 246 of the Tax Code. Consequently, the pronouncement made by the BIR in VAT Ruling No. 231-88 as to the VAT
exemption of petitioner should be upheld.

Petitioner seasonably filed with the Court of Appeals a petition for review, docketed as CA-G.R. SP No. 76449.

In its Decision dated February 18, 2005, the Court of Appeals affirmed the CTA Resolution.

Petitioner CIR filed a motion for reconsideration, but it was denied by the appellate court in its Resolution4 dated May 9, 2005.

Hence, the instant petition for review on certiorari raising these two issues: (1) whether respondent's services are subject to VAT;
and (2) whether VAT Ruling No. 231-88 exempting respondent from payment of VAT has retroactive application.

On the first issue, respondent is contesting petitioner's assessment of its VAT liabilities for taxable years 1996 and 1997.

Section 1025 of the National Internal Revenue Code of 1977, as amended by E.O. No. 273 (VAT Law) and R.A. No. 7716 (E-VAT
Law), provides:

SEC. 102. Value-added tax on sale of services and use or lease of properties. - (a) Rate and base of tax. - There shall be levied,
assessed and collected, a value-added tax equivalent to 10% of gross receipts derived from the sale or exchange of services,
including the use or lease of properties.

The phrase "sale or exchange of service" means the performance of all kinds of services in the Philippines for a fee, remuneration or
consideration, including those performed or rendered by construction and service contractors x x x.

Section 1036 of the same Code specifies the exempt transactions from the provision of Section 102, thus:

SEC. 103. Exempt Transactions. - The following shall be exempt from the value-added tax:

xxx

(l) Medical, dental, hospital and veterinary services except those rendered by professionals

xxx

The import of the above provision is plain. It requires no interpretation. It contemplates the exemption from VAT of taxpayers
engaged in the performance of medical, dental, hospital, and veterinary services. In Commissioner of International Revenue v.
Seagate Technology (Philippines),7 we defined an exempt transaction as one involving goods or services which, by their nature, are
specifically listed in and expressly exempted from the VAT, under the Tax Code, without regard to the tax status of the party in the
transaction. In Commissioner of Internal Revenue v. Toshiba Information Equipment (Phils.) Inc.,8 we reiterated this definition.

In its letter to the BIR requesting confirmation of its VAT-exempt status, respondent described its services as follows:

Under the prepaid group practice health care delivery system adopted by Health Care, individuals enrolled in Health Care's health
care program are entitled to preventive, diagnostic, and corrective medical services to be dispensed by Health Care's duly licensed
physicians, specialists, and other professional technical staff participating in said group practice health care delivery system
established and operated by Health Care. Such medical services will be dispensed in a hospital or clinic owned, operated, or
accredited by Health Care. To be entitled to receive such medical services from Health Care, an individual must enroll in Health
Care's health care program and pay an annual fee. Enrollment in Health Care's health care program is on a year-to-year basis and
enrollees are issued identification cards.

From the foregoing, the CTA made the following conclusions:

a) Respondent "is not actually rendering medical service but merely acting as a conduit between the members and their
accredited and recognized hospitals and clinics."

b) It merely "provides and arranges for the provision of pre-need health care services to its members for a fixed prepaid fee
for a specified period of time."

c) It then "contracts the services of physicians, medical and dental practitioners, clinics and hospitals to perform such
services to its enrolled members;" and
d) Respondent "also enters into contract with clinics, hospitals, medical professionals and then negotiates with them
regarding payment schemes, financing and other procedures in the delivery of health services."

We note that these factual findings of the CTA were neither modified nor reversed by the Court of Appeals. It is a doctrine that
findings of fact of the CTA, a special court exercising particular expertise on the subject of tax, are generally regarded as final,
binding, and conclusive upon this Court, more so where these do not conflict with the findings of the Court of Appeals.9 Perforce, as
respondent does not actually provide medical and/or hospital services, as provided under Section 103 on exempt
transactions, but merely arranges for the same, its services are not VAT-exempt.

Relative to the second issue, Section 246 of the 1997 Tax Code, as amended, provides that rulings, circulars, rules and regulations
promulgated by the Commissioner of Internal Revenue have no retroactive application if to apply them would prejudice the taxpayer.
The exceptions to this rule are: (1) where the taxpayer deliberately misstates or omits material facts from his return or in any
document required of him by the Bureau of Internal Revenue; (2) where the facts subsequently gathered by the Bureau of Internal
Revenue are materially different from the facts on which the ruling is based, or (3) where the taxpayer acted in bad faith.

We must now determine whether VAT Ruling No. 231-88 exempting respondent from paying its VAT liabilities has retroactive
application.

In its Resolution dated March 23, 2003, the CTA found that there is no showing that respondent "deliberately committed mistakes or
omitted material facts" when it obtained VAT Ruling No. 231-88 from the BIR. The CTA held that respondent's letter which served as
the basis for the VAT ruling "sufficiently described" its business and "there is no way the BIR could be misled by the said
representation as to the real nature" of said business.

In sustaining the CTA, the Court of Appeals found that "the failure of respondent to refer to itself as a health maintenance
organization is not an indication of bad faith or a deliberate attempt to make false representations." As "the term health maintenance
organization did not as yet have any particular significance for tax purposes," respondent's failure "to include a term that has yet to
acquire its present definition and significance cannot be equated with bad faith."

We agree with both the Tax Court and the Court of Appeals that respondent acted in good faith. In Civil Service Commission v.
Maala,10 we described good faith as "that state of mind denoting honesty of intention and freedom from knowledge of circumstances
which ought to put the holder upon inquiry; an honest intention to abstain from taking any unconscientious advantage of another,
even through technicalities of law, together with absence of all information, notice, or benefit or belief of facts which render
transaction unconscientious."

According to the Court of Appeals, respondent's failure to describe itself as a "health maintenance organization," which is subject to
VAT, is not tantamount to bad faith. We note that the term "health maintenance organization" was first recorded in the Philippine
statute books only upon the passage of "The National Health Insurance Act of 1995" (Republic Act No. 7875). Section 4 (o) (3)
thereof defines a health maintenance organization as "an entity that provides, offers, or arranges for coverage of designated health
services needed by plan members for a fixed prepaid premium." Under this law, a health maintenance organization is one of the
classes of a "health care provider."

It is thus apparent that when VAT Ruling No. 231-88 was issued in respondent's favor, the term "health maintenance organization"
was yet unknown or had no significance for taxation purposes. Respondent, therefore, believed in good faith that it was VAT exempt
for the taxable years 1996 and 1997 on the basis of VAT Ruling No. 231-88.

In ABS-CBN Broadcasting Corp. v. Court of Tax Appeals,11 this Court held that under Section 246 of the 1997 Tax Code, the
Commissioner of Internal Revenue is precluded from adopting a position contrary to one previously taken where injustice
would result to the taxpayer. Hence, where an assessment for deficiency withholding income taxes was made, three years after a
new BIR Circular reversed a previous one upon which the taxpayer had relied upon, such an assessment was prejudicial to the
taxpayer. To rule otherwise, opined the Court, would be contrary to the tenets of good faith, equity, and fair play.

This Court has consistently reaffirmed its ruling in ABS-CBN Broadcasting Corp. in the later cases of Commissioner of Internal
Revenue v. Borroughs, Ltd.,12 Commissioner of Internal Revenue v. Mega Gen. Mdsg. Corp.13 Commissioner of Internal Revenue v.
Telefunken Semiconductor (Phils.) Inc.,14 and Commissioner of Internal Revenue v. Court of Appeals.15 The rule is that the BIR
rulings have no retroactive effect where a grossly unfair deal would result to the prejudice of the taxpayer, as in this case.

More recently, in Commissioner of Internal Revenue v. Benguet Corporation,16 wherein the taxpayer was entitled to tax refunds or
credits based on the BIR's own issuances but later was suddenly saddled with deficiency taxes due to its subsequent ruling
changing the category of the taxpayer's transactions for the purpose of paying its VAT, this Court ruled that applying such ruling
retroactively would be prejudicial to the taxpayer.

WHEREFORE, we DENY the petition and AFFIRM the assailed Decision and Resolution of the Court of Appeals in CA-G.R. SP No.
76449. No costs.

SO ORDERED.
CASE #11:

G.R. No. 137873 April 20, 2001

D. M. CONSUNJI, INC., v. COURT OF APPEALS and MARIA J. JUEGO, respondents.

KAPUNAN, J.:

At around 1:30 p.m., November 2, 1990, Jose Juego, a construction worker of D. M. Consunji, Inc., fell 14 floors from the
Renaissance Tower, Pasig City to his death.

PO3 Rogelio Villanueva of the Eastern Police District investigated the tragedy and filed a report dated November 25, 1990, stating
that:

x x x. [The] [v]ictim was rushed to [the] Rizal Medical Center in Pasig, Metro Manila where he was pronounced dead on arrival
(DOA) by the attending physician, Dr. Errol de Yzo[,] at around 2:15 p.m. of the same date.

Investigation disclosed that at the given time, date and place, while victim Jose A. Juego together with Jessie Jaluag and Delso
Destajo [were] performing their work as carpenter[s] at the elevator core of the 14th floor of the Tower D, Renaissance Tower Building
on board a [p]latform made of channel beam (steel) measuring 4.8 meters by 2 meters wide with pinulid plywood flooring and cable
wires attached to its four corners and hooked at the 5 ton chain block, when suddenly, the bolt or pin which was merely inserted to
connect the chain block with the [p]latform, got loose xxx causing the whole [p]latform assembly and the victim to fall down to the
basement of the elevator core, Tower D of the building under construction thereby crushing the victim of death, save his two (2)
companions who luckily jumped out for safety.

It is thus manifest that Jose A. Juego was crushed to death when the [p]latform he was then on board and performing work, fell. And
the falling of the [p]latform was due to the removal or getting loose of the pin which was merely inserted to the connecting points of
the chain block and [p]latform but without a safety lock.1

On May 9, 1991, Jose Juego’s widow, Maria, filed in the Regional Trial Court (RTC) of Pasig a complaint for damages against the
deceased’s employer, D.M. Consunji, Inc. The employer raised, among other defenses, the widow’s prior availment of the benefits
from the State Insurance Fund.

After trial, the RTC rendered a decision in favor of the widow Maria Juego. The dispositive portion of the RTC decision reads:

WHEREFORE, judgment is hereby rendered ordering defendant to pay plaintiff, as follows:

1. P50,000.00 for the death of Jose A. Juego.

2. P10,000.00 as actual and compensatory damages.

3. P464,000.00 for the loss of Jose A. Juego’s earning capacity.

4. P100,000.00 as moral damages.

5. P20,000.00 as attorney’s fees, plus the costs of suit.

SO ORDERED.2

On appeal by D. M. Consunji, the Court of Appeals (CA) affirmed the decision of the RTC in toto.

D. M. Consunji now seeks the reversal of the CA decision on the following grounds:

● THE APPELLATE COURT ERRED IN HOLDING THAT THE POLICE REPORT WAS ADMISSIBLE EVIDENCE OF THE
ALLEGED NEGLIGENCE OF PETITIONER.
● THE APPELLATE COURT ERRED IN HOLDING THAT THE DOCTRINE OF RES IPSA LOQUITOR [sic] IS APPLICABLE
TO PROVE NEGLIGENCE ON THE PART OF PETITIONER.
● THE APPELLATE COURT ERRED IN HOLDING THAT PETITIONER IS PRESUMED NEGLIGENT UNDER ARTICLE
2180 OF THE CIVIL CODE, AND
● THE APPELLATE COURT ERRED IN HOLDING THAT RESPONDENT IS NOT PRECLUDED FROM RECOVERING
DAMAGES UNDER THE CIVIL CODE. 3

Petitioner maintains that the police report reproduced above is hearsay and, therefore, inadmissible. The CA ruled otherwise. It held
that said report, being an entry in official records, is an exception to the hearsay rule.

The Rules of Court provide that a witness can testify only to those facts which he knows of his personal knowledge, that is, which
are derived from his perception.4 A witness, therefore, may not testify as what he merely learned from others either because he was
told or read or heard the same. Such testimony is considered hearsay and may not be received as proof of the truth of what he has
learned.5 This is known as the hearsay rule.

Hearsay is not limited to oral testimony or statements; the general rule that excludes hearsay as evidence applies to written, as well
as oral statements.6

The theory of the hearsay rule is that the many possible deficiencies, suppressions, sources of error and untrustworthiness, which
lie underneath the bare untested assertion of a witness, may be best brought to light and exposed by the test of cross-examiantion.7
The hearsay rule, therefore, excludes evidence that cannot be tested by cross-examination.8

The Rules of Court allow several exceptions to the rule,9 among which are entries in official records. Section 44, Rule 130 provides:
Entries in official records made in the performance of his duty made in the performance of his duty by a public officer of the
Philippines, or by a person in the performance of a duty specially enjoined by law are prima facie evidence of the facts therein
stated.

