Republic of the Philippines

SUPREME COURT
Manila

FIRST DIVISION

G.R. No. L-50999 March 23, 1990

JOSE SONGCO, ROMEO CIPRES, and AMANCIO MANUEL, petitioners,

vs
NATIONAL LABOR RELATIONS COMMISSION (FIRST DIVISION), LABOR ARBITER FLAVIO
AGUAS, and F.E. ZUELLIG (M), INC., respondents.

Raul E. Espinosa for petitioners.

Lucas Emmanuel B. Canilao for petitioner A. Manuel.

Atienza, Tabora, Del Rosario & Castillo for private respondent.

MEDIALDEA, J.:

This is a petition for certiorari seeking to modify the decision of the National Labor Relations
Commission in NLRC Case No. RB-IV-20840-78-T entitled, "Jose Songco and Romeo Cipres,
Complainants-Appellants, v. F.E. Zuellig (M), Inc., Respondent-Appellee" and NLRC Case No. RN-
IV-20855-78-T entitled, "Amancio Manuel, Complainant-Appellant, v. F.E. Zuellig (M), Inc.,
Respondent-Appellee," which dismissed the appeal of petitioners herein and in effect affirmed the
decision of the Labor Arbiter ordering private respondent to pay petitioners separation pay
equivalent to their one month salary (exclusive of commissions, allowances, etc.) for every year of
service.

The antecedent facts are as follows:

Private respondent F.E. Zuellig (M), Inc., (hereinafter referred to as Zuellig) filed with the Department
of Labor (Regional Office No. 4) an application seeking clearance to terminate the services of
petitioners Jose Songco, Romeo Cipres, and Amancio Manuel (hereinafter referred to as petitioners)
allegedly on the ground of retrenchment due to financial losses. This application was seasonably
opposed by petitioners alleging that the company is not suffering from any losses. They alleged
further that they are being dismissed because of their membership in the union. At the last hearing of
the case, however, petitioners manifested that they are no longer contesting their dismissal. The
parties then agreed that the sole issue to be resolved is the basis of the separation pay due to
petitioners. Petitioners, who were in the sales force of Zuellig received monthly salaries of at least
P40,000. In addition, they received commissions for every sale they made.

The collective Bargaining Agreement entered into between Zuellig and F.E. Zuellig Employees
Association, of which petitioners are members, contains the following provision (p. 71, Rollo):

ARTICLE XIV — Retirement Gratuity

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 Section l(a)-Any employee, who is separated from employment due to old age,
sickness, death or permanent lay-off not due to the fault of said employee shall
receive from the company a retirement gratuity in an amount equivalent to one (1)
month's salary per year of service. One month of salary as used in this paragraph
shall be deemed equivalent to the salary at date of retirement; years of service shall
be deemed equivalent to total service credits, a fraction of at least six months being
considered one year, including probationary employment. (Emphasis supplied)

On the other hand, Article 284 of the Labor Code then prevailing provides:

Art. 284. Reduction of personnel. — The termination of employment of any employee

due to the installation of labor saving-devices, redundancy, retrenchment to prevent
losses, and other similar causes, shall entitle the employee affected thereby to
separation pay. In case of termination due to the installation of labor-saving devices
or redundancy, the separation pay shall be equivalent to one (1) month pay or to at
least one (1) month pay for every year of service, whichever is higher. In case of
retrenchment to prevent losses and other similar causes, the separation pay shall be
equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of
service, whichever is higher. A fraction of at least six (6) months shall be considered
one (1) whole year. (Emphasis supplied)

In addition, Sections 9(b) and 10, Rule 1, Book VI of the Rules Implementing the Labor Code
provide:

xxx

Sec. 9(b). Where the termination of employment is due to retrechment initiated by the
employer to prevent losses or other similar causes, or where the employee suffers
from a disease and his continued employment is prohibited by law or is prejudicial to
his health or to the health of his co-employees, the employee shall be entitled to
termination pay equivalent at least to his one month salary, or to one-half
month pay for every year of service, whichever is higher, a fraction of at least six (6)
months being considered as one whole year.

xxx

Sec. 10. Basis of termination pay. — The computation of the termination pay of an
employee as provided herein shall be based on his latest salary rate, unless the
same was reduced by the employer to defeat the intention of the Code, in which case
the basis of computation shall be the rate before its deduction. (Emphasis supplied)

On June 26,1978, the Labor Arbiter rendered a decision, the dispositive portion of which reads (p.
78, Rollo):

RESPONSIVE TO THE FOREGOING, respondent should be as it is hereby, ordered

to pay the complainants separation pay equivalent to their one month salary
(exclusive of commissions, allowances, etc.) for every year of service that they have
worked with the company.

SO ORDERED.

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The appeal by petitioners to the National Labor Relations Commission was dismissed for lack of
merit.

Hence, the present petition.

On June 2, 1980, the Court, acting on the verified "Notice of Voluntary Abandonment and
Withdrawal of Petition dated April 7, 1980 filed by petitioner Romeo Cipres, based on the ground that
he wants "to abide by the decision appealed from" since he had "received, to his full and complete
satisfaction, his separation pay," resolved to dismiss the petition as to him.

The issue is whether or not earned sales commissions and allowances should be included in the
monthly salary of petitioners for the purpose of computation of their separation pay.

The petition is impressed with merit.

