Republic of the Philippines property of any kind by means of false or fraudulent pretenses,
SUPREME COURT representations, or promises.
Manila
EN BANC
G.R. No. L-19650 September 29, 1966
CALTEX (PHILIPPINES), INC., petitioner-appellee,
vs.
ENRICO PALOMAR, in his capacity as THE POSTMASTER
GENERAL, respondent-appellant.
Office of the Solicitor General for respondent and appellant.
Ross, Selph and Carrascoso for petitioner and appellee.
CASTRO, J.:
In the year 1960 the Caltex (Philippines) Inc. (hereinafter referred to as
Caltex) conceived and laid the groundwork for a promotional scheme
calculated to drum up patronage for its oil products. Denominated "Caltex
Hooded Pump Contest", it calls for participants therein to estimate the
actual number of liters a hooded gas pump at each Caltex station will
dispense during a specified period. Employees of the Caltex (Philippines)
Inc., its dealers and its advertising agency, and their immediate families
excepted, participation is to be open indiscriminately to all "motor vehicle
owners and/or licensed drivers". For the privilege to participate, no fee or
consideration is required to be paid, no purchase of Caltex products
required to be made. Entry forms are to be made available upon request at
each Caltex station where a sealed can will be provided for the deposit of
accomplished entry stubs.
A three-staged winner selection system is envisioned. At the station level,
called "Dealer Contest", the contestant whose estimate is closest to the
actual number of liters dispensed by the hooded pump thereat is to be
awarded the first prize; the next closest, the second; and the next, the third.
Prizes at this level consist of a 3-burner kerosene stove for first; a thermos
bottle and a Ray-O-Vac hunter lantern for second; and an Everready
Magnet-lite flashlight with batteries and a screwdriver set for third. The
first-prize winner in each station will then be qualified to join in the
"Regional Contest" in seven different regions. The winning stubs of the
qualified contestants in each region will be deposited in a sealed can from
which the first-prize, second-prize and third-prize winners of that region will
be drawn. The regional first-prize winners will be entitled to make a three-
day all-expenses-paid round trip to Manila, accompanied by their respective
Caltex dealers, in order to take part in the "National Contest". The regional
second-prize and third-prize winners will receive cash prizes of P500 and
P300, respectively. At the national level, the stubs of the seven regional
first-prize winners will be placed inside a sealed can from which the drawing
for the final first-prize, second-prize and third-prize winners will be made.
Cash prizes in store for winners at this final stage are: P3,000 for first; P2,000
for second; Pl,500 for third; and P650 as consolation prize for each of the
remaining four participants.
Foreseeing the extensive use of the mails not only as amongst the media for
publicizing the contest but also for the transmission of communications
relative thereto, representations were made by Caltex with the postal
authorities for the contest to be cleared in advance for mailing, having in
view sections 1954(a), 1982 and 1983 of the Revised Administrative Code,
the pertinent provisions of which read as follows:
SECTION 1954. Absolutely non-mailable matter. — No matter
belonging to any of the following classes, whether sealed as first-
class matter or not, shall be imported into the Philippines through
the mails, or to be deposited in or carried by the mails of the
Philippines, or be delivered to its addressee by any officer or
employee of the Bureau of Posts:
Written or printed matter in any form advertising, describing, or
in any manner pertaining to, or conveying or purporting to convey
any information concerning any lottery, gift enterprise, or similar
scheme depending in whole or in part upon lot or chance, or any
scheme, device, or enterprise for obtaining any money or
"SECTION 1982. Fraud orders.—Upon satisfactory evidence that
any person or company is engaged in conducting any lottery, gift
enterprise, or scheme for the distribution of money, or of any real
or personal property by lot, chance, or drawing of any kind, or that
any person or company is conducting any scheme, device, or
enterprise for obtaining money or property of any kind through
the mails by means of false or fraudulent pretenses,
representations, or promises, the Director of Posts may instruct
any postmaster or other officer or employee of the Bureau to
return to the person, depositing the same in the mails, with the
word "fraudulent" plainly written or stamped upon the outside
cover thereof, any mail matter of whatever class mailed by or
addressed to such person or company or the representative or
agent of such person or company.
SECTION 1983. Deprivation of use of money order system and
telegraphic transfer service.—The Director of Posts may, upon
evidence satisfactory to him that any person or company is
engaged in conducting any lottery, gift enterprise or scheme for
the distribution of money, or of any real or personal property by
lot, chance, or drawing of any kind, or that any person or company
is conducting any scheme, device, or enterprise for obtaining
money or property of any kind through the mails by means of false
or fraudulent pretenses, representations, or promise, forbid the
issue or payment by any postmaster of any postal money order or
telegraphic transfer to said person or company or to the agent of
any such person or company, whether such agent is acting as an
individual or as a firm, bank, corporation, or association of any
kind, and may provide by regulation for the return to the remitters
of the sums named in money orders or telegraphic transfers
drawn in favor of such person or company or its agent.
The overtures were later formalized in a letter to the Postmaster General,
dated October 31, 1960, in which the Caltex, thru counsel, enclosed a copy
of the contest rules and endeavored to justify its position that the contest
does not violate the anti-lottery provisions of the Postal Law. Unimpressed,
the then Acting Postmaster General opined that the scheme falls within the
purview of the provisions aforesaid and declined to grant the requested
clearance. In its counsel's letter of December 7, 1960, Caltex sought a
reconsideration of the foregoing stand, stressing that there being involved
no consideration in the part of any contestant, the contest was not, under
controlling authorities, condemnable as a lottery. Relying, however, on an
opinion rendered by the Secretary of Justice on an unrelated case seven
years before (Opinion 217, Series of 1953), the Postmaster General
maintained his view that the contest involves consideration, or that, if it
does not, it is nevertheless a "gift enterprise" which is equally banned by
the Postal Law, and in his letter of December 10, 1960 not only denied the
use of the mails for purposes of the proposed contest but as well threatened
that if the contest was conducted, "a fraud order will have to be issued
against it (Caltex) and all its representatives".
Caltex thereupon invoked judicial intervention by filing the present petition
for declaratory relief against Postmaster General Enrico Palomar, praying
"that judgment be rendered declaring its 'Caltex Hooded Pump Contest' not
to be violative of the Postal Law, and ordering respondent to allow
petitioner the use of the mails to bring the contest to the attention of the
public". After issues were joined and upon the respective memoranda of the
parties, the trial court rendered judgment as follows:
In view of the foregoing considerations, the Court holds that the
proposed 'Caltex Hooded Pump Contest' announced to be
conducted by the petitioner under the rules marked as Annex B of
the petitioner does not violate the Postal Law and the respondent
has no right to bar the public distribution of said rules by the mails.
The respondent appealed.
The parties are now before us, arrayed against each other upon two basic
issues: first, whether the petition states a sufficient cause of action for
declaratory relief; and second, whether the proposed "Caltex Hooded Pump
Contest" violates the Postal Law. We shall take these up in seriatim.
1. By express mandate of section 1 of Rule 66 of the old Rules of Court,
which was the applicable legal basis for the remedy at the time it was
invoked, declaratory relief is available to any person "whose rights are
affected by a statute . . . to determine any question of construction or
validity arising under the . . . statute and for a declaration of his rights
thereunder" (now section 1, Rule 64, Revised Rules of Court). In
amplification, this Court, conformably to established jurisprudence on the
matter, laid down certain conditions sine qua non therefor, to wit: (1) there
must be a justiciable controversy; (2) the controversy must be between
persons whose interests are adverse; (3) the party seeking declaratory relief
must have a legal interest in the controversy; and (4) the issue involved must
be ripe for judicial determination (Tolentino vs. The Board of
Accountancy, et al., G.R. No. L-3062, September 28, 1951; Delumen, et al.
vs. Republic of the Philippines, 50 O.G., No. 2, pp. 576, 578-579; Edades vs.
Edades, et al., G.R. No. L-8964, July 31, 1956). The gravamen of the
appellant's stand being that the petition herein states no sufficient cause of
action for declaratory relief, our duty is to assay the factual bases thereof
upon the foregoing crucible.
As we look in retrospect at the incidents that generated the present
controversy, a number of significant points stand out in bold relief. The
appellee (Caltex), as a business enterprise of some consequence,
concededly has the unquestioned right to exploit every legitimate means,
and to avail of all appropriate media to advertise and stimulate increased
patronage for its products. In contrast, the appellant, as the authority
charged with the enforcement of the Postal Law, admittedly has the power
and the duty to suppress transgressions thereof — particularly thru the
issuance of fraud orders, under Sections 1982 and 1983 of the Revised
Administrative Code, against legally non-mailable schemes. Obviously
pursuing its right aforesaid, the appellee laid out plans for the sales
promotion scheme hereinbefore detailed. To forestall possible difficulties in
the dissemination of information thereon thru the mails, amongst other
media, it was found expedient to request the appellant for an advance
clearance therefor. However, likewise by virtue of his jurisdiction in the
premises and construing the pertinent provisions of the Postal Law, the
appellant saw a violation thereof in the proposed scheme and accordingly
declined the request. A point of difference as to the correct construction to
be given to the applicable statute was thus reached. Communications in
which the parties expounded on their respective theories were exchanged.
The confidence with which the appellee insisted upon its position was
matched only by the obstinacy with which the appellant stood his ground.
And this impasse was climaxed by the appellant's open warning to the
appellee that if the proposed contest was "conducted, a fraud order will
have to be issued against it and all its representatives."
Against this backdrop, the stage was indeed set for the remedy prayed for.
The appellee's insistent assertion of its claim to the use of the mails for its
proposed contest, and the challenge thereto and consequent denial by the
appellant of the privilege demanded, undoubtedly spawned a live
controversy. The justiciability of the dispute cannot be gainsaid. There is an
active antagonistic assertion of a legal right on one side and a denial thereof
on the other, concerning a real — not a mere theoretical — question or
issue. The contenders are as real as their interests are substantial. To the
appellee, the uncertainty occasioned by the divergence of views on the
issue of construction hampers or disturbs its freedom to enhance its
business. To the appellant, the suppression of the appellee's proposed
contest believed to transgress a law he has sworn to uphold and enforce is
an unavoidable duty. With the appellee's bent to hold the contest and the
appellant's threat to issue a fraud order therefor if carried out, the
contenders are confronted by the ominous shadow of an imminent and
inevitable litigation unless their differences are settled and stabilized by a
tranquilizing declaration (Pablo y Sen, et al. vs. Republic of the Philippines,
G.R. No. L-6868, April 30, 1955). And, contrary to the insinuation of the
appellant, the time is long past when it can rightly be said that merely the
appellee's "desires are thwarted by its own doubts, or by the fears of
others" — which admittedly does not confer a cause of action. Doubt, if any
there was, has ripened into a justiciable controversy when, as in the case at
bar, it was translated into a positive claim of right which is actually
contested (III Moran, Comments on the Rules of Court, 1963 ed., pp. 132-
133, citing: Woodward vs. Fox West Coast Theaters, 36 Ariz., 251, 284 Pac.
350).
We cannot hospitably entertain the appellant's pretense that there is here
no question of construction because the said appellant "simply applied the
clear provisions of the law to a given set of facts as embodied in the rules of
the contest", hence, there is no room for declaratory relief. The infirmity of
this pose lies in the fact that it proceeds from the assumption that, if the
circumstances here presented, the construction of the legal provisions can
be divorced from the matter of their application to the appellee's contest.
This is not feasible. Construction, verily, is the art or process of discovering
and expounding the meaning and intention of the authors of the law with
respect to its application to a given case, where that intention is rendered
doubtful, amongst others, by reason of the fact that the given case is not
explicitly provided for in the law (Black, Interpretation of Laws, p. 1). This is
precisely the case here. Whether or not the scheme proposed by the
appellee is within the coverage of the prohibitive provisions of the Postal
Law inescapably requires an inquiry into the intended meaning of the words
used therein. To our mind, this is as much a question of construction or
interpretation as any other.
Nor is it accurate to say, as the appellant intimates, that a pronouncement
on the matter at hand can amount to nothing more than an advisory opinion
the handing down of which is anathema to a declaratory relief action. Of
course, no breach of the Postal Law has as yet been committed. Yet, the
disagreement over the construction thereof is no longer nebulous or
contingent. It has taken a fixed and final shape, presenting clearly defined
legal issues susceptible of immediate resolution. With the battle lines
drawn, in a manner of speaking, the propriety — nay, the necessity — of
setting the dispute at rest before it accumulates the asperity distemper,
animosity, passion and violence of a full-blown battle which looms ahead
(III Moran, Comments on the Rules of Court, 1963 ed., p. 132 and cases
cited), cannot but be conceded. Paraphrasing the language in Zeitlin vs.
Arnebergh 59 Cal., 2d., 901, 31 Cal. Rptr., 800, 383 P. 2d., 152, cited in 22
Am. Jur., 2d., p. 869, to deny declaratory relief to the appellee in the
situation into which it has been cast, would be to force it to choose between
undesirable alternatives. If it cannot obtain a final and definitive
pronouncement as to whether the anti-lottery provisions of the Postal Law
apply to its proposed contest, it would be faced with these choices: If it
launches the contest and uses the mails for purposes thereof, it not only
incurs the risk, but is also actually threatened with the certain imposition,
of a fraud order with its concomitant stigma which may attach even if the
appellee will eventually be vindicated; if it abandons the contest, it becomes
a self-appointed censor, or permits the appellant to put into effect a virtual
fiat of previous censorship which is constitutionally unwarranted. As we
weigh these considerations in one equation and in the spirit of liberality
with which the Rules of Court are to be interpreted in order to promote
their object (section 1, Rule 1, Revised Rules of Court) — which, in the
instant case, is to settle, and afford relief from uncertainty and insecurity
with respect to, rights and duties under a law — we can see in the present
case any imposition upon our jurisdiction or any futility or prematurity in
our intervention.
The appellant, we apprehend, underrates the force and binding effect of the
ruling we hand down in this case if he believes that it will not have the final
and pacifying function that a declaratory judgment is calculated to subserve.
At the very least, the appellant will be bound. But more than this, he
obviously overlooks that in this jurisdiction, "Judicial decisions applying or
interpreting the law shall form a part of the legal system" (Article 8, Civil
Code of the Philippines). In effect, judicial decisions assume the same
authority as the statute itself and, until authoritatively abandoned,
necessarily become, to the extent that they are applicable, the criteria
which must control the actuations not only of those called upon to abide
thereby but also of those in duty bound to enforce obedience thereto.
Accordingly, we entertain no misgivings that our resolution of this case will
terminate the controversy at hand.
It is not amiss to point out at this juncture that the conclusion we have
herein just reached is not without precedent. In Liberty Calendar Co. vs.
Cohen, 19 N.J., 399, 117 A. 2d., 487, where a corporation engaged in
promotional advertising was advised by the county prosecutor that its
proposed sales promotion plan had the characteristics of a lottery, and that
if such sales promotion were conducted, the corporation would be subject
to criminal prosecution, it was held that the corporation was entitled to
maintain a declaratory relief action against the county prosecutor to
determine the legality of its sales promotion plan. In pari materia, see
also: Bunis vs. Conway, 17 App. Div. 2d., 207, 234 N.Y.S. 2d., 435; Zeitlin vs.
Arnebergh, supra; Thrillo, Inc. vs. Scott, 15 N.J. Super. 124, 82 A. 2d., 903.
In fine, we hold that the appellee has made out a case for declaratory relief.
2. The Postal Law, chapter 52 of the Revised Administrative Code, using
almost identical terminology in sections 1954(a), 1982 and 1983
thereof, supra, condemns as absolutely non-mailable, and empowers the
Postmaster General to issue fraud orders against, or otherwise deny the use
of the facilities of the postal service to, any information concerning "any
lottery, gift enterprise, or scheme for the distribution of money, or of any
real or personal property by lot, chance, or drawing of any kind". Upon these
words hinges the resolution of the second issue posed in this appeal.
Happily, this is not an altogether untrodden judicial path. As early as in 1922,
in "El Debate", Inc. vs. Topacio, 44 Phil., 278, 283-284, which significantly
dwelt on the power of the postal authorities under the abovementioned
provisions of the Postal Law, this Court declared that —
While countless definitions of lottery have been attempted, the
authoritative one for this jurisdiction is that of the United States
Supreme Court, in analogous cases having to do with the power
of the United States Postmaster General, viz.: The term "lottery"
extends to all schemes for the distribution of prizes by chance,
such as policy playing, gift exhibitions, prize concerts, raffles at
fairs, etc., and various forms of gambling. The three essential
elements of a lottery are: First, consideration; second, prize; and
third, chance. (Horner vs. States [1892], 147 U.S. 449; Public
Clearing House vs. Coyne [1903], 194 U.S., 497; U.S. vs. Filart and
Singson [1915], 30 Phil., 80; U.S. vs. Olsen and Marker [1917], 36
Phil., 395; U.S. vs. Baguio [1919], 39 Phil., 962; Valhalla Hotel
Construction Company vs. Carmona, p. 233, ante.)
Unanimity there is in all quarters, and we agree, that the elements of prize
and chance are too obvious in the disputed scheme to be the subject of
contention. Consequently as the appellant himself concedes, the field of
inquiry is narrowed down to the existence of the element of consideration
therein. Respecting this matter, our task is considerably lightened inasmuch
as in the same case just cited, this Court has laid down a definitive yard-stick
in the following terms —
In respect to the last element of consideration, the law does not
condemn the gratuitous distribution of property by chance, if no
consideration is derived directly or indirectly from the party
receiving the chance, but does condemn as criminal schemes in
which a valuable consideration of some kind is paid directly or
indirectly for the chance to draw a prize.
Reverting to the rules of the proposed contest, we are struck by the clarity
of the language in which the invitation to participate therein is couched.
Thus —
No puzzles, no rhymes? You don't need wrappers, labels or
boxtops? You don't have to buy anything? Simply estimate the
actual number of liter the Caltex gas pump with the hood at your
favorite Caltex dealer will dispense from — to —, and win valuable
prizes . . . ." .
