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[G.R. No. 143672. April 24, 2003.

COMMISSIONER OF INTERNAL REVENUE, petitioner, vs. GENERAL FOODS (PHILS.), INC., respondent.

4. ID.; ID.; ID.; ID.; ID.; SUBJECT EXPENSE FOR THE ADVERTISEMENT OF A SINGLE PRODUCT
FOUND TO BE INORDINATELY LARGE AND CANNOT BE CONSIDERED AS AN ORDINARY EXPENSE EVEN
IF IT IS NECESSARY. In the case at bar, the P9,461,246 claimed as media advertising expense for
"Tang" alone was almost one-half of its total claim for "marketing expenses." Aside from that,
respondent-corporation also claimed P2,678,328 as "other advertising and promotions expense" and
another P1,548,614, for consumer promotion. Furthermore, the subject P9,461,246 media
advertising expense for "Tang" was almost double the amount of respondent corporation's
P4,640,636 general and administrative expenses. We find the subject expense for the advertisement
of a single product to be inordinately large. Therefore, even if it is necessary, it cannot be considered
an ordinary expense deductible under then Section 29 (a) (1) (A) of the NIRC. HCTaAS

5. ID.; ID.; ID.; ID.; ID.; AN ADVERTISING TO STIMULATE THE FUTURE SALE OF MERCHANDISE
OR USE OF SERVICES IS NOT DEDUCTIBLE AS BUSINESS EXPENSE. Advertising is generally of two
kinds: (1) advertising to stimulate the current sale of merchandise or use of services and (2)
advertising designed to stimulate the future sale of merchandise or use of services. The second type
involves expenditures incurred, in whole or in part, to create or maintain some form of goodwill for
the taxpayer's trade or business or for the industry or profession of which the taxpayer is a member.
If the expenditures are for the advertising of the first kind, then, except as to the question of the
reasonableness of amount, there is no doubt such expenditures are deductible as business expenses.
If, however, the expenditures are for advertising of the second kind, then normally they should be
spread out over a reasonable period of time. We agree with the Court of Tax Appeals that the
subject advertising expense was of the second kind. Not only was the amount staggering; the
respondent corporation itself also admitted, in its letter protest to the Commissioner of Internal
Revenue's assessment, that the subject media expense was incurred in order to protect respondent
corporation's brand franchise, a critical point during the period under review.

[G.R. No. 59758. December 26, 1984.]

ADVERTISING ASSOCIATES, INC., petitioner, vs. COURT OF APPEALS and COMMISSIONER OF


INTERNAL REVENUE, respondents.

3. ID.; ID.; DEFICIENCY ASSESSMENTS; TAXPAYER IN CASE AT BAR CONSIDERED A BUSINESS


AGENT AND AN INDEPENDENT CONTRACTOR; 25% SURCHARGE ELIMINATED DUE TO THE
CONTROVERSIAL NATURE OF THE ASSESSMENTS. The Commissioner required Advertising
Associates to pay P297,927.06 and P84,773.10 as contractor's tax for 1967-1971 and 1972,
respectively, including 25% surcharge (the latter amount includes interest) on its income from
billboards and neon signs. The basis of the assessment is the fact that the taxpayer's articles of
incorporation provide that its primary purpose is to engage in general advertising business. Its
income tax returns indicate that its business was advertising. Advertising Associates contested that
assessments since it considers itself a media company, like a newspaper or a radio broadcasting
company. but not an advertising agency in spite of the purpose stated in its articles of incorporation.
It argues that its act of leasing its neon signs and billboards does not make it a business agent or an
independent contractor. It stresses that it is a mere lessor of neon signs and billboards and does not
perform advertising services. But the undeniable fact is that neon signs and billboards are primarily
designed for advertising. The petitioner is a business agent and an independent contractor as
contemplated in Sections 191 and 194(v). However, in view of the prior rulings that the taxpayer is
not a business agent nor an independent contractor and in view of the controversial nature of the
deficiency assessments, the 25% surcharge should be eliminated (C. M. Hoskins & Co., Inc. vs.
Commissioner of Internal Revenue, L-28383, June 22, 1976, 71 SCRA 511.519; Imus Electric Co., Inc.
vs. Commissioner of Internal Revenue 125 Phil. 1084).

[G.R. No. L-13355. January 28, 1961.]

PHILIPPINE MANUFACTURING COMPANY, petitioner, vs. COLLECTOR OF INTERNAL REVENUE,


respondent.

1. TAXATION; SPECIFIC TAX ON CINEMATOGRAPHIC FILMS; CIRCUMSTANCES TO BE TAKEN


INTO CONSIDERATION IN DETERMINING WHAT ARE EDUCATIONAL CINEMATOGRAPHIC FILMS. In
determining what are educational cinematographic films or those used for visual education, the
circumstances and purposes of the person, corporation, institution or organization importing or
manufacturing or causing them to be imported or manufactured, should be taken into consideration.
In the case at bar, since their educational quality is but incidental to the main purpose of promoting
or advertising petitioner's products, they can not fall within the class exempt from the payment of
specific tax imposed by section 146 of the National Revenue Code, as amended.

[G.R. No. 38954. August 17, 1933.]

I. BECK, INCORPORATED, plaintiff-appellant, vs. VICTOR ALFONSO, as City Treasurer of Manila,


defendant-appellee.

1. RADIO LAW; RADIO BROADCASTING STATION, WHETHER AN ADVERTISING AGENT; CITY OF


MANILA, LICENSES. The City of Manila is without legal right to compel the operator of a radio
broadcasting station to obtain a license as an advertising agent.

2. ID.; ID.; ID. While a broadcasting station sells time for advertising purposes, this does not
make the operator of the broadcasting station an advertising agent.

3. ID.; ID.; ID. In the business of an advertising agent, he occupies himself in securing
advertising, in preparing the copy, and in causing the copy to be disseminated to the public through
various media, including radio broadcasting.

[G.R. No. 212398. November 25, 2014.]


EMILIO RAMON "E.R." P. EJERCITO, petitioner, vs. HON. COMMISSION ON ELECTIONS and EDGAR
"EGAY" S. SAN LUIS, respondents.