Petitioners' position was that in arriving at the correct and legal amount of separation pay due them,
whether under the Labor Code or the CBA, their basic salary, earned sales commissions and
allowances should be added together. They cited Article 97(f) of the Labor Code which includes
commission as part on one's salary, to wit;

(f) 'Wage' paid to any employee shall mean the remuneration or earnings, however
designated, capable of being expressed in terms of money, whether fixed or
ascertained on a time, task, piece, or commission basis, or other method of
calculating the same, which is payable by an employer to an employee under a
written or unwritten contract of employment for work done or to be done, or for
services rendered or to be rendered, and includes the fair and reasonable value, as
determined by the Secretary of Labor, of board, lodging, or other facilities customarily
furnished by the employer to the employee. 'Fair reasonable value' shall not include
any profit to the employer or to any person affiliated with the employer.

Zuellig argues that if it were really the intention of the Labor Code as well as its implementing rules
to include commission in the computation of separation pay, it could have explicitly said so in clear
and unequivocal terms. Furthermore, in the definition of the term "wage", "commission" is used only
as one of the features or designations attached to the word remuneration or earnings.

Insofar as the issue of whether or not allowances should be included in the monthly salary of
petitioners for the purpose of computation of their separation pay is concerned, this has been settled
in the case of Santos v. NLRC, et al., G.R. No. 76721, September 21, 1987, 154 SCRA 166, where
We ruled that "in the computation of backwages and separation pay, account must be taken not only
of the basic salary of petitioner but also of her transportation and emergency living allowances." This
ruling was reiterated in Soriano v. NLRC, et al., G.R. No. 75510, October 27, 1987, 155 SCRA 124
and recently, in Planters Products, Inc. v. NLRC, et al., G.R. No. 78524, January 20, 1989.

We shall concern ourselves now with the issue of whether or not earned sales commission should
be included in the monthly salary of petitioner for the purpose of computation of their separation pay.

Article 97(f) by itself is explicit that commission is included in the definition of the term "wage". It has
been repeatedly declared by the courts that where the law speaks in clear and categorical language,
there is no room for interpretation or construction; there is only room for application (Cebu Portland
Cement Co. v. Municipality of Naga, G.R. Nos. 24116-17, August 22, 1968, 24 SCRA 708; Gonzaga

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v. Court of Appeals, G.R.No. L-2 7455, June 28,1973, 51 SCRA 381). A plain and unambiguous
statute speaks for itself, and any attempt to make it clearer is vain labor and tends only to obscurity.
How ever, it may be argued that if We correlate Article 97(f) with Article XIV of the Collective
Bargaining Agreement, Article 284 of the Labor Code and Sections 9(b) and 10 of the Implementing
Rules, there appears to be an ambiguity. In this regard, the Labor Arbiter rationalized his decision in
this manner (pp. 74-76, Rollo):

The definition of 'wage' provided in Article 96 (sic) of the Code can be correctly be
(sic) stated as a general definition. It is 'wage ' in its generic sense. A careful perusal
of the same does not show any indication that commission is part of salary. We can
say that commission by itself may be considered a wage. This is not something novel
for it cannot be gainsaid that certain types of employees like agents, field personnel
and salesmen do not earn any regular daily, weekly or monthly salaries, but rely
mainly on commission earned.

Upon the other hand, the provisions of Section 10, Rule 1, Book VI of the
implementing rules in conjunction with Articles 273 and 274 (sic) of the Code
specifically states that the basis of the termination pay due to one who is sought to
be legally separated from the service is 'his latest salary rates.

x x x.

Even Articles 273 and 274 (sic) invariably use 'monthly pay or monthly salary'.

The above terms found in those Articles and the particular Rules were intentionally
used to express the intent of the framers of the law that for purposes of separation
pay they mean to be specifically referring to salary only.

.... Each particular benefit provided in the Code and other Decrees on Labor has its
own pecularities and nuances and should be interpreted in that light. Thus, for a
specific provision, a specific meaning is attached to simplify matters that may arise
there from. The general guidelines in (sic) the formation of specific rules for particular
purpose. Thus, that what should be controlling in matters concerning termination pay
should be the specific provisions of both Book VI of the Code and the Rules. At any
rate, settled is the rule that in matters of conflict between the general provision of law
and that of a particular- or specific provision, the latter should prevail.

On its part, the NLRC ruled (p. 110, Rollo):

From the aforequoted provisions of the law and the implementing rules, it could be
deduced that wage is used in its generic sense and obviously refers to the basic
wage rate to be ascertained on a time, task, piece or commission basis or other
method of calculating the same. It does not, however, mean that commission,
allowances or analogous income necessarily forms part of the employee's salary
because to do so would lead to anomalies (sic), if not absurd, construction of the
word "salary." For what will prevent the employee from insisting that emergency
living allowance, 13th month pay, overtime, and premium pay, and other fringe
benefits should be added to the computation of their separation pay. This situation, to
our mind, is not the real intent of the Code and its rules.

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We rule otherwise. The ambiguity between Article 97(f), which defines the term 'wage' and Article
XIV of the Collective Bargaining Agreement, Article 284 of the Labor Code and Sections 9(b) and 10
of the Implementing Rules, which mention the terms "pay" and "salary", is more apparent than real.
Broadly, the word "salary" means a recompense or consideration made to a person for his pains or
industry in another man's business. Whether it be derived from "salarium," or more fancifully from
"sal," the pay of the Roman soldier, it carries with it the fundamental idea of compensation for
services rendered. Indeed, there is eminent authority for holding that the words "wages" and "salary"
are in essence synonymous (Words and Phrases, Vol. 38 Permanent Edition, p. 44 citing Hopkins
vs. Cromwell, 85 N.Y.S. 839,841,89 App. Div. 481; 38 Am. Jur. 496). "Salary," the etymology of
which is the Latin word "salarium," is often used interchangeably with "wage", the etymology of
which is the Middle English word "wagen". Both words generally refer to one and the same meaning,
that is, a reward or recompense for services performed. Likewise, "pay" is the synonym of "wages"
and "salary" (Black's Law Dictionary, 5th Ed.). Inasmuch as the words "wages", "pay" and "salary"
have the same meaning, and commission is included in the definition of "wage", the logical
conclusion, therefore, is, in the computation of the separation pay of petitioners, their salary base
should include also their earned sales commissions.

