Consolidated - Research

PRINCIPLE OF ABUSE OF RIGHTS
The principle of abuse of rights is found under Articles 19, 20

and 21 of the Civil Code of the Philippines, which states that:
Art. 19. Every person must, in the exercise of his rights and in the
performance of his duties, act with justice, give everyone his due and
observe honesty and good faith.
Art. 20. Every person who, contrary to law, willfully or negligently
causes damage to another, shall indemnify the latter for the same.
Art. 21. Any person who willfully causes loss or injury to another in
manner that is contrary to morals, good customs or public policy shall
compensate the latter for the damage.
The above articles depart from the classical theory that he who
uses a right injures no one. The modern tendency is to depart from
the classical and traditional theory, and to grant indemnity for
damages in cases where there is an abuse of rights, even when the
act is not illicit.
When a right is exercised in a manner which does not conform
with the norms enshrined in Article 19 and results in damage to
another, a legal wrong is thereby committed for which the wrongdoer
must be held responsible. Although the requirements of each
provision are different, these three (3) articles are all related to each
1
other. As the eminent Civilist Senator Arturo Tolentino puts it: With
this article (Article 21), combined with articles 19 and 20, the scope of
our law on civil wrongs has been very greatly broadened; it has
become much more supple and adaptable than the Anglo-American
law on torts. It is now difficult to conceive of any malevolent exercise
of a right which could not be checked by the application of these
articles (Tolentino, 1 Civil Code of the Philippines 72).
There is however, no hard and fast rule which can be applied to
determine whether or not the principle of abuse of rights may be
invoked. The question of whether or not the principle of abuse of
rights has been violated, resulting in damages under Articles 20 and
21 or other applicable provision of law, depends on the circumstances
of each case. (Globe Mackay Cable and Radio Corporation vs. Court
of Appeals, 176 SCRA 778 [1989]).
The elements of an abuse of right under Article 19 are the
following: (1) There is a legal right or duty; (2) which is exercised in
bad faith; (3) for the sole intent of prejudicing or injuring another.
Article 20 speaks of the general sanction for all other provisions of
law which do not especially provide for their own sanction (Tolentino,
supra, p. 71). Thus, anyone who, whether willfully or negligently, in
the exercise of his legal right or duty, causes damage to another,
shall indemnify his victim for injuries suffered thereby. Article 21 deals
with acts contra bonus mores, and has the following elements: 1)
There is an act which is legal; 2) but which is contrary to morals, good
2
custom, public order, or public policy; 3) and it is done with intent to

injure. Thus, under any of these three (3) provisions of law, an act
which causes injury to another may be made the basis for an award
of damages.
Of the three articles, Art. 19 was intended to expand the
concept of torts by granting adequate legal remedy for the untold
number of moral wrongs which is impossible for human foresight to
provide specifically in statutory law. If mere fault or negligence in
ones acts can make him liable for damages for injury caused
thereby, with more reason should abuse or bad faith make him liable.
The absence of good faith is essential to abuse of right. Good faith is
an honest intention to abstain from taking any unconscientiously
advantages of another, even though the forms or technicalities of the
law, together with an absence of all information or belief of fact which
would render the transaction unconscientiously. In business relations,
it means good faith as understood by men of affairs.
While Article 19 may have been intended as a mere declaration
of principle, the cardinal law on human conduct expressed in said
article has given rise to certain rules, e.g. that where a person
exercises his rights but does so arbitrarily or unjustly or performs his
duties in a manner that is not in keeping with honesty and good faith,
he opens himself to liability.
Article 19 of the Civil Code, sets certain standards which may

be observed not only in the exercise of ones rights but also in the
performance of ones duties. These standards are the following: to
act with justice; to give everyone his due; and to observe honesty and
good faith. The law, therefore, recognizes the primordial limitation on
all rights: that in their exercise, the norms of human conduct set forth
in Article 19 must be observed. A right, though by itself legal because
recognized or granted by law as such, may nevertheless become the
source of some illegality.
Albetz Investments, Inc. vs. Court of Appeals

G.R. No. L-32570, February 28, 1977
Facts:
The Calma spouses were the lessees of that lot describe as Lot
No. 27 pt., Block No. BP-52 of a subdivision plan and located No. 816
Prudencio
Street,
Sampaloc,
Manila.
The
defendant
Albetz
Investments, Inc., the lessor, needing the premises in order to

construct a new building, demanded delivery of the lot to it and upon
refusal of the Calma Spouses, Albetz Investments, Inc. brought an
action of unlawful detainer against Vicenta Calma, Civil Case No.
119712. Judgment by default was rendered by the Municipal Court on
March 30, 1964, ordering Vicenta Calma and all persons claiming
under her to vacate the premises and to pay the corresponding
rentals. The judgment having become final, Atty. Macario S.
Meneses, director and lawyer of Albetz Investments, Inc., filed a
motion for execution. The motion was granted and the Municipal
Court issued the writ of execution, on July 1, 1964, commanding the
Sheriff to remove the defendants in the premises and to collect the
damages. The Sheriff submitted his return of September 12, 1964,
informing the Court that or the date of the return the defendant has
not yet demolished her house and improvements or vacated the lot.
Vicenta Calma and others filed a petition for certiorari with preliminary
injunction on September 7, 1964 in the Court of First Instance of
Manila, Civil Case No. 58246, entitled Narciso Nakpil, et al. vs. Hon.
Crisanto Aragon, etc. and Albetz Investments, Inc. Upon the filing of
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this petition, counsel for Vicenta Calma filed a motion on September

8, 1964, in the unlawful detainer case, praying that all proceedings be
suspended until the termination of the petition for certiorari with
prohibition, Special Civil Action No. 58246. The Municipal Judge,
acting upon the said motion for suspension, issued on September 17,
1,964, such that all the proceedings in the above-entitled cases are
hereby suspended until after the said special action shall have been
finally resolved.
The petition for certiorari with prohibition was denied by the
Court of First Instance. From the order of dismissal, Vicenta Calma
appealed to the Supreme Court on December 19, 1964. Atty.
Meneses then filed a motion for demolition on February 9, 1965,
which was duly opposed by defendant Vicenta Calma. Acting upon
the said motion, the Municipal Judge entered an order on April 29,
1965, granting the defendant 30 days from the receipt thereof to
vacate and remove her house on the premises, otherwise a
demolition order would issue. Vicenta Calma having failed to remove
the house within the 30 day period, upon motion of Albetz
investments, Inc., the Court issued an order on June 21, 1965,
authorizing and ordering the Sheriff to destroy, demolishes or
removes the house which had been constructed by the defendants.
Alleging that the demolition was illegal because it was made
eight (8) months after issuance of the demolition order, and that the
manner it was carried out was indiscriminate, causing damage to
their personal properties, the spouses Calma, owners of the house,
and the spouses Umengan, occupants of its ground floor,

commenced the instant action in the Court of First Instance of Manila.
On the principal grounds that the order of demolition was no
longer in force, having been issued eight (8) months before its
enforcement, and that the said spouses were not notified of the order
of demolition, and they demolished the house indiscriminately and the
personal properties were carelessly placed, resulting in their being
damaged, the Court of First Instance rendered judgment in favor of
the plaintiffs and against the defendant, awarding them damages in
specified amounts, as well as attorney's fees and costs of suit.
Defendant appealed to the Court of Appeals.
The Court of Appeals affirmed en toto the decision of the Court
of First Instance, saying that "it is not disputed that plaintiffs were only
notified of the order of demolition on the day the Sheriff appeared at
the place of plaintiffs in the morning of February 19, 1966, with about
35 laborers to carry out the demolition of plaintiffs' house", it further
appearing that they had not as yet been notified of the dismissal of
their complaint for specific performance with injunction, Civil Case
No. 63549.
Issue:
Whether or not the Appellate Court and the trial court erred in
declaring that an order of demolition, which is not implemented within
sixty days, becomes a nullity?
Ruling:
While it is true that Albetz Investments, Inc. had the legal right
to the surrender to them of the parcel of land leased by the Calma
spouses, who could only be achieved thru the demolition of the house
standing thereon, nevertheless, such right should not have been
exercised in such a manner as to unduly prejudice its owners. Urged
by the lawyer of petitioner, the Sheriff, aided with petitioner's laborers,
wantonly, maliciously and indiscriminately demolished the house,
destroying in the process many of the personal properties therein
which belonged to the spouses Calma and Umengan. The extent of
the damage has been determined by the trial court and affirmed by
the Court of Appeals, upon a finding that the same was not contested
by petitioner.
Article 19 of the Civil Code on Human Relations states that
Every person must, in the exercise of his rights and in the
performance of his duties, act with justice, give everyone his due, and
observe honesty and good faith.
Manila Electric Co. vs. Court Of Appeals

G.R No. L-39019, January 22, 1988
Facts:
Because of respondents failure to pay his electric bills,
MERALCO cut his electric supply without prior notice. On appeal,
petitioners contend that in the absence of bad faith, they could not be
held liable for moral and exemplary damages as well as attorneys
fees. The failure to give a notice of disconnection to private
respondents might have been a breach of duty or breach of contract,
but by itself does not constitute bad faith or fraud. It must be shown
that such a failure was motivated by in or done with fraudulent intent.
Issue:
Whether or not MERALCO is liable for damages under Article
19 of the Civil Code?
Ruling:
Yes, MERALCO is liable for damages under Article 19. Section
97 of the Revised Order No.1 of Public Service Commission requires
at least a 48-hours notice before electric supply service of
disconnection is made to a delinquent customer. Failure to provide
said prior written notice amounts to tort.
Eredena Agawa Vda. De Oribiana vs. Atty. Gerio

A.M 1582, February 28, 1979
Facts:
Complainant prays for the disbarment of respondent for his
failure to file a brief of her case. Respondent raised the contention
that the period of filing the brief expired without complainants giving a
single centavo for the expenses thereof, that the respondent not a
rich man and having nine children to support, could not spend the
needs of the complainant; and that at any rate, it is not the obligation
of the counsel to spent for his client.
Issue:
Whether or not the contention raised by the respondent is valid
or is lawyer administratively liable?
Ruling:
Yes, the lawyer is administratively liable. He could have filed a
mimeograph or typewritten brief, or he could have informed the court
of the difficulty in preparing a printed brief.
10
Velayo vs. Shell Corporation of the Philippines

G.R. No. L-7817, October 31, 1957
Facts:
The CALI (Commercial Air Lines, Inc.) knew it did not have
sufficient assets to pay of its liabilities, and so it called a meeting of its
creditors, who agreed that they would be contended with a pro rata
division of the assets, including a C-54 plane, still in California. One
of the creditors, the Shell Co., took advantage of this information and
made a telegraphic assignment of its credit in favor of a sister Shell
Co., in the United States which then promptly attached the plane in
California, thus depriving the other creditors of its value.
Issue:
Whether or not the Shell Co. in the Philippines can be made to
pay for damages to the other creditors?
Ruling:
Yes, because it did not show good faith and honesty. There is
no clear proof in the record about the real value of CALIs plane C-54
at the time when the defendants credit was assigned to the sister
corporation in the United States.
11
Manila Electric Co. vs. Court Of Appeals

G.R No. L-39019, January 22, 1988
Facts:
Because of respondents failure to pay his electric bills,
MERALCO cut his electric supply without prior notice. On appeal,
petitioners contend that in the absence of bad faith, they could not be
held liable for moral and exemplary damages as well as attorneys
fees. The failure to give a notice of disconnection to private
respondents might have been a breach of duty or breach of contract,
but by itself does not constitute bad faith or fraud. It must be shown
that such a failure was motivated by in or done with fraudulent intent.
Issue:
Whether or not MERALCO is liable for damages under Article
19 of the Civil Code?
Ruling:
Yes, MERALCO is liable for damages under Article 19. Section
97 of the Revised Order No.1 of Public Service Commission requires
at least a 48-hours notice before electric supply service of
disconnection is made to a delinquent customer. Failure to provide
said prior written notice amounts to tort.
12
The Board of Liquidators vs. Heirs of Maximo M. Kalaw, Et.Al

G.R. No. L-18805, August 14, 1967
Facts:
Maximo Kalaw, as general manager of the governmental
organization, the National Coconut Corporation (NACOCO), entered
into various contracts (involving the sale of Copra), without prior
authority of the Board of Directors. However, he later presented the
contracts to the Board for ratification. Under the NACOCOs
corporate by laws, prior approval is required. The Board ratified said
contracts although Kalaw had informed them that losses would be
incurred, due to typhoons, etc. After Kalaws death, action was
brought against Kalaws heirs and against the members of the Board
to recover governmental losses in the transactions. The action was
brought by the Board of Liquidators, an entity that took place of
NACOCO, after it was dissolved.
Issue:
Whether or not damages can be recovered?
Ruling:
Damages cannot be recovered, for Kalaw and the Board did not
act in bad faith. Several reasons may be given:
a. While it is true that NACOCO by-laws specifically provided
for prior approval, still a general manager by the very nature
of his functions should be allowed greater leeway. A rule that
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has gained acceptance throughout the years is that a

corporate general may do necessary and appropriate acts
without special authority from the Board. This is especially
true in copra-trading where future sales or forward sales
of still unproduced copra are needed to facilitate sales turnovers. To call the Board to a formal meeting is difficult when
time is essential.
b. Many times in the past, Kalaw had done the same without
prior Board approval; profits were then made; instead of
criticism,
Kalaw
had
received
bonus
for
signal
achievement.
c. Even assuming need for prior authority, it must be
remembered that RATIFICATION retroacts to the time of the
act or contract ratified, and is therefore equivalent to original
authority.
d. Bad faith does not simply connote bad judgment or
negligence Thus, Kalaw and the Board is NOT LIABLE.
14
LIBERAL CONSTRUCTION ON THE RULES OF COURTS:

RULE 1, SECTION 6
Construction these rules shall be liberally construed in order to
promote their objective of securing a just, speedy, and inexpensive
disposition of every action and proceeding.
This Section is recognition of the fact that the rules of
procedure one mere tools designed to facilitate the attainment of
justice. Thus, the liberal construction of these rules has been allowed
in the following cases:
(1) Where rigid application will result in manifest failure or
miscarriage of justice;
(2) Where the interest of substantial justice will be served;
(3) Where the resolution of the motion is addressed solely to
the sound and judicious discretion of the court; and
(4)
Where the injustice
to the adverse party is not
commensurate with the prescribed procedure.

In fact, in line with the spirit and purpose of this Section, even
the rules may be justified in the interest of fair play. It was held that
the Court has the power to suspend the rules, or to except a
particular case from their operation, whenever the ends of justice so
require.
15
The Asia United Bank vs. Goodland Company, Inc.

G.R. No. 191388, March 9, 2011
Facts:
The petitioner asssails the orders of the Regional Trial Court of
Makati City, Branch 150, which in turn denied due course to
respondent Goodland Company, Inc.s notice of appeal for invalid
substitution of counsel. Goodland through its counsel Atty. Antonio9
Bautista, opposed the petition for the Issuance of Writ of possession
file by Asia United Bank being declared as the highest bidder of the
public auction sale held on December 4, 2006 denying that it
executed the real estate mortgage. Goodland further averred that the
signature ohf the notary public appearing on the deed was forgery,
and that no technical description of the property supposedly
mortgaged was indicated therein. They sought recourse with the
Court of Appeals by initially filing a Notice of Appeal with the RTC
through a certain Atty. Lito Mondragon and Montoyo Law offices. RTC
issued an order denying due course to Goodlands notice of appeal
for being inutile due to Atty. Mondragons failure to porperly effect the
substitution of former ciunsel on record, Atty. Bautista.
Issue:
Whether or not the substitution of Atty. Mondragon is
substantive reason of the RTC to issue an order denying due course
to Goodlands notice of appeal?
16
Ruling:
Under the Rule 1, Section 6 of the 1997 Rules of Civil
Procedure, Liberal Construction of the rule is the controlling principle
to effect substantial justice. Thus, litigation should, as much as
possible, be decided on their merits and not on technicalities. This
does not mean, however, that procedural rules are to be ignored or
disclaimed at will to suit the convenience of a party. Procedural law
has its own rationale in the orderly administration of justice. Hence,
rules of procedure must be faithfully followed except only when for
persuasive reasons, they may be related to relieve a litigant of an
injustice not commensurate with his failure to comply with the
prescribed procedure.
17
Nilo T. Pates vs. COMELEC and Emelita Alimarante

G.R. No. 184915, June 30, 2009
Facts:
The Petitioner asks for Urgent Motion for Reconsideration with
reiteration for the Issuance of a Temporary Protection Order to
reverse the dismissal of his petition, arguing that the petition was
seasonably filed under the fresh period rule enunciated by the
Supreme Court in a number of cases decided beginning the year
2005. He claims that, historically, the fresh period rule was the
prevailing rule in filing petitions for certiorari
.
Issue:
Whether or not the petitioners claim of fresh period rule is
application in order to grant the Urgent Motion for Reconsideration?
Ruling:
The Court is not inclined to suspend the rules to come to the
rescue of a litigant whose counsel has blundered by reading the
wrong applicable provision. The Rules of Court are prompt and
orderly administration of justice, litigants cannot, after resorting to a
wrong remedy, simply cry for liberal construction of these rules.
Liberality does not signify an unbridled exercise of discretion. It has
its limits, to serve its purpose and to preserve its true worth; it must
be exercised only in the most appropriate causes.
18
Rural Bank of the Seven Lakes (SPC) Inc. vs. Belen A. Dan
G.R. No. 174109, December 24, 2008
Facts:
In 1975, Belen A. Dan was employed by RBSL as an assistant
bookkeeper. She rose from the ranks band in 1982, she was
appointed bank manager by the RBSL Board of Directors. Sometime
in 1998, RBSL discovered that Dan committed unsound banking
practices, which included the granting of loans to herself, her relatives
and close friends. Dan was charged with (a) violation of Section 5 of
RA no. 7353; (b) loss of confidence; (c) willful disobedience to the
lawful order of the employer; (e) willful breach of trust; and (f)
incompetence.
Issue:
Whether or not Dan committed forum shopping?
Ruling:
The liberal interpretation and application of rules apply only in
proper cases of demonstrable merit and under justifiable causes and
circumstances. While it is true that litigation is not a game of
technicalities, it is equally true that every case must be prosecuted in
accordance with the prescribed procedure to ensure an orderly and
speedy administration of justice.
19
Leandro Alcantara vs. PCIB

G.R. No. 151349, October 20, 2010
Facts:
The petitioner seeks to annul and set aside the subsequent
resolution issued by the Court of Appeals due to his allegedly
involvement with a big syndicate and taking advantage of the trust
and confidence reported in his position that causes him the dismissed
of his employment at the Philippine Commercial and International
Bank. The Court of Appeal issued a resolution for the dismissal of the
motion for reconsideration in which the petitioner petition for review.
Issue:
Whether or not the Court of Appeals approved the petition in
annuling the subsequent resolution?
Ruling:
No, the resolution did not comply to submit the requirements to
have sufficient grounds for review of his petition and a lock of merit
for the petition on the issue of the dismissal of employment.
20
Sps. Heber & Charlita Edillo vs. Sps. Norberto & Desideria
Dulpina
G.R. No. 188360, January 21, 2010
Facts:
On February 21, 2006, plaintiffs-respondents Spouses Norberto
and Desideria Dulpina (plaintiffs-respondents) filed a Complaint for
Forcible Entry against the defendants-petitioners with the Municipal
Circuit Trial Court of Del Carmen-San Isidro-San Benito, Surigao del
Norte (MCTC).
The plaintiffs-respondents alleged that they purchased from
Wencelito Camingue a 235-square meter residential lot and house
located in Poblacion, San Isidro, Surigao del Norte, through a Deed
of Saledated May 14, 1990. On August 8, 2005, defendant-petitioner
Heber Edillo, without their consent and against their express
prohibition, suddenly fenced off and occupied a 50-square meter
portion of the western part of the disputed property while uttering
threats against plaintiffs-respondents. On January 26, 2006, they sent
the defendants-petitioners a notice to vacate the disputed property,
but the defendants-petitioners refused to comply.
In their Answer dated March 1, 2006, the defendants-petitioners
countered that the Complaint states no cause of action because the
plaintiffs-respondents failed to allege that they were in prior physical
possession of the disputed property. They also alleged that they
acquired the disputed property through three (3) separate Deeds of
Absolute Sale from Apolinar Saragoza, Felomino Forcadilla, and
Wenceslao Caunzad.
21
On May 23, 2007, the MCTC rendered judgment dismissing the

Complaint.
It
ordered
the
plaintiffs-respondents
to
pay
the
defendants-petitioners P10,000.00 as actual damages and another

P10,000.00 as attorneys fees.The plaintiffs-respondents counsel
received a copy of the MCTC Judgment on May 31, 2007.
On August 15, 2007, the plaintiffs-respondents filed their Appeal
Memorandum with the Regional Trial Court, Branch 31, Dapa,
Surigao del Norte (RTC).
The RTC decided the appeal on November 7, 2007. It set aside
the MCTC judgment and ordered the defendants-petitioners to vacate
the subject property and to restore the plaintiffs-respondents to their
possession. It likewise ordered the payment of P10,000.00 as
attorneys fees and the cost of suit.
After the RTC denied their Motion for Reconsideration,the
defendants-petitioners elevated the case to the CA through a Petition
for Review under Rule 42 of the Rules of Court.They argued that the
plaintiffs-respondents appeal with the RTC was filed out of time since
the Revised Rules of Summary Procedure (RRSP) prohibits the filing
of a motion for reconsideration.
The CA dismissed the Petition in its Resolution of January 28,
2009on the ground that it does not contain a statement of the factual
background of the case, in violation of Sections 2 and 3 of Rule 42 of
the Rules of Court.
22
Issue:
Whether or not liberal construction of the Rules of Court is
applicable in the instant case?
Ruling:
YES. It is settled that liberal construction of the Rules may be
invoked in situations where there may be some excusable formal
deficiency or error in a pleading, provided that the same does not
subvert the essence of the proceeding and connotes at least a
reasonable attempt at compliance with the Rules. After all, rules of
procedure are not to be applied in a very rigid, technical sense; they
are used only to help secure substantial justice.
23
Congress of the Philippines

Twelfth Congress
First Regular Session
REPUBLIC ACT NO. 9165
June 7, 2002
AN ACT INSTITUTING THE COMPREHENSIVE DANGEROUS

DRUGS ACT OF 2002, REPEALING REPUBLIC ACT NO. 6425,
OTHERWISE KNOWN AS THE DANGEROUS DRUGS ACT OF
1972, AS AMENDED, PROVIDING FUNDS THEREFOR, AND FOR
OTHER PURPOSES
Be it enacted by the Senate and House of Representatives of the
Philippines in Congress
Section 1. Short Title. This Act shall be known and cited as the
"Comprehensive Dangerous Drugs Act of 2002".
Section 2. Declaration of Policy. It is the policy of the State to
safeguard the integrity of its territory and the well-being of its citizenry
particularly the youth, from the harmful effects of dangerous drugs on
their physical and mental well-being, and to defend the same against
acts or omissions detrimental to their development and preservation.
In view of the foregoing, the State needs to enhance further the
efficacy of the law against dangerous drugs, it being one of today's
more serious social ills.
Toward this end, the government shall pursue an intensive and
unrelenting campaign against the trafficking and use of dangerous
24
drugs and other similar substances through an integrated system of

planning, implementation and enforcement of anti-drug abuse
policies, programs, and projects. The government shall however aim
to achieve a balance in the national drug control program so that
people with legitimate medical needs are not prevented from being
treated with adequate amounts of appropriate medications, which
include the use of dangerous drugs.
It is further declared the policy of the State to provide effective
mechanisms or measures to re-integrate into society individuals who
have fallen victims to drug abuse or dangerous drug dependence
through sustainable programs of treatment and rehabilitation.
ARTICLE I
Definition of terms
Section 3. Definitions. As used in this Act, the following terms shall
mean:
(a) Administer. Any act of introducing any dangerous drug into the
body of any person, with or without his/her knowledge, by injection,
inhalation, ingestion or other means, or of committing any act of
indispensable assistance to a person in administering a dangerous
drug to himself/herself unless administered by a duly licensed
practitioner for purposes of medication.
(b) Board. - Refers to the Dangerous Drugs Board under Section 77,
Article IX of this Act.
25
(c) Centers. - Any of the treatment and rehabilitation centers for drug
dependents referred to in Section 34, Article VIII of this Act.
(d) Chemical Diversion. The sale, distribution, supply or transport of
legitimately imported, in-transit, manufactured or procured controlled
precursors and essential chemicals, in diluted, mixtures or in
concentrated form, to any person or entity engaged in the
manufacture of any dangerous drug, and shall include packaging,
repackaging, labeling, relabeling or concealment of such transaction
through fraud, destruction of documents, fraudulent use of permits,
misdeclaration, use of front companies or mail fraud.
(e) Clandestine Laboratory. Any facility used for the illegal
manufacture of any dangerous drug and/or controlled precursor and
essential chemical.
(f) Confirmatory Test. An analytical test using a device, tool or
equipment with a different chemical or physical principle that is more
specific which will validate and confirm the result of the screening
test.
(g) Controlled Delivery. The investigative technique of allowing an
unlawful or suspect consignment of any dangerous drug and/or
controlled
precursor
and
essential
chemical,
equipment
or
paraphernalia, or property believed to be derived directly or indirectly

from any offense, to pass into, through or out of the country under the
supervision of an authorized officer, with a view to gathering evidence
26
to identify any person involved in any dangerous drugs related

offense, or to facilitate prosecution of that offense.
(h) Controlled Precursors and Essential Chemicals. Include those
listed in Tables I and II of the 1988 UN Convention Against Illicit
Traffic
in
Narcotic
Drugs
and
Psychotropic
Substances
as
enumerated in the attached annex, which is an integral part of this

Act.
(i) Cultivate or Culture. Any act of knowingly planting, growing,
raising, or permitting the planting, growing or raising of any plant
which is the source of a dangerous drug.
(j) Dangerous Drugs. Include those listed in the Schedules annexed
to the 1961 Single Convention on Narcotic Drugs, as amended by the
1972 Protocol, and in the Schedules annexed to the 1971 Single
Convention on Psychotropic Substances as enumerated in the
attached annex which is an integral part of this Act.
(k) Deliver. Any act of knowingly passing a dangerous drug to
another, personally or otherwise, and by any means, with or without
consideration.
(l) Den, Dive or Resort. A place where any dangerous drug and/or
controlled
precursor
and essential
chemical
is administered,
delivered, stored for illegal purposes, distributed, sold or used in any

form.
27
(m) Dispense. Any act of giving away, selling or distributing

medicine or any dangerous drug with or without the use of
prescription.
(n) Drug Dependence. As based on the World Health Organization
definition, it is a cluster of physiological, behavioral and cognitive
phenomena of variable intensity, in which the use of psychoactive
drug takes on a high priority thereby involving, among others, a
strong desire or a sense of compulsion to take the substance and the
difficulties in controlling substance-taking behavior in terms of its
onset, termination, or levels of use.
(o) Drug Syndicate. Any organized group of two (2) or more
persons forming or joining together with the intention of committing
any offense prescribed under this Act.
(p) Employee of Den, Dive or Resort. The caretaker, helper,
watchman, lookout, and other persons working in the den, dive or
resort, employed by the maintainer, owner and/or operator where any
dangerous drug and/or controlled precursor and essential chemical is
administered, delivered, distributed, sold or used, with or without
compensation, in connection with the operation thereof.
(q) Financier. Any person who pays for, raises or supplies money
for, or underwrites any of the illegal activities prescribed under this
Act.
28
(r) Illegal Trafficking. The illegal cultivation, culture, delivery,

administration,
dispensation,
manufacture,
sale,
trading,
transportation, distribution, importation, exportation and possession of

any dangerous drug and/or controlled precursor and essential
chemical.
(s) Instrument. Any thing that is used in or intended to be used in
any manner in the commission of illegal drug trafficking or related
offenses.
(t) Laboratory Equipment. The paraphernalia, apparatus, materials
or appliances when used, intended for use or designed for use in the
manufacture of any dangerous drug and/or controlled precursor and
essential chemical, such as reaction vessel, preparative/purifying
equipment, fermentors, separatory funnel, flask, heating mantle, gas
generator, or their substitute.
(u) Manufacture. The production, preparation, compounding or
processing of any dangerous drug and/or controlled precursor and
essential chemical, either directly or indirectly or by extraction from
substances of natural origin, or independently by means of chemical
synthesis or by a combination of extraction and chemical synthesis,
and shall include any packaging or repackaging of such substances,
design or configuration of its form, or labeling or relabeling of its
container; except that such terms do not include the preparation,
compounding, packaging or labeling of a drug or other substances by
a duly authorized practitioner as an incident to his/her administration
29
or dispensation of such drug or substance in the course of his/her

professional practice including research, teaching and chemical
analysis of dangerous drugs or such substances that are not intended
for sale or for any other purpose.
(v) Cannabis or commonly known as "Marijuana" or "Indian Hemp" or
by its any other name. Embraces every kind, class, genus, or
specie of the plant Cannabis sativa L. including, but not limited
to, Cannabis americana,hashish, bhang, guaza, churrus and ganjab,
and embraces every kind, class and character of marijuana, whether
dried or fresh and flowering, flowering or fruiting tops, or any part or
portion of the plant and seeds thereof, and all its geographic varieties,
whether as a reefer, resin, extract, tincture or in any form whatsoever.
(w) Methylenedioxymethamphetamine (MDMA) or commonly known
as "Ecstasy", or by its any other name. Refers to the drug having
such chemical composition, including any of its isomers or derivatives
in any form.
(x) Methamphetamine Hydrochloride or commonly known as "Shabu",
"Ice", "Meth", or by its any other name. Refers to the drug having
such chemical composition, including any of its isomers or derivatives
in any form.
(y) Opium. Refers to the coagulated juice of the opium poppy
(Papaver somniferum L.) and embraces every kind, class and
character of opium, whether crude or prepared; the ashes or refuse of
the same; narcotic preparations thereof or therefrom; morphine or
30
any alkaloid of opium; preparations in which opium, morphine or any

alkaloid of opium enters as an ingredient; opium poppy; opium poppy
straw; and leaves or wrappings of opium leaves, whether prepared
for use or not.
(z) Opium Poppy. Refers to any part of the plant of the
species Papaver somniferum L., Papaver setigerum DC, Papaver
orientale, Papaver bracteatum and Papaver rhoeas, which includes
the seeds, straws, branches, leaves or any part thereof, or
substances derived therefrom, even for floral, decorative and culinary
purposes.
(aa) PDEA. Refers to the Philippine Drug Enforcement Agency
under Section 82, Article IX of this Act.
(bb) Person. Any entity, natural or juridical, including among others,
a corporation, partnership, trust or estate, joint stock company,
association,
syndicate,
joint
venture
or
other
unincorporated
organization or group capable of acquiring rights or entering into

obligations.
(cc) Planting of Evidence. The willful act by any person of
maliciously and surreptitiously inserting, placing, adding or attaching
directly or indirectly, through any overt or covert act, whatever
quantity of any dangerous drug and/or controlled precursor and
essential chemical in the person, house, effects or in the immediate
vicinity of an innocent individual for the purpose of implicating,
incriminating or imputing the commission of any violation of this Act.
31
(dd) Practitioner. Any person who is a licensed physician, dentist,

chemist, medical technologist, nurse, midwife, veterinarian or
pharmacist in the Philippines.
(ee) Protector/Coddler. Any person who knowingly and willfully
consents to the unlawful acts provided for in this Act and uses his/her
influence, power or position in shielding, harboring, screening or
facilitating the escape of any person he/she knows, or has
reasonable grounds to believe on or suspects, has violated the
provisions of this Act in order to prevent the arrest, prosecution and
conviction of the violator.
(ff) Pusher. Any person who sells, trades, administers, dispenses,
delivers or gives away to another, on any terms whatsoever, or
distributes, dispatches in transit or transports dangerous drugs or
who acts as a broker in any of such transactions, in violation of this
Act.
(gg) School. Any educational institution, private or public,
undertaking educational operation for pupils/students pursuing certain
studies at defined levels, receiving instructions from teachers, usually
located in a building or a group of buildings in a particular physical or
cyber site.
(hh) Screening Test. A rapid test performed to establish
potential/presumptive positive result.
32
(ii) Sell. Any act of giving away any dangerous drug and/or
controlled precursor and essential chemical whether for money or any
other consideration.
(jj) Trading. Transactions involving the illegal trafficking of
dangerous
drugs
and/or
controlled
precursors
and
essential
chemicals using electronic devices such as, but not limited to, text
messages, email, mobile or landlines, two-way radios, internet,
instant messengers and chat rooms or acting as a broker in any of
such transactions whether for money or any other consideration in
violation of this Act.
(kk) Use. Any act of injecting, intravenously or intramuscularly, of
consuming, either by chewing, smoking, sniffing, eating, swallowing,
drinking or otherwise introducing into the physiological system of the
body, and of the dangerous drugs.
ARTICLE II
Unlawful Acts and Penalties
Section 4. Importation of Dangerous Drugs and/or Controlled
Precursors
and
Essential
Chemicals.- .The
penalty
of
life
imprisonment to death and a ranging from Five hundred thousand

pesos (P500,000.00) to Ten million pesos (P10,000,000.00) shall be
imposed upon any person, who, unless authorized by law, shall
import or bring into the Philippines any dangerous drug, regardless of
the quantity and purity involved, including any and all species of
33
opium poppy or any part thereof or substances derived therefrom

even for floral, decorative and culinary purposes.
The penalty of imprisonment ranging from twelve (12) years and one
(1) day to twenty (20) years and a fine ranging from One hundred
thousand pesos (P100,000.00) to Five hundred thousand pesos
(P500,000.00) shall be imposed upon any person, who, unless
authorized by law, shall import any controlled precursor and essential
chemical.
The maximum penalty provided for under this Section shall be
imposed upon any person, who, unless authorized under this Act,
shall import or bring into the Philippines any dangerous drug and/or
controlled precursor and essential chemical through the use of a
diplomatic passport, diplomatic facilities or any other means involving
his/her official status intended to facilitate the unlawful entry of the
same. In addition, the diplomatic passport shall be confiscated and
canceled.
imposed upon any person, who organizes, manages or acts as a
"financier" of any of the illegal activities prescribed in this Section.
The penalty of twelve (12) years and one (1) day to twenty (20) years
of imprisonment and a fine ranging from One hundred thousand
pesos (P100,000.00) to Five hundred thousand pesos (P500,000.00)
shall be imposed upon any person, who acts as a "protector/coddler"
of any violator of the provisions under this Section.
34
Section 5. Sale, Trading, Administration, Dispensation, Delivery,