Ejercito should be disqualified

for spending in his election

campaign an amount in excess

of what is allowed by the OEC

Ejercito claims that the advertising contracts between ABS-CBN Corporation and Scenema Concept
International, Inc. were executed by an identified supporter without his knowledge and consent as,
in fact, his signature thereon was obviously forged. Even assuming that such contract benefited him,
Ejercito alleges that he should not be penalized for the conduct of third parties who acted on their
own without his consent. Citing Citizens United v. Federal Election Commission 83 decided by the US
Supreme Court, he argues that every voter has the right to support a particular candidate in
accordance with the free exercise of his or her rights of speech and of expression, which is
guaranteed in Section 4, Article III of the 1987 Constitution. 84 He believes that an advertising
contract paid for by a third party without the candidate's knowledge and consent must be
considered a form of political speech that must prevail against the laws suppressing it, whether by
design or inadvertence. Further, Ejercito advances the view that COMELEC Resolution No. 9476 85
distinguishes between "contribution" and "expenditure" and makes no proscription on the medium
or amount of contribution. 86 He also stresses that it is clear from COMELEC Resolution No. 9615
that the limit set by law applies only to election expenditures of candidates and not to contributions
made by third parties. For Ejercito, the fact that the legislature imposes no legal limitation on
campaign donations is presumably because discussion of public issues and debate on the
qualifications of candidates are integral to the operation of the government.

We refuse to believe that the advertising contracts between ABS-CBN Corporation and Scenema
Concept International, Inc. were executed without Ejercito's knowledge and consent. As found by
the COMELEC First Division, the advertising contracts submitted in evidence by San Luis as well as
those in legal custody of the COMELEC belie his hollow assertion. His express conformity to the
advertising contracts is actually a must because non-compliance is considered as an election offense.
87

Notably, R.A. No. 9006 explicitly directs that broadcast advertisements donated to the candidate
shall not be broadcasted without the written acceptance of the candidate, which shall be attached
to the advertising contract and shall be submitted to the COMELEC, and that, in every case,
advertising contracts shall be signed by the donor, the candidate concerned or by the duly-
authorized representative of the political party. 88 Conformably with the mandate of the law,
COMELEC Resolution No. 9476 requires that election propaganda materials donated to a candidate
shall not be broadcasted unless it is accompanied by the written acceptance of said candidate, which
shall be in the form of an official receipt in the name of the candidate and must specify the
description of the items donated, their quantity and value, and that, in every case, the advertising
contracts, media purchase orders or booking orders shall be signed by the candidate concerned or
by the duly authorized representative of the party and, in case of a donation, should be
accompanied by a written acceptance of the candidate, party or their authorized representatives. 89
COMELEC Resolution No. 9615 also unambiguously states that it shall be unlawful to broadcast any
election propaganda donated or given free of charge by any person or broadcast entity to a
candidate without the written acceptance of the said candidate and unless they bear and be
identified by the words "airtime for this broadcast was provided free of charge by" followed by the
true and correct name and address of the donor. 90

This Court cannot give weight to Ejercito's representation that his signature on the advertising
contracts was a forgery. The issue is a belated claim, raised only for the first time in this petition for
certiorari. It is a rudimentary principle of law that matters neither alleged in the pleadings nor raised
during the proceedings below cannot be ventilated for the first time on appeal before the Supreme
Court. 91 It would be offensive to the basic rules of fair play and justice to allow Ejercito to raise an
issue that was not brought up before the COMELEC. 92 While it is true that litigation is not a game of
technicalities, it is equally true that elementary considerations of due process require that a party be
duly apprised of a claim against him before judgment may be rendered. 93

[G.R. No. 119122. August 8, 2000.]

PHILIPPINE BASKETBALL ASSOCIATION, petitioner, vs. COURT OF APPEALS, COURT OF TAX APPEALS,
AND COMMISSIONER OF INTERNAL REVENUE, respondents.

4. TAXATION; PD 1456; AMUSEMENT TAX; INCOME FROM THE CESSION OF STREAMER AND
ADVERTISING SPACES, INCLUDED IN GROSS RECEIPTS. Untenable is the contention that income
from the cession of streamer and advertising spaces to VEI is not subject to amusement tax. The
questioned proviso may be found in Section 1 of PD 1456. The definition of gross receipts is broad
enough to embrace the cession of advertising and streamer spaces as the same embraces all the
receipts of the proprietor, lessee or operator of the amusement place. The law being clear, there is
no need for an extended interpretation.

[G.R. No. L-32560-61. October 22, 1970.]

ESMERALDO M. GATCHALIAN, petitioner on his behalf and on behalf of all others similarly situated,
vs. COMMISSION ON ELECTIONS, respondent.

The position of the respondents Chairman and members of the Commission on Elections that the
Advertising Council of the Philippines and the other advertising firms, associations and organizations
are the donors, and not the alien contributors for the construction of Comelec billboards, is as
inaccurate as it is specious.

Inaccurate, because the very Resolution No. RR-707 states that the advertising firms and
associations mentioned therein "request an opinion from the Commission whether or not foreigners
or companies or corporations which are owned partially or wholly by foreigners or with foreign
stockholders may contribute to or donate billboards to the Commission without violating Sec. 56 of
the Revised Election Code . . ." (See Annex A), re-emphasized by its concluding paragraph that 'in line
with the above rulings of the Commission in the previous elections the Commission hereby
RESOLVES to hold that the donations of billboards to the Commission by foreigners or companies or
corporations owned and controlled partially or wholly by foreigners are not covered by the
prohibition of Sec. 56 of the Revised Election Code." (Italics supplied)

Specious, because the advertising firms and organizations are merely the collectors of such
donations or contributions; they do not own the money or materials contributed or donated by the
foreigners who are the actual benefactors.

[G.R. No. 167514. October 25, 2005.]

METROPOLITAN MANILA DEVELOPMENT AUTHORITY, petitioner, vs. TRACKWORKS RAIL TRANSIT


ADVERTISING, VENDING AND PROMOTIONS, INC., respondent.