The aforequoted provisions are not the only consideration for deciding the petition in favor of the
petitioners.

We agree with the Solicitor General that granting, in gratia argumenti, that the commissions were in
the form of incentives or encouragement, so that the petitioners would be inspired to put a little more
industry on the jobs particularly assigned to them, still these commissions are direct remuneration
services rendered which contributed to the increase of income of Zuellig . Commission is the
recompense, compensation or reward of an agent, salesman, executor, trustees, receiver, factor,
broker or bailee, when the same is calculated as a percentage on the amount of his transactions or
on the profit to the principal (Black's Law Dictionary, 5th Ed., citing Weiner v. Swales, 217 Md. 123,
141 A.2d 749, 750). The nature of the work of a salesman and the reason for such type of
remuneration for services rendered demonstrate clearly that commission are part of petitioners'
wage or salary. We take judicial notice of the fact that some salesmen do not receive any basic
salary but depend on commissions and allowances or commissions alone, are part of petitioners'
wage or salary. We take judicial notice of the fact that some salesman do not received any basic
salary but depend on commissions and allowances or commissions alone, although an employer-
employee relationship exists. Bearing in mind the preceeding dicussions, if we adopt the opposite
view that commissions, do not form part of wage or salary, then, in effect, We will be saying that this
kind of salesmen do not receive any salary and therefore, not entitled to separation pay in the event
of discharge from employment. Will this not be absurd? This narrow interpretation is not in accord
with the liberal spirit of our labor laws and considering the purpose of separation pay which is, to
alleviate the difficulties which confront a dismissed employee thrown the the streets to face the harsh
necessities of life.

Additionally, in Soriano v. NLRC, et al., supra, in resolving the issue of the salary base that should
be used in computing the separation pay, We held that:

The commissions also claimed by petitioner ('override commission' plus 'net deposit
incentive') are not properly includible in such base figure since such commissions
must be earned by actual market transactions attributable to petitioner.

Applying this by analogy, since the commissions in the present case were earned by actual market
transactions attributable to petitioners, these should be included in their separation pay. In the

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computation thereof, what should be taken into account is the average commissions earned during
their last year of employment.

The final consideration is, in carrying out and interpreting the Labor Code's provisions and its
implementing regulations, the workingman's welfare should be the primordial and paramount
consideration. This kind of interpretation gives meaning and substance to the liberal and
compassionate spirit of the law as provided for in Article 4 of the Labor Code which states that "all
doubts in the implementation and interpretation of the provisions of the Labor Code including its
implementing rules and regulations shall be resolved in favor of labor" (Abella v. NLRC, G.R. No.
71812, July 30,1987,152 SCRA 140; Manila Electric Company v. NLRC, et al., G.R. No. 78763, July
12,1989), and Article 1702 of the Civil Code which provides that "in case of doubt, all labor
legislation and all labor contracts shall be construed in favor of the safety and decent living for the
laborer.

ACCORDINGLY, the petition is hereby GRANTED. The decision of the respondent National Labor
Relations Commission is MODIFIED by including allowances and commissions in the separation pay
of petitioners Jose Songco and Amancio Manuel. The case is remanded to the Labor Arbiter for the
proper computation of said separation pay.

SO ORDERED.

Narvasa (Chairman), Cruz, Gancayco and Griño-Aquino, JJ., concur.

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 Republic of the Philippines
SUPREME COURT
Manila

FIRST DIVISION

G.R. No. 93833 September 28, 1995

SOCORRO D. RAMIREZ, petitioner,

vs.
HONORABLE COURT OF APPEALS, and ESTER S. GARCIA, respondents.

KAPUNAN, J.:

A civil case damages was filed by petitioner Socorro D. Ramirez in the Regional Trial Court of
Quezon City alleging that the private respondent, Ester S. Garcia, in a confrontation in the latter's
office, allegedly vexed, insulted and humiliated her in a "hostile and furious mood" and in a manner
offensive to petitioner's dignity and personality," contrary to morals, good customs and public
policy."
1

In support of her claim, petitioner produced a verbatim transcript of the event and sought moral
damages, attorney's fees and other expenses of litigation in the amount of P610,000.00, in addition
to costs, interests and other reliefs awardable at the trial court's discretion. The transcript on which
the civil case was based was culled from a tape recording of the confrontation made by
petitioner. The transcript reads as follows:
2

Plaintiff Soccoro D. Ramirez (Chuchi) — Good Afternoon M'am.

Defendant Ester S. Garcia (ESG) — Ano ba ang nangyari sa 'yo,

nakalimot ka na kung paano ka napunta rito, porke member ka na,
magsumbong ka kung ano ang gagawin ko sa 'yo.

CHUCHI — Kasi, naka duty ako noon.