In Africa, et al. vs. Caltex (Phil.), Inc., et al.,10 this Court, citing the work of Chief Justice Moran, enumerated the requisites for
admissibility under the above rule:

(a) that the entry was made by a public officer or by another person specially enjoined by law to do so;

(b) that it was made by the public officer in the performance of his duties, or by such other person in the performance of a duty
specially enjoined by law; and

(c) that the public officer or other person had sufficient knowledge of the facts by him stated, which must have been acquired by him
personally or through official information.

The CA held that the police report meets all these requisites. Petitioner contends that the last requisite is not present.

The Court notes that PO3 Villanueva, who signed the report in question, also testified before the trial court. In Rodriguez vs. Court of
Appeals,11 which involved a Fire Investigation Report, the officer who signed the fire report also testified before the trial court. This
Court held that the report was inadmissible for the purpose of proving the truth of the statements contained in the report but
admissible insofar as it constitutes part of the testimony of the officer who executed the report.

x x x. Since Major Enriquez himself took the witness stand and was available for cross-examination, the portions of the report which
were of his personal knowledge or which consisted of his perceptions and conclusions were not hearsay. The rest of the report, such
as the summary of the statements of the parties based on their sworn statements (which were annexed to the Report) as well as the
latter, having been included in the first purpose of the offer [as part of the testimony of Major Enriquez], may then be considered as
independently relevant statements which were gathered in the course of the investigation and may thus be admitted as such, but not
necessarily to prove the truth thereof. It has been said that:

"Where regardless of the truth or falsity of a statement, the fact that it has been made is relevant, the hearsay rule does not apply,
but the statement may be shown. Evidence as to the making of such statement is not secondary but primary, for the statement itself
may constitute a fact in issue, or be circumstantially relevant as to the existence of such a fact."

When Major Enriquez took the witness stand, testified for petitioners on his Report and made himself available for
cross-examination by the adverse party, the Report, insofar as it proved that certain utterances were made (but not their truth), was
effectively removed from the ambit of the aforementioned Section 44 of Rule 130. Properly understood, this section does away with
the testimony in open court of the officer who made the official record, considers the matter as an exception to the hearsay rule and
makes the entries in said official record admissible in evidence as prima facie evidence of the facts therein stated. The underlying
reasons for this exceptionary rule are necessity and trustworthiness, as explained in Antillon v. Barcelon.

The litigation is unlimited in which testimony by officials is daily needed; the occasions in which the officials would be summoned
from his ordinary duties to declare as a witness are numberless. The public officers are few in whose daily work something is not
done in which testimony is not needed from official sources. Were there no exception for official statements, hosts of officials would
be found devoting the greater part of their time to attending as witnesses in court or delivering deposition before an officer. The work
of administration of government and the interest of the public having business with officials would alike suffer in consequence. For
these reasons, and for many others, a certain verity is accorded such documents, which is not extended to private documents. (3
Wigmore on Evidence, Sec. 1631).

The law reposes a particular confidence in public officers that it presumes they will discharge their several trusts with accuracy and
fidelity; and, therefore, whatever acts they do in discharge of their duty may be given in evidence and shall be taken to be true under
such a degree of caution as to the nature and circumstances of each case may appear to require.

It would have been an entirely different matter if Major Enriquez was not presented to testify on his report. In that case the
applicability of Section 44 of Rule 143 would have been ripe for determination, and this Court would have agreed with the Court of
Appeals that said report was inadmissible since the aforementioned third requisite was not satisfied. The statements given by the
sources of information of Major Enriquez failed to qualify as "official information," there being no showing that, at the very least, they
were under a duty to give the statements for record.

Similarly, the police report in this case is inadmissible for the purpose of proving the truth of the statements contained therein but is
admissible insofar as it constitutes part of the testimony of PO3 Villanueva.

In any case, the Court holds that portions of PO3 Villanueva’s testimony which were of his personal knowledge suffice to prove that
Jose Juego indeed died as a result of the elevator crash. PO3 Villanueva had seen Juego’s remains at the morgue,12 making the
latter’s death beyond dispute. PO3 Villanueva also conducted an ocular inspection of the premises of the building the day after the
incident13 and saw the platform for himself.14 He observed that the platform was crushed15 and that it was totally damaged.16 PO3
Villanueva also required Garcia and Fabro to bring the chain block to the police headquarters. Upon inspection, he noticed that the
chain was detached from the lifting machine, without any pin or bolt.17

What petitioner takes particular exception to is PO3 Villanueva’s testimony that the cause of the fall of the platform was the
loosening of the bolt from the chain block. It is claimed that such portion of the testimony is mere opinion. Subject to certain
exceptions,18 the opinion of a witness is generally not admissible.19

Petitioner’s contention, however, loses relevance in the face of the application of res ipsa loquitur by the CA. The effect of the
doctrine is to warrant a presumption or inference that the mere fall of the elevator was a result of the person having charge of the
instrumentality was negligent. As a rule of evidence, the doctrine of res ipsa loquitur is peculiar to the law of negligence which
recognizes that prima facie negligence may be established without direct proof and furnishes a substitute for specific proof of
negligence.20

The concept of res ipsa loquitur has been explained in this wise:
While negligence is not ordinarily inferred or presumed, and while the mere happening of an accident or injury will not generally give
rise to an inference or presumption that it was due to negligence on defendant’s part, under the doctrine of res ipsa loquitur, which
means, literally, the thing or transaction speaks for itself, or in one jurisdiction, that the thing or instrumentality speaks for itself, the
facts or circumstances accompanying an injury may be such as to raise a presumption, or at least permit an inference of negligence
on the part of the defendant, or some other person who is charged with negligence.

x x x where it is shown that the thing or instrumentality which caused the injury complained of was under the control or management
of the defendant, and that the occurrence resulting in the injury was such as in the ordinary course of things would not happen if
those who had its control or management used proper care, there is sufficient evidence, or, as sometimes stated, reasonable
evidence, in the absence of explanation by the defendant, that the injury arose from or was caused by the defendant’s want of
care.21

One of the theoretical based for the doctrine is its necessity, i.e., that necessary evidence is absent or not available.22

The res ipsa loquitur doctrine is based in part upon the theory that the defendant in charge of the instrumentality which causes the
injury either knows the cause of the accident or has the best opportunity of ascertaining it and that the plaintiff has no such
knowledge, and therefore is compelled to allege negligence in general terms and to rely upon the proof of the happening of the
accident in order to establish negligence. The inference which the doctrine permits is grounded upon the fact that the chief evidence
of the true cause, whether culpable or innocent, is practically accessible to the defendant but inaccessible to the injured person.

It has been said that the doctrine of res ipsa loquitur furnishes a bridge by which a plaintiff, without knowledge of the cause, reaches
over to defendant who knows or should know the cause, for any explanation of care exercised by the defendant in respect of the
matter of which the plaintiff complains. The res ipsa loquitur doctrine, another court has said, is a rule of necessity, in that it proceeds
on the theory that under the peculiar circumstances in which the doctrine is applicable, it is within the power of the defendant to
show that there was no negligence on his part, and direct proof of defendant’s negligence is beyond plaintiff’s power. Accordingly,
some court add to the three prerequisites for the application of the res ipsa loquitur doctrine the further requirement that for the res
ipsa loquitur doctrine to apply, it must appear that the injured party had no knowledge or means of knowledge as to the cause of the
accident, or that the party to be charged with negligence has superior knowledge or opportunity for explanation of the accident.23

The CA held that all the requisites of res ipsa loquitur are present in the case at bar:

There is no dispute that appellee’s husband fell down from the 14th floor of a building to the basement while he was working with
appellant’s construction project, resulting to his death. The construction site is within the exclusive control and management of
appellant. It has a safety engineer, a project superintendent, a carpenter leadman and others who are in complete control of the
situation therein. The circumstances of any accident that would occur therein are peculiarly within the knowledge of the appellant or
its employees. On the other hand, the appellee is not in a position to know what caused the accident. Res ipsa loquitur is a rule of
necessity and it applies where evidence is absent or not readily available, provided the following requisites are present: (1) the
accident was of a kind which does not ordinarily occur unless someone is negligent; (2) the instrumentality or agency which caused
the injury was under the exclusive control of the person charged with negligence; and (3) the injury suffered must not have been due
to any voluntary action or contribution on the part of the person injured. x x x.

No worker is going to fall from the 14th floor of a building to the basement while performing work in a construction site unless
someone is negligent[;] thus, the first requisite for the application of the rule of res ipsa loquitur is present. As explained earlier, the
construction site with all its paraphernalia and human resources that likely caused the injury is under the exclusive control and
management of appellant[;] thus[,] the second requisite is also present. No contributory negligence was attributed to the appellee’s
deceased husband[;] thus[,] the last requisite is also present. All the requisites for the application of the rule of res ipsa loquitur are
present, thus a reasonable presumption or inference of appellant’s negligence arises. x x x.24

Petitioner does not dispute the existence of the requisites for the application of res ipsa loquitur, but argues that the presumption or
inference that it was negligent did not arise since it "proved that it exercised due care to avoid the accident which befell respondent’s
husband."

Petitioner apparently misapprehends the procedural effect of the doctrine. As stated earlier, the defendant’s negligence is presumed
or inferred25 when the plaintiff establishes the requisites for the application of res ipsa loquitur. Once the plaintiff makes out a prima
facie case of all the elements, the burden then shifts to defendant to explain.26 The presumption or inference may be rebutted or
overcome by other evidence and, under appropriate circumstances disputable presumption, such as that of due care or innocence,
may outweigh the inference.27 It is not for the defendant to explain or prove its defense to prevent the presumption or inference from
arising. Evidence by the defendant of say, due care, comes into play only after the circumstances for the application of the doctrine
has been established.1âwphi1.nêt

In any case, petitioner cites the sworn statement of its leadman Ferdinand Fabro executed before the police investigator as
evidence of its due care. According to Fabro’s sworn statement, the company enacted rules and regulations for the safety and
security of its workers. Moreover, the leadman and the bodegero inspect the chain block before allowing its use.

It is ironic that petitioner relies on Fabro’s sworn statement as proof of its due care but, in arguing that private respondent failed to
prove negligence on the part of petitioner’s employees, also assails the same statement for being hearsay.

Petitioner is correct. Fabro’s sworn statement is hearsay and inadmissible. Affidavits are inadmissible as evidence under the
hearsay rule, unless the affiant is placed on the witness stand to testify thereon.28 The inadmissibility of this sort of evidence is based
not only on the lack of opportunity on the part of the adverse party to cross-examine the affiant, but also on the commonly known
fact that, generally, an affidavit is not prepared by the affiant himself but by another who uses his own language in writing the
affiant’s statements which may either be omitted or misunderstood by the one writing them.29 Petitioner, therefore, cannot use said
statement as proof of its due care any more than private respondent can use it to prove the cause of her husband’s death.
Regrettably, petitioner does not cite any other evidence to rebut the inference or presumption of negligence arising from the
application of res ipsa loquitur, or to establish any defense relating to the incident.

Next, petitioner argues that private respondent had previously availed of the death benefits provided under the Labor Code and is,
therefore, precluded from claiming from the deceased’s employer damages under the Civil Code.

Article 173 of the Labor Code states:

Article 173. Extent of liability. – Unless otherwise provided, the liability of the State Insurance Fund under this Title shall be exclusive
and in place of all other liabilities of the employer to the employee, his dependents or anyone otherwise entitled to receive damages
on behalf of the employee or his dependents. The payment of compensation under this Title shall not bar the recovery of benefits as
provided for in Section 699 of the Revised Administrative Code, Republic Act Numbered Eleven hundred sixty-one, as amended,
Republic Act Numbered Six hundred ten, as amended, Republic Act Numbered Forty-eight hundred sixty-four as amended, and
other laws whose benefits are administered by the System or by other agencies of the government.

The precursor of Article 173 of the Labor Code, Section 5 of the Workmen’s Compensation Act, provided that:

Section 5. Exclusive right to compensation. – The rights and remedies granted by this Act to an employee by reason of a personal
injury entitling him to compensation shall exclude all other rights and remedies accruing to the employee, his personal
representatives, dependents or nearest of kin against the employer under the Civil Code and other laws because of said injury x x x.