In the case at bar, we find that TRACKWORKS sufficiently established a right to be protected by a
writ of preliminary injunction. The contract with the MRTC vested it the exclusive right to undertake
advertising and promotional activities at the MRT 3 structure. The Court of Appeals therefore
correctly ruled that what is involved here is not an indiscriminate posting and installation of
commercial advertisements but one sanctioned by a contract. If not restrained, the dismantling of,
and prohibition from, installing advertisements at the MRT 3 will cause irreparable injury to
TRACKWORKS. This is especially so because TRACKWORKS is generally not entitled to recover
damages resulting from acts of public officers done in their official capacity and in the honest belief
that they have such power. 15 Unless bad faith is clearly proven, TRACKWORKS will be left without
recourse even if petitioner is later declared without authority to prohibit the posting of billboards
and streamers at the MRT 3 structure. Indeed, prudence dictates that the status quo be preserved
until the merits of the case can be heard fully.

[G.R. No. 182944. November 9, 2016.]

DEPARTMENT OF PUBLIC WORKS AND HIGHWAYS (DPWH), represented by SEC. HERMOGENES E.


EBDANE, JR., and METROPOLITAN MANILA DEVELOPMENT AUTHORITY, represented by CHAIRMAN
BAYANI F. FERNANDO, petitioners, vs. CITY ADVERTISING VENTURES CORPORATION, represented by
DEXTER Y. LIM, respondent.

Petitioners have conceded that respondent entered into a lease agreement enabling the latter to
use MERALCO's lampposts to display advertising banners. 67 Respondent obtained permits from the
local government units of Makati, Pasay, and Quezon City so that it could put up banners and
signages on lampposts and pedestrian overpasses. 68

There was no allegation nor contrary proof "[t]hat the ordinary course of business has been
followed." 69 Respondent must have obtained the customary permits and clearances (e.g., Mayor's
and business permits as well as registration with the Securities and Exchange Commission and with
the Bureau of Internal Revenue) necessary to make itself a going concern.
Respondent's lease agreement with MERALCO Financing Services Corporation and its having secured
permits from local government units, for the specific purpose of putting up advertising banners and
signages, gave it the right to put up such banners and signages. Respondent had in its favor a
property right, of which it cannot be deprived without due process. This is respondent's right in esse,
that is, an actual right. It is not merely a right in posse, or a potential right.

III.B

Petitioners counter that respondent had no right to put up banners and signages. They point out
that on September 2, 2004, the Metro Manila Council passed MMDA Regulation No. 04-004,
"[p]rescribing guidelines on the installation and display of billboards and advertising signs along
major and secondary thoroughfares, avenues, streets, roads, parks and open spaces within Metro
Manila and providing penalties for violation thereof." 70

Section 13 of this Regulation identified the officers responsible for issuing clearances for the
installation of "billboards/signages and advertising signs," as follows: DaIAcC

Section 13. The MMDA, thru the Chairman or his duly authorized representative, shall be the
approving authority in the issuance of clearance in the installation of billboards/signboards and
advertising signs along major thoroughfares of Metro Manila. Upon securing clearance from the
MMDA, a permit from the Local Government Unit must be secured. (The list of major thoroughfares
is hereto attached as Appendix A of this Regulation).

The City/Municipal Mayor or his duly authorized representative shall be the approving authority in
the issuance of permit for the installation/posting billboards/signboards and advertising signs along
local roads and private properties of Metro Manila.

Petitioners claim that the dismantling of respondent's banners and signages was "[f]or want of the
required MMMA clearance(s) . . . and for other violation[s] of MMDA Regulation No. 04-004." 71
Petitioners also counter that "sidewalk and streetlight posts are outside the commerce of men" 72
and, therefore, cannot be spaces for respondent's commercial activities. They also claim that
respondent's contract with MERALCO Financing Services Corporation has since expired. 73
Petitioners likewise underscore that the right to non-impairment of contracts "is limited by the
exercise of the police power of the State, in the interest of public health, safety, morals and general
welfare." 74

Petitioners may subsequently and after trial prove that they are correct. A more thorough
examination of prevailing laws, ordinances, and pertinent regulations may later on establish that the
use of lampposts and pedestrian overpasses as platforms for visual advertisements advancing
private commercial interests contradict the public character of certain spaces. Likewise, petitioners
did subsequently adduce evidence that, by December 29, 2006, respondent's contract with
MERALCO Financing Services Corporation had expired. 75 After trial, it may later on be found that
respondent's proprietary interest may be trumped by the general welfare.

However, at the point when the Regional Trial Court was confronted with respondent's prayer for
temporary relief, all that respondent needed was a right ostensibly in existence. Precisely, a writ of
preliminary injunction is issued "before [parties'] claims can be thoroughly studied and adjudicated."
76
MMDA Regulation No. 04-004's clearance requirements appear to stand in contrast with the permits
obtained by respondent from the local government units of Makati, Pasay, and Quezon City.
Whether the permits suffice by themselves, or whether respondent's alleged non-compliance with
MMDA Regulation No. 04-004 is fatal to its cause, are matters better resolved by a process more
painstaking than the summary hearings conducted purely for the purpose of extending provisional
remedy.

[G.R. No. 162021. June 16, 2014.]

MEGA MAGAZINE PUBLICATIONS, INC., JERRY TIU, AND SARITA V. YAP, petitioners, vs. MARGARET A.
DEFENSOR, respondent.

We start by observing that the degree of proof required in labor cases is not as stringent as in other
types of cases. 36 This liberal approach affords to the employee every opportunity to level the
playing field in which her employer is pitted against her. Here, on the one hand, were Tabingo's
memorandum and affidavit indicating that MMPI's revenues in 1999 totaled P36,216,624.07, and, on
the other, the audit report showing MMPI's gross revenues amounting to only P31,947,677.00 in the
same year. That the audit report was rendered by the auditing firm of Punongbayan & Araullo did
not make it weightier than Tabingo's memorandum and affidavit, for only substantial evidence
that amount of relevant evidence which a reasonable mind might accept as adequate to justify a
conclusion 37 was required in labor adjudication. Moreover, whenever the evidence presented by
the employer and that by the employee are in equipoise, the scales of justice must tilt in favor of the
latter. 38 For purposes of determining whether or not the petitioners' gross revenue reached the
minimum target of P35 million, therefore, Tabingo's memorandum and affidavit sufficed to
positively establish that it did, particularly considering that Tabingo's memorandum was made in the
course of the performance of her official tasks as a traffic clerk of MMPI. In her affidavit, too,
Tabingo asserted that her issuance of the memorandum was pursuant to MMPI's year-end
procedures, an assertion that the petitioners did not refute. In any event, Tabingo's categorical
declaration in her affidavit that "[because] of that achievement, as part of the Sales and Traffic Team
of MMPI, in addition to my other bonuses that year, I received P8,500.00 in gift certificates as my
share in the Group Incentive for the Sales and Traffic Team for gross advertising revenue of P35 to
P38 million . . .," 39 aside from the petitioners not refuting it, was corroborated by the 1999
Advertising Target sent by the respondent to Yap on December 2, 1999, in which the respondent
reported a gross revenue of P36,216,624.07 as of December 1, 1999. 40