ESG — Tapos iniwan no. (Sic)

CHUCHI — Hindi m'am, pero ilan beses na nila akong binalikan,

sabing ganoon —

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 ESG — Ito and (sic) masasabi ko sa 'yo, ayaw kung (sic) mag explain
ka, kasi hanggang 10:00 p.m., kinabukasan hindi ka na pumasok.
Ngayon ako ang babalik sa 'yo, nag-aaply ka sa States, nag-aaply ka
sa review mo, kung kakailanganin ang certification mo, kalimutan mo
na kasi hindi ka sa akin makakahingi.

CHUCHI — Hindi M'am. Kasi ang ano ko talaga noon i-cocontinue ko

up to 10:00 p.m.

ESG — Bastos ka, nakalimutan mo na kung paano ka pumasok dito

sa hotel. Magsumbong ka sa Union kung gusto mo. Nakalimutan mo
na kung paano ka nakapasok dito "Do you think that on your own
makakapasok ka kung hindi ako. Panunumbyoyan na kita
(Sinusumbatan na kita).

CHUCHI — Itutuloy ko na M'am sana ang duty ko.

ESG — Kaso ilang beses na akong binabalikan doon ng mga no (sic)

ko.

ESG — Nakalimutan mo na ba kung paano ka pumasok sa hotel,

kung on your own merit alam ko naman kung gaano ka "ka bobo" mo.
Marami ang nag-aaply alam kong hindi ka papasa.

CHUCHI — Kumuha kami ng exam noon.

ESG — Oo, pero hindi ka papasa.

CHUCHI — Eh, bakit ako ang nakuha ni Dr. Tamayo

ESG — Kukunin ka kasi ako.

CHUCHI — Eh, di sana —

ESG — Huwag mong ipagmalaki na may utak ka kasi wala kang

utak. Akala mo ba makukuha ka dito kung hindi ako.

CHUCHI — Mag-eexplain ako.

ESG — Huwag na, hindi ako mag-papa-explain sa 'yo, makaalala ka

kung paano ka puma-rito. "Putang-ina" sasabi-sabihin mo kamag-
anak ng nanay at tatay mo ang mga magulang ko.

ESG — Wala na akong pakialam, dahil nandito ka sa loob, nasa

labas ka puwede ka ng hindi pumasok, okey yan nasaloob ka umalis
ka doon.

CHUCHI — Kasi M'am, binbalikan ako ng mga taga Union.

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 ESG — Nandiyan na rin ako, pero huwag mong kalimutan na hindi ka
makakapasok kung hindi ako. Kung hindi mo kinikilala yan okey lang
sa akin, dahil tapos ka na.

CHUCHI — Ina-ano ko m'am na utang na loob.

ESG — Huwag na lang, hindi mo utang na loob, kasi kung baga sa

no, nilapastangan mo ako.

CHUCHI — Paano kita nilapastanganan?

ESG — Mabuti pa lumabas ka na. Hindi na ako makikipagusap sa

'yo. Lumabas ka na. Magsumbong ka. 3

As a result of petitioner's recording of the event and alleging that the said act of secretly taping the
confrontation was illegal, private respondent filed a criminal case before the Regional Trial Court of
Pasay City for violation of Republic Act 4200, entitled "An Act to prohibit and penalize wire tapping
and other related violations of private communication, and other purposes." An information charging
petitioner of violation of the said Act, dated October 6, 1988 is quoted herewith:

INFORMATION

The Undersigned Assistant City Fiscal Accusses Socorro D. Ramirez of Violation of

Republic Act No. 4200, committed as follows:

That on or about the 22nd day of February, 1988, in Pasay City Metro
Manila, Philippines, and within the jurisdiction of this honorable court,
the above-named accused, Socorro D. Ramirez not being authorized
by Ester S. Garcia to record the latter's conversation with said
accused, did then and there willfully, unlawfully and feloniously, with
the use of a tape recorder secretly record the said conversation and
thereafter communicate in writing the contents of the said recording
to other person.

Contrary to law.

Pasay City, Metro Manila, September 16, 1988.

MARIANO M.
CUNETA
Asst. City Fiscal

Upon arraignment, in lieu of a plea, petitioner filed a Motion to Quash the Information on the ground
that the facts charged do not constitute an offense, particularly a violation of R.A. 4200. In an order
May 3, 1989, the trial court granted the Motion to Quash, agreeing with petitioner that 1) the facts
charged do not constitute an offense under R.A. 4200; and that 2) the violation punished by R.A.
4200 refers to a the taping of a communication by a person other than a participant to the
communication. 4

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From the trial court's Order, the private respondent filed a Petition for Review on Certiorari with this
Court, which forthwith referred the case to the Court of Appeals in a Resolution (by the First Division)
of June 19, 1989.

On February 9, 1990, respondent Court of Appeals promulgated its assailed Decision declaring the
trial court's order of May 3, 1989 null and void, and holding that:

[T]he allegations sufficiently constitute an offense punishable under Section 1 of R.A.

4200. In thus quashing the information based on the ground that the facts alleged do
not constitute an offense, the respondent judge acted in grave abuse of discretion
correctible by certiorari. 5

Consequently, on February 21, 1990, petitioner filed a Motion for Reconsideration which respondent
Court of Appeals denied in its Resolution dated June 19, 1990. Hence, the instant petition.
6

Petitioner vigorously argues, as her "main and principal issue" that the applicable provision of
7

Republic Act 4200 does not apply to the taping of a private conversation by one of the parties to the
conversation. She contends that the provision merely refers to the unauthorized taping of a private
conversation by a party other than those involved in the communication. In relation to this, petitioner
8

avers that the substance or content of the conversation must be alleged in the Information, otherwise
the facts charged would not constitute a violation of R.A. 4200. Finally, petitioner agues that R.A.
9

4200 penalizes the taping of a "private communication," not a "private conversation" and that
consequently, her act of secretly taping her conversation with private respondent was not illegal
under the said act.10

We disagree.