Distribution
and
Transportation
of
Dangerous
Drugs
and/or
Controlled Precursors and Essential Chemicals. - The penalty of life

imprisonment to death and a fine ranging from Five hundred
thousand pesos (P500,000.00) to Ten million pesos (P10,000,000.00)
shall be imposed upon any person, who, unless authorized by law,
shall sell, trade, administer, dispense, deliver, give away to another,
distribute dispatch in transit or transport any dangerous drug,
including any and all species of opium poppy regardless of the
quantity and purity involved, or shall act as a broker in any of such
transactions.
authorized by law, shall sell, trade, administer, dispense, deliver, give
away to another, distribute, dispatch in transit or transport any
controlled precursor and essential chemical, or shall act as a broker
in such transactions.
If the sale, trading, administration, dispensation, delivery, distribution
or transportation of any dangerous drug and/or controlled precursor
and essential chemical transpires within one hundred (100) meters
from the school, the maximum penalty shall be imposed in every
case.
35
For drug pushers who use minors or mentally incapacitated

individuals as runners, couriers and messengers, or in any other
capacity directly connected to the dangerous drugs and/or controlled
precursors and essential chemical trade, the maximum penalty shall
be imposed in every case.
If the victim of the offense is a minor or a mentally incapacitated
individual, or should a dangerous drug and/or a controlled precursor
and essential chemical involved in any offense herein provided be the
proximate cause of death of a victim thereof, the maximum penalty
provided for under this Section shall be imposed.
imposed upon any person who organizes, manages or acts as a
Section 6. Maintenance of a Den, Dive or Resort. - The penalty of life
shall be imposed upon any person or group of persons who shall
maintain a den, dive or resort where any dangerous drug is used or
sold in any form.
36
(P500,000.00) shall be imposed upon any person or group of persons
who shall maintain a den, dive, or resort where any controlled
precursor and essential chemical is used or sold in any form.
imposed in every case where any dangerous drug is administered,
delivered or sold to a minor who is allowed to use the same in such a
place.
Should any dangerous drug be the proximate cause of the death of a
person using the same in such den, dive or resort, the penalty of
death and a fine ranging from One million (P1,000,000.00) to Fifteen
million pesos (P500,000.00) shall be imposed on the maintainer,
owner and/or operator.
If such den, dive or resort is owned by a third person, the same shall
be confiscated and escheated in favor of the government: Provided,
That the criminal complaint shall specifically allege that such place is
intentionally used in the furtherance of the crime: Provided, further,
That the prosecution shall prove such intent on the part of the owner
to use the property for such purpose: Provided, finally, That the
owner shall be included as an accused in the criminal complaint.
37

imposed upon any person who organizes, manages or acts as a
The penalty twelve (12) years and one (1) day to twenty (20) years of
imprisonment and a fine ranging from One hundred thousand pesos
(P100,000.00) to Five hundred thousand pesos (P500,000.00) shall
be imposed upon any person, who acts as a "protector/coddler" of
any violator of the provisions under this Section.
Section 7. Employees and Visitors of a Den, Dive or Resort. - The
penalty of imprisonment ranging from twelve (12) years and one (1)
day to twenty (20) years and a fine ranging from One hundred
(P500,000.00) shall be imposed upon:
(a) Any employee of a den, dive or resort, who is aware of the
nature of the place as such; and
(b) Any person who, not being included in the provisions of the
next preceding, paragraph, is aware of the nature of the place
as such and shall knowingly visit the same
Section 8. Manufacture of Dangerous Drugs and/or Controlled
Precursors and Essential Chemicals. - The penalty of life
imprisonment to death and a fine ranging Five hundred thousand
pesos (P500,000.00) to Ten million pesos (P10,000,000.00) shall be
38
imposed upon any person, who, unless authorized by law, shall

engage in the manufacture of any dangerous drug.
authorized by law, shall manufacture any controlled precursor and
essential chemical.
The presence of any controlled precursor and essential chemical or
laboratory equipment in the clandestine laboratory is a prima
facie proof of manufacture of any dangerous drug. It shall be
considered an aggravating circumstance if the clandestine laboratory
is undertaken or established under the following circumstances:
(a) Any phase of the manufacturing process was conducted in
the presence or with the help of minor/s:
(b) Any phase or manufacturing process was established or
undertaken within one hundred (100) meters of a residential,
business, church or school premises;
(c) Any clandestine laboratory was secured or protected with
booby traps;
(d) Any clandestine laboratory was concealed with legitimate
business operations; or
39
(e) Any employment of a practitioner, chemical engineer, public

official or foreigner.
Section 9. Illegal Chemical Diversion of Controlled Precursors and
Essential Chemicals. - The penalty of imprisonment ranging from
twelve (12) years and one (1) day to twenty (20) years and a fine
ranging from One hundred thousand pesos (P100,000.00) to Five
hundred thousand pesos (P500,000.00) shall be imposed upon any
person, who, unless authorized by law, shall illegally divert any
controlled precursor and essential chemical.
Section 10. Manufacture or Delivery of Equipment, Instrument,
Apparatus, and Other Paraphernalia for Dangerous Drugs and/or
Controlled Precursors and Essential Chemicals. - The penalty of
imprisonment ranging from twelve (12) years and one (1) day to
twenty (20) years and a fine ranging from One hundred thousand
shall be imposed upon any person who shall deliver, possess with
40
intent to deliver, or manufacture with intent to deliver equipment,

instrument, apparatus and other paraphernalia for dangerous drugs,
knowing, or under circumstances where one reasonably should know,
that it will be used to plant, propagate, cultivate, grow, harvest,
manufacture, compound, convert, produce, process, prepare, test,
analyze, pack, repack, store, contain or conceal any dangerous drug
and/or controlled precursor and essential chemical in violation of this
Act.
The penalty of imprisonment ranging from six (6) months and one (1)
day to four (4) years and a fine ranging from Ten thousand pesos
(P10,000.00) to Fifty thousand pesos (P50,000.00) shall be imposed
if it will be used to inject, ingest, inhale or otherwise introduce into the
human body a dangerous drug in violation of this Act.
imposed upon any person, who uses a minor or a mentally
incapacitated individual to deliver such equipment, instrument,
apparatus and other paraphernalia for dangerous drugs.
Section 11. Possession of Dangerous Drugs. - The penalty of life
shall possess any dangerous drug in the following quantities,
regardless of the degree of purity thereof:
(1) 10 grams or more of opium;
41
(2) 10 grams or more of morphine;

(3) 10 grams or more of heroin;
(4) 10 grams or more of cocaine or cocaine hydrochloride;
(5) 50 grams or more of methamphetamine hydrochloride or
"shabu";
(6) 10 grams or more of marijuana resin or marijuana resin oil;
(7) 500 grams or more of marijuana; and
(8) 10 grams or more of other dangerous drugs such as, but not
limited
to,
methylenedioxymethamphetamine
"ecstasy",
(MDA)
paramethoxyamphetamine
or
(PMA),
trimethoxyamphetamine (TMA), lysergic acid diethylamine

(LSD),
gamma
hydroxyamphetamine
(GHB),
and
those
similarly designed or newly introduced drugs and their

derivatives, without having any therapeutic value or if the
quantity possessed is far beyond therapeutic requirements, as
determined and promulgated by the Board in accordance to
Section 93, Article XI of this Act.
Otherwise, if the quantity involved is less than the foregoing
quantities, the penalties shall be graduated as follows:
(1) Life imprisonment and a fine ranging from Four hundred
42
(P500,000.00),
if
the
quantity
of
methamphetamine
hydrochloride or "shabu" is ten (10) grams or more but less

than fifty (50) grams;
(2) Imprisonment of twenty (20) years and one (1) day to life
imprisonment and a fine ranging from Four hundred thousand
pesos
(P400,000.00)
to
Five
hundred
thousand
pesos
(P500,000.00), if the quantities of dangerous drugs are five (5)

grams or more but less than ten (10) grams of opium,
morphine, heroin, cocaine or cocaine hydrochloride, marijuana
resin or marijuana resin oil, methamphetamine hydrochloride or
"shabu", or other dangerous drugs such as, but not limited to,
MDMA or "ecstasy", PMA, TMA, LSD, GHB, and those similarly
designed or newly introduced drugs and their derivatives,
without having any therapeutic value or if the quantity
possessed is far beyond therapeutic requirements; or three
hundred (300) grams or more but less than five (hundred) 500)
grams of marijuana; and
(3) Imprisonment of twelve (12) years and one (1) day to twenty
(20) years and a fine ranging from Three hundred thousand
pesos (P300,000.00) to Four hundred thousand pesos
(P400,000.00), if the quantities of dangerous drugs are less
than five (5) grams of opium, morphine, heroin, cocaine or
cocaine hydrochloride, marijuana resin or marijuana resin oil,
methamphetamine
hydrochloride
or
"shabu",
or
other
dangerous drugs such as, but not limited to, MDMA or

43
"ecstasy", PMA, TMA, LSD, GHB, and those similarly designed

or newly introduced drugs and their derivatives, without having
any therapeutic value or if the quantity possessed is far beyond
therapeutic requirements; or less than three hundred (300)
grams of marijuana.
Section 12. Possession of Equipment, Instrument, Apparatus and
Other
Paraphernalia
for
Dangerous Drugs.
-The penalty of
imprisonment ranging from six (6) months and one (1) day to four (4)
years and a fine ranging from Ten thousand pesos (P10,000.00) to
Fifty thousand pesos (P50,000.00) shall be imposed upon any
person, who, unless authorized by law, shall possess or have under
his/her control any equipment, instrument, apparatus and other
paraphernalia fit or intended for smoking, consuming, administering,
injecting, ingesting, or introducing any dangerous drug into the
body: Provided, That in the case of medical practitioners and various
professionals who are required to carry such equipment, instrument,
apparatus and other paraphernalia in the practice of their profession,
the Board shall prescribe the necessary implementing guidelines
thereof.
The possession of such equipment, instrument, apparatus and other
paraphernalia fit or intended for any of the purposes enumerated in
the preceding paragraph shall be prima facie evidence that the
possessor has smoked, consumed, administered to himself/herself,
injected, ingested or used a dangerous drug and shall be presumed
to have violated Section 15 of this Act.
44
Section 13. Possession of Dangerous Drugs During Parties, Social

Gatherings or Meetings. Any person found possessing any
dangerous drug during a party, or at a social gathering or meeting, or
in the proximate company of at least two (2) persons, shall suffer the
maximum penalties provided for in Section 11 of this Act, regardless
of the quantity and purity of such dangerous drugs.
Section 14. Possession of Equipment, Instrument, Apparatus and
Other Paraphernalia for Dangerous Drugs During Parties, Social
Gatherings or Meetings. - The maximum penalty provided for in
Section 12 of this Act shall be imposed upon any person, who shall
possess or have under his/her control any equipment, instrument,
apparatus and other paraphernalia fit or intended for smoking,
consuming, administering, injecting, ingesting, or introducing any
dangerous drug into the body, during parties, social gatherings or
meetings, or in the proximate company of at least two (2) persons.
Section 15. Use of Dangerous Drugs. A person apprehended or
arrested, who is found to be positive for use of any dangerous drug,
after a confirmatory test, shall be imposed a penalty of a minimum of
six (6) months rehabilitation in a government center for the first
offense, subject to the provisions of Article VIII of this Act. If
apprehended using any dangerous drug for the second time, he/she
shall suffer the penalty of imprisonment ranging from six (6) years
and one (1) day to twelve (12) years and a fine ranging from Fifty
thousand pesos (P50,000.00) to Two hundred thousand pesos
(P200,000.00): Provided, That this Section shall not be applicable
45
where the person tested is also found to have in his/her possession

such quantity of any dangerous drug provided for under Section 11 of
this Act, in which case the provisions stated therein shall apply.
Section 16. Cultivation or Culture of Plants Classified as Dangerous
Drugs or are Sources Thereof. - The penalty of life imprisonment to
death and a fine ranging from Five hundred thousand pesos
(P500,000.00) to Ten million pesos (P10,000,000.00) shall be
imposed upon any person, who shall plant, cultivate or culture
marijuana, opium poppy or any other plant regardless of quantity,
which is or may hereafter be classified as a dangerous drug or as a
source from which any dangerous drug may be manufactured or
derived: Provided, That in the case of medical laboratories and
medical research centers which cultivate or culture marijuana, opium
poppy and other plants, or materials of such dangerous drugs for
medical experiments and research purposes, or for the creation of
new types of medicine, the Board shall prescribe the necessary
implementing guidelines for the proper cultivation, culture, handling,
experimentation and disposal of such plants and materials.
The land or portions thereof and/or greenhouses on which any of said
plants is cultivated or cultured shall be confiscated and escheated in
favor of the State, unless the owner thereof can prove lack of
knowledge of such cultivation or culture despite the exercise of due
diligence on his/her part. If the land involved is part of the public
domain, the maximum penalty provided for under this Section shall
be imposed upon the offender.
46

Section 17. Maintenance and Keeping of Original Records of
Transactions on Dangerous Drugs and/or Controlled Precursors and
Essential Chemicals. - The penalty of imprisonment ranging from one
(1) year and one (1) day to six (6) years and a fine ranging from Ten
thousand pesos (P10,000.00) to Fifty thousand pesos (P50,000.00)
shall be imposed upon any practitioner, manufacturer, wholesaler,
importer, distributor, dealer or retailer who violates or fails to comply
with the maintenance and keeping of the original records of
transactions on any dangerous drug and/or controlled precursor and
essential chemical in accordance with Section 40 of this Act.
An additional penalty shall be imposed through the revocation of the
license to practice his/her profession, in case of a practitioner, or of
the business, in case of a manufacturer, seller, importer, distributor,
dealer or retailer.
Section 18. Unnecessary Prescription of Dangerous Drugs. The
penalty of imprisonment ranging from twelve (12) years and one (1)
47
day to twenty (20) years and a fine ranging from One hundred
(P500,000.00) and the additional penalty of the revocation of his/her
license to practice shall be imposed upon the practitioner, who shall
prescribe any dangerous drug to any person whose physical or
physiological condition does not require the use or in the dosage
prescribed therein, as determined by the Board in consultation with
recognized competent experts who are authorized representatives of
professional organizations of practitioners, particularly those who are
involved in the care of persons with severe pain.
Section 19. Unlawful Prescription of Dangerous Drugs. The penalty
of life imprisonment to death and a fine ranging from Five hundred
shall make or issue a prescription or any other writing purporting to
be a prescription for any dangerous drug.
Section 20. Confiscation and Forfeiture of the Proceeds or
Instruments of the Unlawful Act, Including the Properties or Proceeds
Derived from the Illegal Trafficking of Dangerous Drugs and/or
Precursors and Essential Chemicals. Every penalty imposed for the
unlawful importation, sale, trading, administration, dispensation,
delivery, distribution, transportation or manufacture of any dangerous
drug and/or controlled precursor and essential chemical, the
cultivation or culture of plants which are sources of dangerous drugs,
and the possession of any equipment, instrument, apparatus and
48
other paraphernalia for dangerous drugs including other laboratory

equipment, shall carry with it the confiscation and forfeiture, in favor
of the government, of all the proceeds and properties derived from
the unlawful act, including, but not limited to, money and other assets
obtained thereby, and the instruments or tools with which the
particular unlawful act was committed, unless they are the property of
a third person not liable for the unlawful act, but those which are not
of lawful commerce shall be ordered destroyed without delay
pursuant to the provisions of Section 21 of this Act.
After conviction in the Regional Trial Court in the appropriate criminal
case filed, the Court shall immediately schedule a hearing for the
confiscation and forfeiture of all the proceeds of the offense and all
the assets and properties of the accused either owned or held by him
or in the name of some other persons if the same shall be found to be
manifestly out of proportion to his/her lawful income: Provided,
however, That if the forfeited property is a vehicle, the same shall be
auctioned off not later than five (5) days upon order of confiscation or
forfeiture.
During the pendency of the case in the Regional Trial Court, no
property, or income derived therefrom, which may be confiscated and
forfeited, shall be disposed, alienated or transferred and the same
shall be in custodia legisand no bond shall be admitted for the
release of the same.
49
The proceeds of any sale or disposition of any property confiscated or

forfeited under this Section shall be used to pay all proper expenses
incurred in the proceedings for the confiscation, forfeiture, custody
and maintenance of the property pending disposition, as well as
expenses for publication and court costs. The proceeds in excess of
the above expenses shall accrue to the Board to be used in its
campaign against illegal drugs.
Section 21. Custody and Disposition of Confiscated, Seized, and/or
Surrendered Dangerous Drugs, Plant Sources of Dangerous Drugs,
Controlled
Precursors
and
Essential
Chemicals,
Instruments/Paraphernalia and/or Laboratory Equipment. The

PDEA shall take charge and have custody of all dangerous drugs,
plant sources of dangerous drugs, controlled precursors and
essential chemicals, as well as instruments/paraphernalia and/or
laboratory equipment so confiscated, seized and/or surrendered, for
proper disposition in the following manner:
(1) The apprehending team having initial custody and control of
the drugs shall, immediately after seizure and confiscation,
physically inventory and photograph the same in the presence
of the accused or the person/s from whom such items were
confiscated and/or seized, or his/her representative or counsel,
a representative from the media and the Department of Justice
(DOJ), and any elected public official who shall be required to
sign the copies of the inventory and be given a copy thereof;
50
(2) Within twenty-four (24) hours upon confiscation/seizure of

dangerous drugs, plant sources of dangerous drugs, controlled
precursors
and
essential
chemicals,
as
well
as
instruments/paraphernalia and/or laboratory equipment, the

same shall be submitted to the PDEA Forensic Laboratory for a
qualitative and quantitative examination;
(3) A certification of the forensic laboratory examination results,
which shall be done under oath by the forensic laboratory
examiner, shall be issued within twenty-four (24) hours after the
receipt of the subject item/s: Provided, That when the volume of
the dangerous drugs, plant sources of dangerous drugs, and
controlled precursors and essential chemicals does not allow
the completion of testing within the time frame, a partial
laboratory examination report shall be provisionally issued
stating therein the quantities of dangerous drugs still to be
examined by the forensic laboratory: Provided, however, That a
final certification shall be issued on the completed forensic
laboratory examination on the same within the next twenty-four
(24) hours;
(4) After the filing of the criminal case, the Court shall, within
seventy-two (72) hours, conduct an ocular inspection of the
confiscated, seized and/or surrendered dangerous drugs, plant
sources of dangerous drugs, and controlled precursors and
essential chemicals, including the instruments/paraphernalia
and/or laboratory equipment, and through the PDEA shall within
51
twenty-four (24) hours thereafter proceed with the destruction or

burning of the same, in the presence of the accused or the
person/s from whom such items were confiscated and/or
seized, or his/her representative or counsel, a representative
from the media and the DOJ, civil society groups and any
elected public official. The Board shall draw up the guidelines
on the manner of proper disposition and destruction of such
item/s which shall be borne by the offender: Provided, That
those item/s of lawful commerce, as determined by the Board,
shall
be
donated,
used
or
recycled
for
legitimate
purposes: Provided, further, That a representative sample, duly

weighed and recorded is retained;
(5) The Board shall then issue a sworn certification as to the
fact of destruction or burning of the subject item/s which,
together with the representative sample/s in the custody of the
PDEA, shall be submitted to the court having jurisdiction over
the case. In all instances, the representative sample/s shall be
kept to a minimum quantity as determined by the Board;
(6) The alleged offender or his/her representative or counsel
shall be allowed to personally observe all of the above
proceedings and his/her presence shall not constitute an
admission of guilt. In case the said offender or accused refuses
or fails to appoint a representative after due notice in writing to
the accused or his/her counsel within seventy-two (72) hours
before the actual burning or destruction of the evidence in
52
question, the Secretary of Justice shall appoint a member of the

public attorney's office to represent the former;
(7) After the promulgation and judgment in the criminal case
wherein the representative sample/s was presented as
evidence in court, the trial prosecutor shall inform the Board of
the final termination of the case and, in turn, shall request the
court for leave to turn over the said representative sample/s to
the PDEA for proper disposition and destruction within twentyfour (24) hours from receipt of the same; and
(8) Transitory Provision: a) Within twenty-four (24) hours from
the effectivity of this Act, dangerous drugs defined herein which
are presently in possession of law enforcement agencies shall,
with leave of court, be burned or destroyed, in the presence of
representatives of the Court, DOJ, Department of Health (DOH)
and the accused/and or his/her counsel, and, b) Pending the
organization of the PDEA, the custody, disposition, and burning
or destruction of seized/surrendered dangerous drugs provided
under this Section shall be implemented by the DOH.
Section 22. Grant of Compensation, Reward and Award. The
Board shall recommend to the concerned government agency the
grant of compensation, reward and award to any person providing
information and to law enforcers participating in the operation, which
results in the successful confiscation, seizure or surrender of
53
dangerous drugs, plant sources of dangerous drugs, and controlled

precursors and essential chemicals.
Section 23. Plea-Bargaining Provision. Any person charged under
any provision of this Act regardless of the imposable penalty shall not
be allowed to avail of the provision on plea-bargaining.
Section 24. Non-Applicability of the Probation Law for Drug
Traffickers and Pushers. Any person convicted for drug trafficking or
pushing under this Act, regardless of the penalty imposed by the
Court, cannot avail of the privilege granted by the Probation Law or
Presidential Decree No. 968, as amended.
Section
25. Qualifying
Aggravating
Circumstances
in
the
Commission of a Crime by an Offender Under the Influence of

Dangerous Drugs. Notwithstanding the provisions of any law to the
contrary, a positive finding for the use of dangerous drugs shall be a
qualifying aggravating circumstance in the commission of a crime by
an offender, and the application of the penalty provided for in the
Revised Penal Code shall be applicable.
Section 26. Attempt or Conspiracy. Any attempt or conspiracy to
commit the following unlawful acts shall be penalized by the same
penalty prescribed for the commission of the same as provided under
this Act:
(a) Importation of any dangerous drug and/or controlled
precursor and essential chemical;
54
(b)
Sale,
trading,
administration,
dispensation,
delivery,
distribution and transportation of any dangerous drug and/or

controlled precursor and essential chemical;
(c) Maintenance of a den, dive or resort where any dangerous
drug is used in any form;
(d) Manufacture of any dangerous drug and/or controlled
precursor and essential chemical; and
(e) Cultivation or culture of plants which are sources of
dangerous drugs.
Section 27. Criminal Liability of a Public Officer or Employee for
Misappropriation, Misapplication or Failure to Account for the
Confiscated, Seized and/or Surrendered Dangerous Drugs, Plant
Sources of Dangerous Drugs, Controlled Precursors and Essential
Chemicals, Instruments/Paraphernalia and/or Laboratory Equipment
Including the Proceeds or Properties Obtained from the Unlawful Act
Committed. The penalty of life imprisonment to death and a fine
ranging from Five hundred thousand pesos (P500,000.00) to Ten
million pesos (P10,000,000.00), in addition to absolute perpetual
disqualification from any public office, shall be imposed upon any
public officer or employee who misappropriates, misapplies or fails to
account for confiscated, seized or surrendered dangerous drugs,
plant sources of dangerous drugs, controlled precursors and
essential chemicals, instruments/paraphernalia and/or laboratory
55
equipment including the proceeds or properties obtained from the

unlawful acts as provided for in this Act.
Any elective local or national official found to have benefited from the
proceeds of the trafficking of dangerous drugs as prescribed in this
Act, or have received any financial or material contributions or
donations from natural or juridical persons found guilty of trafficking
dangerous drugs as prescribed in this Act, shall be removed from
office and perpetually disqualified from holding any elective or
appointive positions in the government, its divisions, subdivisions,
and intermediaries, including government-owned or controlled
corporations.
Section
28. Criminal
Liability
of
Government
Officials
and
Employees. The maximum penalties of the unlawful acts provided

for in this Act shall be imposed, in addition to absolute perpetual
disqualification from any public office, if those found guilty of such
unlawful acts are government officials and employees.
Section 29. Criminal Liability for Planting of Evidence. Any person
who is found guilty of "planting" any dangerous drug and/or controlled
precursor and essential chemical, regardless of quantity and purity,
shall suffer the penalty of death.
Section
30. Criminal
Liability
of
Officers
of
Partnerships,
Corporations, Associations or Other Juridical Entities. In case any

violation of this Act is committed by a partnership, corporation,
association or any juridical entity, the partner, president, director,
56
manager, trustee, estate administrator, or officer who consents to or

knowingly tolerates such violation shall be held criminally liable as a
co-principal.
The penalty provided for the offense under this Act shall be imposed
upon the partner, president, director, manager, trustee, estate
administrator, or officer who knowingly authorizes, tolerates or
consents to the use of a vehicle, vessel, aircraft, equipment or other
facility, as
an
instrument
in
the
importation,
sale,
trading,
administration, dispensation, delivery, distribution, transportation or

manufacture of dangerous drugs, or chemical diversion, if such
vehicle, vessel, aircraft, equipment or other instrument is owned by or
under the control or supervision of the partnership, corporation,
association or juridical entity to which they are affiliated.
Section 31. Additional Penalty if Offender is an Alien. In addition to
the penalties prescribed in the unlawful act committed, any alien who
violates such provisions of this Act shall, after service of sentence, be
deported immediately without further proceedings, unless the penalty
is death.
Section 32. Liability to a Person Violating Any Regulation Issued by
the Board. The penalty of imprisonment ranging from six (6) months
and one (1) day to four (4) years and a fine ranging from Ten
thousand pesos (P10,000.00) to Fifty thousand pesos (P50,000.00)
shall be imposed upon any person found violating any regulation duly
57
issued by the Board pursuant to this Act, in addition to the

administrative sanctions imposed by the Board.
Section
33. Immunity
from
Prosecution
and
Punishment.
Notwithstanding the provisions of Section 17, Rule 119 of the Revised

Rules of Criminal Procedure and the provisions of Republic Act No.
6981 or the Witness Protection, Security and Benefit Act of 1991, any
person who has violated Sections 7, 11, 12, 14, 15, and 19, Article II
of this Act, who voluntarily gives information about any violation of
Sections 4, 5, 6, 8, 10, 13, and 16, Article II of this Act as well as any
violation of the offenses mentioned if committed by a drug syndicate,
or any information leading to the whereabouts, identities and arrest of
all or any of the members thereof; and who willingly testifies against
such persons as described above, shall be exempted from
prosecution or punishment for the offense with reference to which
his/her information of testimony were given, and may plead or prove
the giving of such information and testimony in bar of such
prosecution: Provided, That the following conditions concur:
(1) The information and testimony are necessary for the
conviction of the persons described above;
(2) Such information and testimony are not yet in the
possession of the State;
(3) Such information and testimony can be corroborated on its
material points;
58
(4) the informant or witness has not been previously convicted

of a crime involving moral turpitude, except when there is no
other direct evidence available for the State other than the
information and testimony of said informant or witness; and
(5) The informant or witness shall strictly and faithfully comply
without delay, any condition or undertaking, reduced into
writing, lawfully imposed by the State as further consideration
for the grant of immunity from prosecution and punishment.
Provided, further, That this immunity may be enjoyed by such
informant or witness who does not appear to be most guilty for the
offense with reference to which his/her information or testimony were
given: Provided, finally, That there is no direct evidence available for
the State except for the information and testimony of the said
informant or witness.
Section 34. Termination of the Grant of Immunity. The immunity
granted to the informant or witness, as prescribed in Section 33 of
this Act, shall not attach should it turn out subsequently that the
information and/or testimony is false, malicious or made only for the
purpose of harassing, molesting or in any way prejudicing the
persons described in the preceding Section against whom such
information or testimony is directed against. In such case, the
informant or witness shall be subject to prosecution and the
enjoyment of all rights and benefits previously accorded him under
this Act or any other law, decree or order shall be deemed terminated.
59
In case an informant or witness under this Act fails or refuses to

testify without just cause, and when lawfully obliged to do so, or
should he/she violate any condition accompanying such immunity as
provided above, his/her immunity shall be removed and he/she shall
likewise be subject to contempt and/or criminal prosecution, as the
case may be, and the enjoyment of all rights and benefits previously
accorded him under this Act or in any other law, decree or order shall
be deemed terminated.
In case the informant or witness referred to under this Act falls under
the applicability of this Section hereof, such individual cannot avail of
the provisions under Article VIII of this Act.
Section 35. Accessory Penalties. A person convicted under this Act
shall be disqualified to exercise his/her civil rights such as but not
limited to, the rights of parental authority or guardianship, either as to
the person or property of any ward, the rights to dispose of such
property by any act or any conveyance inter vivos, and political rights
such as but not limited to, the right to vote and be voted for. Such
rights shall also be suspended during the pendency of an appeal from
such conviction.
ARTICLE III
Dangerous Drugs Test and Record Requirements
Section 36. Authorized Drug Testing. Authorized drug testing shall
be done by any government forensic laboratories or by any of the
60
drug testing laboratories accredited and monitored by the DOH to

safeguard the quality of test results. The DOH shall take steps in
setting the price of the drug test with DOH accredited drug testing
centers to further reduce the cost of such drug test. The drug testing
shall employ, among others, two (2) testing methods, the screening
test which will determine the positive result as well as the type of the
drug used and the confirmatory test which will confirm a positive
screening test. Drug test certificates issued by accredited drug testing
centers shall be valid for a one-year period from the date of issue
which may be used for other purposes. The following shall be
subjected to undergo drug testing:
(a) Applicants for driver's license. No driver's license shall be
issued or renewed to any person unless he/she presents a
certification that he/she has undergone a mandatory drug test
and indicating thereon that he/she is free from the use of
dangerous drugs;
(b) Applicants for firearm's license and for permit to carry
firearms outside of residence. All applicants for firearm's
license and permit to carry firearms outside of residence shall
undergo a mandatory drug test to ensure that they are free from
the use of dangerous drugs: Provided, That all persons who by
the nature of their profession carry firearms shall undergo drug
testing;
61
(c) Students of secondary and tertiary schools. Students of

secondary and tertiary schools shall, pursuant to the related
rules and regulations as contained in the school's student
handbook and with notice to the parents, undergo a random
drug testing: Provided, That all drug testing expenses whether
in public or private schools under this Section will be borne by
the government;
(d) Officers and employees of public and private offices.
Officers and employees of public and private offices, whether
domestic or overseas, shall be subjected to undergo a random
drug test as contained in the company's work rules and
regulations, which shall be borne by the employer, for purposes
of reducing the risk in the workplace. Any officer or employee
found positive for use of dangerous drugs shall be dealt with
administratively which shall be a ground for suspension or
termination, subject to the provisions of Article 282 of the Labor
Code and pertinent provisions of the Civil Service Law;
(e) Officers and members of the military, police and other law
enforcement agencies. Officers and members of the military,
police and other law enforcement agencies shall undergo an
annual mandatory drug test;
(f) All persons charged before the prosecutor's office with a
criminal offense having an imposable penalty of imprisonment
62
of not less than six (6) years and one (1) day shall have to
undergo a mandatory drug test; and
(g) All candidates for public office whether appointed or elected
both in the national or local government shall undergo a
mandatory drug test.
In addition to the above stated penalties in this Section, those
found to be positive for dangerous drugs use shall be subject to
the provisions of Section 15 of this Act.
Section 37. Issuance of False or Fraudulent Drug Test Results.
Any person authorized, licensed or accredited under this Act and its
implementing rules to conduct drug examination or test, who issues
false or fraudulent drug test results knowingly, willfully or through
gross negligence, shall suffer the penalty of imprisonment ranging
from six (6) years and one (1) day to twelve (12) years and a fine
ranging from One hundred thousand pesos (P100,000.00) to Five
hundred thousand pesos (P500,000.00).
An additional penalty shall be imposed through the revocation of the
license to practice his/her profession in case of a practitioner, and the
closure of the drug testing center.
Section
38. Laboratory
Examination
or
Test
on
Apprehended/Arrested Offenders. Subject to Section 15 of this Act,

any person apprehended or arrested for violating the provisions of
this Act shall be subjected to screening laboratory examination or test
63
within twenty-four (24) hours, if the apprehending or arresting officer

has reasonable ground to believe that the person apprehended or
arrested, on account of physical signs or symptoms or other visible or
outward manifestation, is under the influence of dangerous drugs. If
found to be positive, the results of the screening laboratory
examination or test shall be challenged within fifteen (15) days after
receipt of the result through a confirmatory test conducted in any
accredited
analytical
laboratory
equipment
with
gas
chromatograph/mass spectrometry equipment or some such modern

and accepted method, if confirmed the same shall be prima
facie evidence that such person has used dangerous drugs, which is
without prejudice for the prosecution for other violations of the
provisions of this Act: Provided, That a positive screening laboratory
test must be confirmed for it to be valid in a court of law.
Section 39. Accreditation of Drug Testing Centers and Physicians.
The DOH shall be tasked to license and accredit drug testing centers
in each province and city in order to assure their capacity,
competence, integrity and stability to conduct the laboratory
examinations and tests provided in this Article, and appoint such
technical and other personnel as may be necessary for the effective
implementation of this provision. The DOH shall also accredit
physicians who shall conduct the drug dependency examination of a
drug dependent as well as the after-care and follow-up program for
the said drug dependent. There shall be a control regulations,
64
licensing and accreditation division under the supervision of the DOH

for this purpose.
For this purpose, the DOH shall establish, operate and maintain drug
testing centers in government hospitals, which must be provided at
least with basic technologically advanced equipment and materials, in
order to conduct the laboratory examination and tests herein
provided, and appoint such qualified and duly trained technical and
other personnel as may be necessary for the effective implementation
of this provision.
Section 40. Records Required for Transactions on Dangerous Drug
and Precursors and Essential Chemicals.
a) Every pharmacist dealing in dangerous drugs and/or
controlled precursors and essential chemicals shall maintain
and keep an original record of sales, purchases, acquisitions
and deliveries of dangerous drugs, indicating therein the
following information:
(1) License number and address of the pharmacist;
(2) Name, address and license of the manufacturer,
importer or wholesaler from whom the dangerous drugs
have been purchased;
(3) Quantity and name of the dangerous drugs purchased
or acquired;
65
(4) Date of acquisition or purchase;

(5) Name, address and community tax certificate number
of the buyer;
(6) Serial number of the prescription and the name of the
physician, dentist, veterinarian or practitioner issuing the
same;
(7) Quantity and name of the dangerous drugs sold or
delivered; and
(8) Date of sale or delivery.
A certified true copy of such record covering a period of six (6)
months, duly signed by the pharmacist or the owner of the
drugstore, pharmacy or chemical establishment, shall be
forwarded to the Board within fifteen (15) days following the last
day of June and December of each year, with a copy thereof
furnished the city or municipal health officer concerned.
(b) A physician, dentist, veterinarian or practitioner authorized to
prescribe any dangerous drug shall issue the prescription
therefor in one (1) original and two (2) duplicate copies. The
original, after the prescription has been filled, shall be retained
by the pharmacist for a period of one (1) year from the date of
sale or delivery of such drug. One (1) copy shall be retained by
the buyer or by the person to whom the drug is delivered until
66
such drug is consumed, while the second copy shall be

retained by the person issuing the prescription.
For purposes of this Act, all prescriptions issued by physicians,
dentists, veterinarians or practitioners shall be written on forms
exclusively issued by and obtainable from the DOH. Such forms
shall be made of a special kind of paper and shall be distributed
in such quantities and contain such information and other data
as the DOH may, by rules and regulations, require. Such forms
shall only be issued by the DOH through its authorized
employees to licensed physicians, dentists, veterinarians and
practitioners in such quantities as the Board may authorize. In
emergency cases, however, as the Board may specify in the
public interest, a prescription need not be accomplished on
such forms. The prescribing physician, dentist, veterinarian or
practitioner shall, within three (3) days after issuing such
prescription, inform the DOH of the same in writing. No
prescription once served by the drugstore or pharmacy be
reused nor any prescription once issued be refilled.
(c) All manufacturers, wholesalers, distributors, importers,
dealers and retailers of dangerous drugs and/or controlled
precursors and essential chemicals shall keep a record of all
inventories, sales, purchases, acquisitions and deliveries of the
same as well as the names, addresses and licenses of the
persons from whom such items were purchased or acquired or
to whom such items were sold or delivered, the name and
67
quantity of the same and the date of the transactions. Such

records may be subjected anytime for review by the Board.
ARTICLE IV
Participation of the Family, Students, Teachers and School
Authorities in the Enforcement of this Act
Section 41. Involvement of the Family. The family being the basic
unit of the Filipino society shall be primarily responsible for the
education and awareness of the members of the family on the ill
effects of dangerous drugs and close monitoring of family members
who may be susceptible to drug abuse.
Section 42. Student Councils and Campus Organizations. All
elementary, secondary and tertiary schools' student councils and
campus organizations shall include in their activities a program for the
prevention of and deterrence in the use of dangerous drugs, and
referral for treatment and rehabilitation of students for drug
dependence.
Section 43. School Curricula. Instruction on drug abuse prevention
and control shall be integrated in the elementary, secondary and
tertiary curricula of all public and private schools, whether general,
technical, vocational or agro-industrial as well as in non-formal,
informal and indigenous learning systems. Such instructions shall
include:
68
(1) Adverse effects of the abuse and misuse of dangerous

drugs on the person, the family, the school and the community;
(2) Preventive measures against drug abuse;
(3) Health, socio-cultural, psychological, legal and economic
dimensions and implications of the drug problem;
(4) Steps to take when intervention on behalf of a drug
dependent is needed, as well as the services available for the
treatment and rehabilitation of drug dependents; and
(5) Misconceptions about the use of dangerous drugs such as,
but not limited to, the importance and safety of dangerous
drugs for medical and therapeutic use as well as the
differentiation between medical patients and drug dependents
in order to avoid confusion and accidental stigmatization in the
consciousness of the students.
Section 44. Heads, Supervisors, and Teachers of Schools. For the
purpose of enforcing the provisions of Article II of this Act, all school
heads, supervisors and teachers shall be deemed persons in
authority and, as such, are hereby empowered to apprehend, arrest
or cause the apprehension or arrest of any person who shall violate
any of the said provisions, pursuant to Section 5, Rule 113 of the
Rules of Court. They shall be deemed persons in authority if they are
in the school or within its immediate vicinity, or even beyond such
immediate vicinity if they are in attendance at any school or class
69
function in their official capacity as school heads, supervisors, and

teachers.
Any teacher or school employee, who discovers or finds that any
person in the school or within its immediate vicinity is liable for
violating any of said provisions, shall have the duty to report the same
to the school head or immediate superior who shall, in turn, report the
matter to the proper authorities.
Failure to do so in either case, within a reasonable period from the
time of discovery of the violation shall, after due hearing, constitute
sufficient cause for disciplinary action by the school authorities.
Section 45. Publication and Distribution of Materials on Dangerous
Drugs. With the assistance of the Board, the Secretary of the
Department of Education (DepEd), the Chairman of the Commission
on Higher Education (CHED) and the Director-General of the
Technical Education and Skills Development Authority (TESDA) shall
cause the development, publication and distribution of information
and support educational materials on dangerous drugs to the
students, the faculty, the parents, and the community.
Section 46. Special Drug Education Center. With the assistance of
the Board, the Department of the Interior and Local Government
(DILG), the National Youth Commission (NYC), and the Department
of Social Welfare and Development (DSWD) shall establish in each of
its provincial office a special education drug center for out-of-school
youth and street children. Such Center which shall be headed by the
70
Provincial Social. Welfare Development Officer shall sponsor drug

prevention programs and activities and information campaigns with
the end in view of educating the out-of-school youth and street
children regarding the pernicious effects of drug abuse. The
programs initiated by the Center shall likewise be adopted in all public
and private orphanage and existing special centers for street children.
ARTICLE V
Promotion of a National Drug-Free Workplace Program With the
Participation of Private and Labor Sectors and the Department of
Labor and Employment
Section 47. Drug-Free Workplace. It is deemed a policy of the
State to promote drug-free workplaces using a tripartite approach.
With the assistance of the Board, the Department of Labor and
Employment (DOLE) shall develop, promote and implement a
national drug abuse prevention program in the workplace to be
adopted by private companies with ten (10) or more employees. Such
program shall include the mandatory drafting and adoption of
company policies against drug use in the workplace in close
consultation and coordination with the DOLE, labor and employer
organizations, human resource development managers and other
such private sector organizations.
Section 48. Guidelines for the National Drug-Free Workplace
Program. The Board and the DOLE shall formulate the necessary
guidelines for the implementation of the national drug-free workplace
71
program. The amount necessary for the implementation of which

shall be included in the annual General Appropriations Act.
ARTICLE VI
Participation
of
the
Private
and
Labor
Sectors
in
the
Enforcement of this Act