Accordingly, the Court concludes that the respondent was entitled to her 0.05% outright
commissions and to the special incentive bonus of P8,500.00 based on MMPI having reached the
minimum target of P35 million in gross revenues paid in "bartered goods and cash in direct
proportion to percentage of cash and bartered goods revenue for the year," as provided in Yap's
memorandum of December 8, 1999. 41 TaCIDS

WHEREFORE, the Court REVERSES AND SETS ASIDE the amended decision promulgated on
November 19, 2003; ENTERS a new decision granting respondent Margaret A. Defensor's claim for
outright commissions in the amount of P181,083.12 and special incentive bonus of P8,500.00, or a
total of P189,583.12; and DIRECTS petitioner Mega Magazine Publications, Inc. to pay the costs of
suit.

[G.R. No. 70462. August 11, 1988.]

PAN AMERICAN WORLD AIRWAYS, INC., petitioner, vs. INTERMEDIATE APPELLATE COURT, RENE V.
PANGAN, SOTANG BASTOS PRODUCTIONS and ARCHER PRODUCTIONS, respondents.

The Court is unable to uphold the Intermediate Appellate Court's disregard of the rule laid down in
Mendoza and affirmance of the trial court's conclusion that petitioner is liable for damages based on
the finding that "[t]he undisputed fact is that the contracts of the plaintiffs for the exhibition of the
films in Guam and California were cancelled because of the loss of the two luggages in question."
[Rollo, p. 36] The evidence reveals that the proximate cause of the cancellation of the contracts was
private respondent Pangan's failure to deliver the promotional and advertising materials on the
dates agreed upon. For this petitioner cannot be held liable. Private respondent Pangan had not
declared the value of the two luggages he had checked in and paid additional charges. Neither was
petitioner privy to respondents' contracts nor was its attention called to the condition therein
requiring delivery of the promotional and advertising materials on or before a certain date.

3. With the Court's holding that petitioner's liability is limited to the amount stated in the
ticket, the award of attorney's fees, which is grounded on the alleged unjustified refusal of petitioner
to satisfy private respondent's just and valid claim, loses support and must be set aside.

G.R. No. 148222. August 15, 2003.]

PEARL & DEAN (PHIL.), INCORPORATED, petitioner, vs. SHOEMART, INCORPORATED, and NORTH
EDSA MARKETING, INCORPORATED, respondents.

1. MERCANTILE LAW; INTELLECTUAL PROPERTY LAW (P.D. 49); PETITIONER'S COPYRIGHT


PROTECTION EXTENDED ONLY TO THE TECHNICAL DRAWINGS AND NOT TO THE LIGHT BOX ITSELF
BECAUSE THE LATTER WAS NOT AT ALL IN THE CATEGORY OF "PRINTS, PICTORIALS ILLUSTRATIONS,
ADVERTISING COPIES, LABELS, TAGS AND BOX WRAPS" UNDER SECTION 2, (O) OF THE LAW.
Petitioner's application for a copyright certificate as well as Copyright Certificate No. PD-R2588
issued by the National Library on January 20, 1981 clearly stated that it was for a class "O" work
under Section 2 (O) of PD 49 (The Intellectual Property Decree) which was the statute then
prevailing. Said Section 2 expressly enumerated the works subject to copyright: SEC. 2. The rights
granted by this Decree shall, from the moment of creation, subsist with respect to any of the
following works: . . . (O) Prints, pictorial illustrations, advertising copies, labels, tags, and box wraps; .
. . Although petitioner's copyright certificate was entitled "Advertising Display Units" (which depicted
the box-type electrical devices), its claim of copyright infringement cannot be sustained. Copyright,
in the strict sense of the term, is purely a statutory right. Being a mere statutory grant, the rights are
limited to what the statute confers. It may be obtained and enjoyed only with respect to the subjects
and by the-persons, and on terms and conditions specified in the statute. Accordingly, it can cover
only the works falling within the statutory enumeration or description. P & D secured its copyright
under the classification class "O" work. This being so, petitioner's copyright protection extended only
to the technical drawings and not to the light box itself because the latter was not at all in the
category of "prints, pictorial illustrations, advertising copies, labels, tags and box wraps." Stated
otherwise, even as we find that P & D indeed owned a valid copyright, the same could have referred
only to the technical drawings within the category of "pictorial illustrations." It could not have
possibly stretched out to include the underlying light box. The strict application of the law's
enumeration in Section 2 prevents us from giving petitioner even a little leeway, that is, even if its
copyright certificate was entitled "Advertising Display Units." What the law does not include, it
excludes, and for the good reason: the light box was not a literary or artistic piece which could be
copyrighted under the copyright law. And no less clearly, neither could the lack of statutory
authority to make the light box copyrightable be remedied by the simplistic act of entitling the
copyright certificate issued by the National Library as "Advertising Display Units." caHIAS

2. ID.; ID.; SINCE PETITIONER NEVER SECURED A PATENT OVER THE LIGHT BOXES, IT
THEREFORE ACQUIRED NO PATENT RIGHTS WHICH COULD HAVE PROTECTED ITS INVENTION; NO
PATENT, NO PROTECTION; CASE AT BAR. For some reason or another, petitioner never secured a
patent for the light boxes. It therefore acquired no patent rights which could have protected its
invention, if in fact it really was. And because it had no patent, petitioner could not legally prevent
anyone from manufacturing or commercially using the contraption. In Creser Precision Systems, Inc.
vs. Court of Appeals, we held that "there can be no infringement of a patent until a patent has been
issued, since whatever right one has to the invention covered by the patent arises alone from the
grant of patent. . . . (A)n inventor has no common law right to a monopoly of his invention. He has
the right to make use of and vend his invention, but if he voluntarily discloses it, such as by offering
it for sale, the world is free to copy and use it with impunity. A patent, however, gives the inventor
the right to exclude all others. As a patentee, he has the exclusive right of making, selling or using
the invention. On the assumption that petitioner's advertising units were patentable inventions,
petitioner revealed them fully to the public by submitting the engineering drawings thereof to the
National Library. To be able to effectively and legally preclude others from copying and profiting
from the invention, a patent is a primordial requirement. No patent, no protection. The ultimate
goal of a patent system is to bring new designs and technologies into the public domain through
disclosure. Ideas, once disclosed to the public without the protection of a valid patent, are subject to
appropriation without significant restraint. ASHEca