Whether Section 5 of the Workmen’s Compensation Act allowed recovery under said Act as well as under the Civil Code used to be
the subject of conflicting decisions. The Court finally settled the matter in Floresca vs.Philex Mining Corporation,30 which involved a
cave-in resulting in the death of the employees of the Philex Mining Corporation. Alleging that the mining corporation, in violation of
government rules and regulations, failed to take the required precautions for the protection of the employees, the heirs of the
deceased employees filed a complaint against Philex Mining in the Court of First Instance (CFI). Upon motion of Philex Mining, the
CFI dismissed the complaint for lack of jurisdiction. The heirs sought relief from this Court.

Addressing the issue of whether the heirs had a choice of remedies, majority of the Court En Banc,31 following the rule in Pacaña vs.
Cebu Autobus Company, held in the affirmative.

WE now come to the query as to whether or not the injured employee or his heirs in case of death have a right of selection or choice
of action between availing themselves of the worker’s right under the Workmen’s Compensation Act and suing in the regular courts
under the Civil Code for higher damages (actual, moral and exemplary) from the employers by virtue of the negligence or fault of the
employers or whether they may avail themselves cumulatively of both actions, i.e., collect the limited compensation under the
Workmen’s Compensation Act and sue in addition for damages in the regular courts.

In disposing of a similar issue, this Court in Pacaña vs. Cebu Autobus Company, 32 SCRA 442, ruled that an injured worker has a
choice of either to recover from the employer the fixed amounts set by the Workmen’s Compensation Act or to prosecute an ordinary
civil action against the tortfeasor for higher damages but he cannot pursue both courses of action simultaneously. [Underscoring
supplied.]

Nevertheless, the Court allowed some of the petitioners in said case to proceed with their suit under the Civil Code despite having
availed of the benefits provided under the Workmen’s Compensation Act. The Court reasoned:

With regard to the other petitioners, it was alleged by Philex in its motion to dismiss dated May 14, 1968 before the court a quo, that
the heirs of the deceased employees, namely Emerito Obra, Larry Villar, Jr., Aurelio Lanuza, Lorenzo Isla and Saturnino submitted
notices and claims for compensation to the Regional Office No. 1 of the then Department of Labor and all of them have been paid in
full as of August 25, 1967, except Saturnino Martinez whose heirs decided that they be paid in installments x x x. Such allegation
was admitted by herein petitioners in their opposition to the motion to dismiss dated may 27, 1968 x x x in the lower court, but they
set up the defense that the claims were filed under the Workmen’s Compensation Act before they learned of the official report of the
committee created to investigate the accident which established the criminal negligence and violation of law by Philex, and which
report was forwarded by the Director of Mines to then Executive Secretary Rafael Salas in a letter dated October 19, 1967 only x x
x.

WE hold that although the other petitioners had received the benefits under the Workmen’s Compensation Act, such my not
preclude them from bringing an action before the regular court because they became cognizant of the fact that Philex has been
remiss in its contractual obligations with the deceased miners only after receiving compensation under the Act. Had petitioners been
aware of said violation of government rules and regulations by Philex, and of its negligence, they would not have sought redress
under the Workmen’s Compensation Commission which awarded a lesser amount for compensation. The choice of the first remedy
was based on ignorance or a mistake of fact, which nullifies the choice as it was not an intelligent choice. The case should therefore
be remanded to the lower court for further proceedings. However, should the petitioners be successful in their bid before the lower
court, the payments made under the Workmen’s Compensation Act should be deducted from the damages that may be decreed in
their favor. [Underscoring supplied.]

The ruling in Floresca providing the claimant a choice of remedies was reiterated in Ysmael Maritime Corporation vs. Avelino,32 Vda.
De Severo vs. Feliciano-Go,33 and Marcopper Mining Corp. vs. Abeleda.34 In the last case, the Court again recognized that a
claimant who had been paid under the Act could still sue under the Civil Code. The Court said:

In the Robles case, it was held that claims for damages sustained by workers in the course of their employment could be filed only
under the Workmen’s Compensation Law, to the exclusion of all further claims under other laws. In Floresca, this doctrine was
abrogated in favor of the new rule that the claimants may invoke either the Workmen’s Compensation Act or the provisions of the
Civil Code, subject to the consequence that the choice of one remedy will exclude the other and that the acceptance of
compensation under the remedy chosen will preclude a claim for additional benefits under the other remedy. The exception is where
a claimant who has already been paid under the Workmen’s Compensation Act may still sue for damages under the Civil Code on
the basis of supervening facts or developments occurring after he opted for the first remedy. (Underscoring supplied.)

Here, the CA held that private respondent’s case came under the exception because private respondent was unaware of petitioner’s
negligence when she filed her claim for death benefits from the State Insurance Fund. Private respondent filed the civil complaint for
damages after she received a copy of the police investigation report and the Prosecutor’s Memorandum dismissing the criminal
complaint against petitioner’s personnel. While stating that there was no negligence attributable to the respondents in the complaint,
the prosecutor nevertheless noted in the Memorandum that, "if at all," the "case is civil in nature." The CA thus applied the exception
in Floresca:

x x x We do not agree that appellee has knowledge of the alleged negligence of appellant as early as November 25, 1990, the date
of the police investigator’s report. The appellee merely executed her sworn statement before the police investigator concerning her
personal circumstances, her relation to the victim, and her knowledge of the accident. She did not file the complaint for "Simple
Negligence Resulting to Homicide" against appellant’s employees. It was the investigator who recommended the filing of said case
and his supervisor referred the same to the prosecutor’s office. This is a standard operating procedure for police investigators which
appellee may not have even known. This may explain why no complainant is mentioned in the preliminary statement of the public
prosecutor in her memorandum dated February 6, 1991, to wit: "Respondent Ferdinand Fabro x x x are being charged by
complainant of "Simple Negligence Resulting to Homicide." It is also possible that the appellee did not have a chance to appear
before the public prosecutor as can be inferred from the following statement in said memorandum: "Respondents who were notified
pursuant to Law waived their rights to present controverting evidence," thus there was no reason for the public prosecutor to
summon the appellee. Hence, notice of appellant’s negligence cannot be imputed on appellee before she applied for death benefits
under ECC or before she received the first payment therefrom. Her using the police investigation report to support her complaint
filed on May 9, 1991 may just be an afterthought after receiving a copy of the February 6, 1991 Memorandum of the Prosecutor’s
Office dismissing the criminal complaint for insufficiency of evidence, stating therein that: "The death of the victim is not attributable
to any negligence on the part of the respondents. If at all and as shown by the records this case is civil in nature." (Underscoring
supplied.) Considering the foregoing, We are more inclined to believe appellee’s allegation that she learned about appellant’s
negligence only after she applied for and received the benefits under ECC. This is a mistake of fact that will make this case fall
under the exception held in the Floresca ruling.35

The CA further held that not only was private respondent ignorant of the facts, but of her rights as well:

x x x. Appellee [Maria Juego] testified that she has reached only elementary school for her educational attainment; that she did not
know what damages could be recovered from the death of her husband; and that she did not know that she may also recover more
from the Civil Code than from the ECC. x x x.36

Petitioner impugns the foregoing rulings. It contends that private respondent "failed to allege in her complaint that her application
and receipt of benefits from the ECC were attended by ignorance or mistake of fact. Not being an issue submitted during the trial,
the trial court had no authority to hear or adjudicate that issue."

Petitioner also claims that private respondent could not have been ignorant of the facts because as early as November 28, 1990,
private respondent was the complainant in a criminal complaint for "Simple Negligence Resulting to Homicide" against petitioner’s
employees. On February 6, 1991, two months before the filing of the action in the lower court, Prosecutor Lorna Lee issued a
resolution finding that, although there was insufficient evidence against petitioner’s employees, the case was "civil in nature." These
purportedly show that prior to her receipt of death benefits from the ECC on January 2, 1991 and every month thereafter, private
respondent also knew of the two choices of remedies available to her and yet she chose to claim and receive the benefits from the
ECC.

When a party having knowledge of the facts makes an election between inconsistent remedies, the election is final and bars any
action, suit, or proceeding inconsistent with the elected remedy, in the absence of fraud by the other party. The first act of election
acts as a bar.37 Equitable in nature, the doctrine of election of remedies is designed to mitigate possible unfairness to both parties. It
rests on the moral premise that it is fair to hold people responsible for their choices. The purpose of the doctrine is not to prevent
any recourse to any remedy, but to prevent a double redress for a single wrong.38

The choice of a party between inconsistent remedies results in a waiver by election. Hence, the rule in Floresca that a claimant
cannot simultaneously pursue recovery under the Labor Code and prosecute an ordinary course of action under the Civil Code. The
claimant, by his choice of one remedy, is deemed to have waived the other.

Waiver is the intentional relinquishment of a known right.39

[It] is an act of understanding that presupposes that a party has knowledge of its rights, but chooses not to assert them. It must be
generally shown by the party claiming a waiver that the person against whom the waiver is asserted had at the time knowledge,
actual or constructive, of the existence of the party’s rights or of all material facts upon which they depended. Where one lacks
knowledge of a right, there is no basis upon which waiver of it can rest. Ignorance of a material fact negates waiver, and waiver
cannot be established by a consent given under a mistake or misapprehension of fact.

A person makes a knowing and intelligent waiver when that person knows that a right exists and has adequate knowledge upon
which to make an intelligent decision.

Waiver requires a knowledge of the facts basic to the exercise of the right waived, with an awareness of its consequences. That a
waiver is made knowingly and intelligently must be illustrated on the record or by the evidence.40

That lack of knowledge of a fact that nullifies the election of a remedy is the basis for the exception in Floresca.

It is in light of the foregoing principles that we address petitioner’s contentions.

Waiver is a defense, and it was not incumbent upon private respondent, as plaintiff, to allege in her complaint that she had availed of
benefits from the ECC. It is, thus, erroneous for petitioner to burden private respondent with raising waiver as an issue. On the
contrary, it is the defendant who ought to plead waiver, as petitioner did in pages 2-3 of its Answer;41 otherwise, the defense is
waived. It is, therefore, perplexing for petitioner to now contend that the trial court had no jurisdiction over the issue when petitioner
itself pleaded waiver in the proceedings before the trial court.

Does the evidence show that private respondent knew of the facts that led to her husband’s death and the rights pertaining to a
choice of remedies?

It bears stressing that what negates waiver is lack of knowledge or a mistake of fact. In this case, the "fact" that served as a basis for
nullifying the waiver is the negligence of petitioner’s employees, of which private respondent purportedly learned only after the
prosecutor issued a resolution stating that there may be civil liability. In Floresca, it was the negligence of the mining corporation and
its violation of government rules and regulations. Negligence, or violation of government rules and regulations, for that matter,
however, is not a fact, but a conclusion of law, over which only the courts have the final say. Such a conclusion binds no one until
the courts have decreed so. It appears, therefore, that the principle that ignorance or mistake of fact nullifies a waiver has been
misapplied in Floresca and in the case at bar.

In any event, there is no proof that private respondent knew that her husband died in the elevator crash when on November 15,
1990 she accomplished her application for benefits from the ECC. The police investigation report is dated November 25, 1990, 10
days after the accomplishment of the form. Petitioner filed the application in her behalf on November 27, 1990.
There is also no showing that private respondent knew of the remedies available to her when the claim before the ECC was filed.
On the contrary, private respondent testified that she was not aware of her rights.

Petitioner, though, argues that under Article 3 of the Civil Code, ignorance of the law excuses no one from compliance therewith. As
judicial decisions applying or interpreting the laws or the Constitution form part of the Philippine legal system (Article 8, Civil Code),
private respondent cannot claim ignorance of this Court’s ruling in Floresca allowing a choice of remedies.

The argument has no merit. The application of Article 3 is limited to mandatory and prohibitory laws.42 This may be deduced from the
language of the provision, which, notwithstanding a person’s ignorance, does not excuse his or her compliance with the laws. The
rule in Floresca allowing private respondent a choice of remedies is neither mandatory nor prohibitory. Accordingly, her ignorance
thereof cannot be held against her.

Finally, the Court modifies the affirmance of the award of damages. The records do not indicate the total amount private respondent
ought to receive from the ECC, although it appears from Exhibit "K"43 that she received P3,581.85 as initial payment representing the
accrued pension from November 1990 to March 1991. Her initial monthly pension, according to the same Exhibit "K," was P596.97
and present total monthly pension was P716.40. Whether the total amount she will eventually receive from the ECC is less than the
sum of P644,000.00 in total damages awarded by the trial court is subject to speculation, and the case is remanded to the trial court
for such determination. Should the trial court find that its award is greater than that of the ECC, payments already received by
private respondent under the Labor Code shall be deducted from the trial court'’ award of damages. Consistent with our ruling in
Floresca, this adjudication aims to prevent double compensation.