Nowhere in the said rules is any requirement that any fee be paid, any
merchandise be bought, any service be rendered, or any value whatsoever
be given for the privilege to participate. A prospective contestant has but to
go to a Caltex station, request for the entry form which is available on
demand, and accomplish and submit the same for the drawing of the
winner. Viewed from all angles or turned inside out, the contest fails to
exhibit any discernible consideration which would brand it as a lottery.
Indeed, even as we head the stern injunction, "look beyond the fair exterior,
to the substance, in order to unmask the real element and pernicious
tendencies which the law is seeking to prevent" ("El Debate", Inc. vs.
Topacio, supra, p. 291), we find none. In our appraisal, the scheme does not
only appear to be, but actually is, a gratuitous distribution of property by
chance.
There is no point to the appellant's insistence that non-Caltex customers
who may buy Caltex products simply to win a prize would actually be
indirectly paying a consideration for the privilege to join the contest.
Perhaps this would be tenable if the purchase of any Caltex product or the
use of any Caltex service were a pre-requisite to participation. But it is not.
A contestant, it hardly needs reiterating, does not have to buy anything or
to give anything of value.1awphîl.nèt
Off-tangent, too, is the suggestion that the scheme, being admittedly for
sales promotion, would naturally benefit the sponsor in the way of
increased patronage by those who will be encouraged to prefer Caltex
products "if only to get the chance to draw a prize by securing entry blanks".
The required element of consideration does not consist of the benefit
derived by the proponent of the contest. The true test, as laid down
in People vs. Cardas, 28 P. 2d., 99, 137 Cal. App. (Supp.) 788, is whether the
participant pays a valuable consideration for the chance, and not whether
those conducting the enterprise receive something of value in return for the
distribution of the prize. Perspective properly oriented, the standpoint of
the contestant is all that matters, not that of the sponsor. The following,
culled from Corpus Juris Secundum, should set the matter at rest:
The fact that the holder of the drawing expects thereby to receive,
or in fact does receive, some benefit in the way of patronage or
otherwise, as a result of the drawing; does not supply the element
of consideration. Griffith Amusement Co. vs. Morgan, Tex. Civ.
App., 98 S.W., 2d., 844" (54 C.J.S., p. 849).
Thus enlightened, we join the trial court in declaring that the "Caltex
Hooded Pump Contest" proposed by the appellee is not a lottery that may
be administratively and adversely dealt with under the Postal Law.
But it may be asked: Is it not at least a "gift enterprise, or scheme for the
distribution of money, or of any real or personal property by lot, chance, or
drawing of any kind", which is equally prescribed? Incidentally, while the
appellant's brief appears to have concentrated on the issue of
consideration, this aspect of the case cannot be avoided if the remedy here
invoked is to achieve its tranquilizing effect as an instrument of both
curative and preventive justice. Recalling that the appellant's action was
predicated, amongst other bases, upon Opinion 217, Series 1953, of the
Secretary of Justice, which opined in effect that a scheme, though not a
lottery for want of consideration, may nevertheless be a gift enterprise in
which that element is not essential, the determination of whether or not
the proposed contest — wanting in consideration as we have found it to be
— is a prohibited gift enterprise, cannot be passed over sub silencio.
While an all-embracing concept of the term "gift enterprise" is yet to be
spelled out in explicit words, there appears to be a consensus among
lexicographers and standard authorities that the term is commonly applied
to a sporting artifice of under which goods are sold for their market value
but by way of inducement each purchaser is given a chance to win a prize
(54 C.J.S., 850; 34 Am. Jur., 654; Black, Law Dictionary, 4th ed., p. 817;
Ballantine, Law Dictionary with Pronunciations, 2nd ed., p. 55; Retail Section
of Chamber of Commerce of Plattsmouth vs. Kieck, 257 N.W., 493, 128 Neb.
13; Barker vs. State, 193 S.E., 605, 56 Ga. App., 705; Bell vs. State, 37 Tenn.
507, 509, 5 Sneed, 507, 509). As thus conceived, the term clearly cannot
embrace the scheme at bar. As already noted, there is no sale of anything
to which the chance offered is attached as an inducement to the purchaser.
The contest is open to all qualified contestants irrespective of whether or
not they buy the appellee's products.
Going a step farther, however, and assuming that the appellee's contest can
be encompassed within the broadest sweep that the term "gift enterprise"
is capable of being extended, we think that the appellant's pose will gain no
added comfort. As stated in the opinion relied upon, rulings there are
indeed holding that a gift enterprise involving an award by chance, even in
default of the element of consideration necessary to constitute a lottery, is
prohibited (E.g.: Crimes vs. States, 235 Ala 192, 178 So. 73; Russell vs.
Equitable Loan & Sec. Co., 129 Ga. 154, 58 S.E., 88; State ex rel. Stafford vs.
Fox-Great Falls Theater Corporation, 132 P. 2d., 689, 694, 698, 114 Mont.
52). But this is only one side of the coin. Equally impressive authorities
declare that, like a lottery, a gift enterprise comes within the prohibitive
statutes only if it exhibits the tripartite elements of prize, chance and
consideration (E.g.: Bills vs. People, 157 P. 2d., 139, 142, 113 Colo., 326;
D'Orio vs. Jacobs, 275 P. 563, 565, 151 Wash., 297; People vs. Psallis, 12
N.Y.S., 2d., 796; City and County of Denver vs. Frueauff, 88 P., 389, 394, 39
Colo., 20, 7 L.R.A., N.S., 1131, 12 Ann. Cas., 521; 54 C.J.S., 851, citing: Barker
vs. State, 193 S.E., 605, 607, 56 Ga. App., 705; 18 Words and Phrases, perm.
ed., pp. 590-594). The apparent conflict of opinions is explained by the fact
that the specific statutory provisions relied upon are not identical. In some
cases, as pointed out in 54 C.J.S., 851, the terms "lottery" and "gift
enterprise" are used interchangeably (Bills vs. People, supra); in others, the
necessity for the element of consideration or chance has been specifically
eliminated by statute. (54 C.J.S., 351-352, citing Barker vs. State, supra;
State ex rel. Stafford vs. Fox-Great Falls Theater Corporation, supra). The
lesson that we derive from this state of the pertinent jurisprudence is,
therefore, that every case must be resolved upon the particular phraseology
of the applicable statutory provision.
Taking this cue, we note that in the Postal Law, the term in question is used
in association with the word "lottery". With the meaning of lottery settled,
and consonant to the well-known principle of legal hermeneutics noscitur a
sociis — which Opinion 217 aforesaid also relied upon although only insofar
as the element of chance is concerned — it is only logical that the term
under a construction should be accorded no other meaning than that which
is consistent with the nature of the word associated therewith. Hence, if
lottery is prohibited only if it involves a consideration, so also must the term
"gift enterprise" be so construed. Significantly, there is not in the law the
slightest indicium of any intent to eliminate that element of consideration
from the "gift enterprise" therein included.
This conclusion firms up in the light of the mischief sought to be remedied
by the law, resort to the determination thereof being an accepted extrinsic
aid in statutory construction. Mail fraud orders, it is axiomatic, are designed
to prevent the use of the mails as a medium for disseminating printed
matters which on grounds of public policy are declared non-mailable. As
applied to lotteries, gift enterprises and similar schemes, justification lies in
the recognized necessity to suppress their tendency to inflame the gambling
spirit and to corrupt public morals (Com. vs. Lund, 15 A. 2d., 839, 143 Pa.
Super. 208). Since in gambling it is inherent that something of value be
hazarded for a chance to gain a larger amount, it follows ineluctably that
where no consideration is paid by the contestant to participate, the reason
behind the law can hardly be said to obtain. If, as it has been held —
Gratuitous distribution of property by lot or chance does not
constitute "lottery", if it is not resorted to as a device to evade the
law and no consideration is derived, directly or indirectly, from the
party receiving the chance, gambling spirit not being cultivated or
stimulated thereby. City of Roswell vs. Jones, 67 P. 2d., 286, 41
N.M., 258." (25 Words and Phrases, perm. ed., p. 695, emphasis
supplied).
we find no obstacle in saying the same respecting a gift enterprise. In the
end, we are persuaded to hold that, under the prohibitive provisions of the
Postal Law which we have heretofore examined, gift enterprises and similar
schemes therein contemplated are condemnable only if, like lotteries, they
involve the element of consideration. Finding none in the contest here in
question, we rule that the appellee may not be denied the use of the mails
for purposes thereof.
Recapitulating, we hold that the petition herein states a sufficient cause of
action for declaratory relief, and that the "Caltex Hooded Pump Contest" as
described in the rules submitted by the appellee does not transgress the
provisions of the Postal Law.
ACCORDINGLY, the judgment appealed from is affirmed. No costs.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-61236 January 31, 1984
NATIONAL FEDERATION OF LABOR and ZAMBOWOOD MONTHLY
EMPLOYEES UNION, ITS OFFICERS AND MEMBERS, petitioners,
vs.
THE HONORABLE CARLITO A. EISMA, LT. COL. JACOB CARUNCHO,
COMMANDING OFFICER, ZAMBOANGA DISTRICT COMMAND, PC, AFP,
and ZAMBOANGA WOOD PRODUCTS, respondents.
Jose C. Espina and Potenciano Flores for petitioners.
The Solicitor General for public respondents.
Gaspar V. Tagalo for private respondent Zamboanga Wood Products.
FERNANDO, C.J.:
This Court is confronted once again with the question of whether or not it
is a court or a labor arbiter that can pass on a suit for damages filed by the
employer, here private respondent Zamboanga Wood Products.
Respondent Judge Carlito A. Eisma 1 then of the Court of First Instance, now
of the Regional Trial Court of Zamboanga City, was of the view that it is a
court and denied a motion to dismiss filed by petitioners National
Federation of labor and Zambowood Monthly Employees Union, its officers
and members. It was such an order dated July 20, 1982 that led to the filing
of this certiorari and prohibition proceeding. In the order assailed, it was
required that the officers and members of petitioner union appear before
the court to show cause why a writ of preliminary injunction should not be
issued against them and in the meanwhile such persons as well as any other
persons acting under their command and on their behalf were "temporarily
restrained and ordered to desist and refrain from further obstructing,
impeding and impairing plaintiff's use of its property and free ingress to or
egress from plaintiff's Manufacturing Division facilities at Lumbayao,
Zamboanga City and on its road right of way leading to and from said
plaintiff's facilities, pending the determination of the litigation, and unless a
contrary order is issued by this Court." 2
The record discloses that petitioner National Federation of Labor, on March
5, 1982, filed with the Ministry of Labor and Employment, Labor Relations
Division, Zamboanga City, a petition for direct certification as the sole
exclusive collective bargaining representative of the monthly paid
employees of the respondent Zamboanga Wood Products, Inc. at its
manufacturing plant in Lumbayao, Zamboanga City. 3 Such employees, on
April 17, 1982 charged respondent firm before the same office of the
Ministry of Labor for underpayment of monthly living allowances. 4Then
came, on May 3, 1982, from petitioner union, a notice of strike against
private respondent, alleging illegal termination of Dionisio Estioca,
president of the said local union; unfair labor practice, non-payment of
living allowances; and "employment of oppressive alien management
personnel without proper permit. 5 It was followed by the union submitting
the minutes of the declaration of strike, "including the ninety (90) ballots,
of which 79 voted for yes and three voted for no." 6 The strike began on May
23, 1982. 7 On July 9, 1982, private respondent Zambowood filed a
complaint with respondent Judge against the officers and members of
petitioners union, for "damages for obstruction of private property with
prayer for preliminary injunction and/or restraining order." 8 It was alleged
that defendants, now petitioners, blockaded the road leading to its
manufacturing division, thus preventing customers and suppliers free
ingress to or egress from such premises. 9 Six days later, there was a motion
for the dismissal and for the dissolution of the restraining order and
opposition to the issuance of the writ of preliminary injunction filed by
petitioners. It was contended that the acts complained of were incidents of
picketing by defendants then on strike against private respondent, and that
therefore the exclusive jurisdiction belongs to the Labor Arbiter pursuant to
Batas Pambansa Blg. 227, not to a court of first instance.10 There was, as
noted earlier, a motion to dismiss, which was denied. Hence this petition for
certiorari.
Four days after such petition was filed, on August 3, 1982, this Court
required respondents to answer and set the plea for a preliminary
injunction to be heard on Thursday, August 5, 1982. 11 After such hearing,
a temporary restraining order was issued, "directing respondent Judge and
the commanding officer in Zamboanga and his agents from enforcing
the ex-parte order of injunction dated July 20, 1982; and to restrain the
respondent Judge from proceeding with the hearing of the until otherwise
case effective as of [that] date and continuing ordered by [the] Court. In the
exercise of the right to peaceful picketing, petitioner unions must abide
strictly with Batas Pambansa Blg. 227, specifically Section 6 thereof,
amending Article 265 of the Labor Code, which now reads: '(e) No person
engaged in picketing shall commit any act of violence, coercion or
intimidation or obstruct the free ingress to or egress from the employer's
premises for lawful purposes, or obstruct public thoroughfares.' " 12
On August 13, 1982, the answer of private respondent was filed sustaining
the original jurisdiction of respondent Judge and maintaining that the order
complained of was not in excess of such jurisdiction, or issued with grave
abuse of discretion. Solicitor General Estelito P. Mendoza, 13 on the other
hand, instead of filing an answer, submitted a Manifestation in lieu thereof.
He met squarely the issue of whether or not respondent Judge had
jurisdiction, and answered in the negative. He (i)ncluded that "the instant
petition has merit and should be given due course."
He traced the changes undergone by the Labor Code, citing at the same time
the decisions issued by this Court after each of such changes. As pointed
out, the original wording of Article 217 vested the labor arbiters with
jurisdictional. 14 So it was applied by this Court in Garcia v. Martinez 15 and
in Bengzon v. Inciong. 16 On May 1, 1978, however, Presidential Decree No.
1367 was issued, amending Article 217, and provided "that the Regional
Directors shall not indorse and Labor Arbiters shall not entertain claims for
moral and other forms of damages." 17 The ordinary courts were thus
vested with jurisdiction to award actual and moral damages in the case of
illegal dismissal of employees. 18 That is not, as pointed out by the Solicitor
General, the end of the story, for on May 1, 1980, Presidential Decree No.
1691 was issued, further amending Article 217, returning the original
jurisdiction to the labor arbiters, thus enabling them to decide "3. All money
claims of workers, including those based on non-payment or underpayment
of wages, overtime compensation, separation pay and other benefits
provided by law or appropriate agreement, except claims for employees
compensation, social security, medicare and maternity benefits; [and] (5)
All other claims arising from employer-employee relations unless expressly
excluded by tills Code." 19 An equally conclusive manifestation of the lack
of jurisdiction of a court of first instance then, a regional trial court now, is
Batas Pambansa Blg. 130, amending Article 217 of the Labor Code. It took
effect on August 21, 1981. Subparagraph 2, paragraph (a) is now worded
thus: "(2) those that involve wages, hours of work and other terms and
conditions of employment." 20 This is to be compared with the former
phraseology "(2) unresolved issue in collective bargaining, including those
that involve wages, hours of work and other terms and conditions of
employment." 21 It is to be noted that Batas Pambansa Blg. 130 made no
change with respect to the original and exclusive jurisdiction of Labor
Arbiters with respect to money claims of workers or claims for damages
arising from employer-employee relations.
Nothing becomes clearer, therefore, than the meritorious character of this
petition. certiorari and prohibition lie, respondent Judge being devoid of
jurisdiction to act on the matter.
1. Article 217 is to be applied the way it is worded. The exclusive original
jurisdiction of a labor arbiter is therein provided for explicitly. It means, it
can only mean, that a court of first instance judge then, a regional trial court
judge now, certainly acts beyond the scope of the authority conferred on
him by law when he entertained the suit for damages, arising from picketing
that accompanied a strike. That was squarely within the express terms of
the law. Any deviation cannot therefore be tolerated. So it has been the
constant ruling of this Court even prior to Lizarraga Hermanos v. Yap
Tico, 22 a 1913 decision. The ringing words of the ponencia of Justice
Moreland still call for obedience. Thus, "The first and fundamental duty of
courts, in our judgment, is to apply the law. Construction and interpretation
come only after it has been demonstrated that application is impossible or
inadequate without them." 23 It is so even after the lapse of sixty years. 24
2. On the precise question at issue under the law as it now stands, this Court
has spoken in three decisions. They all reflect the utmost fidelity to the plain
command of the law that it is a labor arbiter, not a court, that ossesses
original and exclusive jurisdiction to decide a claim for damages arising from
picketing or a strike. In Pepsi-Cola Bottling Co. v. Martinez, 25 the issue was
set forth in the opening paragraph, in the ponencia of Justice Escolin: "This
petition for certiorari, prohibition and mandamus raises anew the legal
question often brought to this Court: Which tribunal has exclusive
jurisdiction over an action filed by an employee against his employer for
recovery of unpaid salaries, separation benefits and damages — the court
of general jurisdiction or the Labor Arbiter of the National Labor Relations
Commission [NLRC]?" 26 It was categorically held: "We rule that the Labor
Arbiter has exclusive jurisdiction over the case." 27 Then came this portion
of the opinion: "Jurisdiction over the subject matter in a judicial proceeding
is conferred by the sovereign authority which organizes the court; and it is
given only by law. Jurisdiction is never presumed; it must be conferred by
law in words that do not admit of doubt. Since the jurisdiction of courts and
judicial tribunals is derived exclusively from the statutes of the forum, the
issue before us should be resolved on the basis of the law or statute now in
force. We find that law in presidential Decree 1691 which took effect on
May 1, 1980, Section 3 of which reads as follows: ... Article 217. Jurisdiction
of Labor Arbiters and the Commission. — (a) The Labor Arbiters shall have
the original and exclusive jurisdiction to hear and decide the following cases
involving all workers, whether agricultural or non-agricultural: ... 3. All
money claims of workers, including those based on nonpayment or
underpayment of wages, overtime compensation, separation pay and other
benefits provided by law or appropriate agreement, except claims for
employees' compensation, social security, medicare and maternity benefits;
4. Cases involving household services; and 5. All other claims arising from
employer-employee relations, unless expressly excluded by this
Code." 28 That same month, two other cases were similarly decided, Ebon v.