First, legislative intent is determined principally from the language of a statute. Where the language
of a statute is clear and unambiguous, the law is applied according to its express terms, and
interpretation would be resorted to only where a literal interpretation would be either impossible or
11

absurb or would lead to an injustice. 12

Section 1 of R.A. 4200 entitled, " An Act to Prohibit and Penalized Wire Tapping and Other Related
Violations of Private Communication and Other Purposes," provides:

Sec. 1. It shall be unlawfull for any person, not being authorized by all the parties to
any private communication or spoken word, to tap any wire or cable, or by using any
other device or arrangement, to secretly overhear, intercept, or record such
communication or spoken word by using a device commonly known as a dictaphone
or dictagraph or detectaphone or walkie-talkie or tape recorder, or however otherwise
described.

The aforestated provision clearly and unequivocally makes it illegal for any person, not authorized by
all the parties to any private communication to secretly record such communication by means of a
tape recorder. The law makes no distinction as to whether the party sought to be penalized by the
statute ought to be a party other than or different from those involved in the private communication.
The statute's intent to penalize all persons unauthorized to make such recording is underscored by
the use of the qualifier "any". Consequently, as respondent Court of Appeals correctly concluded,
"even a (person) privy to a communication who records his private conversation with another without
the knowledge of the latter (will) qualify as a violator" under this provision of R.A. 4200.
13

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A perusal of the Senate Congressional Records, moreover, supports the respondent court's
conclusion that in enacting R.A. 4200 our lawmakers indeed contemplated to make illegal,
unauthorized tape recording of private conversations or communications taken either by the parties
themselves or by third persons. Thus:

xxx xxx xxx

Senator Tañada: That qualified only "overhear".

Senator Padilla: So that when it is intercepted or recorded, the element of secrecy

would not appear to be material. Now, suppose, Your Honor, the recording is not
made by all the parties but by some parties and involved not criminal cases that
would be mentioned under section 3 but would cover, for example civil cases or
special proceedings whereby a recording is made not necessarily by all the parties
but perhaps by some in an effort to show the intent of the parties because the
actuation of the parties prior, simultaneous even subsequent to the contract or the
act may be indicative of their intention. Suppose there is such a recording, would you
say, Your Honor, that the intention is to cover it within the purview of this bill or
outside?

Senator Tañada: That is covered by the purview of this bill, Your Honor.

Senator Padilla: Even if the record should be used not in the prosecution of offense
but as evidence to be used in Civil Cases or special proceedings?

Senator Tañada: That is right. This is a complete ban on tape recorded

conversations taken without the authorization of all the parties.

Senator Padilla: Now, would that be reasonable, your Honor?

Senator Tañada: I believe it is reasonable because it is not sporting to record the

observation of one without his knowing it and then using it against him. It is not fair, it
is not sportsmanlike. If the purpose; Your honor, is to record the intention of the
parties. I believe that all the parties should know that the observations are being
recorded.

Senator Padilla: This might reduce the utility of recorders.

Senator Tañada: Well no. For example, I was to say that in meetings of the board of
directors where a tape recording is taken, there is no objection to this if all the parties
know. It is but fair that the people whose remarks and observations are being made
should know that the observations are being recorded.

Senator Padilla: Now, I can understand.

Senator Tañada: That is why when we take statements of persons, we say: "Please
be informed that whatever you say here may be used against you." That is fairness
and that is what we demand. Now, in spite of that warning, he makes damaging
statements against his own interest, well, he cannot complain any more. But if you
are going to take a recording of the observations and remarks of a person without

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 him knowing that it is being taped or recorded, without him knowing that what is
being recorded may be used against him, I think it is unfair.

xxx xxx xxx

(Congression Record, Vol. III, No. 31, p. 584, March 12, 1964)

Senator Diokno: Do you understand, Mr. Senator, that under Section 1 of the bill as
now worded, if a party secretly records a public speech, he would be penalized under
Section 1? Because the speech is public, but the recording is done secretly.

Senator Tañada: Well, that particular aspect is not contemplated by the bill. It is the
communication between one person and another person — not between a speaker
and a public.

xxx xxx xxx

(Congressional Record, Vol. III, No. 33, p. 626, March 12, 1964)

xxx xxx xxx

The unambiguity of the express words of the provision, taken together with the above-quoted
deliberations from the Congressional Record, therefore plainly supports the view held by the
respondent court that the provision seeks to penalize even those privy to the private
communications. Where the law makes no distinctions, one does not distinguish.