WHEREFORE, the case is REMANDED to the Regional Trial Court of Pasig City to determine whether the award decreed in its
decision is more than that of the ECC. Should the award decreed by the trial court be greater than that awarded by the ECC,
payments already made to private respondent pursuant to the Labor Code shall be deducted therefrom. In all other respects, the
Decision of the Court of Appeals is AFFIRMED.

SO ORDERED.
CASE #12:

G.R. No. L-15127 May 30, 1961

EMETERIO CUI, plaintiff-appellant,

vs.

ARELLANO UNIVERSITY, defendant-appellee.

G.A.S. Sipin, Jr., for plaintiff-appellant.

E. Voltaire Garcia for defendant-appellee.

CONCEPCION, J.:

Appeal by plaintiff Emeterio Cui from a decision of the Court of First Instance of Manila, absolving defendant Arellano University
from plaintiff's complaint, with costs against the plaintiff, and dismissing defendant's counter claim, for insufficiency of proof thereon.

In the language of the decision appealed from:

The essential facts of this case are short and undisputed. As established by the agreement of facts Exhibits X and by the respective
oral and documentary evidence introduced by the parties, it appears conclusive that plaintiff, before the school year 1948-1949 took
up preparatory law course in the defendant University. After finishing his preparatory law course plaintiff enrolled in the College of
Law of the defendant from the school year 1948-1949. Plaintiff finished his law studies in the defendant university up to and
including the first semester of the fourth year. During all the school years in which plaintiff was studying law in defendant law college,
Francisco R. Capistrano, brother of the mother of plaintiff, was the dean of the College of Law and legal counsel of the defendant
university. Plaintiff enrolled for the last semester of his law studies in the defendant university but failed to pay his tuition fees
because his uncle Dean Francisco R. Capistrano having severed his connection with defendant and having accepted the deanship
and chancellorship of the College of Law of Abad Santos University, plaintiff left the defendant's law college and enrolled for the last
semester of his fourth year law in the college of law of the Abad Santos University graduating from the college of law of the latter
university. Plaintiff, during all the time he was studying law in defendant university was awarded scholarship grants, for scholastic
merit, so that his semestral tuition fees were returned to him after the ends of semester and when his scholarship grants were
awarded to him. The whole amount of tuition fees paid by plaintiff to defendant and refunded to him by the latter from the first
semester up to and including the first semester of his last year in the college of law or the fourth year, is in total P1,033.87. After
graduating in law from Abad Santos University he applied to take the bar examination. To secure permission to take the bar he
needed the transcripts of his records in defendant Arellano University. Plaintiff petitioned the latter to issue to him the needed
transcripts. The defendant refused until after he had paid back the P1,033 87 which defendant refunded to him as above stated. As
he could not take the bar examination without those transcripts, plaintiff paid to defendant the said sum under protest. This is the
sum which plaintiff seeks to recover from defendant in this case.

Before defendant awarded to plaintiff the scholarship grants as above stated, he was made to sign the following contract covenant
and agreement:

"In consideration of the scholarship granted to me by the University, I hereby waive my right to transfer to another school without
having refunded to the University (defendant) the equivalent of my scholarship cash.

(Sgd.) Emeterio Cui".

It is admitted that, on August 16, 1949, the Director of Private Schools issued Memorandum No. 38, series of 1949, on the subject of
"Scholarship," addressed to "All heads of private schools, colleges and universities," reading:

1. School catalogs and prospectuses submitted to this, Bureau show that some schools offer full or partial scholarships to deserving
students — for excellence in scholarship or for leadership in extra-curricular activities. Such inducements to poor but gifted students
should be encouraged. But to stipulate the condition that such scholarships are good only if the students concerned continue in the
same school nullifies the principle of merit in the award of these scholarships.

2. When students are given full or partial scholarships, it is understood that such scholarships are merited and earned. The amount
in tuition and other fees corresponding to these scholarships should not be subsequently charged to the recipient students when
they decide to quit school or to transfer to another institution. Scholarships should not be offered merely to attract and keep students
in a school.

3. Several complaints have actually been received from students who have enjoyed scholarships, full or partial, to the effect that
they could not transfer to other schools since their credentials would not be released unless they would pay the fees corresponding
to the period of the scholarships. Where the Bureau believes that the right of the student to transfer is being denied on this ground, it
reserves the right to authorize such transfer.

that defendant herein received a copy of this memorandum; that plaintiff asked the Bureau of Private Schools to pass upon the issue
on his right to secure the transcript of his record in defendant University, without being required to refund the sum of P1,033.87; that
the Bureau of Private Schools upheld the position taken by the plaintiff and so advised the defendant; and that, this notwithstanding,
the latter refused to issue said transcript of records, unless said refund were made, and even recommended to said Bureau that it
issue a written order directing the defendant to release said transcript of record, "so that the case may be presented to the court for
judicial action." As above stated, plaintiff was, accordingly, constrained to pay, and did pay under protest, said sum of P1,033.87, in
order that he could take the bar examination in 1953. Subsequently, he brought this action for the recovery of said amount, aside
from P2,000 as moral damages, P500 as exemplary damages, P2,000 as attorney's fees, and P500 as expenses of litigation.
In its answer, defendant reiterated the stand it took, vis-a-vis the Bureau of Private Schools, namely, that the provisions of its
contract with plaintiff are valid and binding and that the memorandum above-referred to is null and void. It, likewise, set up a
counterclaim for P10,000.00 as damages, and P3,000 as attorney's fees.

The issue in this case is whether the above quoted provision of the contract between plaintiff and the defendant, whereby the former
waived his right to transfer to another school without refunding to the latter the equivalent of his scholarships in cash, is valid or not.
The lower court resolved this question in the affirmative, upon the ground that the aforementioned memorandum of the Director of
Private Schools is not a law; that the provisions thereof are advisory, not mandatory in nature; and that, although the contractual
provision "may be unethical, yet it was more unethical for plaintiff to quit studying with the defendant without good reasons and
simply because he wanted to follow the example of his uncle." Moreover, defendant maintains in its brief that the aforementioned
memorandum of the Director of Private Schools is null and void because said officer had no authority to issue it, and because it had
been neither approved by the corresponding department head nor published in the official gazette.

We do not deem it necessary or advisable to consider as the lower court did, the question whether plaintiff had sufficient reasons or
not to transfer from defendant University to the Abad Santos University. The nature of the issue before us, and its far reaching
effects, transcend personal equations and demand a determination of the case from a high impersonal plane. Neither do we deem it
essential to pass upon the validity of said Memorandum No. 38, for, regardless of the same, we are of the opinion that the stipulation
in question is contrary to public policy and, hence, null and void. The aforesaid memorandum merely incorporates a sound principle
of public policy. As the Director of Private Schools correctly pointed, out in his letter, Exhibit B, to the defendant,

There is one more point that merits refutation and that is whether or not the contract entered into between Cui and Arellano
University on September 10, 1951 was void as against public policy. In the case of Zeigel vs. Illinois Trust and Savings Bank, 245 Ill.
180, 19 Ann. Case 127, the court said: 'In determining a public policy of the state, courts are limited to a consideration of the
Constitution, the judicial decisions, the statutes, and the practice of government officers.' It might take more than a government
bureau or office to lay down or establish a public policy, as alleged in your communication, but courts consider the practices of
government officials as one of the four factors in determining a public policy of the state. It has been consistently held in America
that under the principles relating to the doctrine of public policy, as applied to the law of contracts, courts of justice will not recognize
or uphold a transaction which its object, operation, or tendency is calculated to be prejudicial to the public welfare, to sound morality
or to civic honesty (Ritter vs. Mutual Life Ins. Co., 169 U.S. 139; Heding vs. Gallaghere 64 L.R.A. 811; Veazy vs. Allen, 173 N.Y.
359). If Arellano University understood clearly the real essence of scholarships and the motives which prompted this office to issue
Memorandum No. 38, s. 1949, it should have not entered into a contract of waiver with Cui on September 10, 1951, which is a direct
violation of our Memorandum and an open challenge to the authority of the Director of Private Schools because the contract was
repugnant to sound morality and civic honesty. And finally, in Gabriel vs. Monte de Piedad, Off. Gazette Supp. Dec. 6, 1941, p. 67
we read: 'In order to declare a contract void as against public policy, a court must find that the contract as to consideration or the
thing to be done, contravenes some established interest of society, or is inconsistent with sound policy and good morals or tends
clearly to undermine the security of individual rights. The policy enunciated in Memorandum No. 38, s. 1949 is sound policy.
Scholarship are awarded in recognition of merit not to keep outstanding students in school to bolster its prestige. In the
understanding of that university scholarships award is a business scheme designed to increase the business potential of an
education institution. Thus conceived it is not only inconsistent with sound policy but also good morals. But what is morals? Manresa
has this definition. It is good customs; those generally accepted principles of morality which have received some kind of social and
practical confirmation. The practice of awarding scholarships to attract students and keep them in school is not good customs nor
has it received some kind of social and practical confirmation except in some private institutions as in Arellano University. The
University of the Philippines which implements Section 5 of Article XIV of the Constitution with reference to the giving of free
scholarships to gifted children, does not require scholars to reimburse the corresponding value of the scholarships if they transfer to
other schools. So also with the leading colleges and universities of the United States after which our educational practices or
policies are patterned. In these institutions scholarships are granted not to attract and to keep brilliant students in school for their
propaganda mine but to reward merit or help gifted students in whom society has an established interest or a first lien. (Emphasis
supplied.)

WHEREFORE, the decision appealed from is hereby reversed and another one shall be entered sentencing the defendant to pay to
the plaintiff the sum of P1,033.87, with interest thereon at the legal rate from September 1, 1954, date of the institution of this case,
as well as the costs, and dismissing defendant's counterclaim. It is so ordered.
CASE #13:

G.R. No. 103982 December 11, 1992

ANTONIO A. MECANO v. COMMISSION ON AUDIT

CAMPOS, JR., J.:

Antonio A. Mecano, through a petition for certiorari, seeks to nullify the decision of the Commission on Audit (COA, for brevity)
embodied in its 7th Indorsement, dated January 16, 1992, denying his claim for reimbursement under Section 699 of the Revised
Administrative Code (RAC), as amended, in the total amount of P40,831.00.

Petitioner is a Director II of the National Bureau of Investigation (NBI). He was hospitalized for cholecystitis from March 26, 1990 to
April 7, 1990, on account of which he incurred medical and hospitalization expenses, the total amount of which he is claiming from
the COA.

On May 11, 1990, in a memorandum to the NBI Director, Alfredo S. Lim (Director Lim, for brevity), he requested reimbursement for
his expenses on the ground that he is entitled to the benefits under Section 6991 of the RAC, the pertinent provisions of which read:

Sec. 699. Allowances in case of injury, death, or sickness incurred in performance of duty. — When a person in the service of the
national government of a province, city, municipality or municipal district is so injured in the performance of duty as thereby to
receive some actual physical hurt or wound, the proper Head of Department may direct that absence during any period of disability
thereby occasioned shall be on full pay, though not more than six months, and in such case he may in his discretion also authorize
the payment of the medical attendance, necessary transportation, subsistence and hospital fees of the injured person. Absence in
the case contemplated shall be charged first against vacation leave, if any there be.

xxx xxx xxx

In case of sickness caused by or connected directly with the performance of some act in the line of duty, the Department head may
in his discretion authorize the payment of the necessary hospital fees.

Director Lim then forwarded petitioner's claim, in a 1st Indorsement dated June 22, 1990, to the Secretary of Justice, along with the
comment, bearing the same date, of Gerarda Galang, Chief, LED of the NBI, "recommending favorable action thereof". Finding
petitioner's illness to be service-connected, the Committee on Physical Examination of the Department of Justice favorably
recommended the payment of petitioner's claim.

However, then Undersecretary of Justice Silvestre H. Bello III, in a 4th Indorsement dated November 21, 1990, returned petitioner's
claim to Director Lim, having considered the statements of the Chairman of the COA in its 5th Indorsement dated 19 September
1990, to the effect that the RAC being relied upon was repealed by the Administrative Code of 1987.

Petitioner then re-submitted his claim to Director Lim, with a copy of Opinion No. 73, S. 19912 dated April 26, 1991 of then Secretary
of Justice Franklin M. Drilon (Secretary Drilon, for brevity) stating that "the issuance of the Administrative Code did not operate to
repeal or abregate in its entirety the Revised Administrative Code, including the particular Section 699 of the latter".