3. ID.; ID.; NOT HAVING UNDERGONE THE STRINGENT REQUIREMENTS AND EXHAUSTIVE
EXAMINATION FOR PATENTS, PETITIONER CANNOT EXCLUDE OTHERS FROM THE MANUFACTURE,
SALE OR COMMERCIAL USE OF THE LIGHT BOXES ON THE SOLE BASIS OF ITS COPYRIGHT
CERTIFICATE OVER THE TECHNICAL DRAWINGS. The patent law has a three-fold purpose: "first,
patent law seeks to foster and reward invention; second, it promotes disclosures of inventions to
stimulate further innovation and to permit the public to practice the invention once the patent
expires; third, the stringent requirements for patent protection seek to ensure that ideas in the
public domain remain there for the free use of the public." It is only after an exhaustive examination
by the patent office that a patent is issued. Such an in-depth investigation is required because "in
rewarding a useful invention, the rights and welfare of the community must be fairly dealt with and
effectively guarded. To that end, the prerequisites to obtaining a patent are strictly observed and
when a patent is issued, the limitations on its exercise are equally strictly enforced. To begin with, a
genuine invention or discovery must be demonstrated lest in the constant demand for new
appliances, the heavy hand of tribute be laid on each slight technological advance in art." There is no
such scrutiny in the case of copyrights nor any notice published before its grant to the effect that a
person is claiming the creation of a work. The law confers the copyright from the moment of
creation and the copyright certificate is issued upon registration with the National Library of a sworn
ex parte claim of creation. Therefore, not having gone through the arduous examination for patents,
the petitioner cannot exclude others from the manufacture, sale or commercial use of the light
boxes on the sole basis of its copyright certificate over the technical drawings. HcACST

4. ID.; ID.; PETITIONER'S FAILURE TO SECURE A TRADEMARK REGISTRATION FOR SPECIFIC USE
ON THE LIGHT BOXES MEANT THAT THERE COULD NOT HAVE BEEN ANY TRADEMARK
INFRINGEMENT SINCE REGISTRATION WAS AN ESSENTIAL ELEMENT THEREOF. The Court of
Appeals correctly cited Faberge Inc. vs. Intermediate Appellate Court, where we, invoking Section 20
of the old Trademark Law, ruled that "the certificate of registration issued by the Director of Patents
can confer (upon petitioner) the exclusive right to use its own symbol only to those goods specified
in the certificate, subject to any conditions and limitations specified in the certificate . . . One who
has adopted and used a trademark on his goods does not prevent the adoption and use of the same
trademark by others or products which are of a different description. " Faberge, Inc. was correct and
was in fact recently reiterated in Canon Kabushiki Kaisha vs. Court of Appeals. Assuming arguendo
that "Poster Ads" could validly qualify as a trademark, the failure of P & D to secure a trademark
registration for specific use on the light boxes meant that there could not have been any trademark
infringement since registration was an essential element thereof.

[G.R. No. 202943. March 25, 2015.]

THE DEPARTMENT OF HEALTH, represented by SECRETARY ENRIQUE T. ONA, and THE FOOD AND
DRUG ADMINISTRATION (Formerly the Bureau of Food and Drugs), represented by ASSISTANT
SECRETARY OF HEALTH NICOLAS B. LUTERO III, Officer-in-Charge, petitioners, vs. PHILIP MORRIS
PHILIPPINES MANUFACTURING, INC., respondent.

The Issues Before the Court

The essential issues to be resolved are: (a) whether or not the CA erred in finding that the authority
of the DOH, through the BFAD, to regulate tobacco sales promotions under Article 116 in relation to
Article 109 of RA 7394 had already been impliedly repealed by RA 9211, which created the IAC-
Tobacco and granted upon it the exclusive authority to administer and implement the provisions
thereof; and (b) whether or not the CA erred in ascribing grave abuse of discretion upon the DOH
when the latter held that RA 9211 has also completely prohibited tobacco promotions as of July 1,
2008.

Concomitantly, while the Court acknowledges the attempt of the Department of Justice (DOJ),
through its DOJ Opinion No. 29, series of 2004, 40 (DOJ Opinion) to reconcile and harmonize the
apparently conflicting provisions of RA 7394 and RA 9211 in this respect, to the Court's mind, it is
more logical to conclude that "sales promotion" and "promotion" are actually one and the same. The
DOJ, in fact, referred 41 to "product promotion" in RA 9211 as "promotion per se" which, therefore,
can be taken to mean an all-encompassing activity or marketing strategy which may reasonably and
logically include "sales promotion." Besides, the DOJ Opinion is merely persuasive and not
necessarily controlling. 42 DHITCc

Furthermore, the declared policy of RA 9211 where "promotion" is defined includes the institution
of "a balanced policy whereby the use, sale and advertisements of tobacco products shall be
regulated in order to promote a healthful environment and protect the citizens from the hazards of
tobacco smoke . . . ." 43 Hence, if the IAC-Tobacco was created and expressly given the exclusive
authority to implement the provisions of RA 9211 in accordance with the foregoing State policy, it
signifies that it shall also take charge of the regulation of the use, sale, distribution, and
advertisements of tobacco products, as well as all forms of "promotion" which essentially includes
"sales promotion." Therefore, with this regulatory power conferred upon the IAC-Tobacco by RA
9211, the DOH and the BFAD have been effectively and impliedly divested of any authority to act
upon applications for tobacco sales promotional permit, including PMPMI's.