De Guzman 29 and Aguda v. Vallejos. 30
3. It is regrettable that the ruling in the above three decisions, decided in
March of 1982, was not followed by private respondent when it filed the
complaint for damages on July 9, 1982, more than four months later. 31 On
this point, reference may be made to our decision in National Federation of
Labor, et al. v. The Honorable Minister of Labor and
Employment, 32 promulgated on September 15, 1983. In that case, the
question involved was the failure of the same private respondent,
Zamboanga Wood Products, Inc., to admit the striking petitioners, eighty-
one in number, back to work after an order of Minister Blas F. Ople certifying
to the National Labor Relations Commission the labor dispute for
compulsory arbitration pursuant to Article 264 (g) of the Labor Code of the
Philippines. It was noted in the first paragraph of our opinion in that case:
"On the face of it, it seems difficult to explain why private respondent would
not comply with such order considering that the request for compulsory
arbitration came from it. It ignored this notification by the presidents of the
labor unions involved to its resident manager that the striking employees
would lift their picket line and start returning to work on August 20, 1982.
Then, too, Minister Ople denied a partial motion for reconsideration insofar
as the return-to-work aspect is concerned which reads: 'We find no merit in
the said Motion for Reconsideration. The Labor code, as amended,
specifically Article 264 (g), mandates that whenever a labor dispute is
certified by the Minister of Labor and Employment to the National Labor
Relations Commission for compulsory arbitration and a strike has already
taken place at the time of certification, "all striking employees shall
immediately return to work and the employees shall immediately resume
operations and readmit all workers under the same terms and conditions
prevailing before the strike." ' " 33 No valid distinction can be made between
the exercise of compulsory arbitration vested in the Ministry of Labor and
the jurisdiction of a labor arbiter to pass over claims for damages in the light
of the express provision of the Labor Code as set forth in Article 217. In both
cases, it is the Ministry, not a court of justice, that is vested by law with
competence to act on the matter.
4. The issuance of Presidential Decree No. 1691 and the enactment of Batas
Pambansa Blg. 130, made clear that the exclusive and original jurisdiction
for damages would once again be vested in labor arbiters. It can be affirmed
that even if they were not that explicit, history has vindicated the view that
in the appraisal of what was referred to by Philippine American
Management & Financing Co., Inc. v. Management & Supervisors
Association of the Philippine-American Management & Financing Co.,
Inc. 34 as "the rather thorny question as to where in labor matters the
dividing line is to be drawn"35 between the power lodged in an
administrative body and a court, the unmistakable trend has been to refer
it to the former. Thus: "Increasingly, this Court has been committed to the
view that unless the law speaks clearly and unequivocally, the choice should
fall on [an administrative agency]." 36 Certainly, the present Labor Code is
even more committed to the view that on policy grounds, and equally so in
the interest of greater promptness in the disposition of labor matters, a
court is spared the often onerous task of determining what essentially is a
factual matter, namely, the damages that may be incurred by either labor
or management as a result of disputes or controversies arising from
employer-employee relations.
WHEREFORE, the writ of certiorari is granted and the order of July 20, 1982,
issued by respondent Judge, is nullified and set aside. The writ of prohibition
is likewise granted and respondent Judge, or whoever acts in his behalf in
the Regional Trial Court to which this case is assigned, is enjoin from taking
any further action on Civil Case No. 716 (2751), except for the purpose of
dismissing it. The temporary restraining order of August 5, 1982 is hereby
made permanent.
Teehankee, Makasiar, Aquino, Guerrero, Melencio-Herrera, Plana, Escolin
Relova and Gutierrez, Jr., JJ., concur.
Concepcion Jr., J., took no part.
De Castro, J., is on leave.
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 111107 January 10, 1997
LOEONARDO A. PAAT, in his capacity as Officer-in-Charge (OIC), Regional
Executive Director (RED), Region 2 and JOVITO LAYUGAN, JR., in his
capacity as Community Environment and Natural Resources Officer
(CENRO), both of the Department of Environment and Natural Resources
(DENR), petitioners,
vs.
COURT OF APPEALS, HON. RICARDO A. BACULI in his capacity as
Presiding Judge of Branch 2, Regional Trial Court at Tuguegarao, Cagayan,
and SPOUSES BIENVENIDO and VICTORIA DE GUZMAN, respondents.
TORRES, JR., J.:
Without violating the principle of exhaustion of administrative remedies,
may an action for replevin prosper to recover a movable property which is
the subject matter of an administrative forfeiture proceeding in the
Department of Environment and Natural Resources pursuant to Section 68-
A of P.D. 705, as amended, entitled The Revised Forestry Code of the
Philippines?
Are the Secretary of DENR and his representatives empowered to confiscate
and forfeit conveyances used in transporting illegal forest products in favor
of the government?
These are two fundamental questions presented before us for our
resolution.
The controversy on hand had its incipiency on May 19, 1989 when the truck
of private respondent Victoria de Guzman while on its way to Bulacan from
San Jose, Baggao, Cagayan, was seized by the Department of Environment
and Natural Resources (DENR, for brevity) personnel in Aritao, Nueva
Vizcaya because the driver could not produce the required documents for
the forest products found concealed in the truck. Petitioner Jovito Layugan,
the Community Environment and Natural Resources Officer (CENRO) in
Aritao, Cagayan, issued on May 23, 1989 an order of confiscation of the
truck and gave the owner thereof fifteen (15) days within which to submit
an explanation why the truck should not be forfeited. Private respondents,
however, failed to submit the required explanation. On June 22,
1989,1 Regional Executive Director Rogelio Baggayan of DENR sustained
petitioner Layugan's action of confiscation and ordered the forfeiture of the
truck invoking Section 68-A of Presidential Decree No. 705 as amended by
Executive Order No. 277. Private respondents filed a letter of
reconsideration dated June 28, 1989 of the June 22, 1989 order of Executive
Director Baggayan, which was, however, denied in a subsequent order of
July 12, 1989.2 Subsequently, the case was brought by the petitioners to the
Secretary of DENR pursuant to private respondents' statement in their letter
dated June 28, 1989 that in case their letter for reconsideration would be
denied then "this letter should be considered as an appeal to the
Secretary."3 Pending resolution however of the appeal, a suit for replevin,
docketed as Civil Case 4031, was filed by the private respondents against
petitioner Layugan and Executive Director Baggayan4 with the Regional Trial
Court, Branch 2 of Cagayan,5 which issued a writ ordering the return of the
truck to private respondents.6 Petitioner Layugan and Executive Director
Baggayan filed a motion to dismiss with the trial court contending, inter alia,
that private respondents had no cause of action for their failure to exhaust
administrative remedies. The trial court denied the motion to dismiss in an
order dated December 28, 1989.7 Their motion for reconsideration having
been likewise denied, a petition for certiorari was filed by the petitioners
with the respondent Court of Appeals which sustained the trial court's order
ruling that the question involved is purely a legal question.8 Hence, this
present petition,9 with prayer for temporary restraining order and/or
preliminary injunction, seeking to reverse the decision of the respondent
Court of Appeals was filed by the petitioners on September 9, 1993. By
virtue of the Resolution dated September 27, 1993,10 the prayer for the
issuance of temporary restraining order of petitioners was granted by this
Court.
Invoking the doctrine of exhaustion of administrative remedies, petitioners
aver that the trial court could not legally entertain the suit for replevin
because the truck was under administrative seizure proceedings pursuant
to Section 68-A of P.D. 705, as amended by E.O. 277. Private respondents,
on the other hand, would seek to avoid the operation of this principle
asserting that the instant case falls within the exception of the doctrine
upon the justification that (1) due process was violated because they were
not given the chance to be heard, and (2) the seizure and forfeiture was
unlawful on the grounds: (a) that the Secretary of DENR and his
representatives have no authority to confiscate and forfeit conveyances
utilized in transporting illegal forest products, and (b) that the truck as
admitted by petitioners was not used in the commission of the crime.
Upon a thorough and delicate scrutiny of the records and relevant
jurisprudence on the matter, we are of the opinion that the plea of
petitioners for reversal is in order.
This Court in a long line of cases has consistently held that before a party is
allowed to seek the intervention of the court, it is a pre-condition that he
should have availed of all the means of administrative processes afforded
him. Hence, 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 court's judicial power can be sought, The
premature invocation of court's intervention is fatal to one's cause of
action.11 Accordingly, absent any finding of waiver or estoppel the case is
susceptible of dismissal for lack of cause of
action.12 This doctrine of exhaustion of administrative remedies was not
without its practical and legal reasons, for one thing, availment of
administrative remedy entails lesser expenses and provides for a speedier
disposition of controversies. It is no less true to state that the courts of
justice for reasons of comity and convenience will shy away from a dispute
until the system of administrative redress has been completed and
complied with so as to give the administrative agency concerned every
opportunity to correct its error and to dispose of the case. However, we are
not amiss to reiterate that the principle of exhaustion of administrative
remedies as tested by a battery of cases is not an ironclad rule. This doctrine
is a relative one and its flexibility is called upon by the peculiarity and
uniqueness of the factual and circumstantial settings of a case. Hence, it is
disregarded (1) when there is a violation of due process,13 (2) when the issue
involved is purely a legal question,14 (3) when the administrative action is
patently illegal amounting to lack or excess of jurisdiction,15 (4) when there
is estoppel on the part of the administrative agency concerned, 16 (5) when
there is irreparable injury,17 (6) when the respondent is a department
secretary whose acts as an alter ego of the President bears the implied and
assumed approval of the latter,18 (7) when to require exhaustion of
administrative remedies would be unreasonable,19 (8) when it would
amount to a nullification of a claim,20 (9) when the subject matter is a
private land in land case proceedings,21 (10) when the rule does not provide
a plain, speedy and adequate remedy, and (11) when there are
circumstances indicating the urgency of judicial intervention.22
In the case at bar, there is no question that the controversy was pending
before the Secretary of DENR when it was forwarded to him following the
denial by the petitioners of the motion for reconsideration of private
respondents through the order of July 12, 1989. In their letter of
reconsideration dated June 28, 1989,23 private respondents clearly
recognize the presence of an administrative forum to which they seek to
avail, as they did avail, in the resolution of their case. The letter, reads, thus:
xxx xxx xxx
If this motion for reconsideration does not merit your favorable
action, then this letter should be considered as an appeal to the
Secretary.24
It was easy to perceive then that the private respondents looked up to the
Secretary for the review and disposition of their case. By appealing to him,
they acknowledged the existence of an adequate and plain remedy still
available and open to them in the ordinary course of the law. Thus, they
cannot now, without violating the principle of exhaustion of administrative
remedies, seek court's intervention by filing an action for replevin for the
grant of their relief during the pendency of an administrative proceedings.
Moreover, it is important to point out that the enforcement of forestry laws,
rules and regulations and the protection, development and management of
forest lands fall within the primary and special responsibilities of the
Department of Environment and Natural Resources. By the very nature of
its function, the DENR should be given a free hand unperturbed by judicial
intrusion to determine a controversy which is well within its jurisdiction. The
assumption by the trial court, therefore, of the replevin suit filed by private
respondents constitutes an unjustified encroachment into the domain of
the administrative agency's prerogative. The doctrine of primary jurisdiction
does not warrant a court to arrogate unto itself the authority to resolve a
controversy the jurisdiction over which is initially lodged with an
administrative body of special competence.25 In Felipe Ismael, Jr. and
Co. vs. Deputy Executive Secretary,26 which was reiterated in the recent case
of Concerned Officials of MWSS vs. Vasquez,27 this Court held:
Thus, while the administration grapples with the complex and
multifarious problems caused by unbriddled exploitation of these
resources, the judiciary will stand clear. A long line of cases
establish the basic rule that the courts will not interfere in matters
which are addressed to the sound discretion of government
agencies entrusted with the regulation of activities coming under
the special technical knowledge and training of such agencies.
To sustain the claim of private respondents would in effect bring the instant
controversy beyond the pale of the principle of exhaustion of administrative
remedies and fall within the ambit of excepted cases heretofore stated.
However, considering the circumstances prevailing in this case, we can not
but rule out these assertions of private respondents to be without merit.
First, they argued that there was violation of due process because they did
not receive the May 23, 1989 order of confiscation of petitioner Layugan.
This contention has no leg to stand on. Due process does not necessarily
mean or require a hearing, but simply an opportunity or right to be
heard.28 One may be heard, not solely by verbal presentation but also, and
perhaps many times more creditably and practicable than oral argument,
through pleadings.29 In administrative proceedings moreover, technical
rules of procedure and evidence are not strictly applied; administrative
process cannot be fully equated with due process in its strict judicial
sense.30 Indeed, deprivation of due process cannot be successfully invoked
where a party was given the chance to be heard on his motion for
reconsideration,31 as in the instant case, when private respondents were
undisputedly given the opportunity to present their side when they filed a
letter of reconsideration dated June 28, 1989 which was, however, denied
in an order of July 12, 1989 of Executive Director Baggayan, In Navarro III
vs. Damasco,32 we ruled that :
The essence of due process is simply an opportunity to be heard,
or as applied to administrative proceedings, an opportunity to
explain one's side or an opportunity to seek a reconsideration of
the action or ruling complained of. A formal or trial type hearing
is not at all times and in all instances essential. The requirements
are satisfied when the parties are afforded fair and reasonable
opportunity to explain their side of the controversy at hand. What
is frowned upon is the absolute lack of notice or hearing.
Second, private respondents imputed the patent illegality of seizure and
forfeiture of the truck because the administrative officers of the DENR
allegedly have no power to perform these acts under the law. They insisted
that only the court is authorized to confiscate and forfeit conveyances used
in transporting illegal forest products as can be gleaned from the second
paragraph of Section 68 of P.D. 705, as amended by E.O. 277. The pertinent
provision reads as follows:
Sec. 68. . . .
xxx xxx xxx
The court shall further order the confiscation in favor of the
government of the timber or any forest products cut, gathered,
collected, removed, or possessed, as well as
the machinery, equipments, implements and tools illegaly [sic]
used in the area where the timber or forest products are found.
(Emphasis ours)
A reading, however, of the law persuades us not to go along with private
respondents' thinking not only because the aforequoted provision
apparently does not mention nor include "conveyances" that can be the
subject of confiscation by the courts, but to a large extent, due to the fact
that private respondents' interpretation of the subject provision unduly
restricts the clear intention of the law and inevitably reduces the other
provision of Section 68-A, which is quoted herein below:
Sec. 68-A. Administrative Authority of the Department or His Duly
Authorized Representative To Order Confiscation. In all cases of
violation of this Code or other forest laws, rules and regulations,
the Department Head or his duly authorized representative,
may order the confiscation of any forest products illegally cut,
gathered, removed, or possessed or abandoned, and all
conveyances used either by land, water or air in the commission
of the offense and to dispose of the same in accordance with
pertinent laws, regulations and policies on the matter. (Emphasis
ours)
It is, thus, clear from the foregoing provision that the Secretary and his duly
authorized representatives are given the authority to confiscate and forfeit
any conveyances utilized in violating the Code or other forest laws, rules and
regulations. The phrase "to dispose of the same" is broad enough to cover
the act of forfeiting conveyances in favor of the government. The only
limitation is that it should be made "in accordance with pertinent laws,
regulations or policies on the matter." In the construction of statutes, it
must be read in such a way as to give effect to the purpose projected in the
statute.33 Statutes should be construed in the light of the object to be
achieved and the evil or mischief to be suppressed, and they should be given
such construction as will advance the object, suppress the mischief, and
secure the benefits intended.34 In this wise, the observation of the Solicitor
General is significant, thus:
But precisely because of the need to make forestry laws "more
responsive to present situations and realities" and in view of the
"urgency to conserve the remaining resources of the country,"
that the government opted to add Section 68-A. This amendatory
provision is an administrative remedy totally separate and distinct
from criminal proceedings. More than anything else, it is intended
to supplant the inadequacies that characterize enforcement of
forestry laws through criminal actions. The preamble of EO 277-
the law that added Section 68-A to PD 705-is most revealing:
"WHEREAS, there is an urgency to conserve the
remaining forest resources of the country for the
benefit and welfare of the present and future
generations of Filipinos;
WHEREAS, our forest resources may be effectively
conserved and protected through the vigilant
enforcement and implementation of our forestry laws,
rules and regulations;
WHEREAS, the implementation of our forestry
laws suffers from technical difficulties, due to certain
 inadequacies in the penal provisions of the Revised
Forestry Code of the Philippines; and
WHEREAS, to overcome this difficulties, there is a need
to penalize certain acts more responsive to present
situations and realities;"
It is interesting to note that Section 68-A is a new provision
authorizing the DENR to confiscate, not only "conveyances," but
forest products as well. On the other hand, confiscation of forest
products by the "court" in a criminal action has long been provided
for in Section 68. If as private respondents insist, the power on
confiscation cannot be exercised except only through the court
under Section 68, then Section 68-A would have no Purpose at all.
Simply put, Section 68-A would not have provided any solution to
the problem perceived in EO 277, supra.35
Private respondents, likewise, contend that the seizure was illegal because
the petitioners themselves admitted in the Order dated July 12, 1989 of
Executive Director Baggayan that the truck of private respondents was not
used in the commission of the crime. This order, a copy of which was given
to and received by the counsel of private respondents, reads in part, viz.:
. . . while it is true that the truck of your client was not used by her
in the commission of the crime, we uphold your claim that the
truck owner is not liable for the crime and in no case could a
criminal case be filed against her as provided under Article 309
and 310 of the Revised Penal Code. . .36
We observed that private respondents misread the content of the
aforestated order and obviously misinterpreted the intention of petitioners.