Second, the nature of the conversations is immaterial to a violation of the statute. The substance of
the same need not be specifically alleged in the information. What R.A. 4200 penalizes are the acts
of secretly overhearing, intercepting or recording private communications by means of the devices
enumerated therein. The mere allegation that an individual made a secret recording of a private
communication by means of a tape recorder would suffice to constitute an offense under Section 1
of R.A. 4200. As the Solicitor General pointed out in his COMMENT before the respondent court:
"Nowhere (in the said law) is it required that before one can be regarded as a violator, the nature of
the conversation, as well as its communication to a third person should be professed." 14

Finally, petitioner's contention that the phrase "private communication" in Section 1 of R.A. 4200
does not include "private conversations" narrows the ordinary meaning of the word "communication"
to a point of absurdity. The word communicate comes from the latin word communicare, meaning "to
share or to impart." In its ordinary signification, communication connotes the act of sharing or
imparting signification, communication connotes the act of sharing or imparting, as in
a conversation, or signifies the "process by which meanings or thoughts are shared between
15

individuals through a common system of symbols (as language signs or gestures)" These 16

definitions are broad enough to include verbal or non-verbal, written or expressive communications
of "meanings or thoughts" which are likely to include the emotionally-charged exchange, on
February 22, 1988, between petitioner and private respondent, in the privacy of the latter's office.
Any doubts about the legislative body's meaning of the phrase "private communication" are,
furthermore, put to rest by the fact that the terms "conversation" and "communication" were
interchangeably used by Senator Tañada in his Explanatory Note to the bill quoted below:

12 |C o m p i l e d b y W I N N A O R O N C I L L I f o r t h e s u b j e c t S t a t u t o r y
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 It has been said that innocent people have nothing to fear from
their conversations being overheard. But this statement ignores the usual nature
of conversations as well the undeniable fact that most, if not all, civilized people have
some aspects of their lives they do not wish to expose. Free conversationsare often
characterized by exaggerations, obscenity, agreeable falsehoods, and the
expression of anti-social desires of views not intended to be taken seriously. The
right to the privacy of communication, among others, has expressly been assured by
our Constitution. Needless to state here, the framers of our Constitution must have
recognized the nature of conversations between individuals and the significance of
man's spiritual nature, of his feelings and of his intellect. They must have known that
part of the pleasures and satisfactions of life are to be found in the unaudited, and
free exchange of communication between individuals — free from every unjustifiable
intrusion by whatever means. 17

In Gaanan vs. Intermediate Appellate Court, a case which dealt with the issue of telephone
18

wiretapping, we held that the use of a telephone extension for the purpose of overhearing a private
conversation without authorization did not violate R.A. 4200 because a telephone extension devise
was neither among those "device(s) or arrangement(s)" enumerated therein, following the principle
19

that "penal statutes must be construed strictly in favor of the accused." The instant case turns on a
20

different note, because the applicable facts and circumstances pointing to a violation of R.A. 4200
suffer from no ambiguity, and the statute itself explicitly mentions the unauthorized "recording" of
private communications with the use of tape-recorders as among the acts punishable.

WHEREFORE, because the law, as applied to the case at bench is clear and unambiguous and
leaves us with no discretion, the instant petition is hereby DENIED. The decision appealed from is
AFFIRMED. Costs against petitioner.

SO ORDERED.

Padilla, Davide, Jr. and Bellosillo JJ., concur.

Hermosisima, Jr., J., is on leave.

Footnotes

1 Docketed as Civil Case No. 88-403, Regional Trial Court, Makati, Branch
64.

2 Rollo, p. 48.

3 Rollo, pp. 47-48.

4 Rollo, p. 9.

5 Rollo, p. 37.

6 Rollo, p. 99, Annex "H".

7 Rollo, p. 13.

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 8 Id.

9 Rollo, p. 14.

10 Rollo, p. 14-15.

11 Pacific Oxygen and Acytelene Co. vs. Central Bank 37 SCRA 685 (1971).

12 Casela v. Court of Appeals, 35 SCRA 279 (1970).

13 Rollo, p. 33.

14 Rollo, p. 67.

15 WEBSTER'S THIRD NEW INTERNATIONAL DICTIONARY 460 (1976).

16 Id.

17 CONGRESSIONAL RECORD, Vol. III, No. 31, at 573 (March 10, 1964).

18 145 SCRA 112 (1986). See also, Salcedo-Ortanez v. CA 235 SCRA 111
(1994).

19 Id., at 120.

20 Id., at 121.

14 |C o m p i l e d b y W I N N A O R O N C I L L I f o r t h e s u b j e c t S t a t u t o r y
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 Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 98355 March 2, 1994

HON. TOMAS R, OSMEÑA, petitioner,

vs.
COMMISSION ON AUDIT AND HONORABLE EUFEMIO C. DOMINGO, respondents.

Office of the City Attorney for petitioner.

The Solicitor General for respondents.

NOCON, J.:

Sometime in 1985 the City of Cebu decided to construct a modern abattoir. For this project, the City
Treasurer, Ricardo Pestano, issued a certificate of availability of funds dated April 30, 1985, in the
amount of FIVE MILLION FOUR HUNDRED NINETEEN THOUSAND AND ONE HUNDRED
EIGHTY (P5,419,180.00) PESOS, specifically "for the construction of Cebu City Abbatoir
(sic)." After a public bidding, H. Franco Construction Company, Inc. (HFCCI) was awarded to do the
1

construction of the abattoir. Thus, the City of Cebu, through its Mayor, Ronald R. Duterte, entered
into a contract with HFCCI, the terms of which are as follows:

15 |C o m p i l e d b y W I N N A O R O N C I L L I f o r t h e s u b j e c t S t a t u t o r y
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 WHEREAS, the contract cost for this project is EIGHT MILLION THREE HUNDRED
SIXTY-EIGHT THOUSAND NINE HUNDRED TWENTY(P8,368,920.00) PESOS;

xxx xxx xxx

WHEREAS, the City treasurer of Cebu City certified the availability of funds for the
first installment due to the CONTRACTOR in the amount of TWO MILLION NINETY
TWO THOUSAND TWO HUNDRED THIRTY (P2,092,230.00) PESOS, which is to
be due and payable upon certification of the City Engineer, concurred in by the
Project Management Staff that the project substantially completed;