On May 10, 1991, Director Lim, under a 5th Indorsement transmitted anew Mecano's claim to then Undersecretary Bello for
favorable consideration. Under a 6th Indorsement, dated July 2, 1991, Secretary Drilon forwarded petitioner's claim to the COA
Chairman, recommending payment of the same. COA Chairman Eufemio C. Domingo, in his 7th Indorsement of January 16, 1992,
however, denied petitioner's claim on the ground that Section 699 of the RAC had been repealed by the Administrative Code of
1987, solely for the reason that the same section was not restated nor re-enacted in the Administrative Code of 1987. He
commented, however, that the claim may be filed with the Employees' Compensation Commission, considering that the illness of
Director Mecano occurred after the effectivity of the Administrative Code of 1987.

Eventually, petitioner's claim was returned by Undersecretary of Justice Eduardo Montenegro to Director Lim under a 9th
Indorsement dated February 7, 1992, with the advice that petitioner "elevate the matter to the Supreme Court if he so desires".

On the sole issue of whether or not the Administrative Code of 1987 repealed or abrogated Section 699 of the RAC, this petition was
brought for the consideration of this Court.

Petitioner anchors his claim on Section 699 of the RAC, as amended, and on the aforementioned Opinion No. 73, S. 1991 of
Secretary Drilon. He further maintains that in the event that a claim is filed with the Employees' Compensation Commission, as
suggested by respondent, he would still not be barred from filing a claim under the subject section. Thus, the resolution of whether
or not there was a repeal of the Revised Administrative Code of 1917 would decide the fate of petitioner's claim for reimbursement.

The COA, on the other hand, strongly maintains that the enactment of the Administrative Code of 1987 (Exec. Order No. 292)
operated to revoke or supplant in its entirety the Revised Administrative Code of 1917. The COA claims that from the "whereas"
clauses of the new Administrative Code, it can be gleaned that it was the intent of the legislature to repeal the old Code. Moreover,
the COA questions the applicability of the aforesaid opinion of the Secretary of Justice in deciding the matter. Lastly, the COA
contends that employment-related sickness, injury or death is adequately covered by the Employees' Compensation Program under
P.D. 626, such that to allow simultaneous recovery of benefits under both laws on account of the same contingency would be unfair
and unjust to the Government.

The question of whether a particular law has been repealed or not by a subsequent law is a matter of legislative intent. The
lawmakers may expressly repeal a law by incorporating therein a repealing provision which expressly and specifically cites the
particular law or laws, and portions thereof, that are intended to be repealed.3 A declaration in a statute, usually in its repealing
clause, that a particular and specific law, identified by its number or title, is repealed is an express repeal; all others are implied
repeals.4

In the case of the two Administrative Codes in question, the ascertainment of whether or not it was the intent of the legislature to
supplant the old Code with the new Code partly depends on the scrutiny of the repealing clause of the new Code. This provision is
found in Section 27, Book VII (Final Provisions) of the Administrative Code of 1987 which reads:
Sec. 27. Repealing Clause. — All laws, decrees, orders, rules and regulations, or portions thereof, inconsistent with this Code are
hereby repealed or modified accordingly.

The question that should be asked is: What is the nature of this repealing clause? It is certainly not an express repealing clause
because it fails to identify or designate the act or acts that are intended to be repealed.5 Rather, it is an example of a general
repealing provision, as stated in Opinion No. 73, S. 1991. It is a clause which predicates the intended repeal under the condition that
substantial conflict must be found in existing and prior acts. The failure to add a specific repealing clause indicates that the intent
was not to repeal any existing law, unless an irreconcilable inconcistency and repugnancy exist in the terms of the new and old
laws.6 This latter situation falls under the category of an implied repeal.

Repeal by implication proceeds on the premise that where a statute of later date clearly reveals an intention on the part of the
legislature to abrogate a prior act on the subject, that intention must be given effect.7 Hence, before there can be a repeal, there
must be a clear showing on the part of the lawmaker that the intent in enacting the new law was to abrogate the old one. The
intention to repeal must be clear and manifest;8 otherwise, at least, as a general rule, the later act is to be construed as a
continuation of, and not a substitute for, the first act and will continue so far as the two acts are the same from the time of the first
enactment.9

There are two categories of repeal by implication. The first is where provisions in the two acts on the same subject matter are in an
irreconcilable conflict, the later act to the extent of the conflict constitutes an implied repeal of the earlier one. The second is if the
later act covers the whole subject of the earlier one and is clearly intended as a substitute, it will operate to repeal the earlier law.
Implied repeal by irreconcilable inconsistency takes place when the two statutes cover the same subject matter; they are so clearly
inconsistent and incompatible with each other that they cannot be reconciled or harmonized; and both cannot be given effect, that is,
that one law cannot be enforced without nullifying the other.Comparing the two Codes, it is apparent that the new Code does not
cover nor attempt to cover the entire subject matter of the old Code. There are several matters treated in the old Code which are not
found in the new Code, such as the provisions on notaries public, the leave law, the public bonding law, military reservations, claims
for sickness benefits under Section 699, and still others. Moreover, the COA failed to demonstrate that the provisions of the two
Codes on the matter of the subject claim are in an irreconcilable conflict. In fact, there can be no such conflict because the provision
on sickness benefits of the nature being claimed by petitioner has not been restated in the Administrative Code of 1987. However,
the COA would have Us consider that the fact that Section 699 was not restated in the Administrative Code of 1987 meant that the
same section had been repealed. It further maintained that to allow the particular provisions not restated in the new Code to
continue in force argues against the Code itself. The COA anchored this argument on the whereas clause of the 1987 Code, which
states:

WHEREAS, the effectiveness of the Government will be enhanced by a new Administrative Code which incorporate in a unified
document the major structural, functional and procedural principles and rules of governance; and It argues, in effect, that what is
contemplated is only one Code — the Administrative Code of 1987. This contention is untenable.

The fact that a later enactment may relate to the same subject matter as that of an earlier statute is not of itself sufficient to cause an
implied repeal of the prior act, since the new statute may merely be cumulative or a continuation of the old one. 12 What is necessary
is a manifest indication of legislative purpose to repeal.13

We come now to the second category of repeal — the enactment of a statute revising or codifying the former laws on the whole
subject matter. This is only possible if the revised statute or code was intended to cover the whole subject to be a complete and
perfect system in itself. It is the rule that a subsequent statute is deemed to repeal a prior law if the former revises the whole subject
matter of the former statute.14 When both intent and scope clearly evidence the idea of a repeal, then all parts and provisions of the
prior act that are omitted from the revised act are deemed repealed.15 Furthermore, before there can be an implied repeal under this
category, it must be the clear intent of the legislature that the later act be the substitute to the prior act.16

According to Opinion No. 73, S. 1991 of the Secretary of Justice, what appears clear is the intent to cover only those aspects of
government that pertain to administration, organization and procedure, understandably because of the many changes that
transpired in the government structure since the enactment of the RAC decades of years ago. The COA challenges the weight that
this opinion carries in the determination of this controversy inasmuch as the body which had been entrusted with the implementation
of this particular provision has already rendered its decision. The COA relied on the rule in administrative law enunciated in the case
of Sison vs. Pangramuyen17 that in the absence of palpable error or grave abuse of discretion, the Court would be loathe to
substitute its own judgment for that of the administrative agency entrusted with the enforcement and implementation of the law. This
will not hold water. This principle is subject to limitations. Administrative decisions may be reviewed by the courts upon a showing
that the decision is vitiated by fraud, imposition or mistake.18 It has been held that Opinions of the Secretary and Undersecretary of
Justice are material in the construction of statutes in pari materia.19

Lastly, it is a well-settled rule of statutory construction that repeals of statutes by implication are not favored.20 The presumption is
against inconsistency and repugnancy for the legislature is presumed to know the existing laws on the subject and not to have
enacted inconsistent or conflicting statutes.21

This Court, in a case, explains the principle in detail as follows: "Repeals by implication are not favored, and will not be decreed
unless it is manifest that the legislature so intended. As laws are presumed to be passed with deliberation with full knowledge of all
existing ones on the subject, it is but reasonable to conclude that in passing a statute it was not intended to interfere with or
abrogate any former law relating to some matter, unless the repugnancy between the two is not only irreconcilable, but also clear
and convincing, and flowing necessarily from the language used, unless the later act fully embraces the subject matter of the earlier,
or unless the reason for the earlier act is beyond peradventure renewed. Hence, every effort must be used to make all acts stand
and if, by any reasonable construction, they can be reconciled, the later act will not operate as a repeal of the earlier.22

Regarding respondent's contention that recovery under this subject section shall bar the recovery of benefits under the Employees'
Compensation Program, the same cannot be upheld. The second sentence of Article 173, Chapter II, Title II (dealing on Employees'
Compensation and State Insurance Fund), Book IV of the Labor Code, as amended by P.D. 1921, expressly provides that "the
payment of compensation under this Title shall not bar the recovery of benefits as provided for in Section 699 of the Revised
Administrative Code . . . whose benefits are administered by the system (meaning SSS or GSIS) or by other agencies of the
government."

WHEREFORE, premises considered, the Court resolves to GRANT the petition; respondent is hereby ordered to give due course to
petitioner's claim for benefits. No costs. SO ORDERED.
CASE #14:

G.R. No. L-39990 July 22, 1975

THE PEOPLE OF THE PHILIPPINES v. RAFAEL LICERA, defendant-appellant.

Office of the Solicitor General Felix Q. Antonio, Assistant Solicitor General Crispin V. Bautista and Solicitor Pedro A. Ramirez for
plaintiff-appellee.

Romeo Mercado (as Counsel de Oficio) for defendant-appellant.

CASTRO, J.:

This is an appeal, on a question of law, by Rafael Licera from the judgment dated August 14, 1968 of the Court of First Instance of
Occidental Mindoro convicting him of the crime of illegal possession of firearm and sentencing him to imprisonment of five (5) years.
We reverse the judgment of conviction, for the reasons hereunder stated.

On December 3, 1965 the Chief of Police of Abra de Ilog, Occidental Mindoro, filed a complaint, subscribed and sworn to by him,
with the municipal court of the said municipality, charging Rafael Licera with illegal possession of a Winchester rifle, Model 55,
Caliber .30. On August 13, 1966 the municipal court rendered judgment finding Licera guilty of the crime charged, sentencing him to
suffer an indeterminate penalty ranging five years and one day to six years and eight months of imprisonment. Licera appealed to
the Court of First Instance of Occidental Mindoro.

In the Court of First Instance, the parties agreed to the joint trial of the case for illegal possession of firearm and another case,
likewise filed against Licera with the municipal court but already forwarded to the said Court of First Instance, for assault upon an
agent of a person in authority, the two offenses having arisen from the same occasion: apprehension of Licera by the Chief of Police
and a patrolman of Abra de Ilog on December 2, 1965 for possession of the Winchester rifle without the requisite license or permit
therefor.

On August 14, 1968 the court a quo rendered judgment acquitting Licera of the charge of assault upon an agent of a person in
authority, but convicting him of illegal possession of firearm, sentencing him to suffer five years of imprisonment, and ordering the
forfeiture of the Winchester rifle in favor of the Government.

Licera's appeal to the Court of Appeals was certified on October 16, 1974 to this Court as involving only one question of law.

Licera invokes as his legal justification for his possession of the Winschester rifle his appointment as secret agent on December 11,
1961 by Governor Feliciano Leviste of Batangas. He claims that as secret agent, he was a "peace officer" and, thus, pursuant to
People vs. Macarandang,1 was exempt from the requirements relating to the issuance of license to possess firearms. He alleges
that the court a quo erred in relying on the later case of People vs. Mapa2 which held that section 879 of the Revised Administrative
Code provides no exemption for persons appointed as secret agents by provincial governors from the requirements relating to
firearm licenses.

The principal question thus posed calls for a determination of the rule that should be applied to the case at bar that enunciated in
Macarandang or that in Mapa.

The appointment given to Licera by Governor Leviste which bears the date "December 11, 1961" includes a grant of authority to
Licera to possess the Winchester rifle in these terms: "In accordance with the decision of the Supreme Court in G.R. No. L-12088
dated December 23, 1959, you will have the right to bear a firearm ... for use in connection with the performance of your duties."
Under the rule then prevailing, enunciated in Macarandang,3 the appointment of a civilian as a "secret agent to assist in the
maintenance of peace and order campaigns and detection of crimes sufficiently put[s] him within the category of a "peace officer"
equivalent even to a member of the municipal police" whom section 879 of the Revised Administrative Code exempts from the
requirements relating to firearm licenses.