Finally, it must be stressed that RA 9211 is a special legislation which exclusively deals with the
subject of tobacco products and related activities. On the other hand, RA 7394 is broader and more
general in scope, and treats of the general welfare and interests of consumers vis--vis proper
conduct for business and industry. As such, lex specialis derogat generali. General legislation must
give way to special legislation on the same subject, and generally is so interpreted as to embrace
only cases in which the special provisions are not applicable. In other words, where two statutes are
of equal theoretical application to a particular case, the one specially designed therefore should
prevail. 44

In fine, the Court agrees with the CA that it is the IAC-Tobacco and not the DOH which has the
primary jurisdiction to regulate sales promotion activities as explained in the foregoing discussion.
As such, the DOH's ruling, including its construction of RA 9211 (i.e., that it completely banned
tobacco advertisements, promotions, and sponsorships, as promotion is inherent in both advertising
and sponsorship), are declared null and void, which, as a necessary consequence, precludes the
Court from further delving on the same. As it stands, the present applications filed by PMPMI are
thus remanded to the IAC-Tobacco for its appropriate action. Notably, in the proper exercise of its
rule-making authority, nothing precludes the IAC-Tobacco from designating any of its pilot agencies
(which, for instance, may even be the DOH) 45 to perform its multifarious functions under RA 9211.
CTaS

G.R. No. 124055. June 8, 2000.]

ROLANDO E. ESCARIO, NESTOR ANDRES, CESAR AMPER, LORETO BALDEMOR, EDUARDO BOLONIA,
ROMEO E. BOLONIA, ANICETO CADESIM, JOEL CATAPANG, NESTOR DELA CRUZ, EDUARDO DUNGO
ESCARIO REY, ELIZALDE ESTASIO, CAROLINO M. FABIAN, RENATO JANER, EMER B. LIQUIGAN,
ALEJANDRO MABAWAD, FERNANDO M. MAGTIBAY, DOMINADOR B. MALLILLIN, NOEL B. MANILA,
VIRGILIO A. MANIO, ROMEO M. MENDOZA, TIMOTEO NOTARION, FREDERICK RAMOS, JOSEPH
REYES, JESSIE SEVILLA, NOEL STO. DOMINGO, DODJIE TAJONERA, JOSELITO TIONLOC, ARNEL UMALI,
MAURLIE C. VIBAR, ROLANDO ZALDUA, RODOLFO TUAZON, TEODORO LUGADA, MAURING MANUEL,
MARCIANO VERGARA, JR., ARMANDO IBASCO, CAYETANO IBASCO, LEONILO MEDINA, JOSELITO
ODO, MELCHOR BUELA, GOMER GOMEZ, HENRY PONCE, RAMON ORTIZ, JR., ANTONIO MIJARES, JR.,
MARIO DIZER, REYNANTE PEJO, ARNALDO RAFAEL, NELSON BERUELA, AUGUSTO RAMOS, RODOLFO
VALENTIN, ANTONIO CACAM, VERNON VELASQUEZ, NORMAN VALLO, ALEJANDRO ORTIZ, ROSANO
VALLO, ANDREW ESPINOSA, EDGAR CABARDO, FIDELES REYES, EDGARDO FRANCISCO, FERNANDO
VILLARUEL, LEOPOLDO OLEGARIO, OSCAR SORIANO, GARY RELOS, DANTE IRANZO, RONALDO
BACOLOR, RONALD ESGUERA, VICTOR ALVAREZ, JOSE MARCELO, DANTE ESTRELLADO, MELQUIADES
ANGELES, GREGORIO TALABONG, ALBERT BALAO, ALBERT CANLAS, CAMILO VELASCO, PONTINO
CHRISTOPHER, WELFREDO RAMOS, REYNALDO RODRIGUEZ, RAZ GARIZALDE, MIGUEL TUAZON,
ROBERTO SANTOS, AND RICARDO MORTEL, petitioners, vs. NATIONAL LABOR RELATIONS
COMMISSION, CALIFORNIA MANUFACTURING CO. INC. AND DONNA LOUISE ADVERTISING AND
MARKETING ASSOCIATES INCORPORATED, respondents.

4. ID.; ID.; ID.; ID.; STATUS OF D.L. ADMARK AS AN INDEPENDENT CONTRACTOR ESTABLISHED
IN CASE AT BAR. Among the circumstances that tend to establish the status of D.L. Admark as a
legitimate job contractor are: 1) The SEC registration certificate of D.L. Admark states that it is a firm
engaged in promotional, advertising, marketing and merchandising activities. 2) The service contract
between CMC and D.L. Admark clearly provides that the agreement is for the supply of sales
promoting merchandising services rather than one of manpower placement. 3) D.L. Admark was
actually engaged in several activities, such as advertising, publication, promotions, marketing and
merchandising. It had several merchandising contracts with companies like Purefoods, Corona
Supply, Nabisco Biscuits, and Lacron. It was likewise engaged in the publication business as
evidenced by its magazine the "Phenomenon." 4) It had its own capital assets to carry out its
promotion business. It then had current assets amounting to P6 million and is therefore a highly
capitalized venture. It had an authorized capital stock of P500,000.00. It owned several motor
vehicles and other tools, materials and equipment to service its clients. It paid rentals of P30,020 for
the office space it occupied. Moreover, by applying the four-fold test used in determining employer-
employee relationship, the status of D.L. Admark as the true employer of petitioners is further
established. The elements of this test are (1) the selection and engagement of employee; (2) the
payment of wages; (3) the power of dismissal; and (4) the power to control the employee's conduct.
As regards the first element, petitioners themselves admitted that they were selected and hired by
D.L. Admark. As to the second element, the NLRC noted that D.L. Admark was able to present in
evidence the payroll of petitioners, sample SSS contribution forms filed and submitted by D.L.
Admark to the SSS, and the application for employment by R. de los Reyes, all tending to show that
D.L. Admark was paying for the petitioners' salaries. . . . Again petitioners admitted that it was D.L.
Admark who terminated their employment. To prove the fourth and most important element of
control, . . . the NLRC correctly pointed out that nothing in the documents presented by petitioners
remotely suggest that CMC was supervising and controlling the work of the petitioners.

[Adm. Case No. 1117. March 20, 1944.]

THE DIRECTOR OF RELIGIOUS AFFAIRS, complainant, vs. ESTANISLAO R. BAYOT, respondent.