Section 49. Labor Organizations and the Private Sector. All labor
unions, federations, associations, or organizations in cooperation with
the respective private sector partners shall include in their collective
bargaining or any similar agreements, joint continuing programs and
information campaigns for the laborers similar to the programs
provided under Section 47 of this Act with the end in view of
achieving a drug free workplace.
Section 50. Government Assistance. The labor sector and the
respective partners may, in pursuit of the programs mentioned in the
preceding Section, secure the technical assistance, such as but not
limited to, seminars and information dissemination campaigns of the
appropriate government and law enforcement agencies.
ARTICLE VII
Participation of Local Government Units
Section
51. Local
Government
Units'
Assistance.
Local
government units shall appropriate a substantial portion of their

respective annual budgets to assist in or enhance the enforcement of
72
this Act giving priority to preventive or educational programs and the

rehabilitation or treatment of drug dependents.
Section 52. Abatement of Drug Related Public Nuisances. Any
place or premises which have been used on two or more occasions
as the site of the unlawful sale or delivery of dangerous drugs may be
declared to be a public nuisance, and such nuisance may be abated,
pursuant to the following procedures:
(1) Any city or municipality may, by ordinance, create an
administrative
board
to
hear
complaints
regarding
the
nuisances;
(2) any employee, officer, or resident of the city or municipality
may bring a complaint before the Board after giving not less
than three (3) days written notice of such complaint to the
owner of the place or premises at his/her last known address;
and
(3) After hearing in which the Board may consider any
evidence, including evidence of the general reputation of the
place or premises, and at which the owner of the premises shall
have an opportunity to present evidence in his/her defense, the
Board may declare the place or premises to be a public
nuisance.
Section 53. Effect of Board Declaration. If the Board declares a
place or premises to be a public nuisance, it may declare an order
73
immediately prohibiting the conduct, operation, or maintenance of any

business or activity on the premises which is conducive to such
nuisance.
An order entered under this Section shall expire after one (1) year or
at such earlier time as stated in the order. The Board may bring a
complaint seeking a permanent injunction against any nuisance
described under this Section.
This Article does not restrict the right of any person to proceed under
the Civil Code against any public nuisance.
ARTICLE VIII
Program for Treatment and Rehabilitation of Drug Dependents
Section 54. Voluntary Submission of a Drug Dependent to
Confinement, Treatment and Rehabilitation. A drug dependent or
any person who violates Section 15 of this Act may, by himself/herself
or through his/her parent, spouse, guardian or relative within the
fourth degree of consanguinity or affinity, apply to the Board or its
duly recognized representative, for treatment and rehabilitation of the
drug dependency. Upon such application, the Board shall bring forth
the matter to the Court which shall order that the applicant be
examined for drug dependency. If the examination by a DOHaccredited physician results in the issuance of a certification that the
applicant is a drug dependent, he/she shall be ordered by the Court
to undergo treatment and rehabilitation in a Center designated by the
74
Board for a period of not less than six (6) months: Provided, That a
drug dependent may be placed under the care of a DOH-accredited
physician where there is no Center near or accessible to the
residence of the drug dependent or where said drug dependent is
below eighteen (18) years of age and is a first-time offender and nonconfinement in a Center will not pose a serious danger to his/her
family or the community.
Confinement in a Center for treatment and rehabilitation shall not
exceed one (1) year, after which time the Court, as well as the Board,
shall be apprised by the head of the treatment and rehabilitation
center of the status of said drug dependent and determine whether
further confinement will be for the welfare of the drug dependent and
his/her family or the community.
Section 55. Exemption from the Criminal Liability Under the
Voluntary Submission Program. A drug dependent under the
voluntary submission program, who is finally discharged from
confinement, shall be exempt from the criminal liability under Section
15 of this act subject to the following conditions:
(1) He/she has complied with the rules and regulations of the
center, the applicable rules and regulations of the Board,
including the after-care and follow-up program for at least
eighteen (18) months following temporary discharge from
confinement in the Center or, in the case of a dependent placed
under the care of the DOH-accredited physician, the after-care
75
program and follow-up schedule formulated by the DSWD and

approved by the Board: Provided, That capability-building of
local government social workers shall be undertaken by the
DSWD;
(2) He/she has never been charged or convicted of any offense
punishable under this Act, the Dangerous Drugs Act of 1972 or
Republic Act No. 6425, as amended; the Revised Penal Code,
as amended; or any special penal laws;
(3) He/she has no record of escape from a Center: Provided,
That
had
he/she
escaped,
he/she
surrendered
by
himself/herself or through his/her parent, spouse, guardian or

relative within the fourth degree of consanguinity or affinity,
within one (1) week from the date of the said escape; and
(4) He/she poses no serious danger to himself/herself, his/her
family or the community by his/her exemption from criminal
liability.
Section 56. Temporary Release From the Center; After-Care and
Follow-Up Treatment Under the Voluntary Submission Program.
Upon certification of the Center that the drug dependent within the
voluntary submission program may be temporarily released, the
Court shall order his/her release on condition that said drug
dependent shall report to the DOH for after-care and follow-up
treatment, including urine testing, for a period not exceeding eighteen
76
(18) months under such terms and conditions that the Court may
impose.
If during the period of after-care and follow-up, the drug dependent is
certified to be rehabilitated, he/she may be discharged by the Court,
subject to the provisions of Section 55 of this Act, without prejudice to
the outcome of any pending case filed in court.
However, should the DOH find that during the initial after-care and
follow-up program of eighteen (18) months, the drug dependent
requires further treatment and rehabilitation in the Center, he/she
shall be recommitted to the Center for confinement. Thereafter,
he/she may again be certified for temporary release and ordered
released for another after-care and follow-up program pursuant to this
Section.
Section 57. Probation and Community Service Under the Voluntary
Submission Program. A drug dependent who is discharged as
rehabilitated by the DOH-accredited Center through the voluntary
submission program, but does not qualify for exemption from criminal
liability under Section 55 of this Act, may be charged under the
provisions of this Act, but shall be placed on probation and undergo a
community service in lieu of imprisonment and/or fine in the discretion
of the court, without prejudice to the outcome of any pending case
filed in court.
Such drug dependent shall undergo community service as part of
his/her after-care and follow-up program, which may be done in
77
coordination with nongovernmental civil organizations accredited by

the DSWD, with the recommendation of the Board.
Section 58. Filing of Charges Against a Drug Dependent Who is Not
Rehabilitated Under the Voluntary Submission Program. A drug
dependent, who is not rehabilitated after the second commitment to
the Center under the voluntary submission program, shall, upon
recommendation of the Board, be charged for violation of Section 15
of this Act and prosecuted like any other offender. If convicted, he/she
shall be credited for the period of confinement and rehabilitation in
the Center in the service of his/her sentence.
Section 59. Escape and Recommitment for Confinement and
Rehabilitation Under the Voluntary Submission Program. Should a
drug dependent under the voluntary submission program escape
from the Center, he/she may submit himself/herself for recommitment
within one (1) week therefrom, or his/her parent, spouse, guardian or
relative within the fourth degree of consanguinity or affinity may,
within said period, surrender him for recommitment, in which case the
corresponding order shall be issued by the Board.
Should the escapee fail to submit himself/herself or be surrendered
after one (1) week, the Board shall apply to the court for a
recommitment order upon proof of previous commitment or his/her
voluntary submission by the Board, the court may issue an order for
recommitment within one (1) week.
78
If, subsequent to a recommitment, the dependent once again

escapes from confinement, he/she shall be charged for violation of
Section 15 of this Act and he subjected under section 61 of this Act,
either upon order of the Board or upon order of the court, as the case
may be.
Section
60. Confidentiality
of
Records
Under
the
Voluntary
Submission Program. Judicial and medical records of drug

dependents under the voluntary submission program shall be
confidential and shall not be used against him for any purpose,
except to determine how many times, by himself/herself or through
his/her parent, spouse, guardian or relative within the fourth degree of
consanguinity or affinity, he/she voluntarily submitted himself/herself
for confinement, treatment and rehabilitation or has been committed
to a Center under this program.
Section 61. Compulsory Confinement of a Drug Dependent Who
Refuses to Apply Under the Voluntary Submission Program.
Notwithstanding any law, rule and regulation to the contrary, any
person determined and found to be dependent on dangerous drugs
shall, upon petition by the Board or any of its authorized
representative, be confined for treatment and rehabilitation in any
Center duly designated or accredited for the purpose.
A petition for the confinement of a person alleged to be dependent on
dangerous drugs to a Center may be filed by any person authorized
79
by the Board with the Regional Trial Court of the province or city
where such person is found.
After the petition is filed, the court, by an order, shall immediately fix a
date for the hearing, and a copy of such order shall be served on the
person alleged to be dependent on dangerous drugs, and to the one
having charge of him.
If after such hearing and the facts so warrant, the court shall order the
drug dependent to be examined by two (2) physicians accredited by
the Board. If both physicians conclude that the respondent is not a
drug dependent, the court shall order his/her discharge. If either
physician finds him to be a dependent, the court shall conduct a
hearing and consider all relevant evidence which may be offered. If
the court finds him a drug dependent, it shall issue an order for
his/her commitment to a treatment and rehabilitation center under the
supervision of the DOH. In any event, the order of discharge or order
of confinement or commitment shall be issued not later than fifteen
(15) days from the filing of the appropriate petition.
Section 62. Compulsory Submission of a Drug Dependent Charged
with an Offense to Treatment and Rehabilitation. If a person
charged
with
an
offense
where
the
imposable
penalty
is
imprisonment of less than six (6) years and one (1) day, and is found
by the prosecutor or by the court, at any stage of the proceedings, to
be a drug dependent, the prosecutor or the court as the case may be,
80
shall suspend all further proceedings and transmit copies of the

record of the case to the Board.
In the event he Board determines, after medical examination, that
public interest requires that such drug dependent be committed to a
center for treatment and rehabilitation, it shall file a petition for his/her
commitment with the regional trial court of the province or city where
he/she is being investigated or tried: Provided, That where a criminal
case is pending in court, such petition shall be filed in the said court.
The court shall take judicial notice of the prior proceedings in the
case and shall proceed to hear the petition. If the court finds him to
be a drug dependent, it shall order his/her commitment to a Center
for treatment and rehabilitation. The head of said Center shall submit
to the court every four (4) months, or as often as the court may
require, a written report on the progress of the treatment. If the
dependent is rehabilitated, as certified by the center and the Board,
he/she shall be returned to the court, which committed him, for
his/her discharge therefrom.
Thereafter, his/her prosecution for any offense punishable by law
shall be instituted or shall continue, as the case may be. In case of
conviction, the judgment shall, if the accused is certified by the
treatment and rehabilitation center to have maintained good behavior,
indicate that he/she shall be given full credit for the period he/she was
confined in the Center: Provided, however, That when the offense is
for violation of Section 15 of this Act and the accused is not a
recidivist, the penalty thereof shall be deemed to have been served in
81
the Center upon his/her release therefrom after certification by the

Center and the Board that he/she is rehabilitated.
Section 63. Prescription of the Offense Charged Against a Drug
Dependent Under the Compulsory Submission Program. The
period of prescription of the offense charged against a drug
dependent under the compulsory submission program shall not run
during the time that the drug dependent is under confinement in a
Center or otherwise under the treatment and rehabilitation program
approved by the Board.
Upon certification of the Center that he/she may temporarily be
discharged from the said Center, the court shall order his/her release
on condition that he/she shall report to the Board through the DOH for
after-care and follow-up treatment for a period not exceeding
eighteen (18) months under such terms and conditions as may be
imposed by the Board.
If at anytime during the after-care and follow-up period, the Board
certifies to his/her complete rehabilitation, the court shall order his/her
final discharge from confinement and order for the immediate
resumption of the trial of the case for which he/she is originally
charged. Should the Board through the DOH find at anytime during
the after-care and follow-up period that he/she requires further
treatment and rehabilitation, it shall report to the court, which shall
order his/her recommitment to the Center.
82
Should the drug dependent, having been committed to a Center upon

petition by the Board escape therefrom, he/she may resubmit
himself/herself for confinement within one (1) week from the date of
his/her escape; or his/her parent, spouse, guardian or relative within
the fourth degree of consanguinity or affinity may, within the same
period, surrender him for recommitment. If, however, the drug
dependent does not resubmit himself/herself for confinement or
he/she is not surrendered for recommitment, the Board may apply
with the court for the issuance of the recommitment order. Upon proof
of previous commitment, the court shall issue an order for
recommitment. If, subsequent to such recommitment, he/she should
escape again, he/she shall no longer be exempt from criminal liability
for use of any dangerous drug.
A drug dependent committed under this particular Section who is
finally discharged from confinement shall be exempt from criminal
liability under Section 15 of this Act, without prejudice to the outcome
of any pending case filed in court. On the other hand, a drug
dependent who is not rehabilitated after a second commitment to the
Center shall, upon conviction by the appropriate court, suffer the
same penalties provided for under Section 15 of this Act again
without prejudice to the outcome of any pending case filed in court.
Section 64. Confidentiality of Records Under the Compulsory
Submission Program. The records of a drug dependent who was
rehabilitated and discharged from the Center under the compulsory
submission program, or who was charged for violation of Section 15
83
of this Act, shall be covered by Section 60 of this Act. However, the

records of a drug dependent who was not rehabilitated, or who
escaped but did not surrender himself/herself within the prescribed
period, shall be forwarded to the court and their use shall be
determined by the court, taking into consideration public interest and
the welfare of the drug dependent.
Section 65. Duty of the Prosecutor in the Proceedings. It shall be
the duty of the provincial or the city prosecutor or their assistants or
state prosecutors to prepare the appropriate petition in all
proceedings arising from this Act.
Section 66. Suspension of Sentence of a First-Time Minor Offender.
An accused who is over fifteen (15) years of age at the time of the
commission of the offense mentioned in Section 11 of this Act, but not
more than eighteen (18) years of age at the time when judgment
should have been promulgated after having been found guilty of said
offense, may be given the benefits of a suspended sentence, subject
to the following conditions:
(a) He/she has not been previously convicted of violating any
provision of this Act, or of the Dangerous Drugs Act of 1972, as
amended; or of the Revised Penal Code; or of any special
penal laws;
(b) He/she has not been previously committed to a Center or to
the care of a DOH-accredited physician; and
84
(c) The Board favorably recommends that his/her sentence be

suspended.
While under suspended sentence, he/she shall be under the
supervision and rehabilitative surveillance of the Board, under such
conditions that the court may impose for a period ranging from six (6)
months to eighteen (18) months.
Upon recommendation of the Board, the court may commit the
accused under suspended sentence to a Center, or to the care of a
DOH-accredited physician for at least six (6) months, with after-care
and follow-up program for not more than eighteen (18) months.
In the case of minors under fifteen (15) years of age at the time of the
commission of any offense penalized under this Act, Article 192 of
Presidential Decree No. 603, otherwise known as the Child and Youth
Welfare Code, as amended by Presidential Decree No. 1179 shall
apply, without prejudice to the application of the provisions of this
Section.
Section
67. Discharge
After
Compliance
with
Conditions
of
Suspended Sentence of a First-Time Minor Offender. If the accused

first time minor offender under suspended sentence complies with the
applicable rules and regulations of the Board, including confinement
in a Center, the court, upon a favorable recommendation of the Board
for the final discharge of the accused, shall discharge the accused
and dismiss all proceedings.
85
Upon the dismissal of the proceedings against the accused, the court
shall enter an order to expunge all official records, other than the
confidential record to be retained by the DOJ relating to the case.
Such an order, which shall be kept confidential, shall restore the
accused to his/her status prior to the case. He/she shall not be held
thereafter
to
be
guilty
of
perjury
or
of
concealment
or
misrepresentation by reason of his/her failure to acknowledge the

case or recite any fact related thereto in response to any inquiry
made of him for any purpose.
Section 68. Privilege of Suspended Sentence to be Availed of Only
Once by a First-Time Minor Offender. The privilege of suspended
sentence shall be availed of only once by an accused drug
dependent who is a first-time offender over fifteen (15) years of age
at the time of the commission of the violation of Section 15 of this Act
but not more than eighteen (18) years of age at the time when
judgment should have been promulgated.
Section 69. Promulgation of Sentence for First-Time Minor Offender.
If the accused first-time minor offender violates any of the
conditions of his/her suspended sentence, the applicable rules and
regulations of the Board exercising supervision and rehabilitative
surveillance over him, including the rules and regulations of the
Center should confinement be required, the court shall pronounce
judgment of conviction and he/she shall serve sentence as any other
convicted person.
86
Section 70. Probation or Community Service for a First-Time Minor

Offender in Lieu of Imprisonment. Upon promulgation of the
sentence, the court may, in its discretion, place the accused under
probation, even if the sentence provided under this Act is higher than
that provided under existing law on probation, or impose community
service in lieu of imprisonment. In case of probation, the supervision
and rehabilitative surveillance shall be undertaken by the Board
through the DOH in coordination with the Board of Pardons and
Parole and the Probation Administration. Upon compliance with the
conditions of the probation, the Board shall submit a written report to
the court recommending termination of probation and a final
discharge of the probationer, whereupon the court shall issue such an
order.
The community service shall be complied with under conditions, time
and place as may be determined by the court in its discretion and
upon the recommendation of the Board and shall apply only to
violators of Section 15 of this Act. The completion of the community
service shall be under the supervision and rehabilitative surveillance
of the Board during the period required by the court. Thereafter, the
Board shall render a report on the manner of compliance of said
community service. The court in its discretion may require extension
of the community service or order a final discharge.
In both cases, the judicial records shall be covered by the provisions
of Sections 60 and 64 of this Act.
87
If the sentence promulgated by the court requires imprisonment, the

period spent in the Center by the accused during the suspended
sentence period shall be deducted from the sentence to be served.
Section 71. Records to be kept by the Department of Justice. The
DOJ shall keep a confidential record of the proceedings on
suspension of sentence and shall not be used for any purpose other
than to determine whether or not a person accused under this Act is a
first-time minor offender.
Section 72. Liability of a Person Who Violates the Confidentiality of
Records. The penalty of imprisonment ranging from six (6) months
and one (1) day to six (6) years and a fine ranging from One
thousand pesos (P1,000.00) to Six thousand pesos (P6,000.00), shall
be imposed upon any person who, having official custody of or
access to the confidential records of any drug dependent under
voluntary submission programs, or anyone who, having gained
possession of said records, whether lawfully or not, reveals their
content to any person other than those charged with the prosecution
of the offenses under this Act and its implementation. The maximum
penalty shall be imposed, in addition to absolute perpetual
disqualification from any public office, when the offender is a
government official or employee. Should the records be used for
unlawful purposes, such as blackmail of the drug dependent or the
members of his/her family, the penalty imposed for the crime of
violation of confidentiality shall be in addition to whatever crime
he/she may be convicted of.
88
Section 73. Liability of a Parent, Spouse or Guardian Who Refuses

to Cooperate with the Board or any Concerned Agency. Any parent,
spouse or guardian who, without valid reason, refuses to cooperate
with the Board or any concerned agency in the treatment and
rehabilitation of a drug dependent who is a minor, or in any manner,
prevents or delays the after-care, follow-up or other programs for the
welfare of the accused drug dependent, whether under voluntary
submission program or compulsory submission program, may be
cited for contempt by the court.
Section 74. Cost-Sharing in the Treatment and Rehabilitation of a
Drug Dependent. The parent, spouse, guardian or any relative
within the fourth degree of consanguinity of any person who is
confined under the voluntary submission program or compulsory
submission program shall be charged a certain percentage of the
cost of his/her treatment and rehabilitation, the guidelines of which
shall be formulated by the DSWD taking into consideration the
economic status of the family of the person confined. The guidelines
therein formulated shall be implemented by a social worker of the
local government unit.
Section 75. Treatment and Rehabilitation Centers. The existing
treatment and rehabilitation centers for drug dependents operated
and maintained by the NBI and the PNP shall be operated,
maintained and managed by the DOH in coordination with other
concerned agencies. For the purpose of enlarging the network of
centers, the Board through the DOH shall encourage, promote or
89
whenever feasible, assist or support in the establishment, operations

and maintenance of private centers which shall be eligible to receive
grants, donations or subsidy from either government or private
sources. It shall also support the establishment of governmentoperated regional treatment and rehabilitation centers depending
upon the availability of funds. The national government, through its
appropriate agencies shall give priority funding for the increase of
subsidy to existing government drug rehabilitation centers, and shall
establish at least one (1) drug rehabilitation center in each province,
depending on the availability of funds.
Section 76. The Duties and Responsibilities of the Department of
health (DOH) Under this Act. The DOH shall:
(1) Oversee the monitor the integration, coordination and
supervision of all drug rehabilitation, intervention, after-care and
follow-up programs, projects and activities as well as the
establishment, operations, maintenance and management of
privately-owned drug treatment rehabilitation centers and drug
testing networks and laboratories throughout the country in
coordination with the DSWD and other agencies;
(2) License, accredit, establish and maintain drug test network
and laboratory, initiate, conduct and support scientific research
on drugs and drug control;
90
(3) Encourage, assist and accredit private centers, promulgate

rules and regulations setting minimum standards for their
accreditation to assure their competence, integrity and stability;
(4) Prescribe and promulgate rules and regulations governing
the establishment of such Centers as it may deem necessary
after conducting a feasibility study thereof;
(5) The DOH shall, without prejudice to the criminal prosecution
of those found guilty of violating this Act, order the closure of a
Center for treatment and rehabilitation of drug dependency
when, after investigation it is found guilty of violating the
provisions of this Act or regulations issued by the Board; and
(6) Charge reasonable fees for drug dependency examinations,
other medical and legal services provided to the public, which
shall accrue to the Board. All income derived from these
sources shall be part of the funds constituted as special funds
for the implementation of this Act under Section 87.
ARTICLE IX
Dangerous Drugs Board and Philippine Drug Enforcement
Agency
Section 77. The Dangerous Drugs Board. The Board shall be the
policy-making and strategy-formulating body in the planning and
formulation of policies and programs on drug prevention and control.
It shall develop and adopt a comprehensive, integrated, unified and
91
balanced national drug abuse prevention and control strategy. It shall

be under the Office of the President.
Section 78. Composition of the Board. The Board shall be
composed of seventeen (17) members wherein three (3) of which are
permanent members, the other twelve (12) members shall be in
an ex officio capacity and the two (2) shall be regular members.
The three (3) permanent members, who shall possess at least sevenyear training and experience in the field of dangerous drugs and in
any of the following fields: in law, medicine, criminology, psychology
or social work, shall be appointed by the President of the Philippines.
The President shall designate a Chairman, who shall have the rank of
a secretary from among the three (3) permanent members who shall
serve for six (6) years. Of the two (2) other members, who shall both
have the rank of undersecretary, one (1) shall serve for four (4) years
and the other for two (2) years. Thereafter, the persons appointed to
succeed such members shall hold office for a term of six (6) years
and until their successors shall have been duly appointed and
qualified.
The other twelve (12) members who shall be ex officio members of
the Board are the following:
(1) Secretary of the Department of Justice or his/her
representative;
92
(2) Secretary of the Department of Health or his/her

representative;
(3) Secretary of the Department of National Defense or his/her
representative;
(4) Secretary of the Department of Finance or his/her
representative;
(5) Secretary of the Department of Labor and Employment or
his/her representative;
(6) Secretary of the Department of the Interior and Local
Government or his/her representative;
(7) Secretary of the Department of Social Welfare and
Development or his/her representative;
(8) Secretary of the Department of Foreign Affairs or his/her
representative;
(9) Secretary of the Department of Education or his/her
representative;
(10) Chairman of the Commission on Higher Education or
his/her representative;
(11) Chairman of the National Youth Commission;
93
(12) Director General of the Philippine Drug Enforcement

Agency.
Cabinet secretaries who are members of the Board may designate
their duly authorized and permanent representatives whose ranks
shall in no case be lower than undersecretary.
The two (2) regular members shall be as follows:
(a) The president of the Integrated Bar of the Philippines; and
(b)
The
chairman
or
president
of
non-government
organization involved in dangerous drug campaign to be

appointed by the President of the Philippines.
The Director of the NBI and the Chief of the PNP shall be the
permanent consultants of the Board, and shall attend all the meetings
of the Board.
All members of the Board as well as its permanent consultants shall
receive a per diem for every meeting actually attended subject to the
pertinent budgetary laws, rules and regulations on compensation,
honoraria and allowances: Provided, That where the representative of
an ex officio member or of the permanent consultant of the Board
attends a meeting in behalf of the latter, such representative shall be
entitled to receive the per diem.
Section 79. Meetings of the Board. The Board shall meet once a
week or as often as necessary at the discretion of the Chairman or at
94
the call of any four (4) other members. The presence of nine (9)
members shall constitute a quorum.
Section 80. Secretariat of the Board. The Board shall recommend
to the President of the Philippines the appointment of an Executive
Director, with the rank of an undersecretary, who shall be the
Secretary of the Board and administrative officer of its secretariat,
and shall perform such other duties that may be assigned to him/her.
He/she must possess adequate knowledge, training and experience
in the field of dangerous drugs, and in any of the following fields: law
enforcement, law, medicine, criminology, psychology or social work.
Two deputies executive director, for administration and operations,
with the ranks of assistant secretary, shall be appointed by the
President upon recommendation of the Board. They shall possess
the same qualifications as those of the executive director. They shall
receive a salary corresponding to their position as prescribed by the
Salary Standardization Law as a Career Service Officer.
The existing secretariat of the Board shall be under the administrative
control and supervision of the Executive Director. It shall be
composed of the following divisions, namely: Policy Studies,
Research and Statistics; Preventive Education, Training and
Information; Legal Affairs; and the Administrative and Financial
Management.
Section 81. Powers and Duties of the Board. The Board shall:
95
(a) Formulate, develop and establish a comprehensive,

integrated, unified and balanced national drug use prevention
and control strategy;
(b) Promulgate such rules and regulations as may be
necessary to carry out the purposes of this Act, including the
manner of safekeeping, disposition, burning or condemnation of
any dangerous drug and/or controlled precursor and essential
chemical under its charge and custody, and prescribe
administrative remedies or sanctions for the violations of such
rules and regulations;
(c) Conduct policy studies, program monitoring and evaluations
and other researches on drug prevention, control and
enforcement;
(d) Initiate, conduct and support scientific, clinical, social,
psychological, physical and biological researches on dangerous
drugs and dangerous drugs prevention and control measures;
(e) Develop an educational program and information drive on
the hazards and prevention of illegal use of any dangerous drug
and/or controlled precursor and essential chemical based on
factual data, and disseminate the same to the general public,
for which purpose the Board shall endeavor to make the
general public aware of the hazards of any dangerous drugs
and/or controlled precursor and essential chemical by providing
among others, literature, films, displays or advertisements and
96
by coordinating with all institutions of learning as well as with all

national and local enforcement agencies in planning and
conducting
its
educational
campaign
programs
to
be
implemented by the appropriate government agencies;

(f) Conduct continuing seminars for, and consultations with, and
provide information materials to judges and prosecutors in
coordination with the Office of the Court Administrator, in the
case of judges, and the DOJ, in the case of prosecutors, which
aim to provide them with the current developments and
programs of the Board pertinent to its campaign against
dangerous drugs and its scientific researches on dangerous
drugs, its prevention and control measures;
(g) Design special trainings in order to provide law enforcement
officers, members of the judiciary, and prosecutors, school
authorities and personnel of centers with knowledge and knowhow in dangerous drugs and/or controlled precursors and
essential chemicals control in coordination with the Supreme
Court to meet the objectives of the national drug control
programs;
(h) Design and develop, in consultation and coordination with
the DOH, DSWD and other agencies involved in drugs control,
treatment and rehabilitation, both public and private, a national
treatment and rehabilitation program for drug dependents
97
including a standard aftercare and community service program

for recovering drug dependents;
(i) Design and develop, jointly with the DOLE and in
consultation with labor and employer groups as well as
nongovernment organizations a drug abuse prevention program
in the workplace that would include a provision for employee
assistance programs for emotionally-stressed employees;
(j) Initiate and authorize closure proceedings against nonaccredited and/or substandard rehabilitation centers based on
verified
reports
of
human
rights
violations,
subhuman
conditions, inadequate medical training and assistance and

excessive fees for implementation by the PDEA;
(k) Prescribe and promulgate rules and regulations governing
the establishment of such centers, networks and laboratories as
deemed necessary after conducting a feasibility study in
coordination with the DOH and other government agencies;
(l) Receive, gather, collect and evaluate all information on the
importation, exportation, production, manufacture, sale, stocks,
seizures of and the estimated need for any dangerous drug
and/or controlled precursor and essential chemical, for which
purpose the Board may require from any official, instrumentality
or agency of the government or any private person or
enterprise dealing in, or engaged in activities having to do with
any dangerous drug and/or controlled precursors and essential
98
chemicals such data or information as it may need to implement

this Act;
(m) Gather and prepare detailed statistics on the importation,
exportation, manufacture, stocks, seizures of and estimates
need for any dangerous drug and/or controlled precursors and
essential chemicals and such other statistical data on said
drugs as may be periodically required by the United Nations
Narcotics Drug Commission, the World Health Organization and
other international organizations in consonance with the
country's international commitments;
(n) Develop and maintain international networking coordination
with international drug control agencies and organizations, and
implement the provisions of international conventions and
agreements thereon which have been adopted and approved
by the Congress of the Philippines;
(o) Require all government and private hospitals, clinics,
doctors, dentists and other practitioners to submit a report to it,
in coordination with the PDEA, about all dangerous drugs
and/or controlled precursors and essential chemicals-related
cases to which they have attended for statistics and research
purposes;
(p) Receive in trust legacies, gifts and donations of real and
personal properties of all kinds, to administer and dispose the
same when necessary for the benefit of government and private
99
rehabilitation centers subject to limitations, directions and

instructions from the donors, if any;
(q) Issue guidelines as to the approval or disapproval of
applications
for
voluntary
treatment,
rehabilitation
or
confinement, wherein it shall issue the necessary guidelines,

rules and regulations pertaining to the application and its
enforcement;
(r) Formulate guidelines, in coordination with other government
agencies, the importation, distribution, production, manufacture,
compounding, prescription, dispensing and sale of, and other
lawful acts in connection with any dangerous drug, controlled
precursors and essential chemicals and other similar or
analogous substances of such kind and in such quantity as it
may deem necessary according to the medical and research
needs or requirements of the country including diet pills
containing ephedrine and other addictive chemicals and
determine the quantity and/or quality of dangerous drugs and
controlled precursors and essential chemicals to be imported,
manufactured and held in stock at any given time by authorized
importer, manufacturer or distributor of such drugs;
(s) Develop the utilization of a controlled delivery scheme in
addressing the transshipment of dangerous drugs into and out
of the country to neutralize transnational crime syndicates
100
involved in illegal trafficking of any dangerous drugs and/or

controlled precursors and essential chemicals;
(t) Recommend the revocation of the professional license of
any practitioner who is an owner, co-owner, lessee, or in the
employ of the drug establishment, or manager of a partnership,
corporation, association, or any juridical entity owning and/or
controlling such drug establishment, and who knowingly
participates in, or consents to, tolerates, or abets the
commission of the act of violations as indicated in the preceding
paragraph, all without prejudice to the criminal prosecution of
the person responsible for the said violation;
(u) Appoint such technical, administrative and other personnel
as may be necessary for the effective implementation of this
Act, subject to the Civil Service Law and its rules and
regulations;
(v) Establish a regular and continuing consultation with
concerned government agencies and medical professional
organizations to determine if balance exists in policies,
procedures, rules and regulations on dangerous drugs and to
provide recommendations on how the lawful use of dangerous
drugs can be improved and facilitated; and
(w) Submit an annual and periodic reports to the President, the
Congress of the Philippines and the Senate and House of
Representatives committees concerned as may be required
101
from time to time, and perform such other functions as may be

authorized or required under existing laws and as directed by
the President himself/herself or as recommended by the
congressional committees concerned.
Section 82. Creation of the Philippine Drug Enforcement Agency
(PDEA). To carry out the provisions of this Act, the PDEA, which
serves as the implementing arm of the Board, and shall be
responsible for the efficient and effective law enforcement of all the
provisions on any dangerous drug and/or controlled precursor and
essential chemical as provided in this Act.
The PDEA shall be headed by a Director General with the rank of
Undersecretary,
who
shall
be
responsible
for
the
general
administration and management of the Agency. The Director General

of the PDEA shall be appointed by the President of the Philippines
and shall perform such other duties that may be assigned to him/her.
He/she must possess adequate knowledge, training and experience
in the field of dangerous drugs, and in any of the following fields: law
enforcement, law, medicine, criminology, psychology or social work.
The Director General of the PDEA shall be assisted in the
performance of his/her duties and responsibilities by two (2) deputies
director general with the rank of Assistant Secretary; one for
Operations and the other one for Administration. The two (2) deputies
director general shall likewise be appointed by the President of the
Philippines upon recommendation of the Board. The two (2) deputies
102
director general shall possess the same qualifications as those of the

Director General of the PDEA. The Director General and the two (2)
deputies director general shall receive the compensation and salaries
as prescribed by law.
Section 83. Organization of the PDEA. The present Secretariat of
the National Drug Law Enforcement and Prevention Coordinating
Center as created by Executive Order No. 61 shall be accordingly
modified and absorbed by the PDEA.
The Director General of the PDEA shall be responsible for the
necessary changes in the organizational set-up which shall be
submitted to the Board for approval.
For purposes of carrying out its duties and powers as provided for in
the succeeding Section of this Act, the PDEA shall have the following
Services,
namely:
Cooperation
and
Intelligence
Foreign
and
Affairs;
Investigation;
Preventive
International
Education
and
Community Involvement; Plans and Operations; Compliance; Legal

and Prosecution; Administrative and Human Resource; Financial
Management; Logistics Management; and Internal Affairs.
The PDEA shall establish and maintain regional offices in the different
regions of the country which shall be responsible for the
implementation of this Act and the policies, programs, and projects of
said agency in their respective regions.
Section 84. Powers and Duties of the PDEA. The PDEA shall:
103
(a)
Implement
or
cause
the
efficient
and
effective
implementation of the national drug control strategy formulated

by the Board thereby carrying out a national drug campaign
program which shall include drug law enforcement, control and
prevention campaign with the assistance of concerned
government agencies;
(b) Undertake the enforcement of the provisions of Article II of
this Act relative to the unlawful acts and penalties involving any
dangerous drug and/or controlled precursor and essential
chemical and investigate all violators and other matters
involved in the commission of any crime relative to the use,
abuse or trafficking of any dangerous drug and/or controlled
precursor and essential chemical as provided for in this Act and
the provisions of Presidential Decree No. 1619;
(c) Administer oath, issue subpoena and subpoena duces
tecum relative to the conduct of investigation involving the
violations of this Act;
(d) Arrest and apprehend as well as search all violators and
seize or confiscate, the effects or proceeds of the crimes as
provided by law and take custody thereof, for this purpose the
prosecutors and enforcement agents are authorized to possess
firearms, in accordance with existing laws;
(e) Take charge and have custody of all dangerous drugs
and/or controlled precursors and essential chemicals seized,
104
confiscated or surrendered to any national, provincial or local

law enforcement agency, if no longer needed for purposes of
evidence in court;
(f) Establish forensic laboratories in each PNP office in every
province and city in order to facilitate action on seize or
confiscated drugs, thereby hastening its destruction without
delay;
(g) Recommend to the DOJ the forfeiture of properties and
other assets of persons and/or corporations found to be
violating the provisions of this Act and in accordance with the
pertinent provisions of the Anti-Money-Laundering Act of 2001;
(h) Prepare for prosecution or cause the filing of appropriate
criminal and civil cases for violation of all laws on dangerous
drugs, controlled precursors and essential chemicals, and other
similar
controlled
substances,
and
assist,
support
and
coordinate with other government agencies for the proper and

effective prosecution of the same;
(i) Monitor and if warranted by circumstances, in coordination
with the Philippine Postal Office and the Bureau of Customs,
inspect all air cargo packages, parcels and mails in the central
post office, which appear from the package and address itself to
be a possible importation of dangerous drugs and/or controlled
precursors and essential chemicals, through on-line or cyber
shops via the internet or cyberspace;
105
(j) Conduct eradication programs to destroy wild or illegal

growth of plants from which dangerous drugs may be extracted;
(k) Initiate and undertake the formation of a nationwide
organization which shall coordinate and supervise all activities
against drug abuse in every province, city, municipality and
barangay with the active and direct participation of all such local
government
units
and
nongovernmental
organizations,
including the citizenry, subject to the provisions of previously

formulated programs of action against dangerous drugs;
(l) Establish and maintain a national drug intelligence system in
cooperation with law enforcement agencies, other government
agencies/offices and local government units that will assist in its
apprehension of big-time drug lords;
(m) Establish and maintain close coordination, cooperation and
linkages with international drug control and administration
agencies and organizations, and implement the applicable
provisions of international conventions and agreements related
to dangerous drugs to which the Philippines is a signatory;
(n) Create and maintain an efficient special enforcement unit to
conduct an investigation, file charges and transmit evidence to
the proper court, wherein members of the said unit shall
possess suitable and adequate firearms for their protection in
connection with the performance of their duties: Provided, That
106
no previous special permit for such possession shall be

required;
(o) Require all government and private hospitals, clinics,
doctors, dentists and other practitioners to submit a report to it,
in coordination with the Board, about all dangerous drugs
and/or controlled precursors and essential chemicals which
they have attended to for data and information purposes;
(p) Coordinate with the Board for the facilitation of the issuance
of necessary guidelines, rules and regulations for the proper
implementation of this Act;
(q) Initiate and undertake a national campaign for drug
prevention and drug control programs, where it may enlist the
assistance of any department, bureau, office, agency or
instrumentality of the government, including government-owned
and or controlled corporations, in the anti-illegal drugs drive,
which may include the use of their respective personnel,
facilities, and resources for a more resolute detection and
investigation of drug-related crimes and prosecution of the drug
traffickers; and
(r) Submit an annual and periodic reports to the Board as may
be required from time to time, and perform such other functions
as may be authorized or required under existing laws and as
directed by the President himself/herself or as recommended
by the congressional committees concerned.
107
Section 85. The PDEA Academy. Upon the approval of the Board,
the PDEA Academy shall be established either in Baguio or Tagaytay
City, and in such other places as may be necessary. The PDEA
Academy shall be responsible in the recruitment and training of all
PDEA agents and personnel. The Board shall provide for the
qualifications and requirements of its recruits who must be at least
twenty-one (21) years old, of proven integrity and honesty and a
Baccalaureate degree holder.
The graduates of the Academy shall later comprise the operating
units of the PDEA after the termination of the transition period of five
(5) years during which all the intelligence network and standard
operating procedures of the PDEA has been set up and
operationalized.
The Academy shall be headed by a Superintendent, with the rank of
Director. He/she shall be appointed by the PDEA Director General.
Section 86. Transfer, Absorption, and Integration of All Operating
Units on Illegal Drugs into the PDEA and Transitory Provisions. The
Narcotics Group of the PNP, the Narcotics Division of the NBI and the
Customs Narcotics Interdiction Unit are hereby abolished; however
they shall continue with the performance of their task as detail service
with the PDEA, subject to screening, until such time that the
organizational structure of the Agency is fully operational and the
number of graduates of the PDEA Academy is sufficient to do the task
themselves:Provided, That such personnel who are affected shall
108
have the option of either being integrated into the PDEA or remain
with their original mother agencies and shall, thereafter, be
immediately reassigned to other units therein by the head of such
agencies. Such personnel who are transferred, absorbed and
integrated in the PDEA shall be extended appointments to positions
similar in rank, salary, and other emoluments and privileges granted
to their respective positions in their original mother agencies.
The transfer, absorption and integration of the different offices and
units provided for in this Section shall take effect within eighteen (18)
months from the effectivity of this Act: Provided, That personnel
absorbed and on detail service shall be given until five (5) years to
finally decide to join the PDEA.
Nothing in this Act shall mean a diminution of the investigative powers
of the NBI and the PNP on all other crimes as provided for in their
respective
organic
laws: Provided,
however,
That
when
the
investigation being conducted by the NBI, PNP or any ad hoc antidrug task force is found to be a violation of any of the provisions of
this Act, the PDEA shall be the lead agency. The NBI, PNP or any of
the task force shall immediately transfer the same to the
PDEA: Provided, further, That the NBI, PNP and the Bureau of
Customs shall maintain close coordination with the PDEA on all drug
related matters.
ARTICLE X
Appropriations, Management of Funds and Annual Report
109
Section 87. Appropriations. The amount necessary for the

operation of the Board and the PDEA shall be charged against the
current year's appropriations of the Board, the National Drug Law
Enforcement and Prevention Coordinating Center, the Narcotics
Group of the PNP, the Narcotics Division of the NBI and other drug
abuse units of the different law enforcement agencies integrated into
the PDEA in order to carry out the provisions of this Act. Thereafter,
such sums as may be necessary for the continued implementation of
this Act shall be included in the annual General Appropriations Act.
All receipts derived from fines, fees and other income authorized and
imposed in this Act, including ten percent (10%) of all unclaimed and
forfeited sweepstakes and lotto prizes but not less than twelve million
pesos (P12,000,000.00) per year from the Philippine Charity
Sweepstakes Office (PCSO), are hereby constituted as a special
account in the general fund for the implementation of this
Act: Provided, That no amount shall be disbursed to cover the
operating
expenses
of
the
Board
and
other
concerned
agencies: Provided, further, That at least fifty percent (50%) of all the
funds shall be reserved for assistance to government-owned and/or
operated rehabilitation centers.
The fines shall be remitted to the Board by the court imposing such
fines within thirty (30) days from the finality of its decisions or orders.
The unclaimed and forfeited prizes shall be turned over to the Board
by the PCSO within thirty (30) days after these are collected and
declared forfeited.
110
A portion of the funds generated by the Philippine Amusement and