Article 8 of the Civil Code of the Philippines decrees that judicial decisions applying or interpreting the laws or the Constitution form
part of this jurisdiction's legal system. These decisions, although in themselves not laws, constitute evidence of what the laws mean.
The application or interpretation placed by the Court upon a law is part of the law as of the date of the enactment of the said law
since the Court's application or interpretation merely establishes the contemporaneous legislative intent that the construed law
purports to carry into effect.4

At the time of Licera's designation as secret agent in 1961 and at the time of his apprehension for possession of the Winchester rifle
without the requisite license or permit therefor in 1965, the Macarandang rule — the Courts interpretation of section 879 of the
Revised Administrative Code - formed part of our jurisprudence and, hence, of this jurisdiction's legal system. Mapa revoked the
Macarandang precedent only in 1967. Certainly, where a new doctrine abrogates an old rule, the new doctrine should operate
respectively only and should not adversely affect those favored by the old rule, especially those who relied thereon and acted on the
faith thereof. This holds more especially true in the application or interpretation of statutes in the field of penal law, for, in this area,
more than in any other, it is imperative that the punishability of an act be reasonably foreseen for the guidance of society.5

Pursuant to the Macarandang rule obtaining not only at the time of Licera's appointment as secret agent, which appointment
included a grant of authority to possess the Winchester rifle, but as well at the time as of his apprehension, Licera incurred no
criminal liability for possession of the said rifle, notwithstanding his non-compliance with the legal requirements relating to firearm
licenses.1äwphï1.ñët

ACCORDINGLY, the judgment a quo is reversed, and Rafael Licera is hereby acquitted. Costs de oficio.

Makasiar, Esguerra, Muñoz Palma and Martin, JJ., concur.

Teehankee, J., is on leave.

CASE #15:

G.R. No. L-10010 August 1, 1916

CHU JAN v. LUCIO BERNAS

Sulpicio V. Cea for appellant.

ARAULLO, J.:

On the afternoon of June 26, 1913, a match was held in the cockpit of the municipality of Tabaco, Albay, between two cocks
belonging to the plaintiff and to the defendant respectively. Each of said persons had put up a wager of P160; and as the referee of
the cockpit had declared the defendant's cock the winner in the bout, the plaintiff brought suit against the defendant in the justice of
the peace court of the said pueblo, asking that his own rooster be declared the winner. The justice of the peace court decided that
the bout was a draw. From this judgment the defendant appealed to the Court of First Instance of the province. For the purposes of
the appeal, the plaintiff filed his complaint and prayed this court to render judgment ordering the defendant to abide by and comply
with the rules and regulations governing cockfights, to pay the stipulated wager of P160; to return the other like amount (both sums
of wager being held for safe-keeping by the cockpit owner, Tomas Almonte) and to assess the costs of both instances against the
defendant.

The defendant denied each and all of the allegations of the complaint and moved to dismiss with the costs against the plaintiff. On
September 11, 1913, the said Court of First Instance rendered judgment dismissing the appeal without special finding as to costs.
The defendant excepted to this judgment as well as to an order dictated by the same court on November 8th of the same year, on
the plaintiff's motion, ordering the provincial treasurer of Albay and, if necessary, the municipal treasurer of Tabaco of the same
province, to release the deposit of P160 and return it to its owner, the plaintiff Chinaman, Chu Jan. These proceedings have come
before us on appeal by means of the proper bill of exceptions.

The grounds for the dismissal pronounced by the lower court in the judgment appealed from ere that the court has always dismissed
cases of this nature, that he is not familiar with the rules governing cockfights and the duties of referees thereof; that he does not
know where to find the law on the subject and, finally, that he knows of no law whatever that governs the rights to the plaintiff and
the defendant in questions concerning cockfights.

The ignorance of the court or his lack of knowledge regarding the law applicable to a case submitted to him for decision, the fact that
the court does not know the rules applicable to a certain matter that is the subject of an appeal which must be decided by him and
his not knowing where to find the law relative to the case, are not reasons that can serve to excuse the court for terminating the
proceedings by dismissing them without deciding the issues. Such an excuse is the less acceptable because, foreseeing that a case
might arise to which no law would be exactly applicable, the Civil Code, in the second paragraph of article 6, provides that the
customs of the place shall be observed, and, in the absence thereof, the general principles of law.

Therefore the judgment and the order appealed from, hereinbefore mentioned, are reversed and to record of the proceedings shall
remanded to the court from whence they came for due trial and judgment as provided by law. No special finding is made with regard
to costs. So ordered.

Arellano, C. J., Torres, Johnson, and Trent, JJ., concur.

Moreland, J., took no part.

CASE #16:

G.R. No. L-42050-66 November 20, 1978

THE PEOPLE OF THE PHILIPPINES v. Purisima

MUÑOZ PALMA, J.:

These twenty-six (26) Petitions for Review filed by the People of the Philippines represented, respectively, by the Office of the City
Fiscal of Manila, the Office of the Provincial Fiscal of Samar, and joined by the Solicitor General, are consolidated in this one
Decision as they involve one basic question of law.

These Petitions or appeals involve three Courts of First Instance, namely: the Court of First Instance of Manila, Branch VII, presided
by Hon. Amante P. Purisima (17 Petitions), the Court of First Instance of Manila, Branch XVIII, presided by Hon. Maximo A. Maceren
(8 Petitions) and, the Court of First Instance of Samar, with Hon. Wenceslao M. Polo, presiding, (1 Petition).

Before those courts, Informations were filed charging the respective accused with "illegal possession of deadly weapon" in violation
of Presidential Decree No. 9. On a motion to quash filed by the accused, the three Judges mentioned above issued in the respective
cases filed before them — the details of which will be recounted below — an Order quashing or dismissing the Informations, on a
common ground, viz, that the Information did not allege facts which constitute the offense penalized by Presidential Decree No. 9
because it failed to state one essential element of the crime.

Thus, are the Informations filed by the People sufficient in form and substance to constitute the offense of "illegal possession of
deadly weapon" penalized under Presidential Decree (PD for short) No. 9? This is the central issue which we shall resolve and
dispose of, all other corollary matters not being indispensable for the moment.

A — The Information filed by the People —

1. In L-42050-66, one typical Information filed with the Court presided by Judge Purisima follows:

THE PEOPLE OF THE PHILIPPINES, plaintiff, versus PORFIRIO CANDELOSAS Y DURAN, accused.

Crim. Case No. 19639

VIOLATION OF PAR. 3, PRES. DECREE No. 9 OF PROCLAMATION 1081

INFORMATION

The undersigned accuses PORFIRIO CANDELOSAS Y DURAN of a violation of paragraph 3, Presidential Decree No. 9 of
Proclamation 1081, committed as follows:

That on or about the 14 th day of December, 1974, in the City of Manila, Philippines, the said accused did then and there wilfully,
unlawfully, feloniously and knowingly have in his possession and under his custody and control one (1) carving knife with a blade of
6-½ inches and a wooden handle of 5-1/4 inches, or an overall length of 11-¾ inches, which the said accused carried outside of his
residence, the said weapon not being used as a tool or implement necessary to earn his livelihood nor being used in connection
therewith.

Contrary to law. (p. 32, rollo of L-42050-66)

The other Informations are similarly worded except for the name of the accused, the date and place of the commission of the crime,
and the kind of weapon involved.

2. In L-46229-32 and L-46313-16, the Information filed with the Court presided by Judge Maceren follows:

THE PEOPLE OF THE PHILIPPINES, plaintiff, versus REYNALDO LAQUI Y AQUINO, accused.

CRIM. CASE NO. 29677

VIOL. OF PAR. 3,

PD 9 IN REL. TO LOI

No. 266 of the Chief

Executive dated April 1, 1975

INFORMATION

The undersigned accuses REYNALDO LAQUI Y AQUINO of a VIOLATION OF PARAGRAPH 3, PRESIDENTIAL DECREE NO. 9 in
relation to Letter of Instruction No. 266 of the Chief Executive dated April 1, 1975, committed as follows:

That on or about the 28 th day of January, 1977, in the City of Manila, Philippines, the said accused did then and there wilfully,
unlawfully and knowingly carry outside of his residence a bladed and pointed weapon, to wit: an ice pick with an overall length of
about 8½ inches, the same not being used as a necessary tool or implement to earn his livelihood nor being used in connection
therewith.

Contrary to law. (p. 14, rollo of L-46229-32)

The other Informations are likewise similarly worded except for the name of the accused, the date and place of the commission of
the crime, and the kind of weapon involved.
3. In L-46997, the Information before the Court of First Instance of Samar is quoted hereunder:

PEOPLE OF THE PHILIPPINES, complainant, versus PANCHITO REFUNCION, accused.

CRIM. CASE NO. 933

For:

ILLEGAL POSSESSION OF

DEADLY WEAPON

(VIOLATION OF PD NO. 9)

INFORMATION

The undersigned First Assistant Provincial Fiscal of Samar, accuses PANCHITO REFUNCION of the crime of ILLEGAL
POSSESSION OF DEADLY WEAPON or VIOLATION OF PD NO. 9 issued by the President of the Philippines on Oct. 2, 1972,
pursuant to Proclamation No. 1081 dated Sept. 21 and 23, 1972, committed as follows:

That on or about the 6th day of October, 1976, in the evening at Barangay Barruz, Municipality of Matuginao, Province of Samar
Philippines, and within the jurisdiction of this Honorabe Court, the abovenamed accused, knowingly, wilfully, unlawfully and
feloniously carried with him outside of his residence a deadly weapon called socyatan, an instrument which from its very nature is no
such as could be used as a necessary tool or instrument to earn a livelihood, which act committed by the accused is a Violation of
Presidential Decree No. 9.

CONTRARY TO LAW. (p. 8, rollo of L-46997)

B. — The Orders of dismissal —

In dismissing or quashing the Informations the trial courts concurred with the submittal of the defense that one essential element of
the offense charged is missing from the Information, viz: that the carrying outside of the accused's residence of a bladed, pointed or
blunt weapon is in furtherance or on the occasion of, connected with or related to subversion, insurrection, or rebellion, organized
lawlessness or public disorder.

1. Judge Purisima reasoned out, inter alia, in this manner:

... the Court is of the opinion that in order that possession of bladed weapon or the like outside residence may be prosecuted and
tried under P.D. No. 9, the information must specifically allege that the possession of bladed weapon charged was for the purpose of
abetting, or in furtherance of the conditions of rampant criminality, organized lawlessness, public disorder, etc. as are contemplated
and recited in Proclamation No. 1081, as justification therefor. Devoid of this specific allegation, not necessarily in the same words,
the information is not complete, as it does not allege sufficient facts to constitute the offense contemplated in P.D. No. 9. The
information in these cases under consideration suffer from this defect.

xxx xxx xxx

And while there is no proof of it before the Court, it is not difficult to believe the murmurings of detained persons brought to Court
upon a charge of possession of bladed weapons under P.D. No. 9, that more than ever before, policemen - of course not all can be
so heartless — now have in their hands P.D. No. 9 as a most convenient tool for extortion, what with the terrifying risk of being
sentenced to imprisonment of five to ten years for a rusted kitchen knife or a pair of scissors, which only God knows where it came
from. Whereas before martial law an extortion-minded peace officer had to have a stock of the cheapest paltik, and even that could
only convey the coercive message of one year in jail, now anything that has the semblance of a sharp edge or pointed object,
available even in trash cans, may already serve the same purpose, and yet five to ten times more incriminating than the infamous
paltik.

For sure, P.D. No. 9 was conceived with the best of intentions and wisely applied, its necessity can never be assailed. But it seems it
is back-firing, because it is too hot in the hands of policemen who are inclined to backsliding.

The checkvalves against abuse of P.D. No. 9 are to be found in the heart of the Fiscal and the conscience of the Court, and hence
this resolution, let alone technical legal basis, is prompted by the desire of this Court to apply said checkvalves. (pp. 55-57, rollo of
L-42050-66)

2. Judge Maceren in turn gave his grounds for dismissing the charges as follows:

xxx xxx xxx

As earlier noted the "desired result" sought to be attained by Proclamation No. 1081 is the maintenance of law and order throughout
the Philippines and the prevention and suppression of all forms of lawless violence as well as any act of insurrection or rebellion. It is
therefore reasonable to conclude from the foregoing premises that the carrying of bladed, pointed or blunt weapons outside of one's
residence which is made unlawful and punishable by said par. 3 of P.D. No. 9 is one that abets subversion, insurrection or rebellion,
lawless violence, criminality, chaos and public disorder or is intended to bring about these conditions. This conclusion is further
strengthened by the fact that all previously existing laws that also made the carrying of similar weapons punishable have not been
repealed, whether expressly or impliedly. It is noteworthy that Presidential Decree No. 9 does not contain any repealing clause or
provisions.

xxx xxx xxx

The mere carrying outside of one's residence of these deadly weapons if not concealed in one's person and if not carried in any of
the aforesaid specified places, would appear to be not unlawful and punishable by law.
With the promulgation of Presidential Decree No. 9, however, the prosecution, through Assistant Fiscal Hilario H. Laqui, contends in
his opposition to the motion to quash, that this act is now made unlawful and punishable, particularly by paragraph 3 thereof,
regardless of the intention of the person carrying such weapon because the law makes it "mala prohibita". If the contention of the
prosecution is correct, then if a person happens to be caught while on his way home by law enforcement officers carrying a kitchen
knife that said person had just bought from a store in order that the same may be used by one's cook for preparing the meals in
one's home, such person will be liable for punishment with such a severe penalty as imprisonment from five to ten years under the
decree. Such person cannot claim that said knife is going to be used by him to earn a livelihood because he intended it merely for
use by his cook in preparing his meals.