What is contemplated by the petitioners when they stated that the truck
"was not used in the commission of the crime" is that it was not used in the
commission of the crime of theft, hence, in no case can a criminal action be
filed against the owner thereof for violation of Article 309 and 310 of the
Revised Penal Code. Petitioners did not eliminate the possibility that the
truck was being used in the commission of another crime, that is, the breach
of Section 68 of P.D. 705 as amended by E.O. 277. In the same order of July
12, 1989, petitioners pointed out:
. . . However, under Section 68 of P.D. 705 as amended and further
amended by Executive Order No. 277 specifically provides for the
confiscation of the conveyance used in the transport of forest
products not covered by the required legal documents. She may
not have been involved in the cutting and gathering of the product
in question but the fact that she accepted the goods for a fee or
fare the same is therefor liable. . .37
Private respondents, however, contended that there is no crime defined
and punishable under Section 68 other than qualified theft, so that, when
petitioners admitted in the July 12, 1989 order that private respondents
could not be charged for theft as provided for under Articles 309 and 310 of
the Revised Penal Code, then necessarily private respondents could not
have committed an act constituting a crime under Section 68. We disagree.
For clarity, the provision of Section 68 of P.D. 705 before its amendment by
E.O. 277 and the provision of Section 1 of E.O. No. 277 amending the
aforementioned Section 68 are reproduced herein, thus:
Sec. 68. Cutting, gathering and/or collecting timber or other
products without license. — Any person who shall cut, gather,
collect, or remove timber or other forest products from any forest
land, or timber from alienable and disposable public lands, or
from private lands, without any authority under a license
agreement, lease, license or permit, shall be guilty of qualified
theft as defined and punished under Articles 309 and 310 of the
Revised Penal Code . . . (Emphasis ours; Section 68, P.D. 705
before its amendment by E.O. 277)
Sec. 1. Section 68 of Presidential Decree No. 705, as amended, is
hereby amended to read as follows:
Sec. 68. Cutting, gathering and/or collecting
timber or other forest products without
license. — Any person who
shall cut, gather, collect, remove timber or
other forest products from any forest land, or
timber from alienable or disposable public
land, or from private land, without any
authority, or possess timber or other forest
products without the legal documents as
required under existing forest laws and
regulations, shall be punished with the
penalties imposed under Articles 309 and 310
of the Revised Penal Code . . . (Emphasis ours;
Section 1, E.O. No. 277 amending Section 68,
P.D. 705 as amended)
With the introduction of Executive Order No. 277 amending Section 68 of
P.D. 705, the act of cutting, gathering, collecting, removing, or possessing
forest products without authority constitutes a distinct offense
independent now from the crime of theft under Articles 309 and 310 of the
Revised Penal Code, but the penalty to be imposed is that provided for
under Article 309 and 310 of the Revised Penal Code. This is clear from the
language of Executive Order No. 277 when it eliminated the phrase "shall
be guilty of qualified theft as defined and punished under Articles 309 and
310 of the Revised Penal Code" and inserted the words "shall be punished
with the penalties imposed under Article 309 and 310 of the Revised Penal
Code". When the statute is clear and explicit, there is hardly room for any
extended court ratiocination or rationalization of the law.38
From the foregoing disquisition, it is clear that a suit for replevin can not be
sustained against the petitioners for the subject truck taken and retained by
them for administrative forfeiture proceedings in pursuant to Section 68-A
of the P.D. 705, as amended. Dismissal of the replevin suit for lack of cause
of action in view of the private respondents' failure to exhaust
administrative remedies should have been the proper course of action by
the lower court instead of assuming jurisdiction over the case and
consequently issuing the writ ordering the return of the truck. Exhaustion
of the remedies in the administrative forum, being a condition precedent
prior to one's recourse to the courts and more importantly, being an
element of private respondents' right of action, is too significant to be
waylaid by the lower court.
It is worth stressing at this point, that a suit for replevin is founded solely on
the claim that the defendant wrongfully withholds the property sought to
be recovered. It lies to recover possession of personal chattels that are
unlawfully detained.39 "To detain" is defined as to mean "to hold or keep in
custody,"40 and it has been held that there is tortious taking whenever there
is an unlawful meddling with the property, or an exercise or claim of
dominion over it, without any pretense of authority or right; this, without
manual seizing of the property is sufficient.41 Under the Rules of Court, it is
indispensable in replevin proceeding that the plaintiff must show by his own
affidavit that he is entitled to the possession of property, that the property
is wrongfully detained by the defendant, alleging the cause of detention,
that the same has not been taken for tax assessment, or seized under
execution, or attachment, or if so seized, that it is exempt from such seizure,
and the actual value of the property.42 Private respondents miserably failed
to convince this Court that a wrongful detention of the subject truck obtains
in the instant case. It should be noted that the truck was seized by the
petitioners because it was transporting forest products without the
required permit of the DENR in manifest contravention of Section 68 of P.D.
705 as amended by E.O 277. Section 68-A of P.D. 705, as amended,
unquestionably warrants the confiscation as well as the disposition by the
Secretary of DENR or his duly authorized representatives of the
conveyances used in violating the provision of forestry laws. Evidently, the
continued possession or detention of the truck by the petitioners for
administrative forfeiture proceeding is legally permissible, hence, no
wrongful detention exists in the case at bar.
Moreover, the suit for replevin is never intended as a procedural tool to
question the orders of confiscation and forfeiture issued by the DENR in
pursuance to the authority given under P.D. 705, as amended. Section 8 of
the said law is explicit that actions taken by the Director of the Bureau of
Forest Development concerning the enforcement of the provisions of the
said law are subject to review by the Secretary of DENR and that courts may
not review the decisions of the Secretary except through a special civil
action for certiorari or prohibition. It reads:
 Sec. 8. REVIEW — All actions and decisions of the Director are
subject to review, motu propio or upon appeal of any person
aggrieved thereby, by the Department Head whose decision shall
be final and executory after the lapse of thirty (30) days from the
receipt of the aggrieved party of said decision, unless appealed to
the President in accordance with Executive Order No. 19, Series
of 1966. The Decision of the Department Head may not be
reviewed by the courts except through a special civil action
for certiorari or prohibition.
WHEREFORE, the Petition is GRANTED; the Decision of the respondent
Court of Appeals dated October 16, 1991 and its Resolution dated July 14,
1992 are hereby SET ASIDE AND REVERSED; the Restraining Order
promulgated on September 27, 1993 is hereby made permanent; and the
Secretary of DENR is directed to resolve the controversy with utmost
dispatch.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-22301 August 30, 1967
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
MARIO MAPA Y MAPULONG, defendant-appellant.
Francisco P. Cabigao for defendant-appellant.
Office of the Solicitor General Arturo A. Alafriz, Assistant Solicitor General
F. R. Rosete and Solicitor O. C. Hernandez for plaintiff-appellee.
FERNANDO, J.:
The sole question in this appeal from a judgment of conviction by the lower
court is whether or not the appointment to and holding of the position of a
secret agent to the provincial governor would constitute a sufficient
defense to a prosecution for the crime of illegal possession of firearm and
ammunition. We hold that it does not.
The accused in this case was indicted for the above offense in an
information dated August 14, 1962 reading as follows: "The undersized
accuses MARIO MAPA Y MAPULONG of a violation of Section 878 in
connection with Section 2692 of the Revised Administrative Code, as
amended by Commonwealth Act No. 56 and as further amended by
Republic Act No. 4, committed as follows: That on or about the 13th day of
August, 1962, in the City of Manila, Philippines, the said accused did then
and there wilfully and unlawfully have in his possession and under his
custody and control one home-made revolver (Paltik), Cal. 22, without serial
number, with six (6) rounds of ammunition, without first having secured the
necessary license or permit therefor from the corresponding authorities.
Contrary to law."
When the case was called for hearing on September 3, 1963, the lower court
at the outset asked the counsel for the accused: "May counsel stipulate that
the accused was found in possession of the gun involved in this case, that
he has neither a permit or license to possess the same and that we can
submit the same on a question of law whether or not an agent of the
governor can hold a firearm without a permit issued by the Philippine
Constabulary." After counsel sought from the fiscal an assurance that he
would not question the authenticity of his exhibits, the understanding being
that only a question of law would be submitted for decision, he explicitly
specified such question to be "whether or not a secret agent is not required
to get a license for his firearm."
Upon the lower court stating that the fiscal should examine the document
so that he could pass on their authenticity, the fiscal asked the following
question: "Does the accused admit that this pistol cal. 22 revolver with six
rounds of ammunition mentioned in the information was found in his
possession on August 13, 1962, in the City of Manila without first having
secured the necessary license or permit thereof from the corresponding
authority?" The accused, now the appellant, answered categorically: "Yes,
Your Honor." Upon which, the lower court made a statement: "The accused
admits, Yes, and his counsel Atty. Cabigao also affirms that the accused
admits."
Forthwith, the fiscal announced that he was "willing to submit the same for
decision." Counsel for the accused on his part presented four (4) exhibits
consisting of his appointment "as secret agent of the Hon. Feliciano Leviste,"
then Governor of Batangas, dated June 2, 1962;1 another document
likewise issued by Gov. Leviste also addressed to the accused directing him
to proceed to Manila, Pasay and Quezon City on a confidential mission;2 the
oath of office of the accused as such secret agent,3 a certificate dated March
11, 1963, to the effect that the accused "is a secret agent" of Gov.
Leviste.4 Counsel for the accused then stated that with the presentation of
the above exhibits he was "willing to submit the case on the question of
whether or not a secret agent duly appointed and qualified as such of the
provincial governor is exempt from the requirement of having a license of
firearm." The exhibits were admitted and the parties were given time to file
their respective memoranda.1äwphï1.ñët
Thereafter on November 27, 1963, the lower court rendered a decision
convicting the accused "of the crime of illegal possession of firearms and
sentenced to an indeterminate penalty of from one year and one day to two
years and to pay the costs. The firearm and ammunition confiscated from
him are forfeited in favor of the Government."
The only question being one of law, the appeal was taken to this Court. The
decision must be affirmed.
The law is explicit that except as thereafter specifically allowed, "it shall be
unlawful for any person to . . . possess any firearm, detached parts of
firearms or ammunition therefor, or any instrument or implement used or
intended to be used in the manufacture of firearms, parts of firearms, or
ammunition."5 The next section provides that "firearms and ammunition
regularly and lawfully issued to officers, soldiers, sailors, or marines [of the
Armed Forces of the Philippines], the Philippine Constabulary, guards in the
employment of the Bureau of Prisons, municipal police, provincial
governors, lieutenant governors, provincial treasurers, municipal
treasurers, municipal mayors, and guards of provincial prisoners and jails,"
are not covered "when such firearms are in possession of such officials and
public servants for use in the performance of their official duties."6
The law cannot be any clearer. No provision is made for a secret agent. As
such he is not exempt. Our task is equally clear. The first and fundamental
duty of courts is to apply the law. "Construction and interpretation come
only after it has been demonstrated that application is impossible or
inadequate without them."7 The conviction of the accused must stand. It
cannot be set aside.
Accused however would rely on People v. Macarandang,8 where a secret
agent was acquitted on appeal on the assumption that the appointment "of
the accused as a secret agent to assist in the maintenance of peace and
order campaigns and detection of crimes, sufficiently put him within the
category of a "peace officer" equivalent even to a member of the municipal
police expressly covered by section 879." Such reliance is misplaced. It is not
within the power of this Court to set aside the clear and explicit mandate of
a statutory provision. To the extent therefore that this decision conflicts
with what was held in People v. Macarandang, it no longer speaks with
authority.
Wherefore, the judgment appealed from is affirmed.
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Bengzon, J.P., Zaldivar,
Sanchez, Castro and Angeles, JJ., concur.
 Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. L-34568 March 28, 1988
RODERICK DAOANG, and ROMMEL DAOANG, assisted by their father,
ROMEO DAOANG, petitioners,
vs.
THE MUNICIPAL JUDGE, SAN NICOLAS, ILOCOS NORTE, ANTERO AGONOY
and AMANDA RAMOS-AGONOY, respondents.
PADILLA, J.:
This is a petition for review on certiorari of the decision, dated 30 June 1971,
rendered by the respondent judge * in Spec. Proc. No. 37 of Municipal Court
of San Nicolas, Ilocos Norte, entitled: "In re Adoption of the Minors Quirino
Bonilla and Wilson Marcos; Antero Agonoy and Amanda R. Agonoy,
petitioners", the dispositive part of which reads, as follows:
Wherefore, Court renders judgment declaring that henceforth
Quirino Bonilla and Wilson Marcos be, to all legitimate intents and
purposes, the children by adoption of the joint petitioners Antero
Agonoy and Amanda R. Agonoy and that the former be freed from
legal obedience and maintenance by their respective parents,
Miguel Bonilla and Laureana Agonoy for Quirino Bonilla and
Modesto Marcos and Benjamina Gonzales for Wilson Marcos and
their family names 'Bonilla' and 'Marcos' be changed with
"Agonoy", which is the family name of the petitioners.
Successional rights of the children and that of their adopting
parents shall be governed by the pertinent provisions of the New
Civil Code.
Let copy of this decision be furnished and entered into the records
of the Local Civil Registry of San Nicolas, Ilocos Norte, for its legal
effects at the expense of the petitioners. 1
The undisputed facts of the case are as follows:
On 23 March 1971, the respondent spouses Antero and Amanda Agonoy
filed a petition with the Municipal Court of San Nicolas, Ilocos Norte, seeking
the adoption of the minors Quirino Bonilla and Wilson Marcos. The case,
entitled: "In re Adoption of the Minors Quirino Bonilla and Wilson Marcos,
Antero Agonoy and Amanda Ramos-Agonoy, petitioners", was docketed
therein as Spec. Proc. No. 37. 2
The petition was set for hearing on 24 April 1971 and notices thereof were
caused to be served upon the office of the Solicitor General and ordered
published in the ILOCOS TIMES, a weekly newspaper of general circulation
in the province of Ilocos Norte, with editorial offices in Laoag City. 3
On 22 April 1971, the minors Roderick and Rommel Daoang, assisted by
their father and guardian ad litem, the petitioners herein, filed an
opposition to the aforementioned petition for adoption, claiming that the
spouses Antero and Amanda Agonoy had a legitimate daughter named
Estrella Agonoy, oppositors' mother, who died on 1 March 1971, and
therefore, said spouses were disqualified to adopt under Art. 335 of the Civil
Code. 4
After the required publication of notice had been accomplished, evidence
was presented. Thereafter, the Municipal Court of San Nicolas, Ilocos Norte
rendred its decision, granting the petition for adoption. 5
Hence, the present recourse by the petitioners (oppositors in the lower
court).
The sole issue for consideration is one of law and it is whether or not the
respondent spouses Antero Agonoy and Amanda Ramos-Agonoy are
disqualified to adopt under paragraph (1), Art. 335 of the Civil Code.
The pertinent provision of law reads, as follows:
Art. 335. The following cannot adopt:
(1) Those who have legitimate, legitimated, acknowledged natural
children, or children by legal fiction;
xxx xxx xxx
In overruling the opposition of the herein petitioners, the respondents
judge held that "to add grandchildren in this article where no grandchil is
included would violate to (sic) the legal maxim that what is expressly
included would naturally exclude what is not included".
But, it is contended by the petitioners, citing the case of In re Adoption of
Millendez,6 that the adoption of Quirino Bonilla and Wilson Marcos would
not only introduce a foreign element into the family unit, but would result
in the reduction of their legititimes. It would also produce an indirect,
permanent and irrevocable disinheritance which is contrary to the policy of
the law that a subsequent reconciliation between the offender and the
offended person deprives the latter of the right to disinherit and renders
ineffectual any disinheritance that may have been made.
We find, however, that the words used in paragraph (1) of Art. 335 of the
Civil Code, in enumerating the persons who cannot adopt, are clear and
unambiguous. The children mentioned therein have a clearly defined
meaning in law and, as pointed out by the respondent judge, do not include
grandchildren.
Well known is the rule of statutory construction to the effect that a statute
clear and unambiguous on its face need not be interpreted; stated
otherwise, the rule is that only statutes with an ambiguous or doubtful
meaning may be the subject of statutory construction. 7
Besides, it appears that the legislator, in enacting the Civil Code of the
Philippines, obviously intended that only those persons who have certain
classes of children, are disqualified to adopt. The Civil Code of Spain, which
was once in force in the Philippines, and which served as the pattern for the
Civil Code of the Philippines, in its Article 174, disqualified persons who have
legitimate or legitimated descendants from adopting. Under this article, the
spouses Antero and Amanda Agonoy would have been disqualified to adopt
as they have legitimate grandchildren, the petitioners herein. But, when the
Civil Code of the Philippines was adopted, the word "descendants" was
changed to "children", in paragraph (1) of Article 335.
Adoption used to be for the benefit of the adoptor. It was intended to afford
to persons who have no child of their own the consolation of having one, by
creating through legal fiction, the relation of paternity and filiation where
none exists by blood relationship. 8 The present tendency, however, is
geared more towards the promotion of the welfare of the child and the
enhancement of his opportunities for a useful and happy life, and every
intendment is sustained to promote that objective.9 Under the law now in
force, having legitimate, legitimated, acknowledged natural children, or
children by legal fiction, is no longer a ground for disqualification to adopt. 10
WHEREFORE, the petition is DENIED. The judgment of the Municipal Court
of San Nicolas, Ilocos Norte in Spec. Proc. No. 37 is AFFIRMED. Without
pronouncement as to costs in this instance.
SO ORDERED.
Yap, Melencio-Herrera, Paras and Sarmiento, JJ., concur.
 Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 123169 November 4, 1996
DANILO E. PARAS, petitioner,
vs.
COMMISSION ON ELECTIONS, respondent.
RESOLUTION
FRANCISCO, J.:
Petitioner Danilo E. Paras is the incumbent Punong Barangay of Pula,
Cabanatuan City who won during the last regular barangay election in 1994.