Gaming Corporation (PAGCOR) in the amount of Five million pesos
(P5,000,000.00) a month shall be set aside for the purpose of
establishing adequate drug rehabilitation centers in the country and
also for the maintenance and operations of such centers: Provided,
That the said amount shall be taken from the fifty percent (50%)
share
of
the
National
Government
in
the
income
of
PAGCOR: Provided, further, That the said amount shall automatically

be remitted by PAGCOR to the Board. The amount shall, in turn, be
disbursed by the Dangerous Drugs Board, subject to the rules and
regulations of the Commission on Audit (COA).
The fund may be augmented by grants, donations, and endowment
from various sources, domestic or foreign, for purposes related to
their functions, subject to the existing guidelines set by the
government.
Section 88. Management of Funds Under this Act; Annual Report by
the Board and the PDEA. The Board shall manage the funds as it
may deem proper for the attainment of the objectives of this Act. In
addition to the periodic reports as may be required under this Act, the
Chairman of the Board shall submit to the President of the Philippines
and to the presiding officers of both houses of Congress, within
fifteen (15) days from the opening of the regular session, an annual
report on the dangerous drugs situation in the country which shall
include detailed account of the programs and projects undertaken,
statistics on crimes related to dangerous drugs, expenses incurred
111
pursuant to the provisions of this Act, recommended remedial

legislation, if needed, and such other relevant facts as it may deem
proper to cite.
Section 89. Auditing the Accounts and Expenses of the Board and
the PDEA. All accounts and expenses of the Board and the PDEA
shall be audited by the COA or its duly authorized representative.
ARTICLE XI
Jurisdiction Over Dangerous Drugs Cases
Section 90. Jurisdiction. The Supreme Court shall designate
special courts from among the existing Regional Trial Courts in each
judicial region to exclusively try and hear cases involving violations of
this Act. The number of courts designated in each judicial region shall
be based on the population and the number of cases pending in their
respective jurisdiction.
The DOJ shall designate special prosecutors to exclusively handle
cases involving violations of this Act.
The preliminary investigation of cases filed under this Act shall be
terminated within a period of thirty (30) days from the date of their
filing.
When the preliminary investigation is conducted by a public
prosecutor and a probable cause is established, the corresponding
information shall be filed in court within twenty-four (24) hours from
112
the termination of the investigation. If the preliminary investigation is

conducted by a judge and a probable cause is found to exist, the
corresponding information shall be filed by the proper prosecutor
within forty-eight (48) hours from the date of receipt of the records of
the case.
Trial of the case under this Section shall be finished by the court not
later than sixty (60) days from the date of the filing of the information.
Decision on said cases shall be rendered within a period of fifteen
(15) days from the date of submission of the case for resolution.
Section 91. Responsibility and Liability of Law Enforcement
Agencies and other Government Officials and Employees in
Testifying as Prosecution Witnesses in Dangerous Drugs Cases.
Any member of law enforcement agencies or any other government
official and employee who, after due notice, fails or refuses
intentionally or negligently, to appear as a witness for the prosecution
in any proceedings, involving violations of this Act, without any valid
reason, shall be punished with imprisonment of not less than twelve
(12) years and one (1) day to twenty (20) years and a fine of not less
than Five hundred thousand pesos (P500,000.00), in addition to the
administrative liability he/she may be meted out by his/her immediate
superior and/or appropriate body.
The immediate superior of the member of the law enforcement
agency or any other government employee mentioned in the
preceding paragraph shall be penalized with imprisonment of not less
113
than two (2) months and one (1) day but not more than six (6) years
and a fine of not less than Ten thousand pesos (P10,000.00) but not
more than Fifty thousand pesos (P50,000.00) and in addition,
perpetual absolute disqualification from public office if despite due
notice to them and to the witness concerned, the former does not
exert reasonable effort to present the latter to the court.
The member of the law enforcement agency or any other government
employee mentioned in the preceding paragraphs shall not be
transferred or re-assigned to any other government office located in
another territorial jurisdiction during the pendency of the case in
court. However, the concerned member of the law enforcement
agency or government employee may be transferred or re-assigned
for compelling reasons: Provided, That his/her immediate superior
shall notify the court where the case is pending of the order to
transfer or re-assign, within twenty-four (24) hours from its
approval; Provided, further, That his/her immediate superior shall be
penalized with imprisonment of not less than two (2) months and one
(1) day but not more than six (6) years and a fine of not less than Ten
thousand pesos (P10,000.00) but not more than Fifty thousand pesos
(P50,000.00) and in addition, perpetual absolute disqualification from
public office, should he/she fail to notify the court of such order to
transfer or re-assign.
Prosecution and punishment under this Section shall be without
prejudice to any liability for violation of any existing law.
114
Section 92. Delay and Bungling in the Prosecution of Drug Cases.

Any government officer or employee tasked with the prosecution of
drug-related cases under this act, who, through patent laxity,
inexcusable neglect, unreasonable delay or deliberately causes the
unsuccessful prosecution and/or dismissal of the said drug cases,
shall suffer the penalty of imprisonment ranging from twelve (12)
years and one (1) day to twenty (20) years without prejudice to
his/her prosecution under the pertinent provisions of the Revised
Penal Code.
Section 93. Reclassification, Addition or Removal of Any Drug from
the List of Dangerous Drugs. The Board shall have the power to
reclassify, add to or remove from the list of dangerous drugs.
Proceedings to reclassify, add, or remove a drug or other substance
may be initiated by the PDEA, the DOH, or by petition from any
interested party, including the manufacturer of a drug, a medical
society or association, a pharmacy association, a public interest
group concerned with drug abuse, a national or local government
agency, or an individual citizen. When a petition is received by the
Board, it shall immediately begin its own investigation of the drug.
The PDEA also may begin an investigation of a drug at any time
based upon the information received from law enforcement
laboratories, national and local law enforcement and regulatory
agencies, or other sources of information.
115
The Board after notice and hearing shall consider the following
factors with respect to each substance proposed to be reclassified,
added or removed from control:
(a) Its actual or relative potential for abuse;
(b) Scientific evidence of its pharmacological effect if known;
(c) The state of current scientific knowledge regarding the drug
or other substance;
(d) Its history and current pattern of abuse;
(e) The scope, duration, and significance of abuse;
(f) Risk to public health; and
(g) Whether the substance is an immediate precursor of a
substance already controlled under this Act.
The Board shall also take into accord the obligations and
commitments to international treaties, conventions and agreements to
which the Philippines is a signatory.
The Dangerous Drugs Board shall give notice to the general public of
the public hearing of the reclassification, addition to or removal from
the list of any drug by publishing such notice in any newspaper of
general circulation once a week for two (2) weeks.
116
The effect of such reclassification, addition or removal shall be as

follows:
(a) In case a dangerous drug is reclassified as precursors and
essential chemicals, the penalties for the violations of this Act
involving the two latter categories of drugs shall, in case of
conviction, be imposed in all pending criminal prosecutions;
(b) In case a precursors and essential chemicals is reclassified
as dangerous drug, the penalties for violations of the Act
involving precursors and essential chemicals shall, in case of
conviction, be imposed in all pending criminal prosecutions;
(c) In case of the addition of a new drug to the list of dangerous
drugs and precursors and essential chemicals, no criminal
liability involving the same under this Act shall arise until after
the lapse of fifteen (15) days from the last publication of such
notice;
(d) In case of removal of a drug from the list of dangerous drugs
and precursors and essential chemicals, all persons convicted
and/or detained for the use and/or possession of such a drug
shall be automatically released and all pending criminal
prosecution involving such a drug under this Act shall forthwith
be dismissed; and
(e) The Board shall, within five (5) days from the date of its
promulgation submit to Congress a detailed reclassification,
117
addition, or removal of any drug from the list of dangerous

drugs.
ARTICLE XII
Implementing Rules and Regulations
Section 94. Implementing Rules and Regulations. The present
Board in consultation with the DOH, DILG, DOJ, DepEd, DSWD,
DOLE, PNP, NBI, PAGCOR and the PCSO and all other concerned
government agencies shall promulgate within sixty (60) days the
Implementing Rules and Regulations that shall be necessary to
implement the provisions of this Act.
ARTICLE XIII
Final Provisions
Section 95. Congressional Oversight Committee. There is hereby
created a Congressional Oversight Committee composed of seven
(7) Members from the Senate and seven (7) Members from the
House of Representatives. The Members from the Senate shall be
appointed by the Senate President based on the proportional
representation of the parties or coalitions therein with at least two (2)
Senators representing the Minority. The Members from the House of
Representatives shall be appointed by the Speaker, also based on
proportional representation of the parties or coalitions therein with at
least two (2) Members representing the Minority.
118
The Committee shall be headed by the respective Chairpersons of

the Senate Committee on Public Order and Illegal Drugs and the
House of Representatives Committee on Dangerous Drugs.
Section 96. Powers and Functions of the Oversight Committee.
The Oversight Committee on Dangerous Drugs shall, in aid of
legislation, perform the following functions, among others:
(a) To set the guidelines and overall framework to monitor and
ensure the proper implementation of this Act;
(b) To ensure transparency and require the submission of
reports from government agencies concerned on the conduct of
programs, projects and policies relating to the implementation
of this act;
(c) To approve the budget for the programs of the Oversight
Committee on Dangerous Drugs and all disbursements
therefrom, including compensation of all personnel;
(d) To submit periodic reports to the President of the Philippines
and Congress on the implementation of the provisions of this
Act;
(e) To determine inherent weaknesses in the law and
recommend the necessary remedial legislation or executive
measures; and
119
(f) To perform such other duties, functions and responsibilities

as may be necessary to effectively attain the objectives of this
Act.
Section 97. Adoption of Committee Rules and Regulations, and
Funding. The Oversight Committee on Dangerous Drugs shall
adopt its internal rules of procedure, conduct hearings and receive
testimonies, reports, and technical advice, invite or summon
by subpoena ad testificandum any public official, private citizen, or
any other person to testify before it, or require any person
by subpoena duces tecum documents or other materials as it may
require consistent with the provisions of this Act.
The Oversight Committee on Dangerous Drugs shall be assisted by a
secretariat to be composed by personnel who may be seconded from
the Senate and the House of Representatives and may retain
consultants.
To carry out the powers and functions of the Oversight Committee on
Dangerous Drugs, the initial sum of Twenty-five million pesos
(P25,000,000.00) shall be charged against the current appropriations
of the Senate. Thereafter, such amount necessary for its continued
operations shall be included in the annual General Appropriations Act.
The Oversight Committee on Dangerous Drugs shall exist for a
period of ten (10) years from the effectivity of this Act and may be
extended by a joint concurrent resolution.
120
Section 98. Limited Applicability of the Revised Penal Code.

Notwithstanding any law, rule or regulation to the contrary, the
provisions of the Revised Penal Code (Act No. 3814), as amended,
shall not apply to the provisions of this Act, except in the case of
minor offenders. Where the offender is a minor, the penalty for acts
punishable by life imprisonment to death provided herein shall
be reclusion perpetua to death.
Section 99. Separability Clause. If for any reason any section or
provision of this Act, or any portion thereof, or the application of such
section, provision or portion thereof to any person, group or
circumstance is declared invalid or unconstitutional, the remainder of
this Act shall not be affected by such declaration and shall remain in
force and effect.
Section 100. Repealing Clause. Republic Act No. 6425, as
amended, is hereby repealed and all other laws, administrative
orders, rules and regulations, or parts thereof inconsistent with the
provisions of this Act, are hereby repealed or modified accordingly.
Section 101. Amending Clause. Republic Act No. 7659 is hereby
amended accordingly.
Section 102. Effectivity. This Act shall take effect fifteen (15) days
upon its publication in at least two (2) national newspapers of general
circulation.
Approved,
121
(Sgd)
FRANKLIN
(Sgd)
M.
DRILON JOSE
President of the Senate
DE
VENECIA,
JR.
Speaker of the House of

Reapresentatives
This Act which is a consolidation of Senate Bill No. 1858 and House
Bill No. 4433 was finally passed by the Senate and the House of
Representatives on May 30, 2002 and May 29, 2002, respectively.
(Sgd)
(Sgd)
OSCAR G. YABES
ROBERTO P. NAZARENO
Secretary of the Senate
Secretary General
House of Representatives
Approved: January 23, 2002
(Sgd)
GLORIA MACAPAGALARROYO
President of the
Philippines
122
VIOLATION OF R.A. 9165: ILLEGAL SALE OF DRUGS, BUYBUST OPERATION, POSEUR BUYER AND CHAIN OF CUSTODY
People of the Philippines Vs. Joel Ancheta Y Osan
G.R. No. 197371, June 13, 2012
Facts:
On 10 August 2004, [Police Officer (PO) 1] Honorio Marmonejo,
a police officer assigned at the Makati Police Station Anti-Illegal
Drugs Special Operation Task Force (SAID-SOTF), received a
confidential information regarding the drug pushing activities of a
certain alias "Joker" at Llorando Compound, Barangay East Rembo,
Makati City. This alias "Joker" was also listed in the said offices
watchlist of suspected drug pushers.
Thereafter, an anti-narcotics operation was planned by the
police officers in order to apprehend alias "Joker". A buy-bust team
was formed comprising of four policemen and eight [Makati Anti-Drug
Abuse Council (MADAC)] operatives from Cluster 5. PO1 Marmonejo
was designated to act as poseur buyer while the rest of the team
served as his back-up. Thereafter, five pieces of P 100-bills were
provided and marked for use in the operation. PO1 Voltaire Esguerra
likewise coordinated with the Philippine Drug Enforcement Agency
123
(PDEA) by accomplishing the necessary coordination form which was

acknowledged and received by the PDEA.
At about 5:45 in the afternoon of the same day, the buy-bust
team arrived at Llorando Compound, 25th Street, Barangay East
Rembo, Makati City for the conduct of the buy bust operation. As the
rest of the team positioned themselves strategically in places where
they can monitor the transaction, PO1 Marmonejo as the poseur
buyer, accompanied by PO1 Mendoza and the informant, entered a
slightly opened gate through an alley way where they met a man who
asked them where they were going. The informant replied that they
were looking for Joker as they were going to purchase shabu from
the latter. The man asked how much they were going to buy, to which
the informant answered him that he was to purchase P 500.00-worth
of shabu. The man told them to wait for a while and then called for
Joker. The same man thereafter told Joker that there were people
who were going to buy from him. Joker asked him how much they
were going to purchase, and the man replied that they were going to
purchase P 500.00-worth of shabu. Joker came out from inside the
house, and it was at this instance that PO1 Marmonejo took out the
marked money. Joker, in turn, gave him one plastic sachet containing
white crystalline powder. The man they met at the alley took the
marked money from him and handed it over to Joker. While the
transaction was ongoing, the police officers noticed a man, more or
less 3 to 4 meters away from them, washing clothes. After having
received the buy bust money, Joker faced the man washing clothes
124
and gave the latter one plastic sachet containing white crystalline
substance as payment for his laundry service.
The transaction having been consummated, PO1 Marmonejo
gave the pre-arranged signal of sending a missed call to PO1 Voltaire
Esguerra, one of the back-up police officers. PO1 Mendoza, upon
receiving the missed call, together with MADAC [operative Juan
Siborboro], immediately went inside the house where the entrapment
took place and assisted in effecting the arrest of the accused. PO1
Mendoza held alias Joker, who was later on identified as accusedappellant Joel Ancheta, and placed him under arrest. PO1
Marmonejo, on the other hand, arrested the man they met at the
alley, who was later identified to be accused-appellant John Llorando.
MADAC [operative] Siborboro, for his part, apprehended the man
washing clothes, who was later identified as accused-appellant Juan
Carlos Gernada.
Recovered from the possession of accused-appellant Ancheta
after the latters arrest were the marked money and five (5) other
plastic sachets containing the white crystalline substance. On the
other hand, accused-appellant Gernada yielded one (1) plastic sachet
of white crystalline substance when requested to empty the contents
of his pockets.
After informing all of the accused-appellants of their violations
and nature of their arrest as well as their constitutional rights, they
were subsequently brought to the office of the Makati City Police
SAID-SOTF.
125
Consequently, the plastic sachets containing white crystalline

substance were thereafter brought to the crime laboratory for
examination and analysis. The results of the laboratory examination
revealed that the substance was positive for "methyl amphetamine
hydrochloride", otherwise known as "shabu", a dangerous drug.
In its September 17, 2008 Decision, the Makati City RTC found
accused-appellants guilty of violating Article II of RA 9165.
On November 30, 2010, the CA issued a Decision affirming the
reasoning of the RTC in the latters September 17, 2008 judgment.
Issue:
Whether or not non-compliance of the arresting officers with the
procedure drawn in Section 21 of RA 9165 would discharge accusedappellants from the crimes of which they were convicted?
Ruling:
YES. The records are bereft of any indication that would show
that the prosecution was able to establish the arresting officers
compliance with the procedural safeguards under R.A. 9165. Neither
do the records contain any physical inventory report or photograph of
the confiscated items. None of the arresting officers testified that they
had conducted a physical inventory or taken pictures of the items.
Nor did they state that there was even any attempt to contact a
representative from the media and the DOJ, and an elected public
official. Nowhere can it be found that the marking of the items was
done in the presence of any of the said third-party representatives. In
126
all these major lapses, no one gave so much as an explanation of

why the procedure was not followed, or whether there was a
justifiable ground for failing to do so. The arresting officers and the
prosecution simply did not bother discussing these matters. The OSG
does not dispute these assertions and instead counters that
noncompliance was not fatal to the prosecutions case. It then argues
that the marking of the confiscated items was sufficient to protect the
identity of the corpus delicti.
Despite the presumption of regularity in the performance of the
official duties of law enforcers, the Supreme Court stress that the
step-by-step procedure outlined under R.A. 9165 is a matter of
substantive law, which cannot be simply brushed aside as a simple
procedural technicality. The provisions were crafted by Congress as
safety precautions to address potential police abuses, especially
considering that the penalty imposed may be life imprisonment.
127
VIOLATION OF R.A. 6425: INTENTION TO POSSESS

The People of the Philippines vs. William Robert Burton
G.R. No. 114396, February 19, 1997
Facts:
That on or about December 26, 1992 at the Ninoy Aquino
International Airport in Pasay City, Philippines and within the
jurisdiction of this Honorable Court, the accused WILLIAM BURTON
y ROBERT while about to depart abroad, did then and there willfully,
feloniously and unlawfully carry and transport without legal authority,
5.6 kilograms, more or less of Marijuana (Hashish), a prohibited drug.
The Regional Trial Court of Pasay City, Branch 116, in its
Decision promulgated on July 30, 1993, found the accused-appellant
guilty of violating Section 4, in relation to Section 21 of Republic Act
No. 6425, otherwise known as the Dangerous Drugs Act of 1972.
Issue:
Whether or not the accused had the intention to possess the
marijuana of hashish confiscated from him?
128
Ruling:
YES. The 5.6 kilos of hashish cleverly and painstakingly
concealed inside appellants luggage and rubber shoes can be said
to be in the possession and control of the appellant with his
knowledge. Not only were the blocks and bars of the prohibited drug
of a considerable amount, but they were placed inside three different
objects in order to escape detection by authorities.
A mere corroborated claim of the accused that he did not know
that he had a prohibited drug in his possession is insufficient. Any
evasion, false statement, or attempt at concealment on his part, in
explaining how the drug came into his possession, maybe considered
in determining his guilt.
129
VIOLATION OF R.A. 9165: SEARCH ON A MOVING VEHICLE

People of the Philippines vs. Belen Mariacos
G.R. No. 188611, June 16, 2010
Facts:
Accused-appellant
Belen
Mariacos
was
charged
in
an
Information, dated November 7, 2005 of violating Section 5, Article II

of Republic Act [No.] 9165 such that on or about the 27th day of
October, 2005, in the Municipality of San Gabriel, Province of La
Union, Philippines, and within the jurisdiction of this Honorable Court,
the above-named accused, did then and there willfully, unlawfully and
feloniously transport, deliver 7,030.3, (sic) grams of dried marijuana
fruiting tops without the necessary permit or authority from the proper
government agency or office.
The Regional Trial Court, Branch 29, San Fernando, La Union
found appellant guilty of violating Article II, Section 5 of Republic Act
No. 9165, or the Comprehensive Dangerous Drugs Act of 2002, on
January 31, 2007.
130
Appellant appealed to the Court of Appeals, but in its Decision

dated January 19, 2009, dismissed the appeal and affirmed the RTC
decision.
Issue:
Whether or not the search on a moving vehicle is justified
without a warrant?
Ruling:
YES. The search in a moving vehicle is valid on the ground that
the mobility of motor vehicles makes it possible for the vehicle to be
searched to move out of the locality or jurisdiction in which the
warrant must be sought
When a vehicle is stopped and subjected to an extensive
search, such a warrantless search has been held to be justified, only
as long as the officers conducting the search have a reasonable or
probable cause to believe before the search that they will find the
instrumentality or evidence pertaining to a crime, in the vehicle to be
searched.
The arrest is also valid at the outset of the search, there being a
probable cause on the part of the police officer.
Given that the search is valid, appellants arrest is also valid.
131
VIOLATION OF R.A. 6425: PLANTING OF EVIDENCE

People of the Philippines vs. Danilo Cruda
G.R. No. 98251, August 4, 1992
Facts:
In the afternoon, on or about the 9th day of September, 1987, in
the municipality of Sindangan, Zamboanga del Norte, within the
jurisdiction of this Honorable Court, the said accused did then and
there willfully, unlawfully and feloniously sell four (4) cigarette sticks of
Marijuana with the full knowledge that the same is prohibited and a
Violation of Republic Act No. 6425 otherwise known as the
Dangerous Drugs Act of 1972.
The testimonies of the prosecution witnesses as summarized
by the trial court established the following attendant facts: Intelligence
Section of Integrated National Police Station at Sindangan was
organized. Team leader of which was P/Cpl. Erlindo Bayawa.
Members were Pfc. Bienvenido Aguilar, P/Cpl. Rodrigo Santillana and
Pat. Danilo Alforque to apprehend violators of law and those engaged
132
in any illegal activities. On September 9, 1987 they were informed by

their two assets Edgar Geronico and Allan Soriano that DaniloCruda
was selling marijuana at Dapaon, Sindangan, Zamboanga del Norte.
Upon receiving aforesaid information they conceived a "buy-bust
operation", Pfc, Bienvenido Aguilar and P/Cpl. Rodrigo Santillana left
for Dapaon, Sindangan at about 2:20 in the afternoon of the same
day together with two assets Edgar Geronico and Allan Soriano to the
house of the accused DaniloCruda to pose as a marijuana buyer, and
had with them two (2) five-peso bills marked with the initial of Rodrigo
Santillana; that meanwhile Pfc. Bienvenido Aguilar and P/Cpl.
Rodrigo Santillana positioned themselves the former 20 meters and
the latter 10 meters from the place of DaniloCruda; that they saw
DaniloCruda went (sic) down the house; that after Edgar Geronico
gave the money to DaniloCruda he gave the four sticks of marijuana;
after the consummated sale of marijuana they effected immediate
arrest of Danilo Cruda; that Danilo Cruda gave two (2) five-peso
marked bills to P/Cpl. Rodrigo Santillana; that thereafter Danilo Cruda
was brought to the police headquarters where he was investigated;
that the confiscated marijuana were submitted to PC/INP Crime
Laboratory at Recom 9, Zamboanga City and were examined and
authenticated by Forensic Chemist Athena Eliza Anderson and found
the specimens (sic) positive for marijuana.
Version of the defense was that in the afternoon of September
9, 1987 he was at his house at Dapaon, Sindangan Zamboanga del
Norte; that P/Cpl. Rodrigo Santillana and Pfc. Bienvenido Aguilar
arrived and he was called by them while he was at the door; that he
133
went down and approached them; that they immediately handcuff

(sic) him; that they told him he is selling marijuana; that he denied
selling marijuana but they do (sic) not believed (sic) him; that they
brought him to the police station where he was investigated in the
presence of P/Sgt. Caboverde and Pfc. Aguilar; that he did not
remember Edgar Geronico and Allan Soriano came (sic) to his house
at Dapaon, Sindangan, Zamboanga del Norte sometimes (sic) on
September 9, 1987.
Trial on the merits proceeded and the accused was convicted of
the crime charged.
Issue:
Whether or not accused-appellant was a victim of a frame-up?
Ruling:
NO. The evidence presented by the prosecution is both
substantial and convincing. Both the testimonial and physical
evidence militate against the appellant's innocence. Stronger proof is
needed to overcome the findings of the trial court that the prosecution
witnesses are telling the truth. The standard defense of the accused
in drug-related cases is frame-up or fabricated evidence. There is
certainly a possibility in some cases.
134
VIOLATION OF R.A. 6425: SEARCH AND SEIZURE

People of the Philippines vs. Andre Marti
G.R. No. 81561, January 18, 1991
Facts:
On August 14, 1987, between 10:00 and 11:00 a.m., the
appellant and his common-law wife, Shirley Reyes, went to the booth
of the "Manila Packing and Export Forwarders" in the Pistang Pilipino
Complex, Ermita, Manila, carrying with them four (4) gift wrapped
packages. Anita Reyes (the proprietress and no relation to Shirley
Reyes) attended to them. The appellant informed Anita Reyes that he
was sending the packages to a friend in Zurich, Switzerland.
Appellant filled up the contract necessary for the transaction, writing
therein his name, passport number, the date of shipment and the
name and address of the consignee, namely, "WALTER FIERZ,
Mattacketr II, 8052 Zurich, Switzerland".
Anita Reyes then asked the appellant if she could examine and
inspect the packages. Appellant, however, refused, assuring her that
the packages simply contained books, cigars, and gloves and were
135
gifts to his friend in Zurich. In view of appellant's representation, Anita

Reyes no longer insisted on inspecting the packages. The four (4)
packages were then placed inside a brown corrugated box one by
two feet in size (1' x 2'). Styro-foam was placed at the bottom and on
top of the packages before the box was sealed with masking tape,
thus making the box ready for shipment.
Before delivery of appellant's box to the Bureau of Customs
and/or Bureau of Posts, Mr. Job Reyes (proprietor) and husband of
Anita (Reyes), following standard operating procedure, opened the
boxes for final inspection. When he opened appellant's box, a
peculiar odor emitted therefrom. His curiosity aroused, he squeezed
one of the bundles allegedly containing gloves and felt dried leaves
inside. Opening one of the bundles, he pulled out a cellophane
wrapper protruding from the opening of one of the gloves. He made
an opening on one of the cellophane wrappers and took several
grams of the contents thereof.
Job Reyes forthwith prepared a letter reporting the shipment to
the NBI and requesting a laboratory examination of the samples he
extracted from the cellophane wrapper.
He brought the letter and a sample of appellant's shipment to
the Narcotics Section of the National Bureau of Investigation (NBI), at
about 1:30 o'clock in the afternoon of that date, August 14, 1987.
He was interviewed by the Chief of Narcotics Section. Job
Reyes informed the NBI that the rest of the shipment was still in his
office. Therefore, Job Reyes and three (3) NBI agents, and a
photographer, went to the Reyes' office at Ermita, Manila.
136
Job Reyes brought out the box in which appellant's packages

were placed and, in the presence of the NBI agents, opened the top
flaps, removed the styro-foam and took out the cellophane wrappers
from inside the gloves. Dried marijuana leaves were found to have
been contained inside the cellophane wrappers.
The package which allegedly contained books was likewise
opened by Job Reyes. He discovered that the package contained
bricks or cake-like dried marijuana leaves. The package which
allegedly contained tabacalera cigars was also opened. It turned out
that dried marijuana leaves were neatly stocked underneath the
cigars.
The NBI agents made an inventory and took charge of the box
and of the contents thereof, after signing a "Receipt" acknowledging
custody of the said effects.
Thereupon, the NBI agents tried to locate appellant but to no
avail. Appellant's stated address in his passport being the Manila
Central Post Office, the agents requested assistance from the latter's
Chief Security. On August 27, 1987, appellant, while claiming his mail
at the Central Post Office, was invited by the NBI to shed light on the
attempted shipment of the seized dried leaves. On the same day the
Narcotics Section of the NBI submitted the dried leaves to the
Forensic Chemistry Section for laboratory examination. It turned out
that the dried leaves were marijuana flowering tops as certified by the
forensic chemist.
Thereafter, Information was filed against appellant for violation
of RA 6425, otherwise known as the Dangerous Drugs Act.
137
Issue:
Whether or not the lower court erred in admitting in evidence
the illegally searched and seized objects contained in the four
parcels?
Ruling:
NO. The evidence sought to be excluded was primarily
discovered and obtained by a private person, acting in a private
capacity and without the intervention and participation of State
authorities.In the absence of governmental interference, the liberties
guaranteed by the Constitution cannot be invoked against the State.
138
DOCTRINE OF PIERCING THE VEIL OF CORPORATE IDENTITY

Under the doctrine of piercing the veil of corporate entity
requires the court to see through the protective shroud which
exempts its stockholders from liabilities that they ordinarily would be
subject to, or distinguishes a corporation from a seemingly separate
one, were it not for the existing corporate fiction.
The application of the doctrine to a particular case does not
deny the corporation of legal personality for any and all purposes, but
only for particular transaction or instance for which the doctrine was
applied.
Sarona vs. NLRC
G.R. No. 185280
Facts:
On June 20, 2003, the petitioner, who was hired by Sceptre as
a security guard sometime in April 1976, was asked by Karen
Therese Tan (Karen), Sceptres Operation Manager, to submit a
resignation letter as the same was supposedly required for applying
for a position at Royale. The petitioner was also asked to fill up
139
Royales employment application form, which was handed to him by

Royales General Manager, respondent Cesar Antonio Tan II (Cesar).
After several weeks of being in floating status, Royales
Security Officer, Martin Gono (Martin), assigned the petitioner at
Highlight Metal Craft, Inc. (Highlight Metal) from July 29, 2003 to
August 8, 2003. Thereafter, the petitioner was transferred and
assigned to Wide Wide World Express, Inc. (WWWE, Inc.). During his
assignment at Highlight Metal, the petitioner used the patches and
agency cloths of Sceptre and it was only when he was posted at
WWWE, Inc. that he started using those of Royale.
On September 17, 2003, the petitioner was informed that his
assignment at WWWE, Inc. had been withdrawn because Royale had
allegedly been replaced by another security agency. The petitioner,
however, shortly discovered thereafter that Royale was never
replaced as WWWE, Inc.s security agency. When he placed a call at
WWWE, Inc., he learned that his fellow security guard was not
relieved from his post.
In his May 11, 2005 Decision, Labor Arbiter Jose Gutierrez (LA
Gutierrez) ruled in the petitioners favor and found him illegally
dismissed. For being unsubstantiated, LA Gutierrez denied credence
to the respondents claim that the termination of the petitioners
employment relationship with Royale was on his accord following his
alleged employment in another company. That the petitioner was no
longer interested in being an employee of Royale cannot be
presumed from his request for a certificate of employment, a claim
which, to begin with, he vehemently denies. Allegation of the
140
petitioners abandonment is negated by his filing of a complaint for

illegal dismissal three (3) days after he was informed that he would
no longer be given any assignments.
Aside from lack of proof showing that complainant has
abandoned his employment, the record would show that immediate
action was taken in order to protest his dismissal from employment.
He filed a complaint [for] illegal dismissal on October 4, 2004 or three
(3) days after he was dismissed. This act, as declared by the
Supreme Court is inconsistent with abandonment.
The
respondents
were
ordered
to
pay
the
petitioner
backwages, which LA Gutierrez computed from the day he was

dismissed, or on October 1, 2003, up to the promulgation of his
Decision on May 11, 2005. In lieu of reinstatement, the respondents
were ordered to pay the petitioner separation pay equivalent to his
one (1) month salary in consideration of his tenure with Royale, which
lasted for only one (1) month and three (3) days. In this regard, LA
Gutierrez refused to pierce Royales corporate veil for purposes of
factoring the petitioners length of service with Sceptre in the
computation of his separation pay.
The respondents appealed LA Gutierrezs May 11, 2005
Decision to the NLRC, claiming that the finding of illegal dismissal
was attended with grave abuse of discretion. This appeal was,
however, dismissed by the NLRC in its November 30, 2005 Decision.
The petitioner, on the other hand, did not appeal LA Gutierrezs
May 11, 2005 Decision but opted to raise the validity of LA Gutierrezs
adverse findings with respect to piercing Royales corporate
141
personality and computation of his separation pay in his Reply to the

respondents Memorandum of Appeal. As the filing of an appeal is the
prescribed remedy and no aspect of the decision can be overturned
by a mere reply, the NLRC dismissed the petitioners efforts to
reverse LA Gutierrezs disposition of these issues. Effectively, the
petitioner had already waived his right to question LA Gutierrezs
Decision when he failed to file an appeal within the reglementary
period.
Consequently, the petitioner elevated the NLRCs November
30, 2005 Decision to the CA by way of a Petition for Certiorari under
Rule 65 of the Rules of Court. On the other hand, the respondents
filed no appeal from the NLRCs finding that the petitioner was
illegally dismissed.
The CA, in consideration of substantial justice and the
jurisprudential dictum that an appealed case is thrown open for the
appellate courts review, disagreed with the NLRC and proceeded to
review the evidence on record to determine if Royale is Sceptres
alter ego that would warrant the piercing of its corporate veil.
According to the CA, errors not assigned on appeal may be reviewed
as technicalities should not serve as bar to the full adjudication of
cases.
Issue:
Whether or not doctrine of piercing the corporate veil be justly
applied in order to determine petitioners length of service with private
respondents?
142
Ruling:
YES. Well-settled is the principle that the corporate mask may
be removed or the corporate veil pierced when the corporation is just
an alter ego of a person or of another corporation. For reasons of
public policy and in the interest of justice, the corporate veil will
justifiably be impaled only when it becomes a shield for fraud,
illegality or inequity committed against third persons.
The doctrine of piercing the corporate veil applies only in three
(3) basic areas, namely: 1) defeat of public convenience as when the
corporate fiction is used as a vehicle for the evasion of an existing
obligation; 2) fraud cases or when the corporate entity is used to
justify a wrong, protect fraud, or defend a crime; or 3) alter ego cases,
where a corporation is merely a farce since it is a mere alter ego or
business conduit of a person, or where the corporation is so
organized and controlled and its affairs are so conducted as to make
it merely an instrumentality, agency, conduit or adjunct of another
corporation.
The Supreme Court reversed CAs findings. Evidence abound
showing that Royale is a mere continuation or successor of Sceptre
and fraudulent objectives are behind Royales incorporation and the
petitioners subsequent employment therein. These are plainly
suggested by events that the respondents do not dispute and which
the CA, the NLRC and LA Gutierrez accept as fully substantiated but
misappreciated as insufficient to warrant the use of the equitable
weapon of piercing.
143
As correctly pointed out by the petitioner, it was Aida who

exercised control and supervision over the affairs of both Sceptre and
Royale. Contrary to the submissions of the respondents that Roso
had been the only one in sole control of Sceptres finances and
business affairs, Aida took over as early as 1999 when Roso
assigned his license to operate Sceptre on May 3, 1999. As further
proof of Aidas acquisition of the rights as Sceptres sole proprietor,
she caused the registration of the business name "Sceptre Security &
Detective Agency" under her name with the DTI a few months after
Roso abdicated his rights to Sceptre in her favor. As far as Royale is
concerned, the respondents do not deny that she has a hand in its
management and operation and possesses control and supervision of
its employees, including the petitioner. As the petitioner correctly
pointed out, that Aida was the one who decided to stop giving any
assignments to the petitioner and summarily dismiss him is an
eloquent testament of the power she wields insofar as Royales
affairs are concerned. The presence of actual common control
coupled with the misuse of the corporate form to perpetrate
oppressive or manipulative conduct or evade performance of legal
obligations is patent; Royale cannot hide behind its corporate fiction.
144
DOCTRINE OF PRIMARY JURISDICTION