This possibility cannot be discounted if Presidential Decree No. 9 were to be interpreted and applied in the manner that that the
prosecution wants it to be done. The good intentions of the President in promulgating this decree may thus be perverted by some
unscrupulous law enforcement officers. It may be used as a tool of oppression and tyranny or of extortion.

xxx xxx xxx

It is therefore the considered and humble view of this Court that the act which the President intended to make unlawful and
punishable by Presidential Decree No. 9, particularly by paragraph 3 thereof, is one that abets or is intended to abet subversion,
rebellion, insurrection, lawless violence, criminality, chaos and public disorder. (pp. 28-30, rollo of L-46229-32)

3. Judge Polo of the Court of First Instance of Samar expounded his order dismissing the Information filed before him, thus:

... We believe that to constitute an offense under the aforcited Presidential decree, the same should be or there should be an
allegation that a felony was committed in connection or in furtherance of subversion, rebellion, insurrection, lawless violence and
public disorder. Precisely Proclamation No. 1081 declaring a state of martial law throughout the country was issued because of
wanton destruction to lives and properties widespread lawlessness and anarchy. And in order to restore the tranquility and stability
of the country and to secure the people from violence anti loss of lives in the quickest possible manner and time, carrying firearms,
explosives and deadly weapons without a permit unless the same would fall under the exception is prohibited. This conclusion
becomes more compelling when we consider the penalty imposable, which is from five years to ten years. A strict enforcement of
the provision of the said law would mean the imposition of the Draconian penalty upon the accused.

xxx xxx xxx

It is public knowledge that in rural areas, even before and during martial law, as a matter of status symbol, carrying deadly weapons
is very common, not necessarily for committing a crime nor as their farm implement but for self-preservation or self-defense if
necessity would arise specially in going to and from their farm. (pp. 18-19, rollo of L-46997)

In most if not all of the cases, the orders of dismissal were given before arraignment of the accused. In the criminal case before the
Court of (First Instance of Samar the accused was arraigned but at the same time moved to quash the Information. In all the cases
where the accused were under arrest, the three Judges ordered their immediate release unless held on other charges.

C. — The law under which the Informations in question were filed by the People.

As seen from the Informations quoted above, the accused are charged with illegal possession of deadly weapon in violation of
Presidential Decree No. 9, Paragraph 3.

We quote in full Presidential Decree No. 9, to wit:

PRESIDENTIAL DECREE NO. 9

DECLARING VIOLATIONS OF GENERAL ORDERS NO. 6 and NO. 7 DATED SEPTEMBER 22, 1972, AND SEPTEMBER 23,
1972, RESPECTIVELY, TO BE UNLAWFUL AND PROVIDING PENALTIES THEREFORE.

WHEREAS, pursuant to Proclamation No. 1081 dated September 21, 1972, the Philippines has been placed under a state of martial
law;

WHEREAS, by virtue of said Proclamation No. 1081, General Order No. 6 dated September 22, 1972 and General Order No. 7
dated September 23, 1972, have been promulgated by me;

WHEREAS, subversion, rebellion, insurrection, lawless violence, criminality, chaos and public disorder mentioned in the aforesaid
Proclamation No. 1081 are committed and abetted by the use of firearms, explosives and other deadly weapons;

NOW, THEREFORE, I, FERDINAND E. MARCOS, Commander-in-Chief of all the Armed Forces of the Philippines, in older to attain
the desired result of the aforesaid Proclamation No. 1081 and General Orders Nos. 6 and 7, do hereby order and decree that:

1. Any violation of the aforesaid General Orders Nos. 6 and 7 is unlawful and the violator shall, upon conviction suffer:

(a) The mandatory penalty of death by a firing squad or electrocution as a Military, Court/Tribunal/Commission may direct, it the
firearm involved in the violation is unlicensed and is attended by assault upon, or resistance to persons in authority or their agents in
the performance of their official functions resulting in death to said persons in authority or their agent; or if such unlicensed firearm is
used in the commission of crimes against persons, property or chastity causing the death of the victim used in violation of any other
General Orders and/or Letters of Instructions promulgated under said Proclamation No. 1081:

(b) The penalty of imprisonment ranging from twenty years to life imprisonment as a Military Court/Tribunal/commission may direct,
when the violation is not attended by any of the circumstances enumerated under the preceding paragraph;

(c) The penalty provided for in the preceding paragraphs shall be imposed upon the owner, president, manager, members of the
board of directors or other responsible officers of any public or private firms, companies, corporations or entities who shall willfully or
knowingly allow any of the firearms owned by such firm, company, corporation or entity concerned to be used in violation of said
General Orders Nos. 6 and 7.
2. It is unlawful to posses deadly weapons, including hand grenades, rifle grenades and other explosives, including, but not limited
to, "pill box bombs," "molotov cocktail bombs," "fire bombs," or other incendiary device consisting of any chemical, chemical
compound, or detonating agents containing combustible units or other ingredients in such proportion, quantity, packing, or bottling
that ignites by fire, by friction, by concussion, by percussion, or by detonation of all or part of the compound or mixture which may
cause such a sudden generation of highly heated gases that the resultant gaseous pressures are capable of producing destructive
effects on continguous objects or of causing injury or death of a person; and any person convicted thereof shall be punished by
imprisonment ranging from ten to fifteen years as a Military Court/Tribunal/Commission may direct.

3. It is unlawful to carry outside of residence any bladed, pointed or blunt weapon such as "fan knife," "spear," "dagger," "bolo,"
"balisong," "barong," "kris," or club, except where such articles are being used as necessary tools or implements to earn a livelihood
and while being used in connection therewith; and any person found guilty thereof shall suffer the penalty of imprisonment ranging
from five to ten years as a Military Court/Tribunal/Commission may direct.

4. When the violation penalized in the preceding paragraphs 2 and 3 is committed during the commission of or for the purpose of
committing, any other crime, the penalty shall be imposed upon the offender in its maximum extent, in addition to the penalty
provided for the particular offenses committed or intended to be committed.

Done in the City of Manila, this 2nd day of October in the year of Our Lord, nineteen hundred and seventy-two.

(SGD) FERDINAND E. MARCOS

President

Republic of the Philippines

D. — The arguments of the People —

In the Comment filed in these cases by the Solicitor General who as stated earlier joins the City Fiscal of Manila and the Provincial
Fiscal of Samar in seeking the setting aside of the questioned orders of dismissal, the main argument advanced on the issue now
under consideration is that a perusal of paragraph 3 of P.D. 9 'shows that the prohibited acts need not be related to subversive
activities; that the act proscribed is essentially a malum prohibitum penalized for reasons of public policy.1

The City Fiscal of Manila in his brief adds further that in statutory offenses the intention of the accused who commits the act is
immaterial; that it is enough if the prohibited act is voluntarily perpetuated; that P.D. 9 provides and condemns not only the carrying
of said weapon in connection with the commission of the crime of subversion or the like, but also that of criminality in general, that is,
to eradicate lawless violence which characterized pre-martial law days. It is also argued that the real nature of the criminal charge is
determined not from the caption or preamble of the information nor from the specification of the provision of law alleged to have
been violated but by the actual recital of facts in the complaint or information.2

E. — Our Ruling on the matter —

1. It is a constitutional right of any person who stands charged in a criminal prosecution to be informed of the nature and cause of
the accusation against him.3

Pursuant to the above, Section 5, Rule 110 of the Rules of Court, expressly requires that for a complaint or information to be
sufficient it must, inter alia state the designation of the offense by the statute, and the acts or omissions complained of as
constituting the offense. This is essential to avoid surprise on the accused and to afford him the opportunity to prepare his defense
accordingly. 4

To comply with these fundamental requirements of the Constitution and the Rules on Criminal Procedure, it is imperative for the
specific statute violated to be designated or mentioned 4 in the charge. In fact, another compelling reason exists why a specification
of the statute violated is essential in these cases. As stated in the order of respondent Judge Maceren the carrying of so-called
"deadly weapons" is the subject of another penal statute and a Manila city ordinance. Thus, Section 26 of Act No. 1780 provides:

Section 26. It should be unlawful for any person to carry concealed about his person any bowie knife, dirk dagger, kris, or other
deadly weapon: ... Any person violating the provisions of this section shall, upon conviction in a court of competent jurisdiction, be
punished by a fine not exceeding five hundred pesos, or by imprisonment for a period not exceeding six months, or both such fine
and imprisonment, in the discretion of the court.

Ordinance No. 3820 of the City of Manila as amended by Ordinance No. 3928 which took effect on December 4, 1957, in turn
penalizes with a fine of not more than P200.00 or imprisonment for not more than one months, or both, at the discretion of the court,
anyone who shall carry concealed in his person in any manner that would disguise its deadly character any kind of firearm, bowie
knife, or other deadly weapon ... in any public place. Consequently, it is necessary that the particular law violated be specified as
there exists a substantial difference between the statute and city ordinance on the one hand and P.D. 9 (3) on the other regarding
the circumstances of the commission of the crime and the penalty imposed for the offense.

We do not agree with petitioner that the above-mentioned statute and the city ordinance are deemed repealed by P.D. 9 (3). 5 P. D.
9(3) does not contain any repealing clause or provision, and repeal by implication is not favored. 6 This principle holds true with
greater force with regards to penal statutes which as a rule are to be construed strictly against the state and liberally in favor of the
accused. 7 In fact, Article 7 of the New Civil Code provides that laws are repealed only by subsequent ones and their violation or
non- observance shall not be excused by disuse, or custom or practice to the contrary.

Thus we are faced with the situation where a particular act may be made to fall, at the discretion of a police officer or a prosecuting
fiscal, under the statute, or the city ordinance, or the presidential decree. That being the case, the right becomes more compelling
for an accused to be confronted with the facts constituting the essential elements of the offense charged against him, if he is not to
become an easy pawn of oppression and harassment, or of negligent or misguided official action — a fear understandably shared
by respondent Judges who by the nature of their judicial functions are daily exposed to such dangers.

2. In all the Informations filed by petitioner the accused are charged in the caption as well as in the body of the Information with a
violation of paragraph 3, P.D. 9. What then are the elements of the offense treated in the presidential decree in question?
We hold that the offense carries two elements: first, the carrying outside one's residence of any bladed, blunt, or pointed weapon,
etc. not used as a necessary tool or implement for a livelihood; and second, that the act of carrying the weapon was either in
furtherance of, or to abet, or in connection with subversion, rebellion, insurrection, lawless violence, criminality, chaos, or public
disorder.

It is the second element which removes the act of carrying a deadly weapon, if concealed, outside of the scope of the statute or the
city ordinance mentioned above. In other words, a simple act of carrying any of the weapons described in the presidential decree is
not a criminal offense in itself. What makes the act criminal or punishable under the decree is the motivation behind it. Without that
motivation, the act falls within the purview of the city ordinance or some statute when the circumstances so warrant.

Respondent Judges correctly ruled that this can be the only reasonably, logical, and valid construction given to P.D. 9(3).

3. The position taken by petitioner that P.D. 9(3) covers one and all situations where a person carries outside his residence any of
the weapons mentioned or described in the decree irrespective of motivation, intent, or purpose, converts these cases into one of
"statutory construction." That there is ambiguity in the presidential decree is manifest from the conflicting views which arise from its
implementation. When ambiguity exists, it becomes a judicial task to construe and interpret the true meaning and scope of the
measure, guided by the basic principle that penal statutes are to be construed and applied liberally in favor of the accused and
strictly against the state.

4. In the construction or interpretation of a legislative measure — a presidential decree in these cases — the primary rule is to
search for and determine the intent and spirit of the law. Legislative intent is the controlling factor, for in the words of this Court in
Hidalgo v. Hidalgo, per Mr. Justice Claudio Teehankee, whatever is within the spirit of a statute is within the statute, and this has to
be so if strict adherence to the letter would result in absurdity, injustice and contradictions. 8

There are certain aids available to Us to ascertain the intent or reason for P.D. 9(3).