A petition for his recall as Punong Barangay was filed by the registered
voters of the barangay. Acting on the petition for recall, public respondent
Commission on Elections (COMELEC) resolved to approve the petition,
scheduled the petition signing on October 14, 1995, and set the recall
election on November 13, 1995.1 At least 29.30% of the registered voters
signed the petition, well above the 25% requirement provided by law. The
COMELEC, however, deferred the recall election in view of petitioner's
opposition. On December 6, 1995, the COMELEC set anew the recall
election, this time on December 16, 1995. To prevent the holding of the
recall election, petitioner filed before the Regional Trial Court of
Cabanatuan City a petition for injunction, docketed as SP Civil Action No.
2254-AF, with the trial court issuing a temporary restraining order. After
conducting a summary hearing, the trial court lifted the restraining order,
dismissed the petition and required petitioner and his counsel to explain
why they should not be cited for contempt for misrepresenting that the
barangay recall election was without COMELEC approval.2
In a resolution dated January 5, 1996, the COMELEC, for the third time, re-
scheduled the recall election an January 13, 1996; hence, the instant
petition for certiorari with urgent prayer for injunction. On January 12,
1996, the Court issued a temporary restraining order and required the
Office of the Solicitor General, in behalf of public respondent, to comment
on the petition. In view of the Office of the Solicitor General's manifestation
maintaining an opinion adverse to that of the COMELEC, the latter through
its law department filed the required comment. Petitioner thereafter filed
a reply.3
Petitioner's argument is simple and to the point. Citing Section 74 (b) of
Republic Act No. 7160, otherwise known as the Local Government Code,
which states that "no recall shall take place within one (1) year from the date
of the official's assumption to office or one (1) year immediately preceding
a regular local election", petitioner insists that the scheduled January 13,
1996 recall election is now barred as the Sangguniang Kabataan (SK)
election was set by Republic Act No. 7808 on the first Monday of May 1996,
and every three years thereafter. In support thereof, petitioner
cites Associated Labor Union v. Letrondo-Montejo, 237 SCRA 621, where the
Court considered the SK election as a regular local election. Petitioner
maintains that as the SK election is a regular local election, hence no recall
election can be had for barely four months separate the SK election from
the recall election. We do not agree.
The subject provision of the Local Government Code provides:
Sec. 74. Limitations on Recall. — (a) Any elective local official may
be the subject of a recall election only once during his term of
office for loss of confidence.
(b) No recall shall take place within one (1) year from the date of
the official's assumption to office or one (1) year immediately
preceding a regular local election.
[Emphasis added]
It is a rule in statutory construction that every part of the statute must be
interpreted with reference to the context, i.e., that every part of the statute
must be considered together with the other parts, and kept subservient to
the general intent of the whole enactment. 4 The evident intent of Section
74 is to subject an elective local official to recall election once during his
term of office. Paragraph (b) construed together with paragraph (a) merely
designates the period when such elective local official may be subject of a
recall election, that is, during the second year of his term of office. Thus,
subscribing to petitioner's interpretation of the phrase regular local
election to include the SK election will unduly circumscribe the novel
provision of the Local Government Code on recall, a mode of removal of
public officers by initiation of the people before the end of his term. And if
the SK election which is set by R.A No. 7808 to be held every three years
from May 1996 were to be deemed within the purview of the phrase
"regular local election", as erroneously insisted by petitioner, then no recall
election can be conducted rendering inutile the recall provision of the Local
Government Code.
In the interpretation of a statute, the Court should start with the assumption
that the legislature intended to enact an effective law, and the legislature is
not presumed to have done a vain thing in the enactment of a statute.5 An
interpretation should, if possible, be avoided under which a statute or
provision being construed is defeated, or as otherwise expressed, nullified,
destroyed, emasculated, repealed, explained away, or rendered
insignificant, meaningless, inoperative or nugatory.6
It is likewise a basic precept in statutory construction that a statute should
be interpreted in harmony with the Constitution.7 Thus, the interpretation
of Section 74 of the Local Government Code, specifically paragraph (b)
thereof, should not be in conflict with the Constitutional mandate of Section
3 of Article X of the Constitution to "enact a local government code which
shall provide for a more responsive and accountable local government
structure instituted through a system of decentralization with effective
mechanism of recall, initiative, and referendum . . . ."
Moreover, petitioner's too literal interpretation of the law leads to
absurdity which we cannot countenance. Thus, in a case, the Court made
the following admonition:
We admonish against a too-literal reading of the law as
this is apt to constrict rather than fulfill its purpose and
defeat the intention of its authors. That intention is
usually found not in "the letter that killeth but in the
spirit that vivifieth". . .8
The spirit, rather than the letter of a law determines its
construction; hence, a statute, as in this case, must be read
according to its spirit and intent.
Finally, recall election is potentially disruptive of the normal working of the
local government unit necessitating additional expenses, hence the
prohibition against the conduct of recall election one year immediately
preceding the regular local election. The proscription is due to the proximity
of the next regular election for the office of the local elective official
concerned. The electorate could choose the official's replacement in the
said election who certainly has a longer tenure in office than a successor
elected through a recall election. It would, therefore, be more in keeping
with the intent of the recall provision of the Code to construe regular local
election as one referring to an election where the office held by the local
elective official sought to be recalled will be contested and be filled by the
electorate.
Nevertheless, recall at this time is no longer possible because of the
limitation stated under Section 74 (b) of the Code considering that the next
regular election involving the barangay office concerned is barely seven (7)
months away, the same having been scheduled on May 1997. 9
ACCORDINGLY, the petition is hereby dismissed for having become moot
and academic. The temporary restraining order issued by the Court on
January 12, 1996, enjoining the recall election should be as it is hereby made
permanent.
SO ORDERED.

Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-30642 April 30, 1985
PERFECTO S. FLORESCA, in his own behalf and on behalf of the minors
ROMULO and NESTOR S. FLORESCA; and ERLINDA FLORESCA-GABUYO,
PEDRO S. FLORESCA, JR., CELSO S. FLORESCA, MELBA S. FLORESCA,
JUDITH S. FLORESCA and CARMEN S. FLORESCA;
LYDIA CARAMAT VDA. DE MARTINEZ in her own behalf and on behalf of
her minor children LINDA, ROMEO, ANTONIO JEAN and ELY, all surnamed
Martinez; and DANIEL MARTINEZ and TOMAS MARTINEZ;
SALUSTIANA ASPIRAS VDA. DE OBRA, in her own behalf and on behalf of
her minor children JOSE, ESTELA, JULITA SALUD and DANILO, all
surnamed OBRA;
LYDIA CULBENGAN VDA. DE VILLAR, in her own behalf and on behalf of
her minor children EDNA, GEORGE and LARRY III, all surnamed VILLAR;
DOLORES LOLITA ADER VDA. DE LANUZA, in her own behalf and on
behalf of her minor children EDITHA, ELIZABETH, DIVINA, RAYMUNDO,
NESTOR and AURELIO, JR. all surnamed LANUZA;
EMERENCIANA JOSE VDA. DE ISLA, in her own behalf and on behalf of
her minor children JOSE, LORENZO, JR., MARIA, VENUS and FELIX, all
surnamed ISLA, petitioners,
vs.
PHILEX MINING CORPORATION and HON. JESUS P. MORFE, Presiding
Judge of Branch XIII, Court of First Instance of Manila, respondents.
Rodolfo C. Pacampara for petitioners.
Tito M. Villaluna for respondents.
MAKASIAR, J.:
This is a petition to review the order of the former Court of First Instance of
Manila, Branch XIII, dated December 16, 1968 dismissing petitioners'
complaint for damages on the ground of lack of jurisdiction.
Petitioners are the heirs of the deceased employees of Philex Mining
Corporation (hereinafter referred to as Philex), who, while working at its
copper mines underground operations at Tuba, Benguet on June 28, 1967,
died as a result of the cave-in that buried them in the tunnels of the mine.
Specifically, the complaint alleges that Philex, in violation of government
rules and regulations, negligently and deliberately failed to take the
required precautions for the protection of the lives of its men working
underground. Portion of the complaint reads:
xxx xxx xxx
9. That for sometime prior and up to June 28,1967, the defendant
PHILEX, with gross and reckless negligence and imprudence and
deliberate failure to take the required precautions for the due
protection of the lives of its men working underground at the
time, and in utter violation of the laws and the rules and
regulations duly promulgated by the Government pursuant
thereto, allowed great amount of water and mud to accumulate
in an open pit area at the mine above Block 43-S-1 which seeped
through and saturated the 600 ft. column of broken ore and rock
below it, thereby exerting tremendous pressure on the working
spaces at its 4300 level, with the result that, on the said date, at
about 4 o'clock in the afternoon, with the collapse of all
underground supports due to such enormous pressure,
approximately 500,000 cubic feet of broken ores rocks, mud and
water, accompanied by surface boulders, blasted through the
tunnels and flowed out and filled in, in a matter of approximately
five (5) minutes, the underground workings, ripped timber
supports and carried off materials, machines and equipment
which blocked all avenues of exit, thereby trapping within its
tunnels of all its men above referred to, including those named in
the next preceding paragraph, represented by the plaintiffs
herein;
10. That out of the 48 mine workers who were then working at
defendant PHILEX's mine on the said date, five (5) were able to
escape from the terrifying holocaust; 22 were rescued within the
next 7 days; and the rest, 21 in number, including those referred
to in paragraph 7 hereinabove, were left mercilessly to their fate,
notwithstanding the fact that up to then, a great many of them
were still alive, entombed in the tunnels of the mine, but were not
rescued due to defendant PHILEX's decision to abandon rescue
operations, in utter disregard of its bounden legal and moral
duties in the premises;
xxx xxx xxx
13. That defendant PHILEX not only violated the law and the rules
and regulations duly promulgated by the duly constituted
authorities as set out by the Special Committee above referred to,
in their Report of investigation, pages 7-13, Annex 'B' hereof, but
also failed completely to provide its men working underground
the necessary security for the protection of their lives
notwithstanding the fact that it had vast financial resources, it
having made, during the year 1966 alone, a total operating
income of P 38,220,254.00, or net earnings, after taxes of
P19,117,394.00, as per its llth Annual Report for the year ended
December 31, 1966, and with aggregate assets totalling P
45,794,103.00 as of December 31, 1966;
xxx xxx xxx
(pp. 42-44, rec.)
A motion to dismiss dated May 14, 1968 was filed by Philex alleging that the
causes of action of petitioners based on an industrial accident are covered
by the provisions of the Workmen's Compensation Act (Act 3428, as
amended by RA 772) and that the former Court of First Instance has no
jurisdiction over the case. Petitioners filed an opposition dated May 27,
1968 to the said motion to dismiss claiming that the causes of action are not
based on the provisions of the Workmen's Compensation Act but on the
provisions of the Civil Code allowing the award of actual, moral and
exemplary damages, particularly:
Art. 2176. Whoever by act or omission causes damage to another,
there being fault or negligence, is obliged to pay for the damage
done. Such fault or negligence, if there is no pre- existing
contractual relation between the parties, is called a quasi-delict
and is governed by the provisions of this Chapter.
Art. 2178. The provisions of articles 1172 to 1174 are also
applicable to a quasi-delict.
(b) Art. 1173—The fault or negligence of the obligor consists in
the omission of that diligence which is required by the nature of
the obligation and corresponds with the circumstances of the
persons, of the time and of the place. When negligence shows bad
faith, the provisions of Articles 1171 and 2201, paragraph 2 shall
apply.
Art. 2201. x x x x x x x x x
In case of fraud, bad faith, malice or wanton attitude, the obligor
shall be responsible for all damages which may be reasonably
attributed to the non-performance of the obligation.
 Art. 2231. In quasi-delicts, exemplary damages may be granted if
the defendant acted with gross negligence.
After a reply and a rejoinder thereto were filed, respondent Judge issued an
order dated June 27, 1968 dismissing the case on the ground that it falls
within the exclusive jurisdiction of the Workmen's Compensation
Commission. On petitioners' motion for reconsideration of the said order,
respondent Judge, on September 23, 1968, reconsidered and set aside his
order of June 27, 1968 and allowed Philex to file an answer to the complaint.
Philex moved to reconsider the aforesaid order which was opposed by
petitioners.
On December 16, 1968, respondent Judge dismissed the case for lack of
jurisdiction and ruled that in accordance with the established jurisprudence,
the Workmen's Compensation Commission has exclusive original
jurisdiction over damage or compensation claims for work-connected
deaths or injuries of workmen or employees, irrespective of whether or not
the employer was negligent, adding that if the employer's negligence results
in work-connected deaths or injuries, the employer shall, pursuant to
Section 4-A of the Workmen's Compensation Act, pay additional
compensation equal to 50% of the compensation fixed in the Act.
Petitioners thus filed the present petition.
In their brief, petitioners raised the following assignment of errors:
I Justice Manuel Lazaro, as corporate counsel and Assistant General Manager
THE LOWER COURT ERRED IN DISMISSING THE PLAINTIFFS-
PETITIONERS' COMPLAINT FOR LACK OF JURISDICTION.
II
THE LOWER COURT ERRED IN FAILING TO CONSIDER THE CLEAR
DISTINCTION BETWEEN CLAIMS FOR DAMAGES UNDER THE CIVIL
CODE AND CLAIMS FOR COMPENSATION UNDER THE
WORKMEN'S COMPENSATION ACT.
A or whether they have a right of selection or choice of action
In the first assignment of error, petitioners argue that the lower court has
jurisdiction over the cause of action since the complaint is based on the
provisions of the Civil Code on damages, particularly Articles 2176, 2178,
1173, 2201 and 2231, and not on the provisions of the Workmen's
Compensation Act. They point out that the complaint alleges gross and
brazen negligence on the part of Philex in failing to take the necessary
security for the protection of the lives of its employees working
underground. They also assert that since Philex opted to file a motion to
dismiss in the court a quo, the allegations in their complaint including those
contained in the annexes are deemed admitted.
In the second assignment of error, petitioners asseverate that respondent
Judge failed to see the distinction between the claims for compensation
under the Workmen's Compensation Act and the claims for damages based
on gross negligence of Philex under the Civil Code. They point out that
workmen's compensation refers to liability for compensation for loss
resulting from injury, disability or death of the working man through
industrial accident or disease, without regard to the fault or negligence of
the employer, while the claim for damages under the Civil Code which
petitioners pursued in the regular court, refers to the employer's liability for
reckless and wanton negligence resulting in the death of the employees and
for which the regular court has jurisdiction to adjudicate the same.
On the other hand, Philex asserts that work-connected injuries are
compensable exclusively under the provisions of Sections 5 and 46 of the
Workmen's Compensation Act, which read:
SEC. 5. Exclusive right to compensation.—The rights and remedies
granted by this Act to an employee by reason of a personal injury
entitling him to compensation shall exclude all other rights and
remedies accruing to the employee, his personal representatives,
dependents or nearest of kin against the employer under the Civil
Code and other laws because of said injury ...
SEC. 46. Jurisdiction.— The Workmen's Compensation
Commissioner shall have exclusive jurisdiction to hear and decide
claims for compensation under the Workmen's Compensation
Act, subject to appeal to the Supreme Court, ...
Philex cites the case of Manalo vs. Foster Wheeler (98 Phil. 855 [1956])
where it was held that "all claims of workmen against their employer for
damages due to accident suffered in the course of employment shall be
investigated and adjudicated by the Workmen's Compensation
Commission," subject to appeal to the Supreme Court.
Philex maintains that the fact that an employer was negligent, does not
remove the case from the exclusive character of recoveries under the
Workmen's Compensation Act; because Section 4-A of the Act provides an
additional compensation in case the employer fails to comply with the
requirements of safety as imposed by law to prevent accidents. In fact, it
points out that Philex voluntarily paid the compensation due the petitioners
and all the payments have been accepted in behalf of the deceased miners,
except the heirs of Nazarito Floresca who insisted that they are entitled to
a greater amount of damages under the Civil Code.
In the hearing of this case, then Undersecretary of Labor Israel Bocobo, then
Atty. Edgardo Angara, now President of the University of the Philippines,
of the GSIS Legal Affairs Department, and Commissioner on Elections,
formerly UP Law Center Director Froilan Bacungan, appeared as amici
curiae and thereafter, submitted their respective memoranda.
The issue to be resolved as WE stated in the resolution of November 26,
1976, is:
Whether the action of an injured employee or worker or that of
his heirs in case of his death under the Workmen's Compensation
Act is exclusive, selective or cumulative, that is to say, whether his
or his heirs' action is exclusively restricted to seeking the limited
compensation provided under the Workmen's Compensation Act
between availing of the worker's right under the Workmen's
Compensation Act and suing in the regular courts under the Civil
Code for higher damages (actual, moral and/or exemplary) from
the employer by virtue of negligence (or fault) of the employer or
of his other employees or whether they may avail cumulatively of
both actions, i.e., collect the limited compensation under the
Workmen's Compensation Act and sue in addition for damages in
the regular courts.
There are divergent opinions in this case. Justice Lazaro is of the opinion
that an injured employee or worker, or the heirs in case of his death, may
initiate a complaint to recover damages (not compensation under the
Workmen's Compensation Act) with the regular court on the basis of
negligence of an employer pursuant to the Civil Code provisions. Atty.
Angara believes otherwise. He submits that the remedy of an injured
employee for work-connected injury or accident is exclusive in accordance
with Section 5 of the Workmen's Compensation Act, while Atty. Bacungan's
position is that the action is selective. He opines that the heirs of the
employee in case of his death have a right of choice to avail themselves of
the benefits provided under the Workmen's Compensation Act or to sue in
the regular court under the Civil Code for higher damages from the
employer by virtue of negligence of the latter. Atty. Bocobo's stand is the
same as that of Atty. Bacungan and adds that once the heirs elect the
remedy provided for under the Act, they are no longer entitled to avail
themselves of the remedy provided for under the Civil Code by filing an
action for higher damages in the regular court, and vice versa.