The Doctrine of Primary Jurisdiction is a judicial doctrine whereby a
court tends to favor allowing an agency an initial opportunity to decide
an issue in a case in which a court and the agency have concurrent
jurisdiction. This is the principle that the courts cannot or will not
determine a controversy involving a question which is within the
jurisdiction of an administrative tribunal prior to the decision of that
question by the said tribunal.
Euromed Laboratories vs. Province of Batangas
G.R. No. 148106, July 17, 2006
Facts:
A complaint for sum of money3 filed by petitioner Euro-Med
Laboratories, Phil., Inc. against respondent Province of Batangas.
The complaint alleges that on several occasions, particularly from the
period of 19 August 1992 to 11 August 1998, defendant [respondent
here], thru its various authorized representatives of the government
hospitals identified and listed below, purchased various Intravenous
Fluids (IVF) products from the plaintiff [petitioner here], with an
145
unpaid balance of Four Hundred Eighty Seven Thousand Six

Hundred Sixty-Two Pesos and Eighty Centavos (P487,662.80), as of
28 February 1998, which purchases were evidenced by invoices duly
received and signed by defendants authorized representatives, upon
delivery of the merchandise listed in said invoices and that under the
terms and conditions of the aforesaid invoices, defendant agreed and
covenanted to pay plaintiff, without need of demand, its obligations in
the above-enumerated invoices on various terms indicated therein.
Petitioner made several demands for defendant to pay its
accountabilities, including setting up several dialogues with plaintiffs
representatives, but these proved fruitless.
Respondent admitted most of the allegations in the complaint,
denying only those relating to the unpaid balance supposedly still due
petitioner. Respondent alleged that some payments it had already
made were not reflected in the computation set forth in the complaint
and that it was continuously exerting genuine and earnest efforts "to
find out the true and actual amount owed." Pre-trial and trial followed
before the Regional Trial Court of Batangas City.
Respondent filed a motion to dismiss 7 the complaint on the
ground that the primary jurisdiction over petitioners money claim was
lodged with the Commission on Audit (COA). Respondent pointed out
that petitioners claim, arising as it did from a series of procurement
transactions with the province, was governed by the Local
Government Code provisions and COA rules and regulations on
supply and property management in local governments. Respondent
argued that the case called for a determination of whether these
146
provisions and rules were complied with, and that was within the
exclusive domain of COA to make.
Finding the motion to be well-taken, the RTC issued on March
7, 2001 an order dismissing petitioners complaint without prejudice
to the filing of the proper money claim with the COA. In a subsequent
order dated May 16, 2001, the RTC denied petitioners motion for
reconsideration.
Issue:
Whether it is the COA or theRTC which has primary jurisdiction
to pass upon petitioners money claim against the Province of
Batangas?
Ruling:
It is the COA which has primary jurisdiction over the case at bar.
The doctrine of primary jurisdiction holds that if a case is such
that its determination requires the expertise, specialized training and
knowledge of an administrative body, relief must first be obtained in
an administrative proceeding before resort to the courts is had even if
the matter may well be within their proper jurisdiction. It applies where
a claim is originally cognizable in the courts and comes into play
whenever enforcement of the claim requires the resolution of issues
which, under a regulatory scheme, have been placed within the
special competence of an administrative agency. In such a case, the
court in which the claim is sought to be enforced may suspend the
judicial process pending referral of such issues to the administrative
147
body for its view or, if the parties would not be unfairly disadvantaged,
dismiss the case without prejudice.
DOCTRINE OF EXHAUSTION OF ADMINISTRATIVE REMEDIES

Doctrine of Exhaustion of Administrative Remedies is a
cornerstone of our judicial system.
The thrust of the rule is that
courts must allow administrative agencies to carry out their functions

and discharge their responsibilities within the specialized areas of
their respective competence.
Courts cannot or will not determine a controversy involving a question
which is within the jurisdiction of the administrative tribunal prior to
the resolution of that question by the administrative tribunal, where
the question demands the exercise of sound administrative discretion
requiring the special knowledge, experience and services of the
administrative tribunal to determine technical and intricate matters of
fact
Nonetheless, the doctrine of exhaustion of administrative
remedies and the corollary doctrine of primary jurisdiction, which are
based on sound public policy and practical considerations, are not
inflexible rules. There are many accepted exceptions, such as:
a) where there is estoppel on the part of the party invoking the
doctrine;
148
b) where the challenged administrative act is patently illegal,

amounting to lack of jurisdiction;
c) where there is unreasonable delay or official inaction that will
irretrievably prejudice the complainant;
d) where the amount involved is relatively small so as to make
the rule impractical and oppressive;
e) where the question involved is purely legal and will ultimately
f)
g)
h)
i)
have to be decided by the courts of justice;

where judicial intervention is urgent;
when its application may cause great and irreparable damage;
where the controverted acts violate due process;
when the issue of non-exhaustion of administrative remedies
has been rendered moot;

j) when there is no other plain, speedy and adequate remedy;
k) when strong public interest is involved; and, (l) in quo warranto
proceedings.
A litigant cannot go around the authority of the concerned
administrative agency and directly seek redress from the courts.
Thus, when the law provides for a remedy against a certain action of
an administrative board, body, or officer, relief to the courts can be
made only after exhausting all remedies provided therein. It is settled
that
the
non-observance
of
the
doctrine
of
exhaustion
of
administrative remedies results in lack of cause of action, which is

one of the grounds in the Rules of Court justifying the dismissal of the
complaint.
149
Laguna CATV Network, Inc., Vs. Hon. Alex E. Maraan

G.R. No. 139492
November 19, 2002
Facts:
Private respondents filed with the DOLE Region IV separate
complaints for underpayment of wages and non-payment of other
employee benefits against their employer, Laguna CATV. Private
respondents filed their separate complaints pursuant to Article 128 of
the Labor Code, as amended by Republic Act No. 7730.
DOLE Region IV conducted an inspection within the premises
of Laguna CATV and found that the latter violated the laws on
payment of wages and other benefits.Thereupon, DOLE Region IV
requested Laguna CATV to correct its violations but the latter refused,
prompting the Regional Director to set the case for summary
investigation.Thereafter, he issued an Order directing Laguna CATV
to pay the concerned employees the sum of P261,009.19
representing their unpaid claims.
Forthwith, Laguna CATV filed a motion for reconsideration.In
view of Laguna CATVs failure to comply with the Order directing it to
pay the unpaid claims of its employees, DOLE Regional Director
Maraan issued a writ of execution ordering the Sheriff to collect in
cash from Laguna CATV the amount specified in the writ or, in lieu
thereof, to attach its goods and chattels or those of its owner, Dr.
Bernardino Bailon.
150
Laguna CATV and Dr. Bailon filed a motion to quash the writ of
execution, notice of levy and sale on execution and garnishment of
bank deposits.
Regional Director Maraan issued an Order denying the motion
to quash the writ of execution, stating that Laguna CATV failed to
perfect its appeal because it did not comply with the mandatory
requirement of posting a bond equivalent to the monetary award of
P261,009.19; and that the writ of execution should be considered as
an
overt
denial
of
Laguna
CATVs
motion
for
reconsideration.Instead of appealing to the Secretary of Labor,

Laguna CATV filed with the CA a motion for extension of time to file a
petition for review.Laguna CATV was of the view that an appeal to the
Secretary of Labor would be an exercise in futility considering that
the said appeal will be filed with the Regional Office and it will surely
be disapproved.
The CA denied Laguna CATVs motion for extension and
dismissing the case.
The Appellate Court found, among others, that it failed to
exhaust administrative remedies.
Laguna CATV filed a motion for reconsideration but was denied
by the Court of Appeals in its Resolution dated July 22, 1999. Hence,
it filed a petition for review on certiorari to the SC.
Issue:
Whether
or
not
Laguna
administrative remedies?
151
CATV
failed
to
exhaust
all
Ruling:
The SC ruled that Laguna CATV failed to exhaust all
administrative remedies. As provided under Article 128 of the Labor
Code, as amended, an order issued by the duly authorized
representative of the Secretary of Labor may be appealed to the
latter. Thus, petitioner should have first appealed to the Secretary of
Labor instead of filing with the Court of Appeals a motion for
extension of time to file a petition for review.
Courts, for reasons of law, comity and convenience, should not
entertain suits unless the available administrative remedies have first
been resorted to and the proper authorities have been given an
appropriate opportunity to act and correct their alleged errors, if any,
committed in the administrative forum. The SC, in a long line of
cases, has consistently held that if a remedy within the administrative
machinery can still be resorted to by giving the administrative officer
concerned every opportunity to decide on a matter that comes within
his jurisdiction, then such remedy should be exhausted first before
the courts judicial power can be sought. The party with an
administrative remedy must not merely initiate the prescribed
administrative procedure to obtain relief but also pursue it to its
appropriate conclusion before seeking judicial intervention in order to
give the administrative agency an opportunity to decide the matter
itself correctly and prevent unnecessary and premature resort to the
court.
152
Allied Banking Corporation vs. Commissioner of Internal

Revenue
G.R. No. 175097, February 5, 2010
Facts:
Banking Corporation (ABC) demanding payment of P50 million
in taxes. ABC then filed a protest in May 2004. In July 2004, the BIR
issued a formal assessment notice (FAN). The FAN included a formal
demand as well as this phrase:
xxx
This is our final decision based on investigation. If you
disagree, you may appeal this final decision within thirty
(30) days from receipt hereof, otherwise said deficiency
tax assessment shall become final, executory and
demandable.
ABC then appealed the FAN with the Court of Tax Appeals
(CTA). The Commissioner of Internal Revenue (CIR) then filed a
motion to dismiss on the ground that ABC did not exhaust all
administrative remedies for failing to file a protest against the FAN.
Issue:
Whether or not the CIR is correct?
Ruling:
No. It is true that a FAN is not appealable with the CTA.
However, this case holds an exception. The wordings of the FAN
153
issued by the CIR made it appear that the FAN is actually the CIRs
final decision. It even advised ABC to file an appeal instead of filing a
protest. ABC cannot therefore be faulted for filing an appeal with the
CTA instead of filing a protest with the CIR. The CIR as well as his
duly
authorized
representative
must
indicate
clearly
and
unequivocally to the taxpayer whether an action constitutes a final

determination on a disputed assessment.
154
DOCTRINE OF HIERARCHY OF COURTS

The Regional Trial Courts, Court of Appeals and the Supreme
Court have original concurrent jurisdiction over petitions for certiorari;
the rule on hierarchy of courts determines the venue of recourses to
these courts. In original petitions for certiorari, the Supreme Court will
not directly entertain this special civil action unless the redress
desired cannot be obtained elsewhere based on exceptional and
compelling circumstances justifying immediate resort to the Supreme
Court.
Parenthetically, a direct resort to the Supreme Court in a
petition for certiorari is incorrect for it violates the hierarchy of courts
In other words, a regard for judicial hierarchy most certainly indicates
that petitions for the issuance of extraordinary writs against first level
courts should be filed in the RTC and those against the latter should
be filed in the Court of Appeals.
This rule, however, may be relaxed when pure questions of law
are raised. A question of law exists when the doubt or difference
centers on what the law is on a certain state of facts. There is a
question of law if the issue raised is capable of being resolved without
need of reviewing the probative value of the evidence. The resolution
of the issue must rest solely on what the law provides on the given
set of circumstances.
155
PCGG Chairman Magdangal B. Elma vs. Reiner Jacobi

G.R. No. 155996. June 27, 2012
Facts:
There were several letters showing that there exists agreement
between PCGG and respondent Jacobi entitling the latter of incentive
percentage for efforts in recovering ill-gotten wealth of the Marcoses.
Respondent Jacobi filed before the Sandiganbayan thru his counsel
Atty. Reyes a petition for mandamus, prohibition and certiorari (with
prayer for injunction) against PCGG for allegedly re-hiring two trojan
horse consultants preventing the enforcement of claims against the
Marcoses. Another similar thrust was filed before the Ombudsman
against PCGG in violation of R.A. No. 3019, with a later manifestation
of withdrawing a letter because Jacobi is allegedly part of said letter.
PCGG claimed that said that the letter is a falsified document there
being nothing on their records that such ever existed. PCGG through
Chairman Elma filed before the DOJ criminal complaint under Art.171
par.2 and Art. 172 pars.1 and 3 of RPC against respondents. No
summons were issued to respondents. DOJ found no probable cause
on the complaint and the case was dismissed.
Issues:
Whether certiorari under Rule 65 is the proper remedy to
question the DOJs determination of probable cause. If it is, where
should the petition be filed?
156
Ruling:
No. The respondents are mistaken in their claim that petition
for review under Rule 43 is the proper remedy. By weighing the
evidence submitted by the parties in a preliminary investigation and
by making an independent assessment thereof, an investigating
prosecutor is, to that extent, performing functions of a quasi-judicial
nature in the conduct of a preliminary investigation. However, since
he does not make a determination of the rights of any party in the
proceeding, or pronounce the respondents guilt or innocence (thus
limiting his action to the determination of probable cause to file an
information in court), an investigating prosecutors function still lacks
the element of adjudication essential to an appeal under Rule 43.
As an extraordinary remedy, Rule 65 of the Rules of Court does
not require that summons be issued to the respondent; the service
upon him of an order to file its Comment or Memorandum is
sufficient. But it is required that this be filed before the Court of
Appeals and not directly to SC under the doctrine of hierarchy of
courts. SCs original jurisdiction may be allowed only if there are
special and important reasons clearly and specifically set out in the
petition or where exceptional and compelling circumstances justify
availment of a remedy within and calling for the exercise of its primary
jurisdiction.
157
ERNESTO DY, Petitioner,

vs.
HON. GINA M. BIBAT- PALAMOS, in her capacity as Presiding
Judge of the Regional Trial Court, Branch 64, Makati City, and
ORIX
METRO
LEASING
AND
FINANCE
CORPORATION,
Respondents.
G.R. No. 196200
September 11, 2013
Facts:
In 1990, Limchia Enterprises, with Lourdes as co-maker,
obtained a loan from Orix Metro Leasing and Finance Corporation
(respondent) to fund its acquisition of M/V Pilar-I, a cargo vessel. As
additional security for the loan, Limchia Enterprises executed the
Deed of Chattel Mortgage over M/V Pilar-I.3 Due to financial losses
suffered Spouses Dy failed to make the scheduled payments as
required in their promissory note. They applied for the restructuring of
their loan.
On August 18, 1992, respondent filed the Complaint and
Petition for Extrajudicial Foreclosure of Preferred Ship Mortgage. On
July 31, 1997, the RTC rendered a decision in favor of Spouses Dy.
Consequently, on August 17, 2010, petitioner filed a motion for
execution of judgment with the RTC. In the intervening period,
Colorado filed its Manifestation/Motion, dated July 29, 2010,
informing the RTC that M/V Pilar-I, which was in its possession, had
sustained severe damage and deterioration and had sunk in its
shipyard because of its exposure to the elements.
158
The RTC issued its questioned December 13, 2010 Order

granting the motion for execution but denying petitioners prayer for
the return of M/V Pilar-I in the same state in which it was taken by
respondent. Petitioner moved for reconsideration but the motion was
denied by the RTC in its March 7, 2011 Order.12 Hence, this petition.
Issue:
Whether or not the rule on hierarchy of courts is applicable to
the instant petition?
Ruling:
The Court finds the petition to be partly meritorious.
Petitioner argues that his situation calls for the direct invocation
of this Courts jurisdiction in the interest of justice. Moreover, as
pointed out by the RTC, what is involved is a judgment of the Court
which the lower courts cannot modify. Hence, petitioner deemed it
proper to bring this case immediately to the attention of this Court.
Lastly, petitioner claims that the present case involves a novel issue
of law that is, whether in an action to recover, a defendant in
wrongful possession of the subject matter in litigation may be allowed
to return the same in a deteriorated condition without any liability.
Respondent, on the other hand, contends that the petition
should have been filed with the CA, following the doctrine of hierarchy
of courts. It pointed out that petitioner failed to state any special or
important reason or any exceptional and compelling circumstance
which would warrant a direct recourse to this Court.
159
Under the principle of hierarchy of courts, direct recourse to this

Court is improper because the Supreme Court is a court of last resort
and must remain to be so in order for it to satisfactorily perform its
constitutional functions, thereby allowing it to devote its time and
attention to matters within its exclusive jurisdiction and preventing the
overcrowding of its docket. Nonetheless, the invocation of this Courts
original jurisdiction to issue writs of certiorari has been allowed in
certain instances on the ground of special and important reasons
clearly stated in the petition, such as,(1) when dictated by the public
welfare and the advancement of public policy; (2) when demanded by
the broader interest of justice; (3) when the challenged orders were
patent nullities; or (4) when analogous exceptional and compelling
circumstances called for and justified the immediate and direct
handling of the case.
This case falls under one of the exceptions to the principle of
hierarchy of courts. Justice demands that this Court take cognizance
of this case to put an end to the controversy and resolve the matter
which has been dragging on for more than twenty (20) years.
Moreover, in light of the fact that what is involved is a final judgment
promulgated by this Court, it is but proper for petitioner to call upon its
original jurisdiction and seek final clarification.
160
DOCTRINE OF VICARIOUS LIABILITY

Vicarious liability is a legal doctrine that assigns liability for an
injury to a person who did not cause the injury but who has a
particular legal relationship to the person who did act negligently. It is
also referred to as imputed negligence.
Jayme vs. Apostol
G.R. No. 163609, November 27, 2008
Facts:
On February 5, 1989, Mayor Miguel of Koronadal, South
Cotabato was on board the Isuzu pick-up truck driven by Fidel
Lozano, an employee of the Municipality of Koronadal. 2 The pick-up
truck was registered under the name of Rodrigo Apostol, but it was
then in the possession of Ernesto Simbulan. Lozano borrowed the
pick-up truck from Simbulan to bring Miguel to Buayan Airport at
General Santos City to catch his Manila flight.
The pick-up truck accidentally hit Marvin C. Jayme, a minor,
who was then crossing the National Highway in Poblacion,
Polomolok, South Cotabato. The intensity of the collision sent Marvin
some fifty (50) meters away from the point of impact, a clear
indication that Lozano was driving at a very high speed at the time of
the accident.
Marvin sustained severe head injuries with subdural hematoma
and diffused cerebral contusion.He was initially treated at the Howard
161
Hubbard Memorial Hospital. Due to the seriousness of his injuries, he

was airlifted to the Ricardo Limso Medical Center in Davao City for
more intensive treatment. Despite medical attention, Marvin expired
six (6) days after the accident.
Petitioners spouses Buenaventura and Rosario Jayme, the
parents of Marvin, filed a complaint for damages with the RTC
against respondents. In their complaint, they prayed that all
respondents be held solidarily liable for their loss. They pointed out
that that proximate cause of Marvin's death was Lozano's negligent
and reckless operation of the vehicle. They prayed for actual, moral,
and exemplary damages, attorney's fees, and litigation expenses.
In their respective answers, all respondents denied liability for
Marvins death.
On January 25, 1999, the RTC rendered judgment in favor of
spouses Jayme.
Dissatisfied with the RTC ruling, Mayor Miguel interposed an
appeal to the CA.
On October 22, 2003, the CA held that Mayor Miguel should not
be held liable for damages for the death of Marvin Jayme. The CA
also reiterated the settled rule that it is the registered owner of a
vehicle who is jointly and severally liable with the driver for damages
incurred by passengers or third persons as a consequence of injuries
or death sustained in the operation of the vehicle.
162
Issue:
Whether or not the Court of Appeals erred in holding that Mayor
Fernando Miguel cannot be held liable for the death of Marvin Jayme
which conclusion is contrary to law and the settled doctrine of
vicarious liability?
Ruling:
NO. Article 2180 of the Civil Code provides that a person is not
only liable for one's own quasi-delictual acts, but also for those
persons for whom one is responsible for. This liability is popularly
known as vicarious or imputed liability. To sustain claims against
employers for the acts of their employees, the following requisites
must be established: (1) That the employee was chosen by the
employer personally or through another; (2) That the service to be
rendered in accordance with orders which the employer has the
authority to give at all times; and (3) That the illicit act of the
employee was on the occasion or by reason of the functions
entrusted to him.
In the case at bar, Mayor Miguel was neither Lozano's employer
nor the vehicle's registered owner. There existed no causal
relationship between him and Lozano or the vehicle used that will
make him accountable for Marvin's death. Mayor Miguel was a mere
passenger at the time of the accident.
163
DOCTRINE OF LAST CLEAR CHANCE
Last clear chance is a doctrine in civil law which simply states

that if a plaintiff engaged in contributory negligence but the defendant
could have taken action to avoid a danger, the plaintiff can still
recover damages from the defendant. This doctrine can be implied in
a variety of circumstances and is designed to hold people responsible
for tort violations even when those violations were accompanied
by contributory negligence on the part of the plaintiff.
In a simple example of how the last clear chance doctrine might

be used, if a driver involved in a rear end collision is suing the driver
who did the rear ending, the defendant might argue that the first
driver slammed on the brakes suddenly as a result of inattentiveness
or negligence. The plaintiff could admit this, but could argue that the
defendant still had time to act to avoid a collision, and thus that the
defendant should be held liable for damages.
The plaintiff may be considered helpless or inattentive in

reviews to decide whether or not the last clear chance doctrine can
be applied to a case. In the case of a helpless plaintiff, he or she
has ended up in a situation which cannot be avoided as a result of
negligence, while an inattentive plaintiff could escape injury, but is not
164
paying attention to the surroundings. In both cases, if someone

injures the plaintiff, there is a chance of being held responsible under
the argument that the defendant should have exercised due care to
protect the plaintiff from injury.
An example of a helpless plaintiff might be someone who was
speeding on an icy road and spun out. The plaintiff is powerless to
get out of danger at this point, but someone driving down the road
could exercise due caution and stop while the plaintiff gained control
of the vehicle. An inattentive plaintiff might be someone who drifts
over the center line on the road as a result of not paying attention,
which means that a reasonable person would move to avoid the
drifting car and would probably take action such as honking to warn
the other driver.
Likewise, defendants can be classified as inattentive or

observant. Observant defendants are people who saw the danger
and took no steps to avoid it, while inattentive defendants did not see
the danger because they were being negligent, and thus failed to
prevent a dangerous situation from happening. If the plaintiff is
helpless and the defendant is observant, the last clear chance
doctrine is usually applied. In cases of helpless plaintiffs versus
inattentive defendants, or inattentive plaintiffs versus observant
defendants, the doctrine may be applied. When both parties were
inattentive, the last clear chance doctrine is not applied.
165
Sealoader Shipping Corporation Vs.

Grand Cement Manufacturing Corporation
G.R. No. 167363
Facts:
Sealoader Shipping Corporation (Sealoader) is a domestic
corporation engaged in the business of shipping and hauling cargo
from one point to another using sea-going inter-island barges.
Grand Cement Manufacturing Corporation (now Taiheiyo
Cement Philippines, Inc.), on the other hand, is a domestic
corporation engaged in the business of manufacturing and selling
cement through its authorized distributors and, for which purposes, it
maintains its own private wharf in San Fernando, Cebu, Philippines.
On March 24, 1993, Sealoader executed a Time Charter Party
Agreementwith Joyce Launch and Tug Co., Inc. (Joyce Launch), a
domestic corporation, which owned and operated the motor tugboat
M/T Viper. By virtue of the agreement, Sealoader chartered the M/T
Viper in order to tow the formers unpropelled barges for a minimum
period of fifteen days from the date of acceptance, renewable on a
fifteen-day basis upon mutual agreement of the parties.
Subsequently, Sealoader entered into a contract with Grand
Cement for the loading of cement clinkers and the delivery thereof to
166
Manila. On March 31, 1994, Sealoaders barge, the D/B Toploader,

arrived at the wharf of Grand Cement tugged by the M/T Viper. The
D/B Toploader, however, was not immediately loaded with its
intended cargo as the employees of Grand Cement were still loading
another vessel, the Cargo Lift Tres.
On April 4, 1994, Typhoon Bising struck the Visayas area, with
maximum recorded winds of 120 kilometers per hour. Public storm
signal number 3 was raised over the province of Cebu. The D/B
Toploader was, at that time, still docked at the wharf of Grand
Cement. In the afternoon of said date, as the winds blew stronger
and the waves grew higher, the M/T Viper tried to tow the D/B
Toploader away from the wharf.
The efforts of the tugboat were
foiled, however, as the towing line connecting the two vessels

snapped.
This occurred as the mooring lines securing the D/B
Toploader to the wharf were not cast off.
The following day, the
employees of Grand Cement discovered the D/B Toploader situated

on top of the wharf, apparently having rammed the same and causing
significant damage thereto.
On October 3, 1994, Grand Cement filed a Complaint for
Damages against Sealoader, then later against Joyce Launch in an
amended complaint filed on December 14, 1994.
The RTC of Cebu City, Branch 58, rendered a decision on the
case at the case at bar on April 19, 1999. The court was of the view
that the defendants are guilty of negligence, which caused damaged
to the Grand Cements wharf. As the defendants are guilty of
negligence, Grand Cement is entitled to recover damages from them.
167
Sealoder appealed the above ruling with the Court of Appeals.

In its Decision dated November 12, 2004, the Court of Appeals found
no merit in the appeal of Sealoader.
On December 9, 2004, Sealoader filed a Motion for
Reconsideration of the above decision, arguing that the obligation to
pay the damages sustained by Grand Cement did not require
solidarity given that Joyce Launch was solely liable therefor.
Sealoader insisted that the D/B Toploader would not have rammed
the wharf if the M/T Viper had towed the barge to safety on the
morning of April 4, 1994. Sealoader also asserted that the delay in
the loading of the D/B Toploader partly contributed to the resulting
damage to the wharf.
On March 3, 2005, the Court of Appeals issued an Amended
Decision, finding the above stated motion of Sealoader partly
meritorious.
Grand Cement filed a Motion for Reconsideration of the
amended decision but the Court of Appeals denied the same in a
resolution dated February 20, 2007.
Issue:
Whether or not the Honorable Court of Appeals committed
reversible error in not holding that Grand Cement was barred from
recovering damage under the doctrine of last clear chance?
168
Ruling:
NO. The doctrine of last clear chance states that where both
parties are negligent but the negligent act of one is appreciably later
than that of the other, or where it is impossible to determine whose
fault or negligence caused the loss, the one who had the last clear
opportunity to avoid the loss but failed to do so, is chargeable with the
loss. Stated differently, the antecedent negligence of plaintiff does not
preclude him from recovering damages caused by the supervening
negligence of defendant, who had the last fair chance to prevent the
impending harm by the exercise of due diligence.
169
DOCTRINE OF LIMITED LIABILITY

Also called the no vessel, no liability doctrine, it provides that
liability of ship owner is limited to ship owners interest over the
vessel. Consequently, in case of loss, the ship owners liability is also
extinguished.
Limited
liability
likewise
extends
to
ships
appurtenances, equipment, freightage, and insurance proceeds. The

ship owners or agents liability is merely co-extensive with his interest
in the vessel, such that a total loss of the vessel results in the
liabilitys extinction. The vessels total destruction extinguishes
maritime liens because there is no longer any res to which they can
attach. (Monarch Insurance v. CA, G.R. No. 92735, June 8, 2000)
Exceptions:
1. Repairs and provisioning of the vessel before the loss of the
vessel; (Art. 586)
2. Insurance proceeds. If the vessel is insured, the proceeds will go to
the persons entitled to claim from the ship-owner; (Vasquez v. CA,
G.R. No. L-42926, Sept. 13, 1985)
3. Workmens Compensation cases (now Employees Compensation
under the Labor Code); (Oching v. San Diego, G.R. No. 775, Dec. 17,
1946)
4. When the ship-owner is guilty of fault or negligence; Note: But if
the captain is the one who is guilty, doctrine may still be invoked,
hence, abandonment is still an option.
5. Private carrier; or
170
6. Voyage is not maritime in character.

Chua Yek Hong vs. Intermediate Appellate Court
G.R. No. 74811, September 30, 1988
Facts:
Petitioner is a duly licensed copra dealer based at Puerta
Galera, Oriental Mindoro, while private respondents are the owners of
the vessel, "M/V Luzviminda I," a common carrier engaged in
coastwise trade from the different ports of Oriental Mindoro to the
Port of Manila.
In October 1977, petitioner loaded 1,000 sacks of copra, valued
at P101,227.40, on board the vessel "M/V Luzviminda I" for shipment
from Puerta Galera, Oriental Mindoro, to Manila. Said cargo,
however, did not reach Manila because somewhere between Cape
Santiago and Calatagan, Batangas, the vessel capsized and sank
with all its cargo.
On 30 March 1979, petitioner instituted before the then Court of
First Instance of Oriental Mindoro, a Complaint for damages based
on breach of contract of carriage against private respondents (Civil
Case No. R-3205).
In their Answer, private respondents averred that even
assuming that the alleged cargo was truly loaded aboard their vessel,
their liability had been extinguished by reason of the total loss of said
vessel.
On 17 May 1983, the Trial Court rendered its Decision in favor
of Chua Yek Hong.
171
The respondents appealed to the Court of Appeals but ruled to

the contrary when it applied Article 587 of the Code of Commerce and
the doctrine that liability, as ship owners, for the loss of a cargo is
merely co-extensive with their interest in the vessel such that a total
loss thereof results in its extinction.
Issue:
Whether or not respondent Court of Appeals erred in applying
the doctrine of limited liability under Article 587 of the Code of
Commerce?
Ruling:
Article 587 of the Code of Commerce provides that the ship
agent shall also be civilly liable for the indemnities in favor of third
persons which may arise from the conduct of the captain in the care
of the goods which he loaded on the vessel; but he may exempt
himself therefrom by abandoning the vessel with all the equipment
and the freight it may have earned during the voyage. Since the ship
agent's or ship owner's liability is merely co-extensive with his interest
in the vessel such that a total loss thereof results in its extinction and
none of the exceptions to the rule on limited liability being present,
the liability of private respondents for the loss of the cargo of copra
must be deemed to have been extinguished. There is no showing that
the vessel was insured in this case.
172
MIRANDA DOCTRINE
Section 12, Article III.
1. Any person under investigation for the commission of an offense
shall have the right to be informed of his right to remain silent and to
have competent and independent counsel preferably of his own
choice. If the person cannot afford the services of counsel, he must
be provided with one. These rights cannot be waived except in writing
and in the presence of counsel.
2. No torture, force, violence, threat, intimidation, or any other means
which vitiate the free will shall be used against him. Secret detention
places, solitary, incommunicado, or other similar forms of detention
are prohibited.
3.
Any confession or admission obtained in violation of this or
Section 17 hereof shall be inadmissible in evidence against him.

4. The law shall provide for penal and civil sanctions for violations of
this Section as well as compensation to the rehabilitation of victims of
torture or similar practices, and their families.
Miranda Doctrine prior to any questioning during custodial
investigation, the person must be warned that he has a right to
remain silent, that any statement he gives may be used as evidence
against him, and that he has the right to the presence of an attorney,
either retained or appointed. The defendant may waive effectuation
173
of these rights, provided the waiver is made voluntarily, knowingly,

and intelligently.
Purpose of the Doctrine
In Miranda v Arizona, the US Supreme Court established rules to
protect a criminal defendant's privilege against self-incrimination from
the pressures arising during custodial investigation by the police.
Thus, to provide practical safeguards for the practical reinforcement
for the right against compulsory self-incrimination, the Court held that
the prosecution may not use statements, whether exculpatory or
inculpatory, stemming from custodial interrogation of the defendant
unless it demonstrates the use of procedural safeguards effective to
secure the privilege against self-incrimination.
Requisites of the Miranda Doctrine
(1)
any person under custodial investigation has the right to remain
silent;
(2)
anything he says can and will be used against him in a court of
law;
(3)
he has the right to talk to an attorney before being questioned
and to have his counsel present when being questioned; and

(4)
if he cannot afford an attorney, one will be provided before any
questioning if he so desires.
Custodial investigation defined
174
Any questioning initiated by law enforcement officers after a
person has been taken into custody or otherwise deprived of his

freedom of action in any significant way.
Begins as soon as the investigation is no longer a general
inquiry unto an unsolved crime, and direction is then aimed upon a

particular suspect who has been taken into custody and to whom the
police would then direct interrogatory questions which tend to elicit
incriminating statements.
Shall include the practice of issuing an invitation to a person
who is investigated in connection with an offense he is suspected to

have committed, without prejudice to the liability of the inviting officer
for any violation of law.
Extrajudicial confession is Admissible when:
(a) Voluntary
(b) With assistance of counsel
(c) In writing, and
(d) Express
Rights Under Custodial Investigation
(a) To be informed of right to remain silent and to counsel
175
Carries the correlative obligation on the part of the investigator
to explain and contemplates effective communication which results in

the subject understanding what is conveyed. (People v. Agustin)
(b)
To be reminded that if he waives his right to remain silent,
anything he says can and will be used against him

(c)
To remain silent
(d)
To have competent and independent counsel preferably of own
choice
(e)
To be provided with counsel if the person cannot afford the
services of one
(f)
No torture, force, violence, threat, intimidation or any other
means which vitiate the free will shall be used against him
(g)
Secret detention places, solitary, incommunicado, or other
similar forms of detention are prohibited

(h)
Confessions or admissions obtained in violation of these rights
are inadmissible as evidence (exclusionary rule)

Rights That May Be Waived
[waiver must be in writing and in the presence of counsel]
(a) Right to remain silent
(b) Right to Counsel
Rights That Cannot Be Waived
(a) Right to be informed of his right to remain silent and to counsel
176
(b)
Right to counsel when making the waiver of the right to remain
silent or to counsel
Right to counsel de parte is not unlimited. Accused cannot
repeatedly ask for postponement. He must be provided with counsel

de oficio.
.
People Of The Philippines Vs. Dindo Mojello
G.R. No. 145566, March 9, 2004
Facts:
That on the 15th day of December 1996, at about 11:00 o'clock
in the evening, at Sitio Kota, Barangay Talisay, Municipality of Santa
Fe, Province of Cebu, Philippines and within the jurisdiction of this
Honorable Court, the above-named accused, moved by lewd design
and by means of force, violence and intimidation, did then and there
willfully, unlawfully and feloniously succeed in having carnal
knowledge with Lenlen Rayco under twelve (12) years of age and
with mental deficiency, against her will and consent, and by reason
and/or on the occasion thereof, purposely to conceal the most brutal
act and in pursuance of his criminal design, the above-named
accused, did then and there willfully, unlawfully and feloniously with
intent to kill, treacherously and employing personal violence, attack,
assault and kill the victim Lenlen Rayco, thereby inflicting upon the
victim wounds on the different parts of her body which caused her
death.
177
On January 21, 1999, the trial court rendered judgment finding

appellant guilty beyond reasonable doubt of the crime of rape with
homicide, and sentencing him to suffer the death penalty.
Issue:
Whether or not the lower court gravely erred in admitting in
evidence the alleged extrajudicial confession which he executed on
December 23, 1996?
Ruling:
The
extrajudicial
confession
executed
by
appellant
on
December 23, 1996, applying Art. III, Sec. 12, par. 1 of the
Constitution in relation to Rep. Act No. 7438, Sec. 2 complies with the
strict constitutional requirements on the right to counsel.
Appellant was undoubtedly apprised of his Miranda rights under
the Constitution. The court a quo observed that the confession itself
expressly states that the investigating officers informed him of such
rights. As further proof of the same, Atty. Isaias Giduquio testified that
he was requested to assist appellant. Appellant manifested on record
his desire to have Atty. Giduquio as his counsel, with the latter
categorically stating that before the investigation was conducted and
appellant's statement taken, he advised appellant of his constitutional
rights. Atty. Giduquio even told appellant to answer only the questions
178
he understood freely and not to do so if he was not sure of his

answer. Atty. Giduquio represented appellant during the initial stages
of the trial of the present case.
Atty. Giduquio was a competent and independent counsel of
appellant within the contemplation of the Constitution. Atty. Giduquio
was his choice of counsel during the custodial proceedings.
DOCTRINE OF JUDICIAL STABILITY
[The doctrine that] no court can interfere by injunction with the
judgments or orders of another court of concurrent jurisdiction having
the power to grant the relief sought by the injunction. [Cabili v.
Balindong, AM RTJ-10-2225, Sept. 6, 2011].
Rebecco Panlilio vs. Fe V. Federis
G.R. No. 113087, June 27, 1994
Facts:
Michael Lancelot F. Panlilio who was born on July 7, 1990 is
said to be the natural child of petitioner Jose Marcel E. Panlilio and
private respondent Fe V. Federis while principal petitioners Rebecco
and ErlindaPanlilio are the natural grandparents of the minor, being
the parents of Jose Marcel E. Panlilio.
Owing to the so-called cruelty, moral depravity and gross
neglect of private respondent, the grandparents felt obliged to
exercise
substitute parental
authority over
the minor
which
apprehension led to the initiation on December 14, 1993 of special

proceedings geared towards securing their appointment as guardian
179
ad litem of the ward. The Presiding Judge of Branch 15 of the

Regional Trial Court stationed in Naic, Cavite, before whom the case
was eventually raffled, issued an order on December 16, 1993 an
appointment to spouses Rebecco and ErlindaPanlilio as guardian ad
litem pending determination of the merits of the case.
On December 22, 1993, a petition for habeas corpus was
submitted by the private respondent and later assigned to Branch 149
of the Regional Trial Court in Makati. The natural mothers remedial
measure tersely narrated how she was allegedly duped into
permitting her son on one occasion to go with herein petitioners in
Makati City to wait in vain on account of the vehement and persistent
reluctance of petitioners to return the child despite repeated demands
therefore. The Makati Court immediately ordered the issuance of the
writ of habeas corpus on December 23, 1993 supplemented on
December 29, 1993 by a hold departure order of Michael Lancelot F.
Panlilio.
Herein petitioners moved to dismiss the habeas corpus petition
on the basis of litispendentia as well as lack of cause of action, while
herein private respondent filed her own motion to dismiss in the
Cavite custody case anchored on improper venue and existence of a
prejudicial question.
When petitioners motion to dismiss was submitted for resolution
on January 7, 1994, the Makati Judge hearing the habeas corpus
case supposedly made a verbal order to produce the body of the
minor child on January 10, 1994 which prompted herein petitioners to
forthwith file the petition at bench.
180
Following the filing of said petition which had a corollary plea for
issuance of a restraining order, the Supreme Court resolved to issue
the Temporary Restraining Order prayed for.
Issue:
Whether or not judicial stability is violated in this case?
Ruling:
YES. Even as the appointment of principal petitioners is still
subject to the outcome of the case lodged before the Cavite Court,
not to mention the possible courses of action which private
respondent may pursue in said case to indicate custody of her child, it
cannot be gain said that the immediate assumption of authority by the
Makati court, although possibly motivated by a noble goal, is
tantamount to defeating the very essence of the order emanating
from the Cavite Court.
While habeas corpus is the proper remedy to regain custody of
minor children, yet this principle is understood to presuppose that
there is no other previous case whose issue is necessarily interwoven
with the nature of habeas corpus proceeding. Verily, the existence of
a habeas corpus an anterior suit, such as the termination of private
respondents parental authority in the Cavite Court, coupled with the
order appointing principal petitioners as guardians ad litem of the
ward, is sufficiently to momentarily stave off private respondents short
cut and subtle attempt to regain custody of her son at another forum,
181
by reason of the corollary principle that initial acquisition by a court of

concurrent jurisdiction divests another of its own jurisdiction.
The doctrine of judicial stability states that when a court of
competent jurisdiction acquires jurisdiction over the subject matter of
a case, its authority continues, subject only to the appellate authority,
until the matter is finally and completely disposed of, and that no
court of coordinate authority is at liberty to interfere with its action.
DOCTRINE OF OPERATIVE FACT
[The doctrine that] nullifies the effects of an unconstitutional law
by recognizing that the existence of a statute prior to a determination
of
unconstitutionality
is
an
operative
fact
and
may
have
consequences which cannot always be ignored. The past cannot

always be erased by a new judicial declaration. [It] is applicable when
a declaration of unconstitutionality will impose an undue burden on
those who have relied on the invalid law. [Planters Products, Inc. v.
Fertiphil Corp., GR 166006, 14 Mar. 2008]. See also Operative fact
doctrine.
Commissioner Of Internal Revenue Vs.
San Roque Power Corporation
G.R. No. 187485, October 8, 2013
Facts:
For resolution by the Supreme Court in this instant case are the
motion
for
reconsideration
and
182
supplemental
motion
for
reconsideration filed by San Roque Power Corporation in G.R. No.