ATTORNEYS AT LAW; SOLICITATION OF BUSINESS FROM THE PUBLIC. It is undeniable that the
advertisement in question was a flagrant violation by the respondent of the ethics of his profession,
it being a brazen solicitation of business from the public. Section 25 of Rule 127 expressly provides
among other things that "the practice of soliciting cases at law for the purpose of gain, either
personally or thru paid agents or brokers, constitutes malpractice." It is highly unethical for an
attorney to advertise his talents or skill as a merchant advertises his wares. Law is a profession and
not a trade. The lawyer degrades himself and his profession who stoops to and adopts the practices
of mercantilism by advertising his services or offering them to the public. As a member of the bar, he
defiles the temple of justice with mercenary activities as the money-changers of old defiled the
temple of Jehovah. "The most worthy and effective advertisement possible, even for a young lawyer,
. . . is the establishment of a well- merited reputation for professional capacity and fidelity to trust.
This cannot be forced but must be the outcome of character and conduct." (Canon 27, Code of
Ethics.)

[G.R. No. 205357. September 2, 2014.]

GMA NETWORK, INC., petitioner, vs. COMMISSION ON ELECTIONS, respondent.

Assailed in these petitions are certain regulations promulgated by the Commission on Elections
(COMELEC) relative to the conduct of the 2013 national and local elections dealing with political
advertisements. Specifically, the petitions question the constitutionality of the limitations placed on
aggregate airtime allowed to candidates and political parties, as well as the requirements incident
thereto, such as the need to report the same, and the sanctions imposed for violations.

The five (5) petitions before the Court put in issue the alleged unconstitutionality of Section 9 (a) of
COMELEC Resolution No. 9615 (Resolution) limiting the broadcast and radio advertisements of
candidates and political parties for national election positions to an aggregate total of one hundred
twenty (120) minutes and one hundred eighty (180) minutes, respectively. They contend that such
restrictive regulation on allowable broadcast time violates freedom of the press, impairs the
people's right to suffrage as well as their right to information relative to the exercise of their right to
choose who to elect during the forthcoming elections.

The heart of the controversy revolves upon the proper interpretation of the limitation on the
number of minutes that candidates may use for television and radio advertisements, as provided in
Section 6 of Republic Act No. 9006 (R.A. No. 9006), otherwise known as the Fair Election Act.

The Court agrees. The assailed rule on "aggregate-based" airtime limits is unreasonable and arbitrary
as it unduly restricts and constrains the ability of candidates and political parties to reach out and
communicate with the people. Here, the adverted reason for imposing the "aggregate-based"
airtime limits leveling the playing field does not constitute a compelling state interest which
would justify such a substantial restriction on the freedom of candidates and political parties to
communicate their ideas, philosophies, platforms and programs of government. And, this is specially
so in the absence of a clear-cut basis for the imposition of such a prohibitive measure. In this
particular instance, what the COMELEC has done is analogous to letting a bird fly after one has
clipped its wings. ESIcaC

It is also particularly unreasonable and whimsical to adopt the aggregate-based time limits on
broadcast time when we consider that the Philippines is not only composed of so many islands.
There are also a lot of languages and dialects spoken among the citizens across the country.
Accordingly, for a national candidate to really reach out to as many of the electorates as possible,
then it might also be necessary that he conveys his message through his advertisements in languages
and dialects that the people may more readily understand and relate to. To add all of these airtimes
in different dialects would greatly hamper the ability of such candidate to express himself a form
of suppression of his political speech.

Respondent itself states that "[t]elevision is arguably the most cost-effective medium of
dissemination. Even a slight increase in television exposure can significantly boost a candidate's
popularity, name recall and electability." 54 If that be so, then drastically curtailing the ability of a
candidate to effectively reach out to the electorate would unjustifiably curtail his freedom to speak
as a means of connecting with the people.

Finally on this matter, it is pertinent to quote what Justice Black wrote in his concurring opinion in
the landmark Pentagon Papers case: "In the First Amendment, the Founding Fathers gave the free
press the protection it must have to fulfill its essential role in our democracy. The press was to serve
the governed, not the governors. The Government's power to censor the press was abolished so that
the press would remain forever free to censure the Government. The press was protected so that it
could bare the secrets of government and inform the people. Only a free and unrestrained press can
effectively expose deception in government." 55

In the ultimate analysis, when the press is silenced, or otherwise muffled in its undertaking of acting
as a sounding board, the people ultimately would be the victims.

[G.R. No. 163406. November 24, 2009.]

POWER SITES AND SIGNS, INC., petitioner, vs. UNITED NEON (a Division of Ever Corporation),
respondent.

Petitioner's Factual Allegations

Power Sites and Signs, Inc. (Power Sites) is a corporation engaged in the business of installing
outdoor advertising signs or billboards. It applied for, and was granted, the necessary permits to
construct a billboard on a site located at Km. 23, East Service Road, Alabang, Muntinlupa (the site). 4
After securing all the necessary permits, Power Sites began to construct its billboard on the site.

Subsequently, in March 2002, petitioner discovered that respondent United Neon, a Division of Ever
Corporation (United Neon), had also began installation and erection of a billboard only one meter
away from its site and which completely blocked petitioner's sign. Thus, on March 5, 2002, petitioner
requested United Neon to make adjustments to its billboard to ensure that petitioner's sign would
not be obstructed. 5 However, petitioner's repeated requests that respondent refrain from
constructing its billboard were ignored, 6 and attempts to amicably resolve the situation failed. 7

The evidence presented before us in support of a preliminary injunction is weak and inconclusive,
and the alleged right sought to be protected by petitioner is vehemently disputed. We note that
both parties allege that: (1) they began construction of their respective billboards first; (2) the
billboard of the other party blocks the other's exclusive line of sight; (3) they are entitled to
protection under the provisions of the National Building Code and OAAP Code of Ethics/Guidelines.
30 However, we are not in a position to resolve these factual matters, which should be resolved by
the trial court. The question of which party began construction first and which party is entitled to the
exclusive line of sight is inextricably linked to whether or not petitioner has the right that deserves
protection through a preliminary injunction. Indeed, the trial court would be in the best position to
determine which billboard was constructed first, their actual location, and whether or not an
existing billboard was obstructed by another. EIcSDC

At this juncture, it is not even clear to us what relationship Power Sites has to the billboard that
would entitle it to seek an injunction, since the documents before us indicate that the barangay
clearance and the Billboard/Signboard permit were issued to HCLC Resource and Development
Corporation, while the Building Permit and Electrical Permit were issued to Mr. Renato Reyes So. 31
As regards the identity of these parties, the explanation thus far presented was

HCLC Resource and Development Corp. (HCLC) is a corporation whose majority shares of stock are
owned by Mr. Renato So, the same majority owner and President of Power Sites. HCLC and Power
Sites are closely connected. HCLC was the entity which constructs the billboards of Power Sites,
while the latter remains the owner of the billboards.