First, the presence of events which led to or precipitated the enactment of P.D. 9. These events are clearly spelled out in the
"Whereas" clauses of the presidential decree, thus: (1) the state of martial law in the country pursuant to Proclamation 1081 dated
September 21, 1972; (2) the desired result of Proclamation 1081 as well as General Orders Nos. 6 and 7 which are particularly
mentioned in P.D. 9; and (3) the alleged fact that subversion, rebellion, insurrection, lawless violence, criminality, chaos, aid public
disorder mentioned in Proclamation 1081 are committed and abetted by the use of firearms and explosives and other deadly
weapons.

The Solicitor General however contends that a preamble of a statute usually introduced by the word "whereas", is not an essential
part of an act and cannot enlarge or confer powers, or cure inherent defects in the statute (p. 120, rollo of L-42050-66); that the
explanatory note or enacting clause of the decree, if it indeed limits the violation of the decree, cannot prevail over the text itself
inasmuch as such explanatory note merely states or explains the reason which prompted the issuance of the decree. (pp. 114-115,
rollo of 46997)

We disagree with these contentions. Because of the problem of determining what acts fall within the purview of P.D. 9, it becomes
necessary to inquire into the intent and spirit of the decree and this can be found among others in the preamble or, whereas" clauses
which enumerate the facts or events which justify the promulgation of the decree and the stiff sanctions stated therein.

A "preamble" is the key of the statute, to open the minds of the makers as to the mischiefs which are to be remedied, and objects
which are to be accomplished, by the provisions of the statute." (West Norman Timber v. State, 224 P. 2d 635, 639, cited in Words
and Phrases, "Preamble"; emphasis supplied)

While the preamble of a statute is not strictly a part thereof, it may, when the statute is in itself ambiguous and difficult of
interpretation, be resorted to, but not to create a doubt or uncertainty which otherwise does not exist." (James v. Du Bois, 16 N.J.L.
(1 Har.) 285, 294, cited in Words and Phrases, "Preamble")

In Aboitiz Shipping Corporation, et al. v. The City of Cebu, et al. this Court had occasion to state that '(L)egislative intent must be
ascertained from a consideration of the statute as a whole, and not of an isolated part or a particular provision alone. This is a
cardinal rule of statutory construction. For taken in the abstract, a word or phrase might easily convey a meaning quite different from
the one actually intended and evident when the word or phrase is considered with those with which it is associated. Thus, an
apparently general provision may have a limited application if read together with other provisions. 9

Second, the result or effects of the presidential decree must be within its reason or intent.

In the paragraph immediately following the last "Whereas" clause, the presidential decree states:

NOW, THEREFORE, I , FERDINAND E. MARCOS, Commander-in-Chief of an the Armed Forces of the Philippines, in order to
attain the desired result of the aforesaid Proclamation No. 1081 and General Orders Nos. 6 and 7, do hereby order and decree that:

xxx xxx xxx

From the above it is clear that the acts penalized in P.D. 9 are those related to the desired result of Proclamation 1081 and General
Orders Nos. 6 and 7. General Orders Nos. 6 and 7 refer to firearms and therefore have no relevance to P.D. 9(3) which refers to
blunt or bladed weapons. With respect to Proclamation 1081 some of the underlying reasons for its issuance are quoted hereunder:

WHEREAS, these lawless elements having taken up arms against our duly constituted government and against our people, and
having committed and are still committing acts of armed insurrection and rebellion consisting of armed raids, forays, sorties,
ambushes, wanton acts of murders, spoilage, plunder, looting, arsons, destruction of public and private buildings, and attacks
against innocent and defenseless civilian lives and property, all of which activities have seriously endangered and continue to
endanger public order and safety and the security of the nation, ...

xxx xxx xxx

WHEREAS, it is evident that there is throughout the land a state of anarchy and lawlessness, chaos and disorder, turmoil and
destruction of a magnitude equivalent to an actual war between the forces of our duly constituted government and the New People's
Army and their satellite organizations because of the unmitigated forays, raids, ambuscades, assaults, violence, murders,
assassinations, acts of terror, deceits, coercions, threats, intimidations, treachery, machinations, arsons, plunders and depredations
committed and being committed by the aforesaid lawless elements who have pledged to the whole nation that they will not stop their
dastardly effort and scheme until and unless they have fully attained their primary and ultimate purpose of forcibly seizing political
and state power in this country by overthrowing our present duly constituted government, ... (See Book I, Vital Documents on the
Declaration of Martial Law in the Philippines by the Supreme Court of the Philippines, pp. 13-39)

It follows that it is only that act of carrying a blunt or bladed weapon with a motivation connected with or related to the afore-quoted
desired result of Proclamation 1081 that is within the intent of P.D. 9(3), and nothing else.

Statutes are to be construed in the light of purposes to be achieved and the evils sought to be remedied. (U.S. v. American Tracking
Association, 310 U.S. 534, cited in LVN Pictures v. Philippine Musicians Guild, 110 Phil. 725, 731; emphasis supplied)

When construing a statute, the reason for its enactment should be kept in mind, and the statute should be construed with reference
to its intended scope and purpose. (Statutory Construction by E.T. Crawford, pp. 604-605, cited in Commissioner of Internal
Revenue v. Filipinas Compania de Seguros, 107 Phil. 1055, 1060; emphasis supplied)

5. In the construction of P.D. 9(3) it becomes relevant to inquire into the consequences of the measure if a strict adherence to the
letter of the paragraph is followed.

It is a salutary principle in statutory construction that there exists a valid presumption that undesirable consequences were never
intended by a legislative measure, and that a construction of which the statute is fairly susceptible is favored, which will avoid all
objectionable, mischievous, indefensible, wrongful, evil, and injurious consequences.9-a

It is to be presumed that when P.D. 9 was promulgated by the President of the Republic there was no intent to work a hardship or an
oppressive result, a possible abuse of authority or act of oppression, arming one person with a weapon to impose hardship on
another, and so on.10

At this instance We quote from the order of Judge Purisima the following:

And while there is no proof of it before the Court, it is not difficult to believe the murmurings of detained persons brought to Court
upon a charge of possession of bladed weapons under P.D. No. 9, that more than ever before, policemen - of course not all can be
so heartless — now have in their hands P.D. No. 9 as a most convenient tool for extortion, what with the terrifying risk of being
sentenced to imprisonment of five to ten years for a rusted kitchen knife or a pair of scissors, which only God knows where it came
from. Whereas before martial law an extortion-minded peace officer had to have a stock of the cheapest paltik, and even that could
only convey the coercive message of one year in jail, now anything that has the semblance of a sharp edge or pointed object,
available even in trash cans, may already serve the same purpose, and yet five to ten times more incriminating than the infamous
paltik. (pp. 72-73, rollo L-42050-66)

And as respondent Judge Maceren points out, the people's interpretation of P.D. 9(3) results in absurdity at times. To his example
We may add a situation where a law-abiding citizen, a lawyer by profession, after gardening in his house remembers to return the
bolo used by him to his neighbor who lives about 30 meters or so away and while crossing the street meets a policeman. The latter
upon seeing the bolo being carried by that citizen places him under arrest and books him for a violation of P.D. 9(3). Could the
presidential decree have been conceived to produce such absurd, unreasonable, and insensible results?

6. Penal statutes are to be construed strictly against the state and liberally in favor of an accused.

American jurisprudence sets down the reason for this rule to be "the tenderness of the law of the rights of individuals; the object is to
establish a certain rule by conformity to which mankind would be safe, and the discretion of the court limited." 11 The purpose is not
to enable a guilty person to escape punishment through a technicality but to provide a precise definition of forbidden acts.12

Our own decisions have set down the same guidelines in this manner, viz:

Criminal statutes are to be construed strictly. No person should be brought within their terms who is not clearly within them, nor
should any act be pronounced criminal which is not made clearly so by the statute. (U.S. v. Abad Santos, 36 Phil. 243, 246)

The rule that penal statutes are given a strict construction is not the only factor controlling the interpretation of such laws, instead,
the rule merely serves as an additional, single factor to be considered as an aid in determining the meaning of penal laws. (People v.
Manantan, 5 SCRA 684, 692)

F. The Informations filed by petitioner are fatally defective.

The two elements of the offense covered by P.D. 9(3) must be alleged in the Information in order that the latter may constitute a
sufficiently valid charged. The sufficiency of an Information is determined solely by the facts alleged therein.13 Where the facts are
incomplete and do not convey the elements of the crime, the quashing of the accusation is in order.

Section 2(a), Rule 117 of the Rules of Court provides that the defendant may move to quash the complaint or information when the
facts charged do not constitute an offense.

In U.S.U. Gacutan, 1914, it was held that where an accused is charged with knowingly rendering an unjust judgment under Article
204 of the Revised Penal Code, failure to allege in the Information that the judgment was rendered knowing it to be unjust, is fatal. 14

In People v. Yadao, 1954, this Court through then Justice Cesar Bengzon who later became Chief Justice of the Court affirmed an
order of the trial court which quashed an Information wherein the facts recited did not constitute a public offense as defined in
Section 1, Republic Act 145. 15

G. The filing of these Petitions was unnecessary because the People could have availed itself of other available remedies below.

Pertinent provisions of the Rules of Court follow:

Rule 117, Section 7. Effect of sustaining the motion to quash. — If the motion to quash is sustained the court may order that another
information be filed. If such order is made the defendant, if in custody, shall remain so unless he shall be admitted to bail. If such
order is not made or if having been made another information is not filed withuntime to be specified in the order, or within such
further time as the court may allow for good cause shown, the defendant, if in custody, shall be discharged therefrom, unless he is in
custody on some other charge.

Rule 110, Section 13. Amendment. — The information or complaint may be amended, in substance or form, without leave of court,
at any time before the defendant pleads; and thereafter and during the trial as to all matters of form, by leave and at the discretion of
the court, when the same can be done without prejudice to the rights of the defendant.

xxx xxx xxx

Two courses of action were open to Petitioner upon the quashing of the Informations in these cases, viz:

First, if the evidence on hand so warranted, the People could have filed an amended Information to include the second element of
the offense as defined in the disputed orders of respondent Judges. We have ruled that if the facts alleged in the Information do not
constitute a punishable offense, the case should not be dismissed but the prosecution should be given an opportunity to amend the
Information.16

Second, if the facts so justified, the People could have filed a complaint either under Section 26 of Act No. 1780, quoted earlier, or
Manila City Ordinance No. 3820, as amended by Ordinance No. 3928, especially since in most if not all of the cases, the dismissal
was made prior to arraignment of the accused and on a motion to quash.

Section 8. Rule 117 states that:

An order sustaining the motion to quash is not a bar to another prosecution for the same offense unless the motion was based on
the grounds specified in section 2, subsections (f) and (h) of this rule.

Under the foregoing, the filing of another complaint or Information is barred only when the criminal action or liability had been
extinguished (Section 2[f]) or when the motion to quash was granted for reasons of double jeopardy. (ibid., [h])

As to whether or not a plea of double jeopardy may be successfully invoked by the accused in all these cases should new
complaints be filed against them, is a matter We need not resolve for the present.

H. — We conclude with high expectations that police authorities and the prosecuting arm of the government true to the oath of office
they have taken will exercise utmost circumspection and good faith in evaluating the particular circumstances of a case so as to
reach a fair and just conclusion if a situation falls within the purview of P.D. 9(3) and the prosecution under said decree is warranted
and justified. This obligation becomes a sacred duty in the face of the severe penalty imposed for the offense.

On this point, We commend the Chief State Prosecutor Rodolfo A. Nocon on his letter to the City Fiscal of Manila on October 15,
1975, written for the Secretary, now Minister of Justice, where he stated the following:

In any case, please study well each and every case of this nature so that persons accused of carrying bladed weapons, specially
those whose purpose is not to subvert the duly constituted authorities, may not be unduly indicted for the serious offenses falling
under P.D. No. 9.17

Yes, while it is not within the power of courts of justice to inquire into the wisdom of a law, it is however a judicial task and
prerogative to determine if official action is within the spirit and letter of the law and if basic fundamental rights of an individual
guaranteed by the Constitution are not violated in the process of its implementation. We have to face the fact that it is an unwise and
unjust application of a law, necessary and justified under prevailing circumstances, which renders the measure an instrument of
oppression and evil and leads the citizenry to lose their faith in their government.

WHEREFORE, We DENY these 26 Petitions for Review and We AFFIRM the Orders of respondent Judges dismissing or quashing
the Information concerned, subject however to Our observations made in the preceding pages 23 to 25 of this Decision regarding
the right of the State or Petitioner herein to file either an amended Information under Presidential Decree No. 9, paragraph 3, or a
new one under other existing statute or city ordinance as the facts may warrant.

Without costs.

SO ORDERED.