187458, the Motion for Reconsideration filed by the CIR in G.R. No.
196113, and the comment to the Motion for Reconsideration filed by
Taganito Mining Corporation in G.R. No. 196113.
San Roque prays that the rule established in the 12 February
2013 decision be given only a prospective effect, arguing that the
manner by which the Bureau of Internal Revenue (BIR) and the Court
of Tax Appeals (CTA) actually treated the 120+30 day periods
constitutes an operative fact the effects and consequences of which
cannot be erased or undone.
The CIR, on the other hand, asserts that Taganito Mining
Corporation (Taganito) judicial claim for tax credit or refund was
prematurely filed before the CTA and should be disallowed because
BIR Ruling No. DA-489-03 was issued by a Deputy Commissioner,
not by the Commissioner of Internal Revenue.
Issue:
Whether or not the manner by which the Bureau of Internal
Revenue (BIR) and the Court of Tax Appeals (CTA) actually treated
the 120+30 day periods constitutes an operative act?
Ruling:
NO. The general rule is that a void law or administrative act
cannot be the source of legal rights or duties as enunciated in Article
7 of the Civil Code.Its exception is that laws are repealed only by
subsequent ones, and their violation or non-observance shall not be
183
excused by disuse, or custom or practice to the contrary. When the

courts declared a law to be inconsistent with the constitution, the
former shall be void and the latter shall govern. Administrative or
executive acts, orders and regulations shall be valid only when they
are not contrary to the laws or the constitution.
The doctrine of operative fact is an exception to the general
rule, such that as judicial declaration of invalidity may not necessarily
obliterate all the effects and consequences of a void act prior to such
declaration.
An unconstitutional act, for that matter an executive order or a
municipal ordinance likewise suffering from that infirmity, cannot be
the source of any legal rights or duties nor can it justify any official act
taken under it. Its repugnancy to the fundamental law once judicially
declared results in its being to all intents and purposes a mere scrap
of paper.
As the new Civil Code puts it: When the courts declare a law to
be inconsistent with the constitution, the former shall be void and the
latter shall govern. Administrative or executive acts, orders and
regulations shall be valid only when they are not contrary to the laws
of the constitution. It is understandable why it should be so, the
constitution being supreme and paramount.
executive act contrary to its term cannot survive.
184
Any legislative or
DOCTRINE OF SELF-HELP
The doctrine enunciated in Art. 429 of the Civ. Code which
provides: The owner or lawful possessor of a thing has the right to
exclude any person from the enjoyment and disposal thereof. For this
purpose, he may use such force as may be reasonably necessary to
repel or prevent an actual or threatened unlawful physical invasion or
usurpation of his property.
Reynaldo Villafuerte vs. Ca, Edilberto De Mesa
G.R. No. 134239, May 26, 2005
Facts:
The appellees, spouses Reynaldo C. Villafuerte and Perlita Tan
Villafuerte, operated a gasoline station known as Peewees
Powerhouse Service Station and General Merchandise on the
premises of three (3) adjoining lots at the corner of Gomez Street and
Quezon Avenue in Lucena City. One of these lots, Lot No. 2948-A,
with an area of 575 square meters, is owned by several persons one
of whom is appellant Edilberto de Mesa, while the other lot, Lot No.
185
2948-B with an area of 290 square meters, is owned by appellant

Gonzalo Daleon and his brother Federico A. Daleon. The remaining
lot belongs to Mrs. Anicia Yap-Tan, mother of appellee Perlita Tan
Villafuerte.
Appellants Edilberto de Mesa and Gonzalo Daleon acquired
their respective lots subject to the lease by Petrophil Corporation
which had been built thereon the gasoline station being managed by
the Villafuerte couple. When the lease of Petrophil Corporation
expired on December 31, 1988, theVillafuertes obtained a new lease
on Lot No. 2948-A from appellant Edilberto de Mesa for a period
expiring on December 31, 1989.
As regards Lot No. 1948-B of the Daleon brothers, the
Villafuertes were not as lucky. For instead of obtaining a lease
renewal, what they received was demand letters from the brothers
counsel ordering them to vacate the premises. Instead of complying
therewith, the Villafuertes simply ignored the demand and continued
operating the gas station.
On May 9, 1989, in the Office of Barangay Captain of Barangay
Tres, Lucena City, a complaint for ejectment was filed Gonzalo
Daleon against the Villafuertes. Evidently, no settlement was reached
threat, as shown by a certification to file action issued by the lupon.
With their problem with the Daleon brothers from over, the
Villafuertes were apt for another one; their lease contract with
Edilberto de Mesa was not renewed when it expired on December 31,
1989. Nonetheless, and duplicating what they had done in the case of
the property of Daleon brothers, the spouses continued to operate
186
their gasoline station and other businesses on the lot of de Mesa

despite the latters demand to vacate.
It appears that in the early morning or February 1, 1990,
appellants Edilberto de Mesa and Gonzalo Daleon, with the aid of
several persons and without the knowledge of the Villafuertes,
caused the closure of the latters gasoline station by constructing
fences around it.
The following day, February 2, 1990, Villafuertes countered
with a complaint for damages with preliminary mandatory injunction
against both Edilberto de Mesa and Gonzalo Daleon. The complaint
seeks vindication for the alleged malicious and unlawful fencing of the
plaintiffs business premises.
Invoking their status as owners of the withheld premises, the
defendants admitted in their respective answers having caused the
fencing the plaintiffs gasoline station thereat but reasoned out that
they did so on account of the plaintiffs refusal; to vacate the same
despite demands.
After hearing the parties in connection with the plaintiffs
application for a writ of preliminary mandatory injunction, the lower
court, in its order of May 30, 1990, ruled that with the expiration of the
lease of the defendants property, the plaintiffs have no more right to
stay thereon and therefore, cannot pretend to have a clear and
unmistakable right to an injunctive writ and accordingly denied their
application therefore. In a subsequent order of July 30, 1990, the
same court denied the Villafuertes motion for reconsideration.
187
Later, with leave of court, the Villafuertes amended their

complaint.
As later events disclosed, the defendants resumed possession
of the premises in question on January 25, 1991. Four days later,
they obtained a judgment by compromise from the Municipal Trail
Court in Cities, Lucena City in connection with the suit for ejectment
they earlier filed thereat against Petrophil Corporation. In that
judgment, the Petrophil bound itself to remove the materials and
equipment related to the operation of the gasoline station on the
subject premises.
The lower court came out with the decision in favor of the
plaintiffs ordering the defendants Edilberto de Mesa and Gonzalo
Daleon to pay jointly and severally, plaintiffs.
In due time, private respondent filed their respective appeals
before the Court of Appeals which affirmed with modification the
decision of the Trial Court.
Issue:
Whether or not respondents could invoke the doctrine of selfhelp contained in Article 429 of the Civil Code?
Ruling:
NO. There is proper recourse of one who claims to be entitled
to possession of a thing. When private respondents personally took it
upon themselves to evict petitioners from their properties which act
188
was in clear contravention of the law, they became liable for all the
necessary and natural consequences of their illegal act.
The owner or lawful possessor of a thing has the right to
exclude any person from the enjoyment and disposal thereof. For this
purpose, he may use such force as may be reasonably necessary to
repel or prevent an actual or threatened unlawful physical invasion or
usurpation of his property.
The doctrine finds no application when occupation was effected
through lawful means.
Petitioners continued unauthorized occupation of private
respondents properties may have been illegal, however, it was
incumbent upon private respondents to abide by the express
provision of Article 536 of the Civil Code requiring recourse to the
proper court prior to ousting petitioners from their lots.
189
DOCTRINE OF INAPPROPRIATE PROVISION

[It deals with] item provisions [in a budget bill] that are to be
treated as items for the Presidents veto power. [Dean Tupaz, 24
Hours before the Bar (1st Ed. 2005), p. 133].
PHILIPPINE CONSTITUTION ASSOCIATION
GR NO. 113105
RAUL S. ROCO
GR NO. 113174
WIGBERTO E. TAADA
GR NO. 113766
WIGBERTO E. TAADA
GR NO. 113888
VS. COA, Executive Secretary
August 19, 1994
and National Treasurer

Facts:
House Bill No. 10900, the General Appropriation Bill of 1994
(GAB), was passed and approved by both houses of Congress on
December 17, 1993. As passed, it imposed conditions and limitations
on certain items of appropriations in the proposed budget previously
190
submitted by the President. It also authorized members of the

Congress to propose and identify projects in the pork barrels
allotted to them and to realign their respective operating budgets.
Pursuant to the procedure on the passage and enactment of
bills as prescribed by the constitution, congress presented the said
bill to the President for consideration and approval.
On December 30, 1993, the President signed the bill into law,
and declared the same to have become Republic Act No. 7663. On
the same day, the President delivered his Presidential Veto Message,
specifying the provisions of the bill he vetoed and on which he
imposed certain conditions.
Issue:
Whether or not the veto of the President in some of the
provisions of the GAA of 1994 is a valid act?
Ruling:
YES.Under his general veto power, the President has to veto
the entire bill, not merely parts thereof. The exception to the general
veto power is the power given to the President to veto any particular
item or items in a general appropriations bill.
A general appropriations bill is a special type of legislation,
whose content is limited to specified sums of money dedicated to a
specific purpose or a separate fiscal unit.
As the constitution is explicit that the provision which congress
can include in an appropriations bill must Relate specifically to some
particular appropriation therein and be limited in its operation to the
191
appropriation to which it relates, it follows that any provision which

does not relate to any particular item, or which extends in its
operations beyond an item of appropriation, is considered as
inappropriate provision which can be vetoed separately from an
item. Also to be included in the category of inappropriate provisions
are unconstitutional provisions and provisions which are intended to
amend other laws, because clearly these kind of laws have no place
in an appropriations bill. These are matters of general legislation
more appropriately dealt with separate enactments.
Former Justice Irene Cortez, as Amicus Curiae, commented
that congress cannot by law establish conditions for and regulate the
exercise of the powers of the President given by the constitution for
that would be unconstitutional intrusion into executive prerogative.
The doctrine of appropriate provision was well elucidated in
Henry vs. Edwards such that Just as the President may not use his
item-veto to usurp constitutional powers conferred on the legislature,
neither can the legislature deprive the Governor of the constitutional
powers conferred on him as chief executive officers of the state by
including in the general appropriation bill matters more properly
enacted in separate legislation. The Governors constitutional power
to veto bills of the general legislation cannot be abridged by the
careful placement of such measures in a general appropriation bill,
thereby forcing the Governor to choose between approving
unacceptable
substantive
legislation
or
vetoing
items
expenditures essential to the operation of government.
of
The
legislature cannot by location of a bill give it immunity from executive

192
veto. Nor it circumvent the Governors veto power over substantive

legislation by artfully drafting general law measures so that they
appear to be true conditions or limitations on an item of appropriation.
Otherwise, the legislative would be permitted to impair the
constitutional responsibilities and functions of a co-equal branch of
government in contravention of the separation of powers doctrine.
The Supreme Court hold that, when the legislature inserts
inappropriate provisions in a general appropriations bill, such
provisions must be treated as items for purposes of the Presidents
item veto power over general appropriation bills.
193
DOCTRINE OF LACHES OR STALE DEMAND

1. [A doctrine] based upon grounds of public policy which
requires, for the peace of society, the discouragement of stale claims
and x x x is principally a question of the inequity or unfairness of
permitting a right or claim to be enforced or asserted. [Tijam v.
Sibonghanoy, 23 SCRA 29 (1968)].
2. The time-honored rule anchored on public policy that relief
will be denied to a litigant whose claim or demand has become
stale, or who has acquiesced for an unreasonable length of time, or
who has not been vigilant or who has slept on his rights either by
negligence, folly or inattention. [Arradaza v. CA, 170 SCRA 12, 20
(1989)].
Salud D. Lopez Vs. Robert P. David, Jr.
G.R. No. 152145; March 30, 2004
Facts:
Subject for an action of ejectment before the Metropolitan Trial
Court (MTC), Rose Lopez-Co, Amado D. Lopez, Cynthia LopezPortugal, Jose D. Lopez, Jr. and May Lopez-Rueda against Robert P.
194
David and Cleopatra David Campo Ruiz. It was predicated on the

averments that petitioners are owners of the subject property which
was purchased from the Peoples Homesite and Housing Corporation
by Lopez, deceased husband of Salud D. Lopez and father of the rest
of the petitioners.
That in 1954, upon her request, CirilaSadsadVda. De David,
Saluds mother and respondents grandmother, was allowed by Salud
to build a residential house on the subject property to stay thereon
until she could find a suitable residence of her own; that upon Cirilas
death, respondents continued occupancy of said property; that the
possession of Cirila and respondents of the subject property, without
paying rentals and a written contract, was upon tolerance of Salud;
that petitioner withdrew their consent to respondents occupancy of
the subject property per their lawyers letter dated August 10, 1995
demanding of them to vacate the same on or before September 15,
1995, which respondents did not heed.
In their defense, respondents alleged that the subject property
is owned in common by Cirilas children, Salud, Robert S. David, Sr.
(father of respondent Robert P. David) and Celestina S. David
(mother of the other respondent); that the subject property was
placed in the name of Lopez upon agreement that it would be held in
trust for Cirilas children; and that Salud, Ligaya S. David (mother of
respondent Robert P. David) and Celestina S. David built a three door
apartment on the subject property which equally belongs to them.
On August 15, 1997, the MCTC rendered a decision in favor of
petitioners and against respondents.
195
Respondents appealed to the Regional Trial Court of Quezon

City, Branch 95 which on December 17, 1999, rendered a decision
affirming entoto that of the MCTC.
In the Court of Appeals, it was found that the MCTC erred in
taking cognizance of the ejectment suit, since the case had been filed
one year from the withholding of the possession. The appellate court
thus ruled that respondents possession became unlawful on
September 16, 1995, or upon expiration of the grace period, when
they continued occupying subject property. However, the ejectment
suit was only instituted on October 2, 1996, or more than one year
from expiration of the period given to vacate the subject property.
Issue:
Whether or not the Court of Appeals erred in dismissing the
case for ejectment on the ground of lack of jurisdiction despite the
submission of the respondents to the MCTC and the RTC and all the
proceedings therein?
Ruling:
NO. Under Section 1 of Rule 70, the one-year period within
which a complaint for unlawful detainer can be filed should be
counted from the date of demand, because only upon the lapse of
that period does the possession become unlawful. It is undisputed
that petitioners complaint was filed beyond one year from the time
that respondents possession allegedly became unlawful.
196
Laches in a general sense, is failure or neglect, for an

unreasonable and unexplained length of time, to do that, by
exercising due diligence, could or should have done earlier; it is
negligence or omission to assert a right within a reasonable time,
warranting a presumption that the party entitled to assert it either has
abandoned it or declined to assert it.
The doctrine of laches or of state demands is based upon
grounds of public policy which requires, for the peace of society, the
discouragement of state claims and, unlike the statute of limitations,
is not a mere question of time but is principally a question of the
inequity or unfairness of permitting a right or claim to be enforced or
asserted.
197
DOCTRINE OF CONDONATION
[The doctrine that a] public official cannot be removed for
administrative misconduct committed during a prior term, since his reelection to office operates as a condonation of the officers previous
misconduct to the extent of cutting off the right to remove him
therefor. The foregoing rule, however, finds no application to criminal
cases pending against petitioner. [Aguinaldo v. Santos, 212 SCRA
768, 773 (1992)]. Also called Doctrine of forgiveness.
Salumbides, Jr. Vs. Ombudsman
G.R. No. 180917, April 23, 2010
Facts:
Atty. Vicente E. Salumbides, Jr. and Glenda Araa were
appointed in July 2001 as Municipal Legal Officer/Administrator and
Municipal Budget Officer, respectively, of Tagkawayan, Quezon.
Towards the end of 2001, Mayor Vicente Salumbides, II saw the
urgent need to construct a two-classroom building with fence for the
Tagkawayan Municipal High School since the public school in the
public area would no longer admit high school freshmen starting
school year 2002-2003. On how to solve the classroom shortage, the
198
Mayor consulted Salumbides who suggested that the construction of

the two-classroom building be charged to the account of Maintenance
and other Operating Expenses/Repair and Maintenance of Facilities
and implemented by administration as had been done in a previous
classroom building project of the former Mayor.
Upon consultation, Glenda advised Salumbides in December
2001, that there were no more available funds that could be taken
from the MOOE/RMF, but the savings of the municipal government
were adequate to fund the projects. She added, however, that the
approval of the Sangguniang Bayan of a proposed supplemental
budget must be secured.
The members of the Sangguniang Bayan having already gone
on recess for the Christmas holidays, Glenda and Salumbides
advised the Mayor to source the funds from the P1,000,000
MOOE/RMF allocation in the approved Municipal Annual Budget for
2002.
The Mayor thus ordered on January 2, 2002 Municipal
Engineer Jose Aquino to proceed with the construction of the projects
based on the program of work and bill of materials he prepared with a
total cost estimate of P222,000.00.
Upon advice of Municipal Planning and Development Officer,
Herman Jason, the Mayor included the projects in the list of local
government projects scheduled for bidding on January 25, 2002
which, together with the January 31, 2002 public bidding, failed.
The Mayor to admit later his expectation or assumption or risk
on reimbursement.
199
The construction of the projects commenced without any

approved appropriation and ahead of the public bidding. Salumbides
was of the opinion that the projects were regular and legal, based on
an earlier project that was implemented in the same manner, using
the same source of fund and for the same reason of urgency which
was allowed because the building was considered merely temporary
as the TMHS is set to be transferred to an 8-hectare lot which the
municipal government is presently negotiating to buy.
Meanwhile, Aquino suggested to the Sangguniang Bayan the
adoption of model guidelines in the implementation of infrastructure
projects to be executed by administration, while Councilor
ColetaSandro sponsored a resolution to ratify the projects and to
authorize the Mayor to enter into a negotiated procurement. Both
actions did not merit the approval of the Sangguniang Bayan.
On May 13, 2002, respondents Ricardo Agon, Ramon
Villasanta, Elmer Dizon, Salvador Adul and Agnes Fabian, all
members of the Sangguniang Bayan of Tagkawayan, filed with the
office of the Ombudsman a complaint against Salumbides and
Glenda, the Mayor, Coleta, Jason and Aquino.
The administrative aspect of the case, charged petitioners et.
al. with Dishonesty, Grave Misconduct, Gross Neglect of Duty,
Conduct Prejudicial to the Rest Interest of the Service and violation of
the Commission on Audit Rules and the Local Government Code.
By order of June 14, 2002, the Office of the Ombudsman,
denied the prayer to place petitioners et. al. under preventive
suspension pending investigation. By order dated February 1, 2005,
200
approved on April 11, 2005, it denied the motion for reconsideration

but dropped the Mayor and Coleta, both elective officials, as
respondents in the administrative case. The parties were thereupon
directed to submit their respective verified position papers to which
petitioners, Jason and Aquino complied by submitting a consolidated
position paper on May 19, 2005.
Meanwhile, in response to the subpoena ducestecum issued by
the Office of the Ombudsman on February 18, 2005 requiring the
Regional Officer to the COA to submit the post audit report on the
projects, CelerinoAlviar, COA State Auditor II claimed by affidavit of
May 23, 2005 that the required documents were among those razed
by the fire on Aril 14, 2004 that hit the office of the Municipal
Accountant where they were temporarily stored due to lack of space
at the Provincial Auditors Office.
On October 17, 2005, the Office of the Ombudsman approved
the September 9, 2005 Memorandum absolving Jason and Aquino,
and finding petitioners guilty of simple neglect of duty, for which they
were meted the penalty of suspension from office for a maximum
period of six months with a stern warning against a similar repetition.
It also approved on November 2, 2006, the March 27, 2006 denying
the motion for reconsideration.
Recourse of the petitioners to the Court of Appeals failed.
Issue:
Whether or not expansion of the settled doctrine of condonation
to cover coterminous appointive officials who were administratively
201
charged along with the reelected official/appointing authority with

infractions allegedly committed during their preceding term could be
considered by the Supreme Court?
Ruling:
NO. The doctrine of condonation explains that each term is
separate from other terms, and that the reelection to office operates
as a condonation of officers previous misconduct to the extent of
cutting off the right to remove him thereof.
The court should never remove a public officer for acts done
prior to his present term of office. To do otherwise would be to deprive
the people of their right
to elect their officers. When the people
elected a man to office, it must be assumed that they did this with
knowledge of his life and character, and that they disregarded or
forgave his faults or misconduct, if he had been guilty of any. It is not
for the court, by reason of such faults or misconduct, to practically
overrule the will of the people.
The doctrine does not apply to a criminal case.
Respondents in this case are appointed official; hence,
broadening the scope of the doctrine of condonation cannot be
applied. Election expresses the sovereign will of the people. Under
the principle of voxpopuliestsupremalex, the reelection of a public
official may, indeed, supersede the pending administrative case. The
same cannot be said of a re-appointment to a non-career position.
202
DOCTRINE OF QUALIFIED POLITICAL AGENCY

Pol. Law. The doctrine which holds that, as the Pres. cannot be
expected to exercise his control powers all at the same time and in
person, he will have to delegate some of them to his Cabinet
members, who in turn and by his authority, control the bureaus and
other offices under their respective jurisdictions in the executive
department. [Carpio v. Exec. Sec., GR 96409. Feb. 14, 1992].
ANNIE, ANNE MARIE, JAMES JOHN, JAMES FRANCIS, ANNE
MARGARETH (all surnamed Manubay)
vs. HON. GARILAO, SECRETARY OF DAR
G.R. No. 140717, April 16, 2009
Facts:
On November 15, 1994, the Municipal Agrarian Reform Officer
(MARO) of Pili, Camarines Sur issued a notice of coverage placing
the 124 hectare land in Barrio Cadlan owned by petitioners Annie,
Anne Marie, James John, James Francis and Anne Margareth (all
surnamed Manubay) and Manubay Agro Industrial Development
Corporation, under the Comprehensive Agrarian Reform Program
(CARP). Petitioners did not protest the notice.
203
On July 1, 1996, petitioners filed an application at the

Department of Agrarian Reform (DAR) for conversion of the property
from agricultural to residential.
On August 26, 1966, the Sangguniang Bayan of Pili passed
Resolution No. 145 approving the Comprehensive Zoning Ordinance
of 1996 of the Municipality of Pili, Camarines Sur. The ordinance
reclassified the subject property from agricultural to highly urbanized
intended for mixed residential and commercial use.
Thereafter, petitioner requested DAR Regional Director Percival
C. Dalugdugto set aside the November 15, 1994 notice of coverage.
They pointed out that the land had been reclassified and the property
was no longer suitable for agricultural purposes. Directed Dalugdug
denied their request in a letter November 13, 1996.
Respondent Ernesto Garilao, then DAR Secretary, upheld
Director Dalugdug and denied petitioners application for conversion
considering that the property had been placed the CARP.
Aggrieved,
petitioners
separately
asked
respondent
to
reconsider. They insisted that, because the MARO issued a notice of

coverage, not a notice of acquisition, their application for conversion
should have been approved. The motions were denied.
On April 28, 1998, petitioners filed a petition for certiorari in the
Court of Appeals assailing the denial of their application for
conversion. They averred that respondent acted with grave abuse of
discretion when he denied their application. According to them, the
issuance of a mere notice of coverage placing agricultural land under
the CARP was not a ground for the denial of such application.
204
In a resolution dated June 1, 1999, the CA dismissed the

petition. Petitioners moved for reconsideration but it was denied.
Issue:
Whether or not the act of a Department Secretary may be
directly challenged in a petition for certiorari?
Ruling:
YES.
Under
the doctrine
of
qualified
political
agency,
department Secretaries are later egos or assistants of the president

and their acts are presumed to be those of the latter unless
disapproved or reprobated by him. Thus, as a rule, an aggrieved
party affected by the decision by a Cabinet Secretary need not
appeal to the OP and may file a petition for certiorari directly in the
Court of Appeals assailing the acts of the said secretary.
205
DOCTRINE OF CONCLUSIVENESS OF JUDGMENT

Rem. Law. A concept of res judicata holding that] where there is
identity of parties in the first and second cases, but no identity of
causes of action, the first judgment is conclusive only as to those
matters actually and directly controverted and determined and not as
to matters merely involved therein. Stated differently, any right, factor
matter in issue directly adjudicated or necessarily involved in the
determination of an action before a competent court in which
judgment is rendered on the merits is conclusively settled by the
judgment therein and cannot again be litigated between the parties
and their privies, whether or not the claim, demand, purpose, or
subject matter of the two actions is the same. [Antonio v. Sayman
Vda. de Monje, GR 149624, 29 Sept. 2010, 631 SCRA 471, 480].
Andrew Tan Vs. Court Of Appeals And Wu Sen Woei
G.R. No. 142401
Facts:
Plaintiff-appellant Wu Sen Woei (respondent herein), a
Taiwanese national, and defendant-appellee (petitioner herein), a
Filipino, first met in Taiwan sometime in August 1987 through KuaBei
Tiu, defendants sister-in-law.
206
Defendant proposed that plaintiff invest money in the hatchery

business he had started, and plaintiff parted with the amount of
$80,000.00 or its equivalent of P1,650,700.00. Repaid only the
amount of $10,000.00, plaintiff-appellant lodged a complaint before
the National Bureau of Investigation to recover the balance of
$70,000.00.
Defendant claims that he was coerced into signing the above
undertaking. He then assailed the validity of said undertaking before
the Regional Trial Court of Dagupan City, Branch 43. The RTC found
Tans and Gos consent to the undertaking as vitiated and rendered
judgment declaring the undertaking as a nullity.
The decision was appealed to the Court of Appeals but in a
decision dated October 3, 1997 reversed and set aside the appealed
judgment, and dismissed Andrew Tans complaint.
Issue:
Whether or not the Court of Appeals committed a grave and
serious error of judgment in applying the doctrine of conclusiveness
of judgment?
Ruling:
NO. The CAs earlier decision concerning the validity of Andrew
Tans Affidavit of Undertaking has become conclusive to the parties,
pursuant to Section 47 (c) of Rule 30 of the Rules of court. The
parties are bound by the matters adjudged and those that are actually
and necessarily included therein.
207
Under the doctrine of conclusiveness of judgment which is also

known as preclusion of issues or collateral estoppel
issues
actually and directly resolved in a former suit cannot again be raised

in any future case between the same parties involving a different
cause of action.
The concept clearly applies in this case, because petitioner
again seeks refuge in the alleged nullity of the same Affidavit of
Undertaking, which, was already ruled upon with finality. The same
question, therefore, cannot be raised again even in a different
proceeding involving the same parties.
208
DOCTRINE OF PLAIN VIEW

The plain view doctrine is a concept in criminal law that allows a
law enforcement officer to make a search and seizure without
obtaining a search warrant if evidence of criminal activity or the
product of a crime can be seen without entry or search.
Some jurisdictions recognize a "plain-smell" exception to the
requirement that law-enforcement officers obtain a warrant before
conducting a search. In a case involving a police dog, one court has
held that, just as evidence in plain view of officers may be searched
without warrant, evidence in plain smell may be detected without
warrant. However, another court has held that odor alone is not
sufficient to establish probable cause to search, but is one factor to
consider in the totality of circumstances.
REQUIREMENTS FOR SEIZURE OF EVIDENCE IN PLAIN VIEW:
1. Law enforcement authority to seize.
2. Law enforcement official must be in a place he/she has a right to
be in.
3. Discovery of the evidence must be inadvertent.
4. It must be immediately apparent that what the official has
discovered is evidence.
209
Abraham Miclat, Jr. Vs. People Of The Philippines

G.R. No. 176077
Facts:
That on November 8, 2002, in Caloocan City, Metro Manila and
within the jurisdiction of the court, Abraham Miclat, Jr. y Cerbo,
without authority of law, did then and there willfully and feloniously
have in his possession, custody and control Methamphetamine
Hydrochloride (Shabu) weighing .24 gram, knowing the same to be a
dangerous drug under the provisions of Section II of RA No. 9165.
Upon arrangement, petitioner, with the assistance of counsel
pleaded not guilty to the crime charged. Consequently, trial on the
merits ensued.
On July 28, 2004, the RTC after finding that the resolution has
established all the elements of the offense charged, rendered a
decision convicting petitioner.
Aggrieved, petitioner sought recourse before the Court of
Appeals. On October 13, 2006, the CA rendered a decision affirming
in toto the decision of the RTC. The CA ratiocinated that contrary to
the contention of the petitioner, the evidence presented by the
prosecution were all admissible against him. It was established that
he was informed of his constitutional rights at the time of his arrest.
Hence, the CA opined that the prosecution has proven beyond
210
reasonable doubt all of the elements necessary for the conviction of

the petitioner for the offense of illegal possession of dangerous drugs.
Issue:
Whether or not peeping through a curtain-covered window is
within the meaning of plain view doctrine for a warrantless seizure
to be lawful?
Ruling:
YES. The seizure made by PO3 Antonio of the four (4) plastic
sachets from the petitioner was not only incidental to a lawful arrest,
but it also falls, within the purview of the plain view doctrine.
Objects falling in plain view of an officer who has a right to be in
a position to have that view are subject to seizure even without a
search warrant and may be introduced in evidence. The plain view
doctrine applies when the following requisites concur: a) the law
enforcement officer in search of the evidence has a prior justification
for an intrusion or is in a position from which he can view a particular
area; b) the discovery of evidence in plain view is inadvertent; c) it is
immediately apparent to the officer that the item he observes may be
evidence of a crime, contraband or otherwise subject to seizure.
An object is in plain view if the object itself is plainly exposed to
sight. Since petitioners arrest is among the exceptions to the rule
requiring a warrant before effecting an arrest and the evidence seized
from the petitioner was the result of a warrantless search incidental to
a lawful arrest, which incidentally was in plain view of the arresting
211
officer, the results of the ensuing search and seizure were admissible
in evidence to prove petitioners guilt of the offense charged.
SINGLE LARCENY DOCTRINE
Single larceny doctrine is a principle of criminal law that taking

of different items of property belonging to either the same or different
owners at the same time and place constitutes one act of larceny if
the theft is part of one larcenous plan.
For example in State v. Klasner, 19 N.M. 474, 478, 145 P. 679,
680 (1914) it was held that taking nineteen cattle on same day from
one area but belonging to different individuals constituted one larceny
as a matter of law; State v. Allen, 59 N.M. 139, 140-41, 280 P.2d 298,
299 (1955). Subsequently the doctrine was applied to embezzlement,
another form of larceny. The intent of the thief determines the number
of occurrences.
Single larceny doctrine is also known as single-criminal-intent
doctrine or single-impulse plan.
Santiago vs. Garchitorena

G.R. No. 109266, December 2, 1993
Facts:
212
On May 1, 1991, petitioner was charged in Criminal Case No.