On August 3, 1978, petitioners-heirs of deceased employee Nazarito
Floresca filed a motion to dismiss on the ground that they have amicably
settled their claim with respondent Philex. In the resolution of September
7, 1978, WE dismissed the petition only insofar as the aforesaid petitioners
are connected, it appearing that there are other petitioners in this case.
WE hold that the former Court of First Instance has jurisdiction to try the
case,
It should be underscored that petitioners' complaint is not for
compensation based on the Workmen's Compensation Act but a complaint
for damages (actual, exemplary and moral) in the total amount of eight
hundred twenty-five thousand (P825,000.00) pesos. Petitioners did not
invoke the provisions of the Workmen's Compensation Act to entitle them
to compensation thereunder. In fact, no allegation appeared in the
complaint that the employees died from accident arising out of and in the
course of their employments. The complaint instead alleges gross and
reckless negligence and deliberate failure on the part of Philex to protect
the lives of its workers as a consequence of which a cave-in occurred
resulting in the death of the employees working underground. Settled is the
rule that in ascertaining whether or not the cause of action is in the nature
of workmen's compensation claim or a claim for damages pursuant to the
provisions of the Civil Code, the test is the averments or allegations in the
complaint (Belandres vs. Lopez Sugar Mill, Co., Inc., 97 Phil. 100).
In the present case, there exists between Philex and the deceased
employees a contractual relationship. The alleged gross and reckless
negligence and deliberate failure that amount to bad faith on the part of
Philex, constitute a breach of contract for which it may be held liable for
damages. The provisions of the Civil Code on cases of breach of contract
when there is fraud or bad faith, read:
Art. 2232. In contracts and quasi-contracts, the court may award
exemplary damages if the defendant acted in a wanton,
fraudulent, reckless, oppressive or malevolent manner.
Art. 2201. In contracts and quasi-contracts, the damages for
which the obligor who acted in good faith is able shall be those
that are the natural and probable consequences of the breach of
the obligation, and which the parties have foreseen or could have
reasonably foreseen at the time the obligation was constituted.
In cases of fraud, bad faith, malice or wanton attitude, the obligor
shall be responsible for all damages which may be reasonably
attributed to the non-performance of the obligation.
Furthermore, Articles 2216 et seq., Civil Code, allow the payment of all kinds
of damages, as assessed by the court.
The rationale in awarding compensation under the Workmen's
Compensation Act differs from that in giving damages under the Civil Code.
The compensation acts are based on a theory of compensation distinct from
the existing theories of damages, payments under the acts being made as
compensation and not as damages (99 C.J.S. 53). Compensation is given to
mitigate the harshness and insecurity of industrial life for the workman and
his family. Hence, an employer is liable whether negligence exists or not
since liability is created by law. Recovery under the Act is not based on any
theory of actionable wrong on the part of the employer (99 C.J.S. 36).
In other words, under the compensation acts, the employer is liable to pay
compensation benefits for loss of income, as long as the death, sickness or
injury is work-connected or work-aggravated, even if the death or injury is
not due to the fault of the employer (Murillo vs. Mendoza, 66 Phil. 689). On
the other hand, damages are awarded to one as a vindication of the
wrongful invasion of his rights. It is the indemnity recoverable by a person
who has sustained injury either in his person, property or relative rights,
through the act or default of another (25 C.J.S. 452).
The claimant for damages under the Civil Code has the burden of proving
the causal relation between the defendant's negligence and the resulting
injury as well as the damages suffered. While under the Workmen's
Compensation Act, there is a presumption in favor of the deceased or
injured employee that the death or injury is work-connected or work-
aggravated; and the employer has the burden to prove otherwise (De los
Angeles vs. GSIS, 94 SCRA 308; Carino vs. WCC, 93 SCRA 551; Maria Cristina
Fertilizer Corp. vs. WCC, 60 SCRA 228).
The claim of petitioners that the case is not cognizable by the Workmen's
Compensation Commission then, now Employees Compensation
Commission, is strengthened by the fact that unlike in the Civil Code, the
Workmen's Compensation Act did not contain any provision for an award of
actual, moral and exemplary damages. What the Act provided was merely
the right of the heirs to claim limited compensation for the death in the
amount of six thousand (P6,000.00) pesos plus burial expenses of two
hundred (P200.00) pesos, and medical expenses when incurred (Sections 8,
12 and 13, Workmen's Compensation Act), and an additional compensation
of only 50% if the complaint alleges failure on the part of the employer to
"install and maintain safety appliances or to take other precautions for the
prevention of accident or occupational disease" (Section 4-A, Ibid.). In the
case at bar, the amount sought to be recovered is over and above that which
was provided under the Workmen's Compensation Act and which cannot be
granted by the Commission.
Moreover, under the Workmen's Compensation Act, compensation benefits
should be paid to an employee who suffered an accident not due to the
facilities or lack of facilities in the industry of his employer but caused by
factors outside the industrial plant of his employer. Under the Civil Code,
the liability of the employer, depends on breach of contract or tort. The
Workmen's Compensation Act was specifically enacted to afford protection
to the employees or workmen. It is a social legislation designed to give relief
to the workman who has been the victim of an accident causing his death
or ailment or injury in the pursuit of his employment (Abong vs. WCC, 54
SCRA 379).
WE now come to the query as to whether or not the injured employee or
his heirs in case of death have a right of selection or choice of action
between availing themselves of the worker's right under the Workmen's
Compensation Act and suing in the regular courts under the Civil Code for
higher damages (actual, moral and exemplary) from the employers by virtue
of that negligence or fault of the employers or whether they may avail
themselves cumulatively of both actions, i.e., collect the limited
compensation under the Workmen's Compensation Act and sue in addition
for damages in the regular courts.
In disposing of a similar issue, this Court in Pacana vs. Cebu Autobus
Company, 32 SCRA 442, ruled that an injured worker has a choice of either
to recover from the employer the fixed amounts set by the Workmen's
Compensation Act or to prosecute an ordinary civil action against the
tortfeasor for higher damages but he cannot pursue both courses of action
simultaneously.
In Pacaña WE said:
In the analogous case of Esguerra vs. Munoz Palma, involving the
application of Section 6 of the Workmen's Compensation Act on
the injured workers' right to sue third- party tortfeasors in the
regular courts, Mr. Justice J.B.L. Reyes, again speaking for the
Court, pointed out that the injured worker has the choice of
remedies but cannot pursue both courses of action
simultaneously and thus balanced the relative advantage of
recourse under the Workmen's Compensation Act as against an
ordinary action.
As applied to this case, petitioner Esguerra cannot maintain his
action for damages against the respondents (defendants below),
because he has elected to seek compensation under the
Workmen's Compensation Law, and his claim (case No. 44549 of
the Compensation Commission) was being processed at the time
he filed this action in the Court of First Instance. It is argued for
petitioner that as the damages recoverable under the Civil Code
are much more extensive than the amounts that may be awarded
under the Workmen's Compensation Act, they should not be
deemed incompatible. As already indicated, the injured laborer
was initially free to choose either to recover from the employer
the fixed amounts set by the Compensation Law or else, to
prosecute an ordinary civil action against the tortfeasor for higher
damages. While perhaps not as profitable, the smaller indemnity
obtainable by the first course is balanced by the claimant's being
relieved of the burden of proving the causal connection between
the defendant's negligence and the resulting injury, and of having
to establish the extent of the damage suffered; issues that are apt
to be troublesome to establish satisfactorily. Having staked his
fortunes on a particular remedy, petitioner is precluded from
 pursuing the alternate course, at least until the prior claim is
rejected by the Compensation Commission. Anyway, under the
proviso of Section 6 aforequoted, if the employer Franklin Baker
Company recovers, by derivative action against the alleged
tortfeasors, a sum greater than the compensation he may have
paid the herein petitioner, the excess accrues to the latter.
Although the doctrine in the case of Esguerra vs. Munoz Palma (104 Phil.
582), applies to third-party tortfeasor, said rule should likewise apply to the
employer-tortfeasor.
Insofar as the heirs of Nazarito Floresca are concerned, as already stated,
the petition has been dismissed in the resolution of September 7, 1978 in
view of the amicable settlement reached by Philex and the said heirs.
With regard to the other petitioners, it was alleged by Philex in its motion
to dismiss dated May 14, 1968 before the court a quo, that the heirs of the
deceased employees, namely Emerito Obra, Larry Villar, Jr., Aurelio Lanuza,
Lorenzo Isla and Saturnino Martinez submitted notices and claims for
compensation to the Regional Office No. 1 of the then Department of Labor
and all of them have been paid in full as of August 25, 1967, except
Saturnino Martinez whose heirs decided that they be paid in installments
(pp. 106-107, rec.). Such allegation was admitted by herein petitioners in
their opposition to the motion to dismiss dated May 27, 1968 (pp. 121-122,
rec.) in the lower court, but they set up the defense that the claims were
filed under the Workmen's Compensation Act before they learned of the
official report of the committee created to investigate the accident which
established the criminal negligence and violation of law by Philex, and which
report was forwarded by the Director of Mines to the then Executive
Secretary Rafael Salas in a letter dated October 19, 1967 only (p. 76, rec.).
WE hold that although the other petitioners had received the benefits under
the Workmen's Compensation Act, such may not preclude them from
bringing an action before the regular court because they became cognizant
of the fact that Philex has been remiss in its contractual obligations with the
deceased miners only after receiving compensation under the Act. Had
petitioners been aware of said violation of government rules and
regulations by Philex, and of its negligence, they would not have sought
redress under the Workmen's Compensation Commission which awarded a
lesser amount for compensation. The choice of the first remedy was based
on ignorance or a mistake of fact, which nullifies the choice as it was not an
intelligent choice. The case should therefore be remanded to the lower
court for further proceedings. However, should the petitioners be
successful in their bid before the lower court, the payments made under the
Workmen's Compensation Act should be deducted from the damages that
may be decreed in their favor.
B
Contrary to the perception of the dissenting opinion, the Court does not
legislate in the instant case. The Court merely applies and gives effect to the
constitutional guarantees of social justice then secured by Section 5 of
Article 11 and Section 6 of Article XIV of the 1935 Constitution, and now by
Sections 6, 7, and 9 of Article 11 of the DECLARATION OF PRINCIPLES AND
STATE POLICIES of the 1973 Constitution, as amended, and as implemented
by Articles 2176, 2177, 2178, 1173, 2201, 2216, 2231 and 2232 of the New
Civil Code of 1950.
To emphasize, the 1935 Constitution declares that:
Sec. 5. The promotion of social justice to insure the well-being and
economic security of all the people should be the concern of the
State (Art. II).
Sec. 6. The State shall afford protection to labor, especially to
working women, and minors, and shall regulate the relations
between landowner and tenant, and between labor and capital in
industry and in agriculture. The State may provide for compulsory
arbitration (Art. XIV).
The 1973 Constitution likewise commands the State to "promote social
justice to insure the dignity, welfare, and security of all the people "...
regulate the use ... and disposition of private property and equitably diffuse
property ownership and profits "establish, maintain and ensure adequate
social services in, the field of education, health, housing, employment,
welfare and social security to guarantee the enjoyment by the people of a
decent standard of living" (Sections 6 and 7, Art. II, 1973 Constitution);
"... afford protection to labor, ... and regulate the relations between workers
and employers ..., and assure the rights of workers to ... just and humane
conditions of work" (Sec. 9, Art. II, 1973 Constitution, emphasis supplied).
The foregoing constitutional guarantees in favor of labor institutionalized in
Section 9 of Article 11 of the 1973 Constitution and re-stated as a
declaration of basic policy in Article 3 of the New Labor Code, thus:
Art. 3. Declaration of basic policy.—The State shall afford
protection to labor, promote full employment, ensure equal work
opportunities regardless of sex, race or creed, and regulate the
relations between workers and employers. The State shall assure
the rights of workers to self-organization, collective bargaining,
security of tenure, and just and humane conditions of work.
(emphasis supplied).
The aforestated constitutional principles as implemented by the
aforementioned articles of the New Civil Code cannot be impliedly repealed
by the restrictive provisions of Article 173 of the New Labor Code. Section 5
of the Workmen's Compensation Act (before it was amended by R.A. No.
772 on June 20, 1952), predecessor of Article 173 of the New Labor Code,
has been superseded by the aforestated provisions of the New Civil Code, a
subsequent law, which took effect on August 30, 1950, which obey the
constitutional mandates of social justice enhancing as they do the rights of
the workers as against their employers. Article 173 of the New Labor Code
seems to diminish the rights of the workers and therefore collides with the
social justice guarantee of the Constitution and the liberal provisions of the
New Civil Code.
The guarantees of social justice embodied in Sections 6, 7 and 9 of Article II
of the 1973 Constitution are statements of legal principles to be applied and
enforced by the courts. Mr. Justice Robert Jackson in the case of West
Virginia State Board of Education vs. Barnette, with characteristic
eloquence, enunciated:
The very purpose of a Bill of Rights was to withdraw certain
subjects from the vicissitudes of political controversy, to place
them beyond the reach of majorities and officials and to establish
them as legal principles to be applied by the courts. One's right to
life, liberty, and property, to free speech, a free press, freedom of
worship and assembly, and other fundamental rights may not be
submitted to vote; they depend on the outcome of no elections
(319 U.S. 625, 638, 87 L.ed. 1638, emphasis supplied).
In case of any doubt which may be engendered by Article 173 of the New
Labor Code, both the New Labor Code and the Civil Code direct that the
doubts should be resolved in favor of the workers and employees.
Thus, Article 4 of the New Labor Code, otherwise known as Presidential
Decree No. 442, as amended, promulgated on May 1, 1974, but which took
effect six months thereafter, provides that "all doubts in the
implementation and interpretation of the provisions of this Code, including
its implementing rules and regulations, shall be resolved in favor of labor"
(Art. 2, Labor Code).
Article 10 of the New Civil Code states: "In case of doubt in the
interpretation or application of laws, it is presumed that the law-making
body intended right and justice to prevail. "
More specifically, Article 1702 of the New Civil Code likewise directs that.
"In case of doubt, all labor legislation and all labor contracts shall be
construed in favor of the safety and decent living of the laborer."
Before it was amended by Commonwealth Act No. 772 on June 20, 1952,
Section 5 of the Workmen's Compensation Act provided:
Sec. 5. Exclusive right to compensation.- The rights and remedies
granted by this Act to an employee by reason of a personal injury
entitling him to compensation shall exclude all other rights and
 remedies accruing to the employee, his personal representatives,
dependents or nearest of kin against the employer under the Civil
Code and other laws, because of said injury (emphasis supplied).
Employers contracting laborecsrs in the Philippine Islands for
work outside the same may stipulate with such laborers that the
remedies prescribed by this Act shall apply exclusively to injuries
received outside the Islands through accidents happening in and
during the performance of the duties of the employment; and all
service contracts made in the manner prescribed in this section
shall be presumed to include such agreement.
Only the second paragraph of Section 5 of the Workmen's Compensation
Act No. 3428, was amended by Commonwealth Act No. 772 on June 20,
1952, thus:
Sec. 5. Exclusive right to compensation.- The rights and remedies
granted by this Act to an employee by reason of a personal injury
entitling him to compensation shall exclude all other rights and
remedies accruing to the employee, his personal representatives,
dependents or nearest of kin against the employer under the Civil
Code and other laws, because of said injury.
Employers contracting laborers in the Philippine Islands for work
outside the same shall stipulate with such laborers that the
remedies prescribed by this Act shall apply to injuries received
outside the Island through accidents happening in and during the
performance of the duties of the employment. Such stipulation
shall not prejudice the right of the laborers to the benefits of the
Workmen's Compensation Law of the place where the accident
occurs, should such law be more favorable to them (As amended
by section 5 of Republic Act No. 772).
Article 173 of the New Labor Code does not repeal expressly nor impliedly
the applicable provisions of the New Civil Code, because said Article 173
provides:
Art. 173. Exclusiveness of liability.- Unless otherwise provided, the
liability of the State Insurance Fund under this Title shall be
exclusive and in place of all other liabilities of the employer to the
employee, his dependents or anyone otherwise entitled to
receive damages on behalf of the employee or his dependents.
The payment of compensation under this Title shall bar the
recovery of benefits as provided for in Section 699 of the Revised
Administrative Code, Republic Act Numbered Eleven hundred
sixty-one, as amended, Commonwealth Act Numbered One
hundred eighty- six, as amended, Commonwealth Act Numbered
Six hundred ten, as amended, Republic Act Numbered Forty-eight
hundred Sixty-four, as amended, and other laws whose benefits
are administered by the System during the period of such
payment for the same disability or death, and conversely
(emphasis supplied).
As above-quoted, Article 173 of the New Labor Code expressly repealed
only Section 699 of the Revised Administrative Code, R.A. No. 1161, as
amended, C.A. No. 186, as amended, R.A. No. 610, as amended, R.A. No.
4864, as amended, and all other laws whose benefits are administered by
the System (referring to the GSIS or SSS).
Unlike Section 5 of the Workmen's Compensation Act as aforequoted,
Article 173 of the New Labor Code does not even remotely, much less
expressly, repeal the New Civil Code provisions heretofore quoted.
It is patent, therefore, that recovery under the New Civil Code for damages
arising from negligence, is not barred by Article 173 of the New Labor Code.
And the damages recoverable under the New Civil Code are not
administered by the System provided for by the New Labor Code, which
defines the "System" as referring to the Government Service Insurance
System or the Social Security System (Art. 167 [c], [d] and [e] of the New
Labor Code).
Furthermore, under Article 8 of the New Civil Code, decisions of the
Supreme Court form part of the law of the land.
Article 8 of the New Civil Code provides:
Art. 8. Judicial decisions applying or interpreting the laws or the
Constitution shall form a part of the legal system of the
Philippines.
The Court, through the late Chief Justice Fred Ruiz Castro, in People vs.