WHEREAS, the CITY OF CEBU shall include the Budget for calendar year 1986, the
amount of SIX MILLION TWO HUNDRED SEVENTY SIX THOUSAND SIX
HUNDRED NINETY (P6,276,690.00) PESOS which represents the second, third and
final installment payments due to the CONTRACTOR. 2

On March 13, 1986, Sen. John H. Osmeña, then Officer-In-Charge of the City of Cebu, ordered the
suspension of the project and review of the contract by the COA. He also wrote HFCCI asking them
to account for the value of their progress. On April 24, 1986, HFCCI claimed the amount of TWO
MILLION ONE HUNDRED FORTY TWO THOUSAND NINE HUNDRED SIXTY FOUR AND 29/100
(P2,142,964.29) PESOS as the value of the work accomplished.

Unable to collect the said amount after so many demands, HFCCI instituted a civil action, dated
3

May 21, 1987 against the City of Cebu, for recovery of investment and damages.

In its answer dated June 5, 1987, the City of Cebu, while admitting having entered into a contract
with HFCCI, alleged that the contract it entered into was null and void as declared by the
Commission on Audit in its 2nd Indorsement dated September 4, 1986. Therefore whatever amount
is due to HFCCI is to the sole liability of the officer or officers who entered into the said contract.
4

Nevertheless, on December 15, 1988, the City of Cebu, through its Mayor, Tomas R. Osmeña,
entered into a compromise agreement, approved by the court, to the effect that as a full and final
settlement to the claim of HFCCI, the City of Cebu shall pay the amount of ONE MILLION FIVE
HUNDRED THOUSAND (P1,500,000.00) PESOS.

On the strength of the Court's Order dated March 3, 1989 the Provincial Deputy Sheriff, RTC,
Branch 5, Cebu City was ordered on March 8, 1989, to serve a writ of execution against the City of
Cebu through its Mayor, Tomas R. Osmeña. Thus, the amount of P1,500,000.00 and P15,052.00, as
lawful fees, were garnished from the City's funds deposited in the Philippine National
Bank. 5

The trial court's judgment based on the compromise agreement was referred to the COA's Regional
Director, who in turn indorsed the same to the Chairman of the COA. In its 3rd Indorsement dated
May 2, 1989, the COA ruled that:

It may not be disputed that the contract for the construction of the Cebu City Abattoir
was declared void in a 2nd Indorsement dated September 4, 1986, of this
Commission. And since no appeal appears to have been taken thereon, said
decision became final.

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 Consequently, "if a compromise is based upon an antecedent claim which is
undisputedly and undoubtedly illegal, the compromise may be considered invalid on
the ground of illegality as well as lack of consideration." (Sec. 29, 15 Am. Jur 2d)
Besides the compromise agreement entered into by the City of Cebu with H. Franco
Construction Co., Inc., after the contract by and between them had been declared
void by this Commission, is a circumvention of the constitutional provision that the
party aggrieved by any decision, order or ruling of the Commission may within thirty
(30) days from receipt of a copy thereof appeal on certiorari to the Supreme Court
(Sec. 2-2, Art. XII-D,1973 Constitution; Sec. 7, Art, IX-A, 1987 Constitution).

Under the circumstances, this Commission concurs in the view expressed by that
Office that the expenditure involved would be the personal liability of the officer
directly responsible for its incurrence (Sec. 103, P.D. No. 1445).
6

Petitioner's request for reconsideration of the above ruling was denied in COA's 5th Indorsement
dated January 23, 1991, hence this petition, with the following arguments:
7

1) the decision of the Public Respondent as contained in the 2nd Indorsement dated
September 4, 1986 is null and void for having been made without, in excess of
jurisdiction or with grave abuse of discretion;

2) that Public Respondent's decision has never become final because it was made
without, in excess of jurisdiction, or with grave abuse of discretion.
8

Petitioner argues that the decision of COA invalidating the contract between the City of Cebu and
HFCCI was void since it was already executed and fulfilled. Petitioner further stresses that COA has
no authority to declare a contract already executed void. And since the 2nd Indorsement is a nullity,
it never attained finality.

The petition is devoid of merit.

The Commission on Audit has the power, authority and duty to examine, audit and settle all
accounts pertaining to revenue and receipts of and expenditures or uses of funds and property,
owned of held in trust by, or pertaining to, the government, or any of its subdivisions, agencies or
instrumentalities. 9

The Auditing Code of the Philippines (P.D. 1445) further provides that no contract involving the
expenditure of public funds shall be entered into unless there is an appropriation therefor and the
10

proper accounting official of the agency concerned shall have certified to the officer entering into the
obligation that funds have been duly appropriated for the purpose and the amount necessary to
cover the proposed contract for the current year is available for expenditure on account
thereof. (Emphasis supplied) Any contract entered into contrary to the foregoing requirements shall
11

be VOID. 12

Clearly then, the contract entered into by the former Mayor Duterte was void from the very beginning
since the agreed cost for the project (P8,368,920.00) was way beyond the appropriated amount
(P5,419,180.00) as certified by the City Treasurer. Hence, the contract was properly declared void
and unenforceable in COA's 2nd Indorsement, dated September 4, 1986. The COA declared and we
agree, that:

17 |C o m p i l e d b y W I N N A O R O N C I L L I f o r t h e s u b j e c t S t a t u t o r y
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 The prohibition contained in Sec. 85 of PD 1445 (Government Auditing Code) is
explicit and mandatory. Fund availability is, as it has always been, an indispensable
prerequisite to the execution of any government contract involving the expenditure of
public funds by all government agencies at all levels. Such contracts are not to be
considered as final or binding unless such certification as to funds availability is
issued (Letter of Instruction No. 767, s. 1978). Antecedent of advance appropriation
is thus essential to government liability on contracts (Zobel v. City of Manila, 47 Phil.
169). This contract being violative of the legal requirements aforequoted, the same
contravenes Sec. 85 of PD 1445 and is null and void by virtue of Sec. 87. 13

As a matter of fact, the City of Cebu relied on the above pronouncement and interposed the same as
its affirmative defense, so much so that petitioner cannot now assert that it was void having been
14

issued in excess of COA's jurisdiction. A party cannot invoke the jurisdiction of a court or an
administrative body to secure affirmative relief against his opponent and after obtaining or failing to
obtain such relief, repudiate or question that same jurisdiction. It is not right for a party who has
affirmed and invoked the jurisdiction of a court in a particular matter to secure an affirmative relief, to
afterwards deny the same jurisdiction to escape a penalty. 15

Besides, neither the petitioner nor HFCCI questioned the ruling of COA declaring the invalidity of the
abattoir contract, thereby resulting in its finality even before the civil case was instituted. Petitioner
could have brought the case to the Supreme Court on a petition for certiorari within thirty days from
receipt of a copy of the COA decision in the manner provided by law and the Rules of Court. A 16

decision of the Commission or of any of its Auditor not appealed within the period provided by law,
shall be final and executory.17

Petitioner cannot hide behind the argument that the payment was made in compliance with the trial
court's judgment. As correctly stated by the Solicitor General:

Since petitioner and HFCCI knew of the absolute invalidity of said Abattoir Contract,
the Compromise Agreement relative to the petitioner's obligation resulting from said
Abattoir contract is also void and in existent and the decision based on said
Compromise Agreement is unenforceable against the City of Cebu. (Art. 1422, Civil
Code of the Philippines). 18

The trial court's decision based on the compromise agreement could not have ratified a contract
which is void ab initio. Consequently the settlement of the supposed obligation of the City of Cebu
arising out of a void contract becomes a personal liability of petitioner who is directly responsible
therefor.
19

Neither can petitioner rely on the principle of Quantum Meruit. Quantum Meruit is based on justice
and equity, to compensate a property or benefit received if restitution is equitable and if such action
involves no violation, frustration or opposition to public policy. In the present case, however, the
payment due to HFCCI was due to the compromise agreement which in turn was made in pursuance
to a supposed abattoir contract, which is a void contract. Furthermore, there was no evidence
presented as to the extent of work accomplished by HFCCI as to substantiate the amount stipulated
in the compromise agreement. Finally, as observed by the Solicitor General:

In any event, it is respectfully submitted that since petitioner's act in entering into said
Compromise Agreement . . . came after public respondent had voided petitioner's
abattoir contract (he) may not be allowed to evade the legal sanctions resulting from

18 |C o m p i l e d b y W I N N A O R O N C I L L I f o r t h e s u b j e c t S t a t u t o r y
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 his failure to comply with the law's safeguards against undue expenditures of public
funds.20

Premises considered, the Compromise Agreement entered into between the City of Cebu, through
its Mayor, Tomas Osmeña is void being merely a derivative of a previously void Abattoir Contract,
and thus becomes a personal liability of the officer who entered into it pursuant to Sec. 87 & 103 of
P.D. 1445.

WHEREFORE, petition is hereby DISMISSED for lack of merit.

SO ORDERED.

Narvasa, C.J., Padilla, Regalado and Puno, JJ., concur.

#Footnotes

1 Annex "A" of the Complaint, Original Record, p. 6.

2 Annex "B" of the Complaint, Original Record, p. 18-19.

3 H. Franco Construction Company, Inc. v. City of Cebu, Civil Case No. CEB-5966,
Celso M. Gimenez, presiding Judge, Branch V, RTC of Cebu.

4 Annex "E" of the Petition, Rollo, pp. 27-29.

5 Original Record, pp. 177, 181-185.

6 Annex "B" of the Petition, Rollo, p. 19-20.

7 Annex "C" of the Petition, Rollo, p. 21.

8 Petition, p. 6; Rollo, p. 8.

9 Sec. 2, Art. IX, 1987 Constitution.

10 Sec. 85, Chap. 3, Title II of P.D. 1445.

11 Sec. 86, Chap. 3, Title II, P.D. 1445.

12 Sec. 87, Chap 3, Title II, P.D. 1445.

13 Annex "A" of the Petition, Rollo, p. 40.

14 Annex "E" of the Petition, Rollo, p. 28.

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 15 Marquez v. Secretary of Labor, G.R. No. 80685, 171 SCRA 337, quoting from
Dean v. Dean, 136 Or. 694, 86 A.L.R. 79 and Littleton v. Burges, 16 Wyo. 58.

16 Sec. 50, Chap. 3, Title I, P.D. 1445; Sec. 35, Chap. 5, Administrative Code of
1987.

17 Sec. 51, Chap. 3, P.D. 1445; Sec. 36, Chap. 5, Administrative Code of 1987.

18 Respondent's Memorandum, p. 5.

19 Sec. 87 and Sec. 103 of P.D. 1445.

20 Respondent's Memorandum, p. 9.

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