16698 of the Sandiganbayan with violation of Section 3(e) of R.A. No.
3019, as amended, otherwise known as the Anti-Graft and Corrupt
Practices Act, allegedly committed by her favoring "unqualified" aliens
with the benefits of the Alien Legalization Program.
On May 24, 1991, petitioner filed a petition for certiorari and
prohibition, with the Supreme Court, to enjoin the Sandiganbayan
from proceeding with Criminal Case No. 16698 on the ground that
said case was intended solely to harass her as she was then a
presidential candidate. She alleged that this was in violation of
Section 10, Article IX-C of the Constitution which provides that
"(b)ona fide candidates for any public office shall be free from any
form of harassment and discrimination." The petition was dismissed
on January 13, 1992.
On October 16, 1992, petitioner filed a motion for inhibition of
Presiding Justice Garchitorena, which motion was set for hearing on
November 13, 1992 at 8:00 A.M.
On October 27, 1992, the Sandiganbayan (First Division), of
which Presiding Justice Garchitorena is a member, set the criminal
case for arraignment on November 13, 1992 at 8:00 A.M.
On November 6, 1992, petitioner moved to defer the
arraignment on the grounds that there was a pending motion for
inhibition, and that petitioner intended to file a motion for a bill of
particulars.
213
On November 9, 1992, the Sandiganbayan (First Division)

denied the motion to defer the arraignment.
On November 10, 1992, petitioner filed a motion for a bill of
particulars. The motion stated that while the information alleged that
petitioner had approved the application or legalization of "aliens" and
gave them indirect benefits and advantages it lacked a list of the
favored aliens. According to petitioner, unless she was furnished with
the names and identities of the aliens, she could not properly plead
and prepare for trial.
On November 12, 1992 and upon motion of petitioner in G.R.
No. 107598, the Supreme Court directed the Sandiganbayan to reset
the arraignment to a later date and to dispose of the two incidents
pending before it.
At the hearing on November 13, 1992 on the motion for a bill of
particulars, the prosecution stated categorically that they would file
only one amended information against petitioner.
However, on December 8, 1992, the prosecution filed a motion
to admit the 32 Amended Informations.
On March 3, 1993, Presiding Justice Garchitorena issued the
questioned Resolution dated March 11, 1993, denying the motion for
his disqualification.
On March 14, 1993, the Sandiganbayan promulgated a
resolution, admitting the 32 Amended Informations and ordering
214
petitioner to post the corresponding bail bonds within ten days from
notice. Petitioner's arraignment on the 32 Amended Informations was
set for April 12, 1993 at 8:00 A.M.
Issue:
Whether or not filing by the prosecutor of the 32 Amended
Information against the petitioner is in order?
Ruling:
NO, because technically, there was only one crime that was
committed in petitioners case and there should only be one
information to be filed against her.
For delitocontinuado to exist there should be a plurality of acts
performed during a period of time; unity of penal provision violated;
and unity of criminal intent or purpose, which means that two or more
violations of the same penal provisions are united in one and same
instant or resolution leading to the perpetration of the same criminal
purpose or aim.
The so-called "single larceny" doctrine, that is, the taking of
several things, whether belonging to the same or different owners, at
the same time and place constitutes but one larceny. Many courts
have abandoned the "separate larceny doctrine," under which there is
a distinct larceny as to the property of each victim. Also abandoned
215
was the doctrine that the government has the discretion to prosecute
the accused or one offense or for as many distinct offenses as there
are victims.
DOCTRINE OF STRAINED RELATIONS

Doctrine of strained relations. Labor. [The rule] that where
reinstatement is not feasible, expedient or practical, as where
reinstatement would only exacerbate the tension and strained
relations bet. the parties, or where the relationship bet. the employer
and employee has been unduly strained by reason of their
irreconcilable differences, particularly where the illegally dismissed
employee held a managerial or key position in the company, it would
be more prudent to order payment of separation pay instead of
reinstatement. [Quijano v. Mercury Drug Corp., GR 126561. July 8,
1998].
Leopard Security And Investigation Agency Vs.
Quitoy, Sabang And Morales
216
G.R. No. 186344, February 20, 2013

Facts:
Respondents Tomas Quitoy, Raul Sabang and Diego Morales
were hired as security guards by petitioner Leopard Security and
Investigation Agency (LSIA) which maintained its office at BCC
House, 537 Shaw Boulevard, Mandaluyong City. All being residents
of Cebu City, respondents were assigned by LSIA to the different
branches of its only client in said locality, Union Bank of the
Philippines.
On 1 April 2005, it appears that Union Bank served a notice to
LSIA, terminating the parties security service contract effective at the
end of business hours of 30 April 2005.
Thru its representative, Rogelio Morales, LSIA informed
respondents on 29 April 2005 of the termination of its contract with
Union Bank which had decided to change its security provider. Upon
Morales instruction, respondents went to the Union Bank Cebu
Business Park Branch on 30 April 2005, for the turnover of their
service firearms to ArnelCortes, Union Banks Chief Security Officer.
On 3 May 2005, respondents and Ondong filed a complaint for illegal
dismissal, unpaid 13th month pay and service incentive leave pay
(SILP), moral and exemplary damages as well as attorneys fees
against LSIA, its President, Jose Poe III, Union Bank, its Regional
Service and Operations Officer, Catherine Cheung, Herbert Hojas,
217
Protectors Services, Inc. (PSI) and Capt. Gerardo Jaro. With the
complaint already filed before the Regional Arbitration Branch No. VII
of the National Labor Relations Commission (NLRC) in Cebu City,it
appears that LSIA sent on 10 May 2005 a notice requiring
respondents to report for work to its Mandaluyong City office. As
respondents failed to do so, LSIA alleged that it issued show cause
letters on June 21, 2005, requiring the former to explain why they
should not be administratively sanctioned for their unexplained
absences.
On 6 April 2006, Labor Arbiter Violeta Ortiz-Bantug rendered a
Decision, finding LSIA liable for the illegal dismissal of respondents.
Faulting LSIA for informing respondents of the termination of their
services only on 30 April 2005 despite Union Banks 1 April 2005
advice of the termination of its security service contract, the Labor
Arbiter ruled that the 10 May 2005 report to work order did not show a
sincere intention on the part of LSIA to provide respondents with
other assignments. Aside from respondents claims for backwages,
LSIA was ordered by the Labor Arbiter to pay the formers claim for
separation pay on the ground that reinstatement was no longer
feasible under the circumstances. Although absolved from liability for
the foregoing awards upon the finding that LSIA was an independent
contractor, Union Bank was, however, held jointly and severally liable
with said security agency for the payment of respondents claims for
proportionate 13th month pay and SILP for the three years
immediately preceding the institution of the case.
218
The foregoing decision was modified in the 20 March 2007

Decision rendered by the Fourth Division of the NLRC in NLRC Case
No. V-000570-2006. Applying the principle that security agencies like
LSIA are allowed to put security guards on temporary off-detail or
floating status for a period not exceeding six months, the NLRC
discounted the factual and legal bases for the illegal dismissal
determined by the Labor Arbiter as well as the backwages awarded in
favor of respondents. Finding that the filing of the complaint on 3 May
2005 was premature, the NLRC took note of the fact that respondents
did not even protest against the report to work order issued by LSIA.
Even then, the NLRC upheld the Labor Arbiters award of separation
pay on the theory that reinstatement was no longer viable. The
awards of proportionate 13th month pay and SILP for which Union
Bank and LSIA were held solidarily liable were likewise sustained for
failure of the latter to discharge the burden of proving payment of said
labor standard benefits.
LSIA filed a motion for reconsideration of the foregoing
decision15 which was, however, denied for lack of merit.
Dissatisfied, LSIA filed the Rule 65 Petition for Certiorari
docketed before the CA as CA-G.R. SP No. 03097. Calling attention
to the impropriety of the award of separation pay absent a finding of
illegal dismissal, LSIA also faulted the NLRC for ignoring the
evidence it submitted alongside its motion for reconsideration to
prove the payment of respondents SILP for the years 2003, 2004 and
2005.
219
On 26 September 2008, the then Twentieth Division of the CA

rendered the herein assailed decision, affirming the NLRCs 23 July
2007 Decision and denying LSIAs petition for lack of merit.
Issue:
Whether or not an award of separation pay is proper despite
lack of showing of illegal dismissal?
Ruling:
NO. Respondents reinstatement without backwages is instead,
in order.
Under Article 279 of the Labor Code, an illegally dismissed
employee is entitled to the twin reliefs of full backwages and
reinstatement without loss of seniority rights.Aside from the instances
provided under Articles 283and 284of the Labor Code, separation pay
is, however, granted when reinstatement is no longer feasible
because of strained relations between the employer and the
employee.In cases of illegal dismissal, the accepted doctrine is that
separation pay is available in lieu of reinstatement when the latter
recourse is no longer practical or in the best interest of the parties.
220
GLOBE DOCTRINE
Globe doctrine deals with the determination of whether a
certain group or category of employees constitutes an appropriate
bargaining unit. The doctrine states that in determining whether a
group or category of employees constitute an appropriate bargaining
unit, the desire of the employees is taken into consideration.
Philips Industrial Development, Inc. Vs.

221
Nlrc And Philips Employees Organization

G.R. No. 88957, June 25, 1992
Facts:
PIDI is a domestic corporation engaged in the manufacturing
and marketing of electronic products Since 1971, it had a total of six
(6) collective bargaining agreements (CBAs) with private respondent
Philips Employees Organization-FFW (PEO-FFW), a registered labor
union and the certified bargaining agent of all the rank and file
employees of PIDI.
In the first CBA (1971-1974), the supervisors referred to in R.A.
No. 875, confidential employees, security guards, temporary
employees and sales representatives were excluded from the
bargaining unit. In the second to the fifth CBAs (1975-1977; 19781980; 1981-1983; and 1984-1986), the sales force, confidential
employees and heads of small units, together with the managerial
employees, temporary employees and security personnel, were
specifically excluded from the bargaining unit.
In the sixth CBA covering the years 1987 to 1989, it was agreed
upon, among others, that the subject of inclusion or exclusion of
service engineers, sales personnel and confidential employees in the
coverage of the bargaining unit would be submitted for arbitration.
Pursuant thereto, on June 1987, PEO-FFW filed a petition
before the Bureau of Labor Relations (BLR) praying for an order
222
"directing the parties to select a voluntary arbitrator in accordance

with its rules and regulations."
As the parties failed to agree on a voluntary arbitrator, the BLR
endorsed the petition to the Executive Labor Arbiter of the National
Capital Region for compulsory arbitration pursuant to Article 228 of
the Labor Code.
On March 17, 1988, Labor Arbiter rendered a decision ordering
respondent to conduct a referendum to determine the will of the
service engineers, sales representatives as to their exclusion in the
bargaining unit.
PEO-FFW appealed from the decision to the NLRC.On 16
January 1989, the NLRC rendered the questioneddecision, declaring
respondent company's Service Engineers, Sales Force, division
secretaries, all Staff of General Management, Personnel and
Industrial Relations Department, Secretaries of Audit, EDP and
Financial Systems are included within the rank and file bargaining
unit.
PIDI filed a motion for reconsideration but denied by the NLRC
in its Resolution on March 16, 1989.
Issue:
223
Whether or not NLRC committed grave abuse of discretion

amounting to lack or excess of jurisdiction in not applying the time
honored globe doctrine?
Ruling:
NO, because the Globe Doctrine finds no application in this
case.
Globe doctrine deals with the determination of whether a
certain group or category of employees constitutes an appropriate
bargaining unit by considering the desire of the employees.
This doctrine applies only in instances of evenly balanced
claims by competitive groups for the right to be established as a
bargaining unit, which do not obtain in this case, because the only
issue is the inclusion or exclusion of service engineers and sales
representatives.
DOCTINE OF EXECUTIVE PRIVILEGE

224
[The doctrine stating that a] x x x President and those who

assist him must be free 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. These are the
considerations justifying a presumptive privilege for Presidential
communications. The privilege is fundamental to the operation of
government and inextricably rooted in the separation of powers under
the Constitution x x x [Almonte v. Vasquez, 314 Phil. 150 (1995)].
Romulo L. Neri vs. Senate Accountabilty Of Public Officers And
Investigations, Senate Committee On Trade And Commerce, And
Senate Committee On National Defense And Security
G.R. No. 180643, March 25, 2008
Facts:
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. The
project should be financed by the Peoples Republic of China.
In connection with this NBN Project, various resolutions were
introduced in the senate.
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
225
to appear and testify on September 18, 20 and 26 and October 25,

2007. However, he attended only September 26 hearing, claiming he
was out of town during the 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 Project but, on March 22, 2007
the NEDA acquiesced to convert it into as 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 Chairman, Benjamin Abalos offered him P200M in
exchange for his approval of the NBN project. He further narrated
President Arroyo about the bribery attempt and 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; b) whether or not she directed him to prioritize it;
whether or not she directed him to approve.
Unrelenting, respondent committees issued a subpoena ad
testificandumto 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
226
dispense with petitioners testimony on the ground of executive

privilege.
On November 20, 2007, petitioner did not appear before
respondent committees. Thus, on November 22, 2007, the latter
showed the show cause letter requiring him to explain why he should
not be cited in contempt.
On November 29, 2009, 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.
In addition, petitioner submitted a letter prepared by his
counsel, Atty. Antonio R. Bautista, stating among others that: 1) his
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
bribery scandal involving high government officials and the possible
loss of confidence of foreign investors and leaders in the Philippines.
The letter ended with a reiteration of petitioners 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 the
Supreme Court a petition for certiorari assailing the show cause letter
dated November 22, 2007.
Respondent
committees
found
petitioners
explanations
unsatisfactory. Without responding to his request for advance notice

of the matters that he should still clarify, they issued the order dated
227
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.
On the same date, petitioner moved for the reconsideration of
the order. He insisted that he has not shown any contemptible
conduct worthy or contempt and arrest.
In view of respondent committees issuance of contempt order,
petitioner filed on February 1, 2008, a Supplemental Petition for
Certiorari, 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
causeLetter 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
228
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. Ermitaand United States v. Reynolds.Lastly, he
argues that he is precluded from disclosing communications made to
him in official confidence under Section 7of Republic Act No. 6713,
otherwise known as Code of Conduct and Ethical Standards for
Public Officials and Employees, and Section 24(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.
An oral argument was held last March 4, 2008. Afterwhich, the
parties were directed to manifest to the Court within twenty four hours
if they are amenable to the Courts proposal of allowing petitioner to
immediately resume his testimony before the Senate committees to
answer the questions of the Senators without prejudice to the
decision on the merits of the pending petition.
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"
229
and the "Minute Book" because it has never been the "historical and
traditional legislative practice to keep them."They instead submitted
the Transcript of Stenographic Notes of respondent Committees' joint
public hearings.
On March 17, 2008, the Office of the Solicitor General filed a
Motion for Leave to Intervene and to admit Attached Memorandum.
The Court granted the OSGs Motion on March 18, 2008.
As the foregoing facts unfold, related events transpired such that 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. Ermitawhen they are invited to
legislative inquiries in aid of legislation.
Issue:
Whether or not the communications elicited by subject three (3)
questions of the respondent committees covered by executive
privilege?
Ruling:
230
YES. 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 other country.
The Congress must not require the executive to state the
reasons for the claim with such particularly 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.
The doctrine of executive privilege states that a President and
those who assist him must be free to explore alternatives in the
process of shaping policies and making decisions and to do so in a
way many would be unwilling to except privately. This privilege is
fundamental to the operation of government and inextricably rooted in
the separation of powers under the constitution.
231
DOCTRINE OF PRIVILEGED COMMUNICATION

1. [The doctrine] that utterances made in the course of judicial
proceedings, incl. all kinds of pleadings, petitions and motions,
belong to the class of communications that are absolutely privileged.
[US v. Salera, 32 Phil. 365].
2. [The doctrine that] statements made in the course of judicial
proceedings are absolutely privileged that is, privileged regardless
of defamatory tenor and of the presence of malice if the same are
232
relevant, pertinent, or material to the cause in hand or subject of

inquiry. [Tolentino v. Baylosis, 1 SCRA 396].
People Of The Philippines Vs. Atty. Raul H. Sesbreno
G.R. No. L-622449, July 16, 1984
Facts:
In an information filed on March 4, 1981, the City Fiscals Office
of Cebu City accused Atty. Raul Sesbreno of the crime of libel based
on the alleged defamatory statements found in a pleading entitled
PLAINTIFFS REPLY TO DEFENDANTS OPPOSITION DATED
MARCH 9TH dated March 11, 1980 filed in Civil Case entitled
HEIRS OF ROBERTO CENIZA, ET. AL. C. DANIELA CENIZA
UROT pending litigation before Branch IV of the Court of First
Instance of Cebu, 14th Judicial District.
On March 5, 1981, the accused filed a MOTION TO QUASH
INFORMATION. The main thrust of the motion is that on the face
itself of the information, it is obvious that the allegedly libelous
statements inputting Atty. Ramon B. Ceniza is an irresponsible
person, cannot be trusted, like Judas, a liar and irresponsible childish
prankster are contained in a pleading filed in a court and, therefore,
covered by the DOCTRINE OF ABSOLUTELY PRIVILEGED
COMMUNICATIONS; hence, no civil or criminal liability can arise
therefrom.
A decision was rendered by the court quashing the information
and dismissing the case for lack of cause of action.
233
Issue:
Whether or not Atty. Raul Sebrenos statements in his pleading
are covered by the doctrine of privilege communication?
Ruling:
YES, but he was reprimanded and admonished to refrain from
employing language unbecoming of a member of the Bar and to
extend courtesy and respect to his brothers in the profession.
The doctrine of privileged communication that utterances made
in the course of judicial proceedings, including all kinds of pleadings,
petitions and motions, belong to the class of communications that are
absolutely privileged.
The doctrine of privileged communication rests upon public
policy, which looks to the free and unfettered administration of justice,
though, as an incidental result it may in some instances afford an
immunity to the evil disposed and malignant slanderer.
While the doctrine is liable to be abuse and its abuse may lead
to grate hardships, yet to give legal action to such libel suits would
give rise to greater hardships. The privilege is not intended so much
for protection of those engaged in the public service and in the
enactment and administration of law, as for the promotion of the
public welfare, the purpose being that members of the legislature,
judges of courts, juror, lawyers, and witnesses may speak their minds
freely and exercise their respective functions without incurring the risk
of a criminal prosecution or an action for the recovery of damages.
234
Lawyers, most especially, should be allowed a great latitude of

pertinent comment in the furtherance of the causes they uphold, and
for the felicity of their clients, they may be pardoned some infelicities
of language.
The doctrine of privileged communication, moreover is explicitly
provided for in the Revised Penal Code, as an exemption to the
general principle that every defamatory imputation is presumed to be
malicious, even if it is true, in the absence of good intention and
justifiable motive.
However, this doctrine is not without qualification. Statements
made in the course of judicial proceedings are absolutely privileged,
that is privileged regardless of defamatory tenor and of the presence
of malice, if the same are relevant, pertinent, or material to the cause
in hand or subject of inquiry. A pleading must meet the test of
relevancy does not extend must be so palpably wanting in relation to
the subject matter of the controversy that no reasonable man can
doubt its irrelevance and impropriety. In order that a matter alleged in
a pleading may be privileged, it need not be in every case material to
the issues presented by the pleadings. It must, however, be
legitimately related thereto, or so pertinent to the subject of the
controversy that it may become the subject of the inquiry in the
course of the trial.
235
236
DOCTRINE ON IMPUTED NEGLIGENCE

The Doctrine of Imputed Negligence is the device whereby the
plaintiff is denied recovery against the defendant when the
negligence of another is imputed to the plaintiff because of the
existence of some relationship with the latter usually agency or joint
enterprise. As the doctrine assumes the plaintiff innocence of actual
negligence, imputed negligence is best understood as transferred
negligence.
Macario Tamargo vs. Ca And Sps Bundoc
G.R. No. 85044, June 3, 1992
Facts:
On 20 October 1982, AdelbertoBundoc, then a minor of 10
years of age, shot Jennifer Tamargo with an air rifle causing injuries
which resulted in her death. Accordingly, a civil complaint for
damages was filed with the Regional Trial Court, Branch 20, Vigan,
Ilocos Sur, docketed as Civil Case No. 3457-V, by petitioner
MacarioTamargo, Jennifer's adopting parent, and petitioner spouses
Celso and Aurelia Tamargo, Jennifer's natural parents against
respondent spouses Victor and Clara Bundoc, Adelberto's natural
237
parents with whom he was living at the time of the tragic incident. In
addition to this case for damages, a criminal information or Homicide
through Reckless Imprudence was filed [Criminal Case No. 1722-V]
against Adelberto Bundoc. Adelberto, however, was acquitted and
exempted from criminal liability on the ground that he bad acted
without discernment.
Prior to the incident, or on 10 December 1981, the spouses
Sabas and FelisaRapisura had filed a petition to adopt the minor
AdelbertoBundoc in Special Proceedings No. 0373-T before the then
Court of First Instance of Ilocos Sur. This petition for adoption was
grunted on, 18 November 1982, that is, afterAdelberto had shot and
killed Jennifer.
In their Answer, respondent spouses Bundoc, Adelberto's
natural parents, reciting the result of the foregoing petition for
adoption, claimed that not they, but rather the adopting parents,
namely the spouses Sabas and FelisaRapisura, were indispensable
parties to the action since parental authority had shifted to the
adopting parents from the moment the successful petition for
adoption was filed.
Petitioners in their Reply contended that since AdelbertoBundoc
was then actually living with his natural parents, parental authority
had not ceased nor been relinquished by the mere filing and granting
of a petition for adoption.
238
The trial court on 3 December 1987 dismissed petitioners'

complaint, ruling that respondent natural parents of Adelberto indeed
were not indispensable parties to the action.
Petitioners filed a motion for reconsideration followed by a
supplemental motion for reconsideration but both were denied by the
trial court in an Order dated April 18, 1988. On April 28, 1988,
petitioners filed a notice of appeal but the trial court dismissed the
notice at appeal, in its Order dated June 6, 1988.
Petitioners went to the Court of Appeals on a petition for
mandamus and certiorari questioning the trial court's Decision dated
3 December 1987 and the Orders dated 18 April 1988 and 6 June
1988, The Court of Appeals dismissed the petition, ruling that
petitioners had lost their right to appeal.
Issue:
Whether or not the effects of adoption, in so far as parental
authority is concerned may be given retroactive effect so as to make
the adopting parents the indispensable parties in a damage case filed
against their adopted child, for acts committed by the latter, when
actual custody was yet lodged with biological parents?
Ruling:
239
NO. Article 2176 of the Civil Code provides that whoever by act
or omission causes damage to another, there being fault or
negligence, is obliged to pay for the damage done.
On the other hand, the law imposes civil liability upon the father
and, in case of his death or incapacity, the mother for any damages
that may be caused by a minor child who lives with them.
Article 2180 of the Civil Code states that the obligation imposed
by Article 2176 is demandable not only for ones own acts or
omissions, but also for those of persons for whom one is responsible.
This principle of parental liability is called doctrine of imputed
negligence, where a person is not only liable for torts committed by
himself, but also for the torts committed by others with whom he has
a certain relationship and for whom he is responsible, their parental
authority, which includes instructing, controlling and disciplining of the
child.
240
TRUST FUND DOCTRINE

Generic term used in many context to describe the imposition of
fiduciary obligations on persons who control money or property of
another under certain circumstances. A creature of equity which
operates of or to treat officers, directors, or majority shareholders of a
corporation as holding in trust for the benefit of creditors such
corporate assets have been improperly appropriated.
Donnina C. Halley vs. Printwell, Inc.
G.R.No. 157549
Facts:
The petitioner was an incorporator
and original director of
Business Media Philippines, Inc., which, at its incorporation on

241
November 12, 1987, had an authorized capital stock of P3M divided

into 300,000 shares each with a par value of P10.00 of which 75,000
were initially subscribed.
Printwell engaged in commercial and industrial printing BMPI
commissioned Printwell for the printing of the Magazine Philippines,
Inc. that BMPI published and sold.
For that purpose, printwell
extended 30-day credit accommodations to BMPI.

In the period from October 11, 1988 until July 12, 1989, BMPI
placed with Printwell several orders on credit, evidenced by invoices
and delivery receipts totaling P316,342.76. Considering that BMPI
paid on P25,000, Printwell sued BMPI on January 26, 1990 for the
collection of the unpaid balance of P291,342.76 in the RTC.
On February 8, 1990, Printwell amended the complaint in order
to implead as defendants all the original stockholders and
incorporators to recover their unpaid subscriptions.
The defendants files a consolidated answer, averring that they
all had paid their subscriptions in full; that BMPI had a separate
personality from those of its stockholders.
On November 3, 1993, the RTC rendered a decision in favor of
the Printwell, rejecting the allegation of payment in full of the
subscriptions in view of an irregularity in the issuance of the ORs and
observing that the defendants had used BMPIs corporate personality
to evade payment and create injustice.
Applying the Trust Fund Doctrine, the RTC declared
stockholders liable to Printwell pro rata. Subscription to the capital
stock of a corporation constitute a fund to which creditors have a right
242
to look for satisfaction of their claims, and, in fact, a corporation has

no legal capacity to release a subscriber to its capital stock from the
obligation to pay for his shares, and any agreement to this effect is
invalid.
All the defendants, except BMPI, appealed to the Court of
Appeals.
On August 14, 2002, the CA affirmed the RTC, holding that the
defendants resort to the corporate personality would create an
injustice because Printwell would thereby be at a loss against whom it
would assert the right to collect.
Issue:
Whether or not the Court of Appeals erred in Applying the Trust
Fund Doctrine when the grounds therefor have not been satisfied?
Ruling:
NO. Both RTC and CA applied the trust fund doctrine against
the defendant stockholders, including the petitioner.
The trust fund doctrine enunciates a rule that the property of a
corporation is a trust fund for the payment of creditors, but such
property can be called a trust fund only by way of analogy or
metaphor. As between the corporation itself and its creditors it is a
simple debtor, and as between its creditors and stockholders its
assets are in equity a fund for the payment of its debts.
It is established doctrine that subscriptions to the capital of a
corporation constitute a fund to which creditors have a right to look for
satisfaction of their claims and that the assignee insolvency can
243
maintain an action upon any unpaid stock subscription in order to

realize assets for the payments of its debts.
The trust fund doctrine is not limited to reaching the
stockholders unpaid subscriptions. The scope of the doctrine when
the corporation is insolvent encompasses not only the capital stock,
but also other property and assets generally regarded in equity as a
trust fund for the payment of the corporate debts. All assets and
property belonging to the corporation held in trust for the benefit of
the creditors that were distributed or in the possession of the
stockholders, regardless of full payment of their subscriptions, may
be reached by the creditor in satisfaction of its claim.
Also, under the trust fund doctrine, a corporation has no legal
capacity to release an originals subscriber to its capitals tock from the
obligation paying for his shares, in whole or in part, without a valuable
consideration, or fraudulently, to the prejudice of creditors. The
creditor is allowed to maintain an action upon any unpaid
subscriptions and thereby steps into the shoes of the corporation for
the satisfaction of its debt. To make out a prima facie case in a suit
against stockholders of an insolvent corporation to compel to
contribute to the payment of its debt by making good unpaid balances
upon their subscriptions, it is only necessary to establish that the
stockholders have not in good faith paid the par value of the stocks of
the cooperation.
244
DOCTRINE OF RES JUDICATA

The doctrine [that] has 2 aspects. The first is the effect of a
judgment as a bar to the prosecution of a second action upon the
same claim, demand or cause of action. The second aspect is that it
precludes the relitigation of a particular fact or issues in another
action between the same parties on a different claim or cause of
action. [Lopez v. Reyes, GR L-29498, Mar. 31, 1977, 76 SCRA 179].
Sps Rodolfo A. Noceda And Erna T. Noceda
Vs. Aurora Arbizo-Directo
G.R. No. 178495
Facts:
On September 16, 1896, respondent Aurora Arbizo-Directo filed
a complaint against her nephew, herein petitioner Rodolfo Noceda,
for Recovery of Possession and Ownership and Rescission
245
Annulment of Donation with the Regional Trial Court of Iba,

Zambales, Branch 71. The respondent alleged that he and her coheirs have extra-judicially settled the property they inherited from their
late father on August 19, 1981, consisting of a parcel of land. She
donated a portion of her hereditary share to her nephew, but the latter
occupied a bigger area, claiming ownership thereof since September
1985.
On November 6, 1991, judgment was rendered in favor of
respondent, where the RTC declared the Deed of Donation revoked;
ordered defendant to vacate and reconvey that donated portion of lot
subject of the Deed of Donation of the plaintiff or her heirs or assigns;
ordered the defendant to remove the house built inside the donated
portion at the defendants expense or pay a monthly rental of P300.00
and ordered the defendant to pay attorneys fees in the amount of
P5,000.00.
The decision was appealed to the Court of Appeals.
On January 5, 1995 spouses Rodolfo Dahipon and Cecila
Obispo-Dahipon filed a complaint for recovery ownership and
possession and annulment of sale and damages against spouses
Antonio and DomingaArbizo, spouses Rodolfo and Erna Noceda and
Aurora Arbizo-Directo with the RTC, Iba, Zambales.
In the complaint, spouses Dahipon alleged that they were
registered owners of a parcel of land, situated in Brgy. San Isidro,
Cabangan, Zambales. The Original Certificate of Title over the land
was issued in the name of Cecili Obispo-Dahipon, pursuant to a Free
Patent. Spouses Dahipon claimed that the defendants therein
246
purchased portions of the land from them without paying the whole
amount. Except for Aurora, a compromise agreement was entered
into by the parties, as a result of which, a deed of absolute sale was
executed and a title was issued in the name of spouses Noceda for
their portion of the land. For her part, Aurora questioned Dahipons
alleged ownership over the same parcel of land filing and adverse
claim.
A decision was rendered in the Court of Appeals ordering
defendant Rodolfo Noceda to vacate the portion known as Lot C of
Lot 1121, which was allotted to Aurora Arbizo-Directo.
Petitioners filed a petition for review with the Supreme Court but
the court found no reversible error, much less grave abuse of
discretion, with the factual findings of the RTC and the CA; hence
denied the petition on September 2, 1999.
On December 14, 2003, petitioners instituted an action for
quieting of title against respondent. In the complaint, petitioner
admitted that Civil Case No. RTC-3541 was decided in favor of
respondent and writ of execution had been issued, ordering them to
vacate the property. However, petitioners claimed that the land, which
was the subject matter of the Civil Case No. RTC 3541, was the
same parcel of land owned by spouses Dahipon from whom they
purchased a portion; and that the title was, in fact, issued in their
name.
Petitioners prayed for the issuance of a writ of preliminary
injunction to enjoin the implementation of the Writ of Execution dated
March 6, 2001 in Civil Case No. RTC 3541 and that a declaration be
247
made that the property bought, occupied and now titled in the name
of petitioners was formerly part and subdivision of Lot No. 1121
covered by OCT No. P-9036 in the name of Cecilia Obispo Dahipon.
The respondent filed a Motion to Dismiss on the ground of Res
Judicata. Respondent averred that petitioners, aware of their defeat
in Civil Case No. RTC 3541, surreptitiously negotiated with Cecilia
Obispo-Dahipon for the sale of the land and filed the present suit in
order to subvert the execution thereof.
The Trial Court denied the motion, holding that there was no
identity of causes of action.
On January 25, 2006, after petitioners presented their
evidence, respondent filed a Demurrer to Evidence, stating that the
claim of ownership and possession of petitioners on the basis of the
title emanating from that of Cecilia
Obispo-Dahipon was already
raised in previous case.

On February 22, 2006, the Trial Court issued a resolution
granting the Demurrer to Evidence.
The CA affirmed.
Issue:
Whether or not the principle of Res Judicata or doctrine of
conclusiveness of judgment is applicable under the facts obtaining in
the present case?
Ruling:
It does not apply.
248
The doctrine of Res Judicata is set forth in Section 47 of Rule

39 of the Rules of Court, as follows:
Section 47. Effect of judgments or final orders.
The effect of a judgment or final order rendered by a court of
the Philippines, having jurisdiction to pronounce the judgment or final
order, may be as follows:
b) in other cases, the judgment or final order is, with respect to
the matter directly adjudged or as to any other matter that could have
been raised in relation thereto, conclusive between parties and their
successors in interest by title subsequent to the commencement of
the action or special proceeding, litigating for the same thing and
under the same title and in the same capacity; and
c) in any other litigation between the same parties or their
successors in interest, that only is deemed to have been adjudged in
a former judgment or final order which appears upon its face to have
been so adjudged, or which actually and necessarily included there in
or necessary thereto.
The principle of res judicata lays down two main rules, namely:
1). The judgment or decree of a court of competent jurisdiction on the
merits concludes the litigation between the parties and their privies
and constitutes a bar to a new action or suit involving the same case
of action either before the same or any other tribunal.; and 2) any
right fact or matter in issue directly adjudicated or necessarily
involved in the determination of an action before a competent court in
which a judgment or decree is rendered on the merits is conclusively
settled by the judgment therein and cannot again be litigated between
249
the parties and their privies whether or not the claims or demands.,
purposes or subject matters of the two suits are the same. These two
main rules mark the distinction between the principles governing the
two typical cases in which a judgment may operate as an evidence.
The first general rule above stated, and which corresponds to the
afore-quoted paragraph of Section 47, Rule 39 of the Rules of Court,
is referred to as bar by former judgment while the second general
rule, which is embodied in the paragraph (c) of the same section and
rule, is known as conclusiveness and judgment.
The second concept-conclusiveness of judgment states that a
fact or question which was in issue in a former suit and was there
judicially passed upon and determined by a court of competent
jurisdiction, is conclusively settled by the judgment therein as far as
the parties to that action and persons in the privity with them are
concerned and cannot be again litigated in any future action between
such parties or their privies, in the same court or any of concurrent
jurisdiction on either the same or different cause of action while the
judgment remains un-reversed by proper authority.
In order that a judgment in one action can be conclusive as to a
particular matter in another action between the same parties of their
privies, it is essential that the issue be identical. If a particular point or
question is in issue in the second action, and the judgment will
depend in the determination of that particular point or question, a
former judgment between the same parties or their privies will be final
and conclusive in the second if that same point or question was in
250
issue and adjudicated in the first suit. Identity of cause of action is not
required but merely identity of issue.
DOCTRINE OF RES IPSA LOQUITOR

Lat. The thing itself speaks. A doctrine of law that one is
presumed to be negligent if he had exclusive control of whatever
caused the injury even though there is no specific evidence of an act
of negligence, and without negligence the accident would not have
happened.
Dr. Emmanuel Jarcia, Jr. And Dr. Marilou Bastan vs.
People Of The Philippines
Facts:
Belinda Santiago lodged a complaint with the National Bureau
of Investigation against the petitioners, Dr. Emmanuel Jarcia, Jr. and
Dr. MarilouBastan, for their alleged neglect of professional duty which
caused her son, Roy Alfonso Santiago, to suffer serious physical
injuries. Upon investigation, the NBI found that Roy Jr. was hit by a
taxi cab; that he was rushed to the Manila Doctors Hospital for an
emergency medical treatment; that an x-ray of the victims ankle was
251
order; that the x-ray result showed no fracture as read by Dr. Jarcia;
that Dr. Bastan entered the emergency room and, after conducting
her own examination of the victim, informed Mrs. Santiago that since
it was only the ankle that was hit, there was no need to examine the
upper leg; that eleven days later, Roy Jr. developed fever, swelling of
the right leg and misalignment of the right foot; that Mrs. Santiago
brought him back to the hospital; and that the x-ray revealed a right
mid-tibial fracture and a linear hairline fracture in the shaft of the
bone.
The NBI endorsed the matter to the office of the City Prosecutor
of Manila for preliminary investigation. Probable cause was found and
a criminal case was for reckless imprudence resulting to serious
physical injuries, was filed against Dr. Jarcia, Dr. Bastanand Dr.
Pamittan, before the Regional Trial Court.
On June 14, 2005, the RTC found the petitioners guilty beyond
reasonable doubt of the crime of simple Imprudence Resulting to
Serious Physical Injuries.
Dissatisfied, the petitioners appealed to the CA. The CA
affirmed the RTC decision.
The petitioners filed a motion for reconsideration, but it was
denied by the CA in its May 19, 2009 resolution.
Issue:
Whether or not the doctrine of res ipsaloquitor is applicable in
this case?
252
Ruling:
The CA is correct in finding that there was negligence on the
part of the petitioners; however, the Supreme Court was not
convinced that the petitioners are guilty of criminal negligence
complained of. The Court was also of the view that the CA erred in
applying the doctrine of res ipsaloquitor.
The doctrine of res ipsaloquitor means where the thing which
causes injury is shown to be under the management of the
defendant, and the accident is such as in the ordinary course of
things does not happen if those who have the management use
proper care, it affords reasonable evidence, in the absence of
explanation by the defendant, that the accident course from want of
care.
The Blacks Law Dictionary defines the said doctrine is a rule of
evidence whereby negligence of the alleged wrongdoer maybe
inferred from the mere fact that the accident happened provided the
character of the accident and circumstances attending it lead
reasonably to belief that in the absence of negligence it would not
have occurred and that thing which caused injury is shown to have
been under the management control of the alleged wrongdoer. Under
this doctrine, the happening of an injury permits an inference of
negligence where plaintiff produces substantial evidences that the
injury was caused by an agency or instrumentality under the
exclusive control and management of defendant, and that the
253
occurrence was that in the ordinary course of things would not

happen of reasonable care had been used.
The doctrine of res ipsaloquitor as a rule f evidence is unusual
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. The doctrine, however, is not a rule of
substantive law, but merely a mode of proof or a mere procedural
convenience.
The
rule,
when
applicable
to
the
facts
and
circumstances of a given case, is not meant to and does not dispense

with the requirement of proof of culpable negligence on the party
charged. It merely determines and regulates what shall be prima facie
evidence thereof and helps the plaintiff in proving a breach of the
duty. The doctrine can be invoke when and only when, under the
circumstances involved, direct evidence is absent and not readily
available.
The requisites for the application of the doctrine of res
ipsaloquitor are: 1) the accident was of a kind which does not
ordinarily occur unless someone is negligent; 2) the instrumentality or
agency which cause the injury was under the exclusive control of the
person in charge; and 3) the injury suffered must not have been due
to any voluntary or contribution of the person injured.
254
DOCTRINE OF APPARENT AUTHORITY