Licera ruled:
Article 8 of the Civil Code of the Philippines decrees that judicial
decisions applying or interpreting the laws or the Constitution
form part of this jurisdiction's legal system. These decisions,
although in themselves not laws, constitute evidence of what the
laws mean. The application or interpretation placed by the Court
upon a law is part of the law as of the date of the enactment of
the said law since the Court's application or interpretation merely
establishes the contemporaneous legislative intent that the
construed law purports to carry into effect" (65 SCRA 270, 272-
273 [1975]).
WE ruled that judicial decisions of the Supreme Court assume the same
authority as the statute itself (Caltex vs. Palomer, 18 SCRA 247; 124 Phil.
763).
The aforequoted provisions of Section 5 of the Workmen's Compensation
Act, before and after it was amended by Commonwealth Act No. 772 on
June 20, 1952, limited the right of recovery in favor of the deceased, ailing
or injured employee to the compensation provided for therein. Said Section
5 was not accorded controlling application by the Supreme Court in the
1970 case of Pacana vs. Cebu Autobus Company (32 SCRA 442) when WE
ruled that an injured worker has a choice of either to recover from the
employer the fixed amount set by the Workmen's Compensation Act or to
prosecute an ordinary civil action against the tortfeasor for greater
damages; but he cannot pursue both courses of action simultaneously. Said
Pacana case penned by Mr. Justice Teehankee, applied Article 1711 of the
Civil Code as against the Workmen's Compensation Act, reiterating the 1969
ruling in the case of Valencia vs. Manila Yacht Club (28 SCRA 724, June
30,1969) and the 1958 case of Esguerra vs. Munoz Palma (104 Phil. 582),
both penned by Justice J.B.L. Reyes. Said Pacana case was concurred in by
Justices J.B.L. Reyes, Dizon, Makalintal, Zaldivar, Castro, Fernando and
Villamor.
Since the first sentence of Article 173 of the New Labor Code is merely a re-
statement of the first paragraph of Section 5 of the Workmen's
Compensation Act, as amended, and does not even refer, neither expressly
nor impliedly, to the Civil Code as Section 5 of the Workmen's Compensation
Act did, with greater reason said Article 173 must be subject to the same
interpretation adopted in the cases of Pacana, Valencia and Esguerra
aforementioned as the doctrine in the aforesaid three (3) cases is faithful to
and advances the social justice guarantees enshrined in both the 1935 and
1973 Constitutions.
It should be stressed likewise that there is no similar provision on social
justice in the American Federal Constitution, nor in the various state
constitutions of the American Union. Consequently, the restrictive nature
of the American decisions on the Workmen's Compensation Act cannot limit
the range and compass of OUR interpretation of our own laws, especially
Article 1711 of the New Civil Code, vis-a-vis Article 173 of the New Labor
Code, in relation to Section 5 of Article II and Section 6 of Article XIV of the
1935 Constitution then, and now Sections 6, 7 and 9 of the Declaration of
Principles and State Policies of Article II of the 1973 Constitution.
The dissent seems to subordinate the life of the laborer to the property
rights of the employer. The right to life is guaranteed specifically by the due
process clause of the Constitution. To relieve the employer from liability for
the death of his workers arising from his gross or wanton fault or failure to
provide safety devices for the protection of his employees or workers
against the dangers which are inherent in underground mining, is to deprive
the deceased worker and his heirs of the right to recover indemnity for the
loss of the life of the worker and the consequent loss to his family without
due process of law. The dissent in effect condones and therefore
encourages such gross or wanton neglect on the part of the employer to
comply with his legal obligation to provide safety measures for the
protection of the life, limb and health of his worker. Even from the moral
viewpoint alone, such attitude is un-Christian.
It is therefore patent that giving effect to the social justice guarantees of the
Constitution, as implemented by the provisions of the New Civil Code, is not
an exercise of the power of law-making, but is rendering obedience to the
mandates of the fundamental law and the implementing legislation
aforementioned.
The Court, to repeat, is not legislating in the instant case.
It is axiomatic that no ordinary statute can override a constitutional
provision.
The words of Section 5 of the Workmen's Compensation Act and of Article
173 of the New Labor Code subvert the rights of the petitioners as surviving
heirs of the deceased mining employees. Section 5 of the Workmen's
Compensation Act and Article 173 of the New Labor Code are retrogressive;
because they are a throwback to the obsolete laissez-faire doctrine of Adam
Smith enunciated in 1776 in his treatise Wealth of Nations (Collier's
Encyclopedia, Vol. 21, p. 93, 1964), which has been discarded soon after the
close of the 18th century due to the Industrial Revolution that generated
the machines and other mechanical devices (beginning with Eli Whitney's
cotton gin of 1793 and Robert Fulton's steamboat of 1807) for production
and transportation which are dangerous to life, limb and health. The old
socio-political-economic philosophy of live-and-let-live is now superdesed
by the benign Christian shibboleth of live-and-help others to live. Those who
profess to be Christians should not adhere to Cain's selfish affirmation that
he is not his brother's keeper. In this our civilization, each one of us is our
brother's keeper. No man is an island. To assert otherwise is to be as
atavistic and ante-deluvian as the 1837 case of Prisley vs. Fowler (3 MN
1,150 reprint 1030) invoked by the dissent, The Prisley case was decided in
1837 during the era of economic royalists and robber barons of America.
Only ruthless, unfeeling capitalistics and egoistic reactionaries continue to
pay obeisance to such un-Christian doctrine. The Prisley rule humiliates man
and debases him; because the decision derisively refers to the lowly worker
as "servant" and utilizes with aristocratic arrogance "master" for
"employer." It robs man of his inherent dignity and dehumanizes him. To
stress this affront to human dignity, WE only have to restate the quotation
from Prisley, thus: "The mere relation of the master and the servant never
can imply an obligation on the part of the master to take more care of the
servant than he may reasonably be expected to do himself." This is the very
selfish doctrine that provoked the American Civil War which generated so
much hatred and drew so much precious blood on American plains and
valleys from 1861 to 1864.
"Idolatrous reverence" for the letter of the law sacrifices the human being.
The spirit of the law insures man's survival and ennobles him. In the words
of Shakespeare, "the letter of the law killeth; its spirit giveth life."
C
It is curious that the dissenting opinion clings to the myth that the courts
cannot legislate.
That myth had been exploded by Article 9 of the New Civil Code, which
provides that "No judge or court shall decline to render judgment by reason
of the silence, obscurity or insufficiency of the laws. "
Hence, even the legislator himself, through Article 9 of the New Civil Code,
recognizes that in certain instances, the court, in the language of Justice
Holmes, "do and must legislate" to fill in the gaps in the law; because the
mind of the legislator, like all human beings, is finite and therefore cannot
envisage all possible cases to which the law may apply Nor has the human
mind the infinite capacity to anticipate all situations.
But about two centuries before Article 9 of the New Civil Code, the founding
fathers of the American Constitution foresaw and recognized the
eventuality that the courts may have to legislate to supply the omissions or
to clarify the ambiguities in the American Constitution and the statutes.
'Thus, Alexander Hamilton pragmatically admits that judicial legislation may
be justified but denies that the power of the Judiciary to nullify statutes may
give rise to Judicial tyranny (The Federalist, Modern Library, pp. 503-511,
1937 ed.). Thomas Jefferson went farther to concede that the court is even
independent of the Nation itself (A.F.L. vs. American Sash Company, 1949
335 US 538).
Many of the great expounders of the American Constitution likewise share
the same view. Chief Justice Marshall pronounced: "It is emphatically the
province and duty of the Judicial department to say what the law is
(Marbury vs. Madison I Cranch 127 1803), which was re-stated by Chief
Justice Hughes when he said that "the Constitution is what the judge says it
is (Address on May 3, 1907, quoted by President Franklin Delano Roosevelt
on March 9, 1937). This was reiterated by Justice Cardozo who pronounced
that "No doubt the limits for the judge are narrower. He legislates only
between gaps. He fills the open spaces in the law. " (The Nature of the
Judicial Process, p. 113). In the language of Chief Justice Harlan F. Stone,
"The only limit to the judicial legislation is the restraint of the judge" (U.S.
vs. Butler 297 U.S. 1 Dissenting Opinion, p. 79), which view is also
entertained by Justice Frankfurter and Justice Robert Jackson. In the
rhetoric of Justice Frankfurter, "the courts breathe life, feeble or strong, into
the inert pages of the Constitution and all statute books."
It should be stressed that the liability of the employer under Section 5 of the
Workmen's Compensation Act or Article 173 of the New Labor Code is
limited to death, ailment or injury caused by the nature of the work, without
any fault on the part of the employers. It is correctly termed no fault liability.
Section 5 of the Workmen's Compensation Act, as amended, or Article 173
of the New Labor Code, does not cover the tortious liability of the employer
occasioned by his fault or culpable negligence in failing to provide the safety
devices required by the law for the protection of the life, limb and health of
the workers. Under either Section 5 or Article 173, the employer remains
liable to pay compensation benefits to the employee whose death, ailment
or injury is work-connected, even if the employer has faithfully and
diligently furnished all the safety measures and contrivances decreed by the
law to protect the employee.
The written word is no longer the "sovereign talisman." In the epigrammatic
language of Mr. Justice Cardozo, "the law has outgrown its primitive stage
of formalism when the precise word was the sovereign talisman, and every
slip was fatal" (Wood vs. Duff Gordon 222 NW 88; Cardozo, The Nature of
the Judicial Process 100). Justice Cardozo warned that: "Sometimes the
conservatism of judges has threatened for an interval to rob the legislation
of its efficacy. ... Precedents established in those items exert an unhappy
influence even now" (citing Pound, Common Law and Legislation 21 Harvard
Law Review 383, 387).
Finally, Justice Holmes delivered the coup de grace when he pragmatically
admitted, although with a cautionary undertone: "that judges do and must
legislate, but they can do so only interstitially they are confined from molar
to molecular motions" (Southern Pacific Company vs. Jensen, 244 US 204
1917). And in the subsequent case of Springer vs. Government (277 US 188,
210-212, 72 L.ed. 845, 852- 853), Justice Holmes pronounced:
The great ordinances of the Constitution do not establish and
divide fields of black and white. Even the more specific of them
are found to terminate in a penumbra shading gradually from one
extreme to the other. x x x. When we come to the fundamental
distinctions it is still more obvious that they must be received with
a certain latitude or our government could not go on.
To make a rule of conduct applicable to an individual who but for
such action would be free from it is to legislate yet it is what the
judges do whenever they determine which of two competing
principles of policy shall prevail.
xxx xxx xxx
It does not seem to need argument to show that however we may
disguise it by veiling words we do not and cannot carry out the
distinction between legislative and executive action with
mathematical precision and divide the branches into waterlight
compartments, were it ever so desirable to do so, which I am far
from believing that it is, or that the Constitution requires.
True, there are jurists and legal writers who affirm that judges should not
legislate, but grudgingly concede that in certain cases judges do legislate.
They criticize the assumption by the courts of such law-making power as
dangerous for it may degenerate into Judicial tyranny. They include
Blackstone, Jeremy Bentham, Justice Black, Justice Harlan, Justice Roberts,
Justice David Brewer, Ronald Dworkin, Rolf Sartorious, Macklin Fleming and
Beryl Harold Levy. But said Justices, jurists or legal commentators, who
either deny the power of the courts to legislate in-between gaps of the law,
or decry the exercise of such power, have not pointed to examples of the
exercise by the courts of such law-making authority in the interpretation
and application of the laws in specific cases that gave rise to judicial tyranny
or oppression or that such judicial legislation has not protected public
interest or individual welfare, particularly the lowly workers or the
underprivileged.
On the other hand, there are numerous decisions interpreting the Bill of
Rights and statutory enactments expanding the scope of such provisions to
protect human rights. Foremost among them is the doctrine in the cases of
Miranda vs. Arizona (384 US 436 1964), Gideon vs. Wainright (372 US 335),
Escubedo vs. Illinois (378 US 478), which guaranteed the accused under
custodial investigation his rights to remain silent and to counsel and to be
informed of such rights as even as it protects him against the use of force or
intimidation to extort confession from him. These rights are not found in
the American Bill of Rights. These rights are now institutionalized in Section
20, Article IV of the 1973 Constitution. Only the peace-and-order adherents
were critical of the activism of the American Supreme Court led by Chief
Justice Earl Warren.
Even the definition of Identical offenses for purposes of the double jeopardy
provision was developed by American judicial decisions, not by amendment
to the Bill of Rights on double jeopardy (see Justice Laurel in People vs.
Tarok, 73 Phil. 260, 261-268). And these judicial decisions have been re-
stated in Section 7 of Rule 117 of the 1985 Rules on Criminal Procedure, as
well as in Section 9 of Rule 117 of the 1964 Revised Rules of Court. In both
provisions, the second offense is the same as the first offense if the second
offense is an attempt to commit the first or frustration thereof or
necessarily includes or is necessarily included in the first offense.
The requisites of double jeopardy are not spelled out in the Bill of Rights.
They were also developed by judicial decisions in the United States and in
the Philippines even before people vs. Ylagan (58 Phil. 851-853).
Again, the equal protection clause was interpreted in the case of Plessy vs.
Ferguson (163 US 537) as securing to the Negroes equal but separate
facilities, which doctrine was revoked in the case of Brown vs. Maryland
Board of Education (349 US 294), holding that the equal protection clause
means that the Negroes are entitled to attend the same schools attended
by the whites-equal facilities in the same school-which was extended to
public parks and public buses.
De-segregation, not segregation, is now the governing principle.
Among other examples, the due process clause was interpreted in the case
of People vs. Pomar (46 Phil. 440) by a conservative, capitalistic court to
invalidate a law granting maternity leave to working women-according
primacy to property rights over human rights. The case of People vs. Pomar
is no longer the rule.
As early as 1904, in the case of Lochner vs. New York (198 US 45, 76, 49 L.
ed. 937, 949), Justice Holmes had been railing against the conservatism of
Judges perverting the guarantee of due process to protect property rights
as against human rights or social justice for the working man. The law fixing
maximum hours of labor was invalidated. Justice Holmes was vindicated
finally in 1936 in the case of West Coast Hotel vs. Parish (300 US 377-79; 81
L. ed. 703) where the American Supreme Court upheld the rights of workers
to social justice in the form of guaranteed minimum wage for women and
minors, working hours not exceeding eight (8) daily, and maternity leave for
women employees.
The power of judicial review and the principle of separation of powers as
well as the rule on political questions have been evolved and grafted into
the American Constitution by judicial decisions (Marbury vs. Madison, supra
Coleman vs. Miller, 307 US 433, 83 L. ed. 1385; Springer vs. Government,
277 US 210-212, 72 L. ed. 852, 853).
It is noteworthy that Justice Black, who seems to be against judicial
legislation, penned a separate concurring opinion in the case of Coleman vs.
Miller, supra, affirming the doctrine of political question as beyond the
ambit of judicial review. There is nothing in both the American and
Philippine Constitutions expressly providing that the power of the courts is
limited by the principle of separation of powers and the doctrine on political
questions. There are numerous cases in Philippine jurisprudence applying
the doctrines of separation of powers and political questions and invoking
American precedents.
Unlike the American Constitution, both the 1935 and 1973 Philippine
Constitutions expressly vest in the Supreme Court the power to review the
validity or constitutionality of any legislative enactment or executive act.
WHEREFORE, THE TRIAL COURT'S ORDER OF DISMISSAL IS HEREBY
REVERSED AND SET ASIDE AND THE CASE IS REMANDED TO IT FOR FURTHER
PROCEEDINGS. SHOULD A GREATER AMOUNT OF DAMAGES BE DECREED IN
FAVOR OF HEREIN PETITIONERS, THE PAYMENTS ALREADY MADE TO THEM
PURSUANT TO THE WORKMEN'S COMPENSATION ACT SHALL BE
DEDUCTED. NO COSTS.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 108763 February 13, 1997
REPUBLIC OF THE PHILIPPINES,
vs.
COURT OF APPEALS and RORIDEL OLAVIANO MOLINA, respondents.
PANGANIBAN, J.:
The Family Code of the Philippines provides an entirely new ground (in
addition to those enumerated in the Civil Code) to assail the validity of a
marriage, namely, "psychological incapacity." Since the Code's effectivity,
our courts have been swamped with various petitions to declare
marriages void based on this ground. Although this Court had interpreted
the meaning of psychological incapacity in the recent case of Santos
vs. Court of Appeals, still many judges and lawyers find difficulty in
applying said novel provision in specific cases. In the present case and in
the context of the herein assailed Decision of the Court of Appeals, the
Solicitor General has labelled — exaggerated to be sure but nonetheless
expressive of his frustration — Article 36 as the "most liberal divorce
procedure in the world." Hence, this Court in addition to resolving the
present case, finds the need to lay down specific guidelines in the
interpretation and application of Article 36 of the Family Code.
Before us is a petition for review on certiorari under Rule 45 challenging
the January 25, 1993 Decision1 of the Court of Appeals2 in CA-G.R. CV No.
34858 affirming in toto the May 14, 1991 decision of the Regional Trial
Court of La Trinidad,3 Benguet, which declared the marriage of respondent
Roridel Olaviano Molina to Reynaldo Molina void ab initio, on the ground of
"psychological incapacity" under Article 36 of the Family Code.
The Facts
This case was commenced on August 16, 1990 with the filing by respondent
Roridel O. Molina of a verified petition for declaration of nullity of her
marriage to Reynaldo Molina. Essentially, the petition alleged that Roridel
and Reynaldo were married on April 14, 1985 at the San Agustin Church4 in
Manila; that a son, Andre O. Molina was born; that after a year of marriage,
Reynaldo showed signs of "immaturity and irresponsibility" as a husband
and a father since he preferred to spend more time with his peers and
friends on whom he squandered his money; that he depended on his
parents for aid and assistance, and was never honest with his wife in regard
to their finances, resulting in frequent quarrels between them; that
sometime in February 1986, Reynaldo was relieved of his job in Manila, and
since then Roridel had been the sole breadwinner of the family; that in
October 1986 the couple had a very intense quarrel, as a result of which
their relationship was estranged; that in March 1987, Roridel resigned from
her job in Manila and went to live with her parents in Baguio City; that a few
weeks later, Reynaldo left Roridel and their child, and had since then
abandoned them; that Reynaldo had thus shown that he was
psychologically incapable of complying with essential marital obligations
and was a highly immature and habitually quarrel some individual who
thought of himself as a king to be served; and that it would be to the
couple's best interest to have their marriage declared null and void in order
to free them from what appeared to be an incompatible marriage from the
start.