[A.C. No. 5299. August 19, 2003.]

ATTY. ISMAEL G. KHAN, JR., Assistant Court Administrator and Chief, Public Information Office,
complainant, vs. ATTY. RIZALINO T. SIMBILLO, respondent.

1. LEGAL ETHICS; CODE OF PROFESSIONAL RESPONSIBILITY; PROHIBITION AGAINST


SOLICITATION OF LEGAL BUSINESS. Rules 2.03 and 3.01 of the Code of Professional Responsibility
read: Rule 2.03. A lawyer shall not do or permit to be done any act designed primarily to solicit
legal business. Rule 3.01. A lawyer shall not use or permit the use of any false, fraudulent,
misleading, deceptive, undignified, self-laudatory or unfair statement or claim regarding his
qualifications or legal services. AEScHa

2. ID.; DISBARMENT AND SUSPENSION OF ATTORNEYS BY THE SUPREME COURT, GROUNDS


THEREFOR. Rule 138, Section 27 of the Rules of Court states: SEC. 27. Disbarment and suspension
of attorneys by Supreme Court, grounds therefor. A member of the bar may be disbarred or
suspended from his office as attorney by the Supreme Court for any deceit, malpractice or other
gross misconduct in such office, grossly immoral conduct or by reason of his conviction of a crime
involving moral turpitude, or for any violation of the oath which he is required to take before the
admission to practice, or for a willful disobedience appearing as attorney for a party without
authority to do so. CHIScD

3. ID.; PRACTICE OF LAW AS A PROFESSION, NOT A BUSINESS; ELUCIDATED. It has been


repeatedly stressed that the practice of law is not a business. It is a profession in which duty to
public service, not money, is the primary consideration. Lawyering is not primarily meant to be a
money-making venture, and law advocacy is not a capital that necessarily yields profits. The gaining
of a livelihood should be a secondary consideration. The duty to public service and to the
administration of justice should be the primary consideration of lawyers, who must subordinate
their personal interests or what they owe to themselves. The following elements distinguish the
legal profession from a business: 1. A duty of public service, of which the emolument is a by-product,
and in which one may attain the highest eminence without making much money; 2. A relation as an
"officer of the court" to the administration of justice involving thorough sincerity, integrity and
reliability; 3. A relation to clients in the highest degree of fiduciary; 4. A relation to colleagues at the
bar characterized by candor, fairness, and unwillingness to resort to current business methods of
advertising and encroachment on their practice, or dealing directly with their clients. CcADHI

4. ID.; LAWYER ADVERTISING HIMSELF AS MARRIAGE ANNULMENT SPECIALIST UNDERMINES


THE STABILITY AND SANCTITY OF MARRIAGE. What adds to the gravity of respondent's acts is that
in advertising himself as a self-styled "Annulment of Marriage Specialist," he wittingly or unwittingly
erodes and undermines not only the stability but also the sanctity of an institution still considered
sacrosanct despite the contemporary climate of permissiveness in our society. Indeed, in assuring
prospective clients that an annulment may be obtained in four to six months from the time of the
filing of the case, he in fact encourages people, who might have otherwise been disinclined and
would have refrained from dissolving their marriage bonds, to do so. CaASIc

5. ID.; SOLICITATION OF LEGAL BUSINESS; PROPER MANNER THEREOF. The solicitation of


legal business is not altogether proscribed. However, for solicitation to be proper, it must be
compatible with the dignity of the legal profession. If it is made in a modest and decorous manner, it
would bring no injury to the lawyer and to the bar. Thus, the use of simple signs stating the name or
names of the lawyers, the office and residence address and fields of practice, as well as
advertisement in legal periodicals bearing the same brief data, are permissible. Even the use of
calling cards is now acceptable. Publication in reputable law lists, in a manner consistent with the
standards of conduct imposed by the canon, of brief biographical and informative data is likewise
allowable. EcASIC

1. Tax
a. CIR v. General Foods: Not ordinary expense if inordinately large
b. Advertising Associates v. CA and CIR: Not mere lessor of neon signs but engaged in
advertising
c. Philippine Manufacturing Company v. CIR: educational quality is incident to
advertising, thus not exempted from payment of tax
d. PBA v. CA, CTA and CIR: cession of streamer and advertising spaces is subject to
amusement tax
2. Regulation
a. I. Beck, Inc. v. Alfonso: Broadcast station, while it sells time slots for advertising, is
not an advertising agent
b. DPWH and MMDA v. City Advertising Ventures Corp.: dismantling of billboards and
signages
c. Power Sites and Signs, Inc. v. United Neon
d. Churchill and Tait v. Rafferty
3. Election Law
a. Ejercito v. COMELEC: excess election spending on advertising
b. Gatchalian v. COMELEC: donation of billboards to COMELEC
c. GMA Network, Inc. v. COMELEC: ad minutes
d. National Press Club v. COMELEC
e. Telecommunications & Broadcast Attorneys of the Philippines v. COMELEC
f. Penera v. COMELEC
g. Adiong v. COMELEC
h. Mutuc v. COMELEC
i. RA No. 9006
4. Contract Law
a. MMDA v. Trackworks Rail Transit Advertising, Vending and Promotions, Inc:
sanctioned by contract
b. Pan American World Airways, Inc. v. IAC
5. Labor Law
a. Mega Magazine Publications, Inc. et. al. v. Defensor
b. Escario et. al. v. NLRC
6. Intellectual Property Law
a. Pearl & Dean (Phil.), Inc. v. Shoemart, Inc. and North EDSA Marketing, Inc.:
lightboxes not subject of copyright
7. Health Law
a. DOH and FDA v. Philip Morris Philippines Manufacturing, Inc.
8. Legal Ethics
a. The Director of Religious Affairs v. Bayot
b. Khan, Jr. v. Simbillo

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