[T]he doctrine [under which] acts and contracts of the agent, as
are within the apparent scope of the authority conferred on him,
although no actual authority to do such acts or to make such
contracts has been conferred, bind the principal. The principals
liability, however, is limited only to 3rd persons who have been led
reasonably to believe by the conduct of the principal that such actual
authority exists, although none was given. In other words, apparent
authority is determined only by the acts of the principal and not by the
acts of the agent.[Banate v. Phil. Countryside Rural Bank, Inc., GR
163825, July 13, 2010].Also called the Holding out theory; or Doctrine
of ostensible agency or Agency by estoppel. See Apparent authority
doctrine.
Violeta Tudtud Banate Vs. Phil. Countryside Rural Bank, Inc.
G.R. No. 163825, July 13, 2010
255
Facts:
On July 22, 1997, petitioner spouses RosendoMaglasang and
PatrociniaMonilar (spouses Maglasang) obtained a loan (subject
loan) from PCRB for P1,070,000.00. The subject loan was evidenced
by a promissory note and was payable on January 18, 1998. To
secure the payment of the subject loan, the spouses Maglasang
executed, in favor of PCRB a real estate mortgage over their
property, Lot 12868-H-3-C, including the house constructed thereon
(collectively referred to as subject properties), owned by petitioners
Mary Melgrid and BonifacioCortel (spouses Cortel), the spouses
Maglasangs daughter and son-in-law, respectively. Aside from the
subject loan, the spouses Maglasang obtained two other loans from
PCRB which were covered by separate promissory notes 7 and
secured by mortgages on their other properties.
Sometime in November 1997 (before the subject loan became
due), the spouses Maglasang and the spouses Cortel asked PCRBs
permission to sell the subject properties. They likewise requested that
the subject properties be released from the mortgage since the two
other loans were adequately secured by the other mortgages. The
spouses Maglasang and the spouses Cortel claimed that the PCRB,
acting through its Branch Manager, PancrasioMondigo, verbally
agreed to their request but required first the full payment of the
subject loan. The spouses Maglasang and the spouses Cortel
thereafter sold to petitioner VioletaBanate the subject properties for
P1,750,000.00. The spouses Magsalang and the spouses Cortel
256
used the amount to pay the subject loan with PCRB. After settling the
subject loan, PCRB gave the owners duplicate certificate of title of
Lot 12868-H-3-C to Banate, who was able to secure a new title in her
name. The title, however, carried the mortgage lien in favor of PCRB,
prompting the petitioners to request from PCRB a Deed of Release of
Mortgage. As PCRB refused to comply with the petitioners request,
the petitioners instituted an action for specific performance before the
RTC to compel PCRB to execute the release deed.
The petitioners additionally sought payment of damages from
PCRB, which, they claimed, caused the publication of a news report
stating that they "surreptitiously" caused the transfer of ownership of
Lot 12868-H-3-C. The petitioners considered the news report false
and malicious, as PCRB knew of the sale of the subject properties
and, in fact, consented thereto.
PCRB countered the petitioners allegation by invoking cross
collateral stipulation in the mortgage deed.
PCRB claimed that full payment of the three loans, obtained by
the spouses Maglasang, was necessary before any of the mortgages
could be released; the settlement of the subject loan merely
constituted partial payment of the total obligation. Thus, the payment
does not authorize the release of the subject properties from the
mortgage lien.
PCRB considered Banate as a buyer in bad faith as she was
fully aware of the existing mortgage in its favor when she purchased
257
the subject properties from the spouses Maglasang and the spouses
Cortel. It explained that it allowed the release of the owners duplicate
certificate of title to Banate only to enable her to annotate the sale.
PCRB claimed that the release of the title should not indicate the
corresponding release of the subject properties from the mortgage
constituted thereon.
After trial, the RTC ruled in favor of the petitioners. It noted that
the petitioners, as "necessitous men," could not have bargained on
equal footing with PCRB in executing the mortgage, and concluded
that it was a contract of adhesion. Therefore, any obscurity in the
mortgage contract should not benefit PCRB.
On appeal, the CA reversed the RTCs decision. The CA did not
consider as valid the petitioners new agreement with Mondigo, which
would novate the original mortgage contract containing the crosscollateral stipulation. It ruled that Mondigo cannot orally amend the
mortgage contract between PCRB, and the spouses Maglasang and
the spouses Cortel; therefore, the claimed commitment allowing the
release of the mortgage on the subject properties cannot bind PCRB.
Since the cross-collateral stipulation in the mortgage contract
(requiring full settlement of all three loans before the release of any of
the mortgages) is clear, the parties must faithfully comply with its
terms. The CA did not consider as material the release of the owners
duplicate copy of the title, as it was done merely to allow the
annotation of the sale of the subject properties to Banate.
258
Issue:
Whether or not the authority of PCRB Branch Manager
PancrasioMondigo in dealing with third persons is covered by the
doctrine of apparent authority?
Ruling:
YES. The doctrine of apparent authority, with special
reference to banks, may be ascertained through: 1) the general
manner in which the corporation holds out an officer or agent as
having the power to act, or in other words, the apparent authority to
act, in general, with which it clothes him; 2) the acquiescence in his
acts of a particular nature, with actual or constructive knowledge
thereof, within or beyond the scope of his ordinary powers.
Under the doctrine of apparent authority, acts and controls of
the agent, as are within the apparent scope of the authority conferred
on him, although no actual authority conferred on him, although no
actual authority to do such acts or to makes such contracts has been
conferred, bind the principal.
259
DOCTRINE OF THE LAW OF THE CASE

Doctrine of the law of the case. That principle under which
determination of questions of law will generally be held to govern a
case throughout all its subsequent stages where such determination
has already been made on a prior appeal to a court of last resort. It is
merely a rule of procedure and does not go to the power of the court,
and will not be adhered to where its application will result in an unjust
decision. It relates entirely to questions of law, and is confined in its
operation to subsequent proceedings in the same case. [Villa v.
Sandiganbayan, GR 87186, Apr. 24, 1992, 208 SCRA 283, 295-296].
Charlie Vios Vs. Manuel Pantangco, Jr.
G.R. No. 163103
Facts:
260
Respondent Manuel Pantangco, Jr. (Pantangco) filed with the

Metropolitan Trial Court (MTC), Branch 32, Quezon City a complaint
for ejectment and damages against petitioners Charlie Vios
(petitioner Vios) and the Spouses Rogelio and Teresita Antonio
(Spouses Antonio) (collectively, the petitioners), docketed as Civil
Case No. 37-8529. Pantangco alleged in his complaint that: (1) he is
a co-owner by purchase from the former owner of a residential
land located on Sampaguita St., Barangay Pasong Tamo, Quezon
City registered under TCT No. 76956; (2) prior to his purchase of the
property, he inquired from the petitioners whether they were
interested in buying the property; when the petitioners responded that
they were not, he told them that he would give them one (1) week
from his purchase of the property to vacate the premises; he claimed
that the petitioners agreed; (3) after the consummation of the sale to
him, the petitioners refused to vacate notwithstanding the agreement;
and (4) he filed the complaint when no settlement was reached
before the PangkatTagapagkasundo.
The petitioners specifically denied in their Answer the material
allegations of the complaint and pleaded the special and affirmative
defenses that: (1) the disputed property belongs to the government
since it forms part of unclassified public forest; (2) the real previous
owner of the property was Alfredo Aquino, from whom they acquired
their rights through a document entitled "Waiver"; (3) Pantangco's title
is fake as it originated from Original Certificate of Title No. 614 which
was nullified in a decision in Civil Case No. 36752 rendered by Judge
261
Reynaldo V. Roura of the Regional Trial Court (RTC), Branch 83,

Quezon City; and (4) assuming Pantangco's title to be valid, the
property it covers is different from the premises they (the petitioners)
occupy.
After appropriate proceedings, the MTC rendered on July 12,
1996 a decision (MTC decision) in Pantangco's favor.
Pantangco filed on August 12, 1996, a Motion for the Issuance
of a Writ of Execution which was granted on August 3, 1996.
On November 13, 1996, petitioner Vios filed with the RTC,
Branch 224, Quezon City a Petition for Certiorari and Mandamus with
Prayer for a Writ of Preliminary Mandatory Injunction, assailing both
the MTC decision and the writ of execution.
On August 4, 1997, the RTC rendered a decision (RTC
decision) in petitioner Vios' favor. It annulled the MTC decision for
being contrary to the evidence; it annulled as well the related writ of
execution on the reasoning that the decision it was implementing was
not yet final and executory.
On March 10, 1998, Pantangco filed with the CA a Petition for
Declaration of Nullity of the RTC Decision. He essentially asserted in
his petition that the RTC decision is void, given that the MTC decision
cannot be assailed on certiorari; the proper remedy is an ordinary
appeal from the MTC decision. He further argued that no remedy is
available from the final and executory MTC decision as the remedy of
appeal was lost when the period to appeal expired fifteen (15) days
from receipt of petitioner's counsel of record of a copy of the MTC
262
decision; certiorari is not a substitute for the remedy of appeal already

lost.
The CA rendered its decision on October 10, 2003 in favor of
respondent Pantangco.
Issue:
Whether or not the RTC decision which was not appealed
become the law of the case that may no longer be disturbed?
Ruling:
NO. The law of the case doctrine applies in a situation where an
appellate court has made a ruling on a question on appeal and
thereafter remands the case to the lower court for further
proceedings; the question settled by the appellate court becomes the
law of the case at the lower court and in any subsequent appeal. It
means that whatever is irrevocably established as the controlling
legal rule or decision between the same parties in the same case
continues to be the law of the case, whether correct on general
principles or not, so long as the facts on which the legal rule or
decision was predicated continue to be the facts of the case before
the court.
Based on this definition, the petitioners heavy reliance on the
law of the case doctrine is clearly misplaced. No opinion has been
made in a former appeal that can be considered controlling legal rule
263
or decision between the same parties thereafter. There is no

remanded case to which a previous ruling on appeal applies.
PRINCIPLE OF ESTOPPEL
Doctrine of estoppel. Rem. Law. [A doctrine] based on grounds
of public policy, fair dealing, good faith and justice, [the]purpose [of
which] is to forbid one to speak against his own act, representations,
or commitments to the injury of one to whom they were directed and
who reasonably relied thereon. [PNB v. CA, 94 SCRA 357].
Doctrine of estoppel by laches. Rem. Law. An equitable
doctrine by which some courts deny relief to a claimant who has
unreasonably delayed or been negligent in asserting a claim. A
person invoking laches should assert that an opposing party has slept
on his/her rights and that the party is no longer entitled to his/her
original claim.
Phil. Realty And Holdings Corporation Vs.
264
Ley Construction And Development Corporation

G.R. No. 165548
Facts:
Ley Construction and Development Corporation (LCDC) was
the project contractor for the construction of several buildings for
Philippine Realty & Holdings Corporation (PRHC), the project owner.
Sometime between April 1988 and October 1989, the two
corporations entered into four major construction projects.
Two more agreement were entered into by the parties for the
construction of the concreting works on GL 5, 9 & A of the Tektite
Towers.
In order to jump-start the construction operations, LCDC was
required to submit a performance bond as provided for in the
construction agreements. As stated in these agreements, as soon as
PRHC received the performance bond, it would deliver its initial
payment to LCDC. The remaining balance was to be paid in monthly
progress payments based on actual work completed. In practice,
these monthly progress payments were used by LCDC to purchase
the materials needed to continue the construction of the remaining
parts of the building.
In the course of the construction of the Tektite Building, it
became evident to both parties that LCDC would not be able to finish
the project within the agreed period. Thus, through its president,
265
LCDC met with Abcede to discuss the cause of the delay. LCDC
explained that the unanticipated delay in construction was due mainly
to the sudden, unexpected hike in the prices of cement and other
construction materials. It claimed that, without a corresponding
increase in the fixed prices found in the agreements, it would be
impossible for it to finish the construction of the Tektite Building. In
their analysis of the project plans for the building and of all the
external factors affecting the completion of the project, the parties
discovered that even if LCDC were able to collect the entire balance
from the contract, the collected amount would still be insufficient to
purchase all the materials needed to complete the construction of the
building.
Both parties agreed that their foremost objective should be to
ensure that the Tektite Building project would be completed. To
achieve this goal, they entered into another agreement. Abcede
asked LCDC to advance the amount necessary to complete
construction. Its president acceded, on the absolute condition that it
be allowed to escalate the contract price. It wanted PRHC to allow
the escalation and to disregard the prohibition contained in Article VII
of the agreements. Abcede replied that he would take this matter up
with the board of directors of PRHC.
The board of directors turned down the request for an
escalation agreement.Neither PRHC nor Abcede gave notice to
LCDC of the alleged denial of the proposal. However, on 9 August
1991 Abcede sent a formal letter to LCDC, asking for its conformity,
266
to the effect that should it infuse P36 million into the project, a
contract price escalation for the same amount would be granted in its
favor by PRHC.
The letter was signed by Abcede above the title "Construction
Manager," as well as by LCDC.A plain reading of the letter-agreement
will reveal that the blank above the words "PHIL. REALTY &
HOLDINGS CORP." was never signed.
Notwithstanding the absence of a signature above PRHCs
name, LCDC proceeded with the construction of the Tektite Building,
expending the entire amount necessary to complete the project. From
August
to
December
1991,
it
infused
amounts
totaling
38,248,463.92. These amounts were not deposited into the joint

account of LCDC and PRHC, but paid directly to the suppliers upon
the instruction of Santos.
LCDC religiously submitted to PRHC monthly reportsthat
contained the amounts of infusion it made from the period August
1991 to December 1991.
PRHC never replied to any of these monthly reports.
On 20 January 1992, LCDC wrote a letter addressed to Santos
stating that it had already complied with its commitment as of 31
December 1991 and was requesting the release of P 2,248,463.92. It
attached a 16 January 1992 letter written by D.A. Abcede&
267
Associates, informing PRHC of the total cash infusion made by LCDC

to the project.
PRHC never replied to this letter.
In another letter dated 7 September 1992, there was a
reconciliation of accounts between the two corporations with respect
to the balances due for Projects 1, 2, and 3. The reconciliation of
accounts resulted in PRHC owing LCDC the sum of P 20,862,546.41.
In a letter dated 8 September 1992,when 96.43% of Tektite
Building had been completed, LCDC requested the release of the P
36 million escalation price. PRHC did not reply, but after the
construction of the building was completed, it conveyed its decision in
a letter on 7 December 1992.That decision was to set off, in the form
of liquidated damages, its claim to the supposed liability of LCDC.
In a letter dated 18 January 1993, LCDC, through counsel,
demanded payment of the agreed escalation price of P 36 million. In
its reply on 16 February 1993, PRHC suddenly denied any liability for
the escalation price. In the same letter, it claimed that LCDC had
incurred 111 days of delay in the construction of the Tektite Building
and demanded that the latter pay P 39,326,817.15 as liquidated
damages.
LCDC countered that there were many times when its requests
for time extension although due to reasonable causes sanctioned
by the construction agreement such as power failures, water supply
268
interruption,
and
scarcity
of
construction
materials
were
unreasonably reduced to shorter periods by PRHC. In its letter dated

9 December 1992, LCDC claimed that in a period of over two years,
out of the 618 days of extension it requested, only 256 days or not
even half the number of days originally requested were considered.
It further claimed that its president inquired from Abcede and Santos
why its requests for extension of time were not granted in full. The
two, however, assured him that LCDC would not be penalized with
damages for even a single day of delay, because the fact that it was
working hard on the Tektite Building project was known to PRHC.
Thereafter, in a letter dated 18 January 1993, LCDC demanded
payment of the agreed total balance for Projects 1, 2, and 3. Through
a reply letter dated 16 February 1993, PRHC denied any liability.
During the course of the proceedings, both parties conducted another
reconciliation of their respective records. The reconciliation showed
the following balances in favor of LCDC.
In addition to the agreed-upon outstanding balance in favor of
LCDC, the latter claimed another outstanding balance of P
232,367.96 in its favor for the construction of the drivers quarters in
Project 3.
It also further claimed the amount of P 7,112,738.82,
representing the balance for the concreting works from the ground
floor to the fifth floor of the Tektite Building.
269
Seeking to recover all the above-mentioned amounts, LCDC

filed a Complaint with Application for the Issuance of a Writ of
Preliminary Attachment on 2 February 1996 before the RTC in Makati
City.
On January 31, 2001, the RTC promulgated its Decision.
Judgment was rendered: a) Dismissing the counter-claim of
defendant DENNIS ABCEDE and the cross-claim of JOSELITO
SANTOS; and b) ordering defendant PHILIPPINE REALTY AND
HOLDING CORPORATION to pay plaintiff LEY CONSTRUCTION
AND DEVELOPMENT CORPORATION.
PRHC filed a notice of appeal on June 14, 2001. The Court of
Appeals reversed the lower courts amended Decision on September
30, 2004.
Issue:
Whether or not PRHC could use the principle of estoppel in this
case?
Ruling:
270
NO. PRHC is barred by the doctrine of promissory estoppel

from denying that it agreed, and even promised, to hold LCDC free
and clear of any liquidated damages. Abcede and Santos also
promised that the latter corporation would not be held liable for
liquidated damages even for a single day of delay despite the nonapproval of the requests for extension.
Estoppel is an equitable principle rooted in natural justice; it is
meant to prevent persons from going back on their own acts and
representations, to the prejudice of others who have relied on them.
Article 1431 of the Civil Code provides that: through estoppel
an admission or representation is rendered conclusive upon the
person making it, and cannot be denied or disproved as against the
person relying thereon.
Elements of estoppel as identified by the Supreme Court are: a)
the actor usually must have knowledge, notice or suspicion of the true
facts, communicates something to another in a misleading way, either
by words, conduct or silence; 2) the other in fact relies, and relies
reasonably or justifiably, upon that communication; 3) the other would
be harmed materially if the actor is later permitted to assert any claim
inconsistent with his earlier conduct; and 4) the actor knows, expects
or foresees that the other would act upon the information given or that
a reasonable person in the actors position would expect or foresee
such action.
PRINCIPLE OF JUS SANGUINIS

271
Lat.
Right of blood. A principle of
nationality law
by which citizenship is
not determined by place of birth but by having instead one or both

parents who are citizens of the state or more generally by having
state citizenship or membership to a nation determined or conferred
by ethnic, cultural or other descent or origin.
Doctrine of quantum meruit. Lat. As much as one deserves. [Doctrine
that] prevents undue enrichment based on the equitable postulate
that it is unjust for a person to retain benefit without paying for it. [See
Soler v. CA, 410 Phil. 264, 273 (2001)].
Victorino Lim Teco Vs. The Insular Collector Of Customs
G.R. No. L-7071
Facts:
Victorino Lim Teco was born in Manila November 8, 1885, the
legitimate son of Apolonio Lim Teco and Lucia Tiangco. Victorino was
sent to China at the age of 5 and remained there until he returned to
Manila on the steamer Yingchow, October 14, 1910, and sought
admission as a citizen of the Philippine Islands. Apolonio Lim Teco, a
Christian Chinese, died in Manila on October 22, 1900. His widow
Lucia Tiangco is now living in the city of Manila. She was born in the
Philippine Islands of a Chinese mestizo father and mother, who were
likewise born here. Victorino, his seven brothers and sisters, and his
father and mother, were all Christians and members of the Catholic
church. His mother has never been outside the Philippine Islands.
272
Petitioner's right to enter the Philippine Islands as a citizen

thereof was passed upon by a board of special inquiry and the board
denied his right to enter upon two grounds: (1)Because his father was
a subject of the Chinese Emperor of the 11th day of April, 1899, and
his nationality followed that of his father; and (2) because the fact that
he remained in China some five years after reaching his majority
shows that he elected the nationality of that country and abandoned
his right, if he had any, to citizenship here. The Court of First Instance
of Manila, upon habeas corpus proceedings, ordered the petitioner
discharged from custody. From this order the Collector of Customs
appealed.
Issue:
Whether or not Victorino Lim Teco can be considered as citizen
of the Philippines based on the principle of Jus Sanguinis?
Ruling:
NO. Persons born of Chinese fathers and Filipina mothers
within the Philippine Islands are citizens thereof, with certain wellrecognized exceptions. If, during minority they are taken to the
country of their father's origin, they still remain citizens of the
Philippine Islands. But in case the country of their father's origin
claims them as citizens under the principle of jus sanguinis, such
children are then considered as possessing a so-called dual
nationality.
273
The appellee was a citizen by birth of the Philippine Islands,

and that, due to the fact of his foreign parentage, the obligation of
election devolved upon him upon attaining his majority. The domicile
of his father and after the latter's death that of his mother and his two
brothers and one sister who are still living was and has been in the
Philippine Islands. Until he became of age, the appellee's legal right
to claim a domicile within the Philippine Islands cannot be denied.
The question is thus narrowed down to what the appellee did from the
date of his majority until he returned to the Philippine Islands in
October, 1910, a period of about five years, indicative of his selection
of a permanent domicile.
With reference to Act of 1907 of the Congress of the United
States, a child born of alien parents who goes to his father's native
land at a tender age and remains there during minority, on becoming
of age should, if he desires to retain his Filipino citizenship, indicate
that desire by exercising his right of election; and a failure to express
such a desire within a reasonable time should be regarded as a
strong presumption of his purpose to become definitely identified with
the body politic of his father's country. The length of time within this
right must be exercised, as stated above, has never been the subject
of legislation. The State Department of the United States has,
however, repeatedly held that such election must be made within a
reasonable time and is best evidenced by an early return to the
country of his birth.
Upon a proper showing, the return at an early date would, no
doubt, be waived, so far as the exigencies of the case required. No
274
such claims have, however, been made in the case at bar, and the
board of special inquiry having found as a fact that the appellee by
his conduct had expatriated himself, we cannot entertain the idea that
the appellee may, after a residence, under these circumstances, of
five years in his father's native country after attaining majority, now
elect to become a citizen of the Philippine Islands. He has irrevocably
lost that right by his failure to exercise it within a reasonable time after
becoming of age.
PRINCIPLE OF QUANTUM MERUIT
275
Lat. As much as one deserves. [Doctrine that] prevents undue

enrichment based on the equitable postulate that it is unjust for a
person to retain benefit without paying for it. [See Soler v. CA, 410
Phil. 264, 273 (2001)].
The Civil Service Commission Vs. Felicisimo O. Joson, Jr.
G.R. No. 154674, May 27, 2004
Facts:
On July 1, 1995, Respondent Felicisimo O. Joson, Jr., then
Administrator of the Philippine Overseas Employment Administration
(POEA) appointed Priscilla Ong as Executive Assistant IV in his office
under a contractual status. The appointment was made after the
Department of Budget and Management (DBM) thru Director Miguel
B. Doctorapproved his request for the creation of a contractual
position of Executive Assistant IV at the Office of the POEA
Administrator, effective not earlier than July 1, 1995.
Subsequently, respondent Joson wrote the CSC requesting
exemption from the rule requiring appointees to confidential staff
positions to meet the prescribed educational qualification.The
educational requirement for the position of Executive Assistant is a
"Bachelors degree relevant to the job"and Priscilla Ong was not a
college degree holder.
276
Acting upon this request, the petitioner CSC issued Resolution

No. 956978 on November 2, 1995, approving the appointment of Ong
under a Coterminous Temporary status.
However, on February 6, 1996, Director Nelson Acebedo of the
CSC National Capital Region (NCR) issued a post audit report on the
issuance of Ongs appointment made on July 1, 1995, and invalidated
the same. A motion for reconsideration was filed, stressing, among
others, that the Department of Budget Management (DBM) allowed
the POEA to create such a position not earlier than July 1, 1995 and
that no less than the petitioner itself approved the appointment under
a coterminous temporary status. Upon the instructions of Director
Acebedo, the effectivity of Ongs appointment was changed from July
1, 1995 to November 2, 1995.
Considering the said adjustment in the effectivity date of Ongs
appointment, the respondent then requested approval for the
payment of her salary for services rendered for the period of July 1,
1995 to October 31, 1995.
The petitioner denied the request for the payment of Ongs
salary in Resolution No. 974094 dated October 16, 1997.
The respondent filed a motion for reconsideration, averring that
Ong was appointed to a newly-created position which does not
require any such authority from the petitioner. The respondent
emphasized in his motion that the DBM approved the creation of the
position for Ong. He asserted that, if at all, it is the POEA who should
277
be liable under the principle of quantum meruit since the latter was
the one benefited.
On June 8, 1998, the petitioner issued Resolution No. 981399
denying the respondents motion for reconsideration.It affirmed its
ruling that the effectivity date of Ongs appointment should be
reckoned from November 2, 1995 when it granted the authority to the
respondent to fill the position, and not July 1, 1995 as asserted by the
respondent. It also declared that Ongs appointment was not included
in the POEAs Report on Personnel Action (ROPA) submitted to the
petitioner for the month of July 1995.
The petitioner also held that the POEA only submitted Ongs
appointment in its ROPA for the month of November 1995. Such
belated report rendered the appointment in July ineffective.The
petitioner concluded that there was clearly no legal basis for the
payment of Ongs salary prior to November 2, 1995, and that the
principle of quantum meruit invoked by the respondent was not
applicable.
The respondent appealed the CSC resolutions to the Court of
Appeals. On August 12, 2002, the CA rendered the assailed judgment
in favor of herein respondent, ruling that Ong was considered a de
facto officer and is entitled to the payment of her salary.
Issue:
Whether or not the respondent is right in invoking the principle
of quantum meruit?
278
Ruling:
YES. The doctrine of quantum meruitstates that as much as
one deserves, it is unjust for a person to retain benefit without paying
for it.
Ong assumed the position and discharged her functions as
Executive Assistant IV on July 1, 1995. Thenceforth, she was entitled
to the payment of her salary, as provided for in Section 10 of Rule V
of the Omnibus Rules of the Civil Service Commission on the matter
of appointments.
279
PRINCIPLE OF MUTUALITY OF CONTRACT

The requirement that all rules must apply to all parties to a contract
for the contract to be enforceable. Otherwise, the contract must be
rejected by all parties. No party is allowed to have unfair advantage of
partially applied rules under any legal contract.
An important part of a contract is mutuality, that is, both parties
must be bound or neither is. This principle doesnt apply to
unilateral contracts where only one party is bound or to cases
where both parties make promises but one party isnt bound
(such as fraud). It does, however, apply to bilateral contracts. An
example of mutuality is seen in Scott v. Moragues Lumber
Co. Here, Scott told the lumber company that if he bought a ship,
hed ship their lumber. This created an express condition. Neither
party was bound until the condition was fulfilled. Indeed, Scott did
buy a ship, but he chartered it to someone else. The lumber
company was understandably upset. The court held that Scott
was bound to the contract as soon as he bought the ship.
This is pretty straight-forward, but what about illusory promises?
An illusory promise has the form of a promise, but not the
substance of one. We have an example of such a promise
inWickham & Burton Coal. v. Farmers Lumber. The coal company
agreed to fill any orders from the lumber company at a certain
price. The lumber company, however, didnt actually promise to
buy any coal. The court held that the contract wasnt mutual
280
because the quantity to be delivered (even if its none) is

conditioned entirely on the buyer. Because Farmers Lumber
could have decided not to purchase coal, they werent bound. So
if both arent bound, neither is. For more on illusory promises,
check out section 77 of the Restatement Second on Contracts.
Manuel International Airport Authority Vs.
Ding Velayo Sports Center, Inc.
G.R. No. 161718
Facts:
On February 15, 1967, petitioner (then still called the Civil
Aeronautics
Administration
or
CAA)
and
Salem
Investment
Corporation (Salem) entered into a Contract of Lease whereby

petitioner leased in favor of Salem a parcel of land known as Lot 2-A,
with an area of 76,328 square meters, located in front of the Manila
International Airport (MIA) in Pasay City.
The term of the lease and renewal as stipulated upon by
petitioner and Salem shall be for a period of twenty five years and at
the option of the lessee, renewable for another twenty five years.
Subsequently, in a Transfer of Lease Rights and Existing
Improvements dated September 30, 1974, Salem conveyed in favor
of Ding Velayo Export Corporation (Velayo Export), for the
consideration of P1,050,000.00, its leasehold rights over a portion of
Lot 2-A, measuring about 15,534 square meters, with the
improvements thereon, consisting of an unfinished cinema-theater.
281
Accordingly, petitioner and Velayo Export executed a Contract of

Lease dated November 26, 1974.
In turn, Velayo Export executed a Transfer of Lease Rights
dated April 27, 1976 by which it conveyed to respondent, for the
consideration of P500,000.00, its leasehold rights over an 8,481square meter area (subject property) out of the 15,534-square meter
portion it was leasing from petitioner. As a result, petitioner and
respondent executed another Contract of Leasedated May 14, 1976
covering the subject property.
Respondent began occupying the subject property and paying
petitioner the amount of P2,205.25 per month as rental fee.
Respondent then constructed a multi-million plaza with a three-storey
building on said property. Respondent leased spaces in the building
to various business proprietors.
In a Letterdated April 11, 1979, petitioner requested respondent
for a copy of the latters Gross Income Statement from December
1977 to December 1978, duly certified by a certified public
accountant, for the purpose of computing the royalty equivalent to 1%
of the monthly gross income of respondent. Acceding to this request,
respondent sent petitioner a Letterdated May 31, 1979 and appended
therewith the requested income statements which disclosed that the
total gross income of respondent for the period in question amounted
to P1,972,968.11. Respondent also submitted to petitioner and the
Commission on Audit (COA) its duly audited financial statementsfor
282
the years 1984 to 1988. Meanwhile, petitioner had continued billing

respondent the amount of P2,205.25 as monthly rental fee, which the
latter obediently paid.
Petitioner eventually issued Administrative Order (AO) No. 4,
series of 1982,and AO No. 1, series of 1984, fixing various rates for
the lease rentals of its properties. AO No. 4, series of 1982, and AO
No. 1, series of 1984, allegedly effected an increase in the lease
rental of respondent for the subject property, as provided for in
paragraph 13 of the Contract of Lease dated May 14, 1976 between
petitioner and respondent. However, said issuances were subjected
to review for revision purposes and their implementation was
suspended. Still, petitioner, through a letter dated September 23,
1986, required respondent to pay a moratorium rental at the rate of
P5.00 per square meter rate per month or a total of P42,405.00 every
month.
In a Letterdated October 18, 1986, respondent opposed the
implementation of any increase in its lease rental for the subject
property.
Following the foregoing exchange, petitioner had kept on
charging respondent the original monthly rental of P2,205.25.
More than 60 days prior to the expiration of the lease between
petitioner and respondent, the latter, through its President, Conrado
M. Velayo (Velayo), sent the former a Letterdated December 2, 1991
283
stating that respondent was interested in renewing the lease for

another 25 years.
Petitioner,
through
its
General
Manager,
Eduardo
O.
Carrascoso, in a Letterdated February 24, 1992, declined to renew

the lease, ordered respondent to vacate the subject property within
five days, and demanded respondent to pay arrears in lease rentals
as of January 1992 in the sum of P15,671,173.75.
In Lettersall dated March 10, 1992, Velayo informed petitioner
that he already sent individual letters to Manila Electric Company,
Philippine
Long
Distance
Telephone
Company,
and
Manila
Waterworks and Sewerage System, instructing the said utility

companies that succeeding billings for electric, telephone, and water
consumptions should already be transferred to the account of
petitioner in light of the expected turn-over of the subject property and
improvements thereon from respondent to petitioner.
However, around the same time, Samuel Alomesen (Alomesen)
became the new President and General Manager of respondent,
replacing Velayo. Alomesen, acting on behalf of respondent, sent
petitioner a Letterdated March 25, 1992, revoking the aforementioned
Letters dated March 3 and 10, 1992 since these were purportedly
sent by Velayo without authority from respondents Board of
Directors. Respondent expressed its interest in continuing the lease
of the subject property for another 25 years and tendered to petitioner
a managers check in the amount of P8,821.00 as payment for the
284
lease rentals for the subject property from December 1991 until
March 1992.
Petitioner entirely disregarded the claims of respondent and
threatened to take-over the subject property.
On March 30, 1992, respondent filed against petitioner before
the RTC a Complaint for Injunction, Consignation, and Damages with
a Prayer for a Temporary Restraining Order.Respondent essentially
prayed for the RTC to order the renewal of the Contract of Lease
between the parties for another 25-year term counted from February
15, 1992. On even date, the RTC issued a Temporary Restraining
Orderpreventing petitioner and all persons acting on its behalf from
taking possession of the entire or any portion of the subject property,
from administering the said property, from collecting rental payments
from sub-lessees, and from taking any action against respondent for
the collection of alleged arrears in rental payments until further orders
from the trial court.
On April 30, 1992 upon the posting by respondent of a bond in
the amount of P100,000.00.
In its Decision dated October 29, 1999, the RTC ruled in favor
of respondent.
Petitioner appealed the RTC judgment before the Court of
Appeals.
285
The Court of Appeals promulgated its Decision on January 8,

2004, finding no reversible error in the appealed judgment of the
RTC.
Issue:
Whether or not the renewal of Contract of Lease can be made
to depend on the sole will of respondent?
Ruling:
NO. The principle of mutuality of contracts provides that the
contract must bind both the contracting parties; its validity or
compliancecannot be left to the will of one of them. This binding effect
of a contract on both parties is based on the principle that the
obligations arising from contracts have the force of law between the
contracting parties, and there must be mutuality between them based
essentially on their equity under which it is repugnant to have one
party bound by the contract while leaving the other free therefrom.
The ultimate purpose is to render void a contract containing a
condition which makes its fulfillment dependent solely upon the
uncontrolled will of one the contracting parties.
Exception thereto, is when an old contract solely grants to one
party the option of renewing the lease. But the terms and conditions
286
to be embodied in the renewed contract should be the same as the

original contract.
PRINCIPLE OF JUS SOLI

The law of the place of ones birth as contrasted with jus
sanguinis. The law of the place of ones descent or parentage. The
principle that a persons citizenship is determined by place of birth
rather than by citizenship of ones parents. It is of feudal origin.
Lam Swee Sang Vs. The Commonwealth of the Philippines
G.R. No. 47623, September 16, 1947
Facts:
On 15 October 1941, a decision was promulgated in thecase of
Tan Chong vs. Secretary of Labor, G.R. No. 47616, whereby the
287
Supreme Court affirmed the judgment of the Court of First Instance of

Manila, which had granted the writ of habeas corpus applied for by
tan Chong, on the ground that he, being a native of the Philippines, of
a Chinese father and a Filipino mother, is a citizen of the Philippines.
On the same date, in the case of Lam Swee Sang vs.
Commonwealth of the Philippines (G.R. No. 47623), the Supreme
Court rendered a decision dismissing the petition of the applicant for
naturalization filed in the Court of First Instance of Zamboanga, on
the ground that the applicant, having been born in Sulu, Philippines,
of a Chinese father and Filipino mother, is a citizen of the Philippines.
The dismissal of the petition implies and means that there was no
need of naturalization for the applicant who is aFilipino citizen.
On 21 October 1941, a motion for reconsideration was filed in
both cases by the Solicitor General. The latter contends that even if
the petitioner in the first case and the applicant in the second were
born in the Philippines, of a Chinese father and a Filipino mother,
lawfully married, still they are not citizens of the Philippines under and
pursuant to the laws in force at the time of their birth, and prays that
both decisions be set aside and the judgments appealed from be
reversed.
Issue:
Whether or not Jose Tan Chong and Lam Swee Sang are
citizens of the Philippines by virtue of the principle of jus soli?
288
Ruling:
NO. The principle of jus soli or principle of citizenship by virtue
of place of birth does not apply to the appellees, considering that the
law in force and applicable to the petitioner and the applicant in the
two cases at the time of their birth is Section 4 of the Philippine Bill
(Act of July 1, 1902), as amended by Act of 23 March 1912, which
provides that only those inhabitants of the Philippine Islands
continuing to reside therein who were Spanish subjects on the 11th
day of April 1899, and then resided in said Islands and their children
born subsequent thereto, shall be deemed and held to be citizens of
the Philippine Islands.
289

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PRINCIPLE OF ABUSE OF RIGHTS

The principle of abuse of rights is found under Articles 19, 20

custom, public order, or public policy; 3) and it is done with intent to

Article 19 of the Civil Code, sets certain standards which may

Albetz Investments, Inc. vs. Court of Appeals

Investments, Inc., the lessor, needing the premises in order to

this petition, counsel for Vicenta Calma filed a motion on September

and the spouses Umengan, occupants of its ground floor,

Manila Electric Co. vs. Court Of Appeals

Eredena Agawa Vda. De Oribiana vs. Atty. Gerio

Velayo vs. Shell Corporation of the Philippines

Manila Electric Co. vs. Court Of Appeals

The Board of Liquidators vs. Heirs of Maximo M. Kalaw, Et.Al

has gained acceptance throughout the years is that a

LIBERAL CONSTRUCTION ON THE RULES OF COURTS:

Where the injustice

to the adverse party is not

commensurate with the prescribed procedure.

The Asia United Bank vs. Goodland Company, Inc.

Nilo T. Pates vs. COMELEC and Emelita Alimarante

Leandro Alcantara vs. PCIB

On May 23, 2007, the MCTC rendered judgment dismissing the

defendants-petitioners P10,000.00 as actual damages and another

Congress of the Philippines

AN ACT INSTITUTING THE COMPREHENSIVE DANGEROUS

drugs and other similar substances through an integrated system of

paraphernalia, or property believed to be derived directly or indirectly

to identify any person involved in any dangerous drugs related

enumerated in the attached annex, which is an integral part of this

delivered, stored for illegal purposes, distributed, sold or used in any

(m) Dispense. Any act of giving away, selling or distributing

(r) Illegal Trafficking. The illegal cultivation, culture, delivery,

transportation, distribution, importation, exportation and possession of

or dispensation of such drug or substance in the course of his/her

any alkaloid of opium; preparations in which opium, morphine or any

organization or group capable of acquiring rights or entering into

(dd) Practitioner. Any person who is a licensed physician, dentist,

imprisonment to death and a ranging from Five hundred thousand

opium poppy or any part thereof or substances derived therefrom

Section 5. Sale, Trading, Administration, Dispensation, Delivery,

Controlled Precursors and Essential Chemicals. - The penalty of life

For drug pushers who use minors or mentally incapacitated

The maximum penalty provided for under this Section shall be

imposed upon any person, who, unless authorized by law, shall

(e) Any employment of a practitioner, chemical engineer, public

intent to deliver, or manufacture with intent to deliver equipment,

(2) 10 grams or more of morphine;

trimethoxyamphetamine (TMA), lysergic acid diethylamine

similarly designed or newly introduced drugs and their

hydrochloride or "shabu" is ten (10) grams or more but less

(P500,000.00), if the quantities of dangerous drugs are five (5)

dangerous drugs such as, but not limited to, MDMA or

"ecstasy", PMA, TMA, LSD, GHB, and those similarly designed

Section 13. Possession of Dangerous Drugs During Parties, Social

where the person tested is also found to have in his/her possession

The maximum penalty provided for under this Section shall be

other paraphernalia for dangerous drugs including other laboratory

The proceeds of any sale or disposition of any property confiscated or

Instruments/Paraphernalia and/or Laboratory Equipment. The

(2) Within twenty-four (24) hours upon confiscation/seizure of

instruments/paraphernalia and/or laboratory equipment, the

twenty-four (24) hours thereafter proceed with the destruction or

purposes: Provided, further, That a representative sample, duly

question, the Secretary of Justice shall appoint a member of the