In his Answer filed on August 28, 1989, Reynaldo admitted that he and
Roridel could no longer live together as husband and wife, but contended
that their misunderstandings and frequent quarrels were due to (1)
Roridel's strange behavior of insisting on maintaining her group of friends
even after their marriage; (2) Roridel's refusal to perform some of her
marital duties such as cooking meals; and (3) Roridel's failure to run the
household and handle their finances.
During the pre-trial on October 17, 1990, the following were stipulated:
1. That the parties herein were legally married on April 14, 1985
at the Church of St. Augustine, Manila;
2. That out of their marriage, a child named Albert Andre Olaviano
Molina was born on July 29, 1986;
3. That the parties are separated-in-fact for more than three
years;
4. That petitioner is not asking support for her and her child;
5. That the respondent is not asking for damages;
6. That the common child of the parties is in the custody of the
petitioner wife.
Evidence for herein respondent wife consisted of her own testimony and
that of her friends Rosemarie Ventura and Maria Leonora Padilla as well as
of Ruth G. Lalas, a social worker, and of Dr. Teresita Hidalgo-Sison, a
psychiatrist of the Baguio General Hospital and Medical Center. She also
submitted documents marked as Exhibits "A" to "E-1." Reynaldo did not
present any evidence as he appeared only during the pre-trial conference.
On May 14, 1991, the trial court rendered judgment declaring the marriage
void. The appeal of petitioner was denied by the Court of Appeals which
affirmed in toto the RTC's decision. Hence, the present recourse.
The Issue
In his petition, the Solicitor General insists that "the Court of Appeals made
an erroneous and incorrect interpretation of the phrase 'psychological
incapacity' (as provided under Art. 36 of the Family Code) and made an
incorrect application thereof to the facts of the case," adding that the
appealed Decision tended "to establish in effect the most liberal divorce
procedure in the world which is anathema to our culture."
In denying the Solicitor General's appeal, the respondent Court
relied5 heavily on the trial court's findings "that the marriage between the
parties broke up because of their opposing and conflicting personalities."
Then, it added it sown opinion that "the Civil Code Revision Committee
(hereinafter referred to as Committee) intended to liberalize the application
of our civil laws on personal and family rights. . . ." It concluded that:
As ground for annulment of marriage, We view psychologically
incapacity as a broad range of mental and behavioral conduct on
the part of one spouse indicative of how he or she regards the
marital union, his or her personal relationship with the other
spouse, as well as his or her conduct in the long haul for the
attainment of the principal objectives of marriage. If said conduct,
observed and considered as a whole, tends to cause the union to
self-destruct because it defeats the very objectives of marriage,
then there is enough reason to leave the spouses to their
individual fates.
In the case at bar, We find that the trial judge committed no
indiscretion in analyzing and deciding the instant case, as it did,
hence, We find no cogent reason to disturb the findings and
conclusions thus made.
Respondent, in her Memorandum, adopts these discussions of the Court of
Appeals.
The petitioner, on the other hand, argues that "opposing and conflicting
personalities" is not equivalent to psychological incapacity, explaining that
such ground "is not simply the neglect by the parties to the marriage of their
responsibilities and duties, but a defect in their psychological nature which
renders them incapable of performing such marital responsibilities and
duties."
The Court's Ruling
The petition is meritorious.
In Leouel Santos vs. Court of Appeals6 this Court, speaking thru Mr. Justice
Jose C. Vitug, ruled that "psychological incapacity should refer to no less
than a mental (nor physical) incapacity . . . and that (t)here is hardly any
doubt that the intendment of the law has been to confine the meaning of
'psychological incapacity' to the most serious cases of personality disorders
clearly demonstrative of an utter insensitivity or inability to give meaning
and significance to the marriage. This psychologic condition must exist at
the time the marriage is celebrated." Citing Dr. Gerardo Veloso, a former
presiding judge of the Metropolitan Marriage Tribunal of the Catholic
Archdiocese of Manila,7Justice Vitug wrote that "the psychological
incapacity must be characterized by (a) gravity, (b) juridical antecedence,
and (c) incurability."
On the other hand, in the present case, there is no clear showing to us that
the psychological defect spoken of is an incapacity. It appears to us to be
more of a "difficulty," if not outright "refusal" or "neglect" in the
performance of some marital obligations. Mere showing of "irreconciliable
differences" and "conflicting personalities" in no wise constitutes
psychological incapacity. It is not enough to prove that the parties failed to
meet their responsibilities and duties as married persons; it is essential that
they must be shown to be incapable of doing so, due to some psychological
(nor physical) illness.
The evidence adduced by respondent merely showed that she and her
husband could nor get along with each other. There had been no showing
of the gravity of the problem; neither its juridical antecedence nor its
incurability. The expert testimony of Dr. Sison showed no incurable
psychiatric disorder but only incompatibility, not psychological incapacity.
Dr. Sison testified:8
COURT
Q It is therefore the recommendation of the psychiatrist based on
your findings that it is better for the Court to annul (sic) the
marriage?
A Yes, Your Honor.
 Q There is no hope for the marriage?
A There is no hope, the man is also living with another woman.
Q Is it also the stand of the psychiatrist that the parties are
psychologically unfit for each other but they are psychologically
fit with other parties?
A Yes, Your Honor.
Q Neither are they psychologically unfit for their professions?
A Yes, Your Honor.
The Court has no more questions.
In the case of Reynaldo, there is no showing that his alleged personality
traits were constitutive of psychological incapacity existing at the time of
marriage celebration. While some effort was made to prove that there was
a failure to fulfill pre-nuptial impressions of "thoughtfulness and
gentleness" on Reynaldo's part of being "conservative, homely and
intelligent" on the part of Roridel, such failure of expectation is nor
indicative of antecedent psychological incapacity. If at all, it merely shows
love's temporary blindness to the faults and blemishes of the beloved.
During its deliberations, the Court decided to go beyond merely ruling on
the facts of this case vis-a-vis existing law and jurisprudence. In view of the
novelty of Art. 36 of the Family Code and the difficulty experienced by many
trial courts interpreting and applying it, the Court decided to invite
two amici curiae, namely, the Most Reverend Oscar V. Cruz,9 Vicar
Judicial (Presiding Judge) of the National Appellate Matrimonial Tribunal of
the Catholic Church in the Philippines, and Justice Ricardo C. Puno, 10 a
member of the Family Code Revision Committee. The Court takes this
occasion to thank these friends of the Court for their informative and
interesting discussions during the oral argument on December 3, 1996,
which they followed up with written memoranda.
From their submissions and the Court's own deliberations, the following
guidelines in the interpretation and application of Art. 36 of the Family Code
are hereby handed down for the guidance of the bench and the bar:
(1) The burden of proof to show the nullity of the marriage belongs to the
plaintiff. Any doubt should be resolved in favor of the existence and
continuation of the marriage and against its dissolution and nullity. This is
rooted in the fact that both our Constitution and our laws cherish the
validity of marriage and unity of the family. Thus, our Constitution devotes
an entire Article on the Family, 11 recognizing it "as the foundation of the
nation." It decrees marriage as legally "inviolable," thereby protecting it
from dissolution at the whim of the parties. Both the family and marriage
are to be "protected" by the state.
The Family Code 12 echoes this constitutional edict on marriage and the
family and emphasizes the permanence, inviolability and solidarity
(2) The root cause of the psychological incapacity must be (a) medically or
clinically identified, (b) alleged in the complaint, (c) sufficiently proven by
experts and (d) clearly explained in the decision. Article 36 of the Family
Code requires that the incapacity must be psychological — not physical.
although its manifestations and/or symptoms may be physical. The
evidence must convince the court that the parties, or one of them, was
mentally or physically ill to such an extent that the person could not have
known the obligations he was assuming, or knowing them, could not have
given valid assumption thereof. Although no example of such incapacity
need be given here so as not to limit the application of the provision under
the principle of ejusdem generis, 13 nevertheless such root cause must be
identified as a psychological illness and its incapacitating nature explained.
Expert evidence may be given qualified psychiatrist and clinical
psychologists.
(3) The incapacity must be proven to be existing at "the time of the
celebration" of the marriage. The evidence must show that the illness was
existing when the parties exchanged their "I do's." The manifestation of the
illness need not be perceivable at such time, but the illness itself must have
attached at such moment, or prior thereto.
(4) Such incapacity must also be shown to be medically or clinically
permanent or incurable. Such incurability may be absolute or even relative
only in regard to the other spouse, not necessarily absolutely against
everyone of the same sex. Furthermore, such incapacity must be relevant
to the assumption of marriage obligations, not necessarily to those not
related to marriage, like the exercise of a profession or employment in a
job. Hence, a pediatrician may be effective in diagnosing illnesses of children
and prescribing medicine to cure them but may not be psychologically
capacitated to procreate, bear and raise his/her own children as an essential
obligation of marriage.
(5) Such illness must be grave enough to bring about the disability of the
party to assume the essential obligations of marriage. Thus, "mild
characteriological peculiarities, mood changes, occasional emotional
outbursts" cannot be accepted as root causes. The illness must be shown as
downright incapacity or inability, nor a refusal, neglect or difficulty, much
less ill will. In other words, there is a natal or supervening disabling factor in
the person, an adverse integral element in the personality structure that
effectively incapacitates the person from really accepting and thereby
complying with the obligations essential to marriage.
(6) The essential marital obligations must be those embraced by Articles 68
up to 71 of the Family Code as regards the husband and wife as well as
Articles 220, 221 and 225 of the same Code in regard to parents and their
children. Such non-complied marital obligation(s) must also be stated in the
petition, proven by evidence and included in the text of the decision.
(7) Interpretations given by the National Appellate Matrimonial Tribunal of
the Catholic Church in the Philippines, while not controlling or decisive,
should be given great respect by our courts. It is clear that Article 36 was
taken by the Family Code Revision Committee from Canon 1095 of the New
Code of Canon Law, which became effective in 1983 and which provides:
The following are incapable of contracting marriage: Those who
are unable to assume the essential obligations of marriage due to
causes of psychological nature. 14
Since the purpose of including such provision in our Family Code is to
harmonize our civil laws with the religious faith of our people, it stands to
reason that to achieve such harmonization, great persuasive weight should
be given to decision of such appellate tribunal. Ideally — subject to our law
on evidence — what is decreed as canonically invalid should also be decreed
civilly void.
This is one instance where, in view of the evident source and purpose of the
Family Code provision, contemporaneous religious interpretation is to be
given persuasive effect. Here, the State and the Church — while remaining
independent, separate and apart from each other — shall walk together in
synodal cadence towards the same goal of protecting and cherishing
marriage and the family as the inviolable base of the nation.
(8) The trial court must order the prosecuting attorney or fiscal and the
Solicitor General to appear as counsel for the state. No decision shall he
handed down unless the Solicitor General issues a certification, which will
be quoted in the decision, briefly staring therein his reasons for his
agreement or opposition, as the case may be, to the petition. The Solicitor
General, along with the prosecuting attorney, shall submit to the court such
certification within fifteen (15) days from the date the case is deemed
submitted for resolution of the court. The Solicitor General shall discharge
the equivalent function of the defensor vinculi contemplated under Canon
1095.
In the instant case and applying Leouel Santos, we have already ruled to
grant the petition. Such ruling becomes even more cogent with the use of
the foregoing guidelines.
WHEREFORE, the petition is GRANTED. The assailed Decision is REVERSED
and SET ASIDE. The marriage of Roridel Olaviano to Reynaldo Molina
subsists and remains valid.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-39419 April 12, 1982
MAPALAD AISPORNA, petitioner,
vs.
THE COURT OF APPEALS and THE PEOPLE OF THE
PHILIPPINES, respondents.
DE CASTRO, J.:
In this petition for certiorari, petitioner-accused Aisporna seeks the reversal
of the decision dated August 14, 1974 1in CA-G.R. No. 13243-CR entitled
"People of the Philippines, plaintiff-appellee, vs. Mapalad Aisporna,
defendant-appellant" of respondent Court of Appeals affirming the
judgment of the City Court of Cabanatuan 2 rendered on August 2, 1971
which found the petitioner guilty for having violated Section 189 of the
Insurance Act (Act No. 2427, as amended) and sentenced her to pay a fine
of P500.00 with subsidiary imprisonment in case of insolvency, and to pay
the costs.
Petitioner Aisporna was charged in the City Court of Cabanatuan for
violation of Section 189 of the Insurance Act on November 21, 1970 in an
information 3 which reads as follows:
That on or before the 21st day of June, 1969, in the City of
Cabanatuan, Republic of the Philippines, and within the
jurisdiction of this Honorable Court, the above-named accused,
did then and there, wilfully, unlawfully and feloniously act as
agent in the solicitation or procurement of an application for
insurance by soliciting therefor the application of one Eugenio S.
Isidro, for and in behalf of Perla Compania de Seguros, Inc., a duly
organized insurance company, registered under the laws of the
Republic of the Philippines, resulting in the issuance of a Broad
Personal Accident Policy No. 28PI-RSA 0001 in the amount not
exceeding FIVE THOUSAND PESOS (P5,000.00) dated June 21,
1969, without said accused having first secured a certificate of
authority to act as such agent from the office of the Insurance
Commissioner, Republic of the Philippines.
CONTRARY TO LAW.
The facts, 4 as found by the respondent Court of Appeals are quoted
hereunder:
IT RESULTING: That there is no debate that since 7 March, 1969
and as of 21 June, 1969, appellant's husband, Rodolfo S. Aisporna
was duly licensed by Insurance Commission as agent to Perla
Compania de Seguros, with license to expire on 30 June, 1970,
Exh. C; on that date, at Cabanatuan City, Personal Accident Policy,
Exh. D was issued by Perla thru its author representative, Rodolfo
S. Aisporna, for a period of twelve (12) months with beneficiary as
Ana M. Isidro, and for P5,000.00; apparently, insured died by
violence during lifetime of policy, and for reasons not explained in
record, present information was filed by Fiscal, with assistance of
private prosecutor, charging wife of Rodolfo with violation of Sec.
189 of Insurance Law for having, wilfully, unlawfully, and
feloniously acted, "as agent in the solicitation for insurance by
soliciting therefore the application of one Eugenio S. Isidro for and
in behalf of Perla Compaña de Seguros, ... without said accused
having first secured a certificate of authority to act as such agent
from the office of the Insurance Commission, Republic of the
Philippines."
and in the trial, People presented evidence that was hardly
disputed, that aforementioned policy was issued with active
participation of appellant wife of Rodolfo, against which appellant
in her defense sought to show that being the wife of true agent,
Rodolfo, she naturally helped him in his work, as clerk, and that
policy was merely a renewal and was issued because Isidro had
called by telephone to renew, and at that time, her husband,
Rodolfo, was absent and so she left a note on top of her husband's
desk to renew ...
Consequently, the trial court found herein petitioner guilty as charged. On
appeal, the trial court's decision was affirmed by the respondent appellate
court finding the petitioner guilty of a violation of the first paragraph of
Section 189 of the Insurance Act. Hence, this present recourse was filed on
October 22, 1974. 5
In its resolution of October 28, 1974, 6 this Court resolved, without giving
due course to this instant petition, to require the respondent to comment
on the aforesaid petition. In the comment 7 filed on December 20, 1974, the
respondent, represented by the Office of the Solicitor General, submitted
that petitioner may not be considered as having violated Section 189 of the
Insurance Act. 8 On April 3, 1975, petitioner submitted his Brief 9 while the
Solicitor General, on behalf of the respondent, filed a manifestation 10 in
lieu of a Brief on May 3, 1975 reiterating his stand that the petitioner has
not violated Section 189 of the Insurance Act.
In seeking reversal of the judgment of conviction, petitioner assigns the
following errors 11 allegedly committed by the appellate court:
1. THE RESPONDENT COURT OF APPEALS ERRED IN FINDING THAT
RECEIPT OF COMPENSATION IS NOT AN ESSENTIAL ELEMENT OF
THE CRIME DEFINED BY THE FIRST PARAGRAPH OF SECTION 189
OF THE INSURANCE ACT.
2. THE RESPONDENT COURT OF APPEALS ERRED IN GIVING DUE
WEIGHT TO EXHIBITS F, F-1, TO F-17, INCLUSIVE SUFFICIENT TO
ESTABLISH PETITIONER'S GUILT BEYOND REASONABLE DOUBT.
3. THE RESPONDENT COURT OF APPEALS ERRED IN NOT
ACQUITTING HEREIN PETITIONER.
We find the petition meritorious.
The main issue raised is whether or not a person can be convicted of having
violated the first paragraph of Section 189 of the Insurance Act without
reference to the second paragraph of the same section. In other words, it is
necessary to determine whether or not the agent mentioned in the first
paragraph of the aforesaid section is governed by the definition of an
insurance agent found on its second paragraph.
The pertinent provision of Section 189 of the Insurance Act reads as follows:
No insurance company doing business within the Philippine
Islands, nor any agent thereof, shall pay any commission or other
compensation to any person for services in obtaining new
insurance, unless such person shall have first procured from the
Insurance Commissioner a certificate of authority to act as an
agent of such company as hereinafter provided. No person shall
act as agent, sub-agent, or broker in the solicitation of
procurement of applications for insurance, or receive for services
in obtaining new insurance, any commission or other
compensation from any insurance company doing business in the
Philippine Islands, or agent thereof, without first procuring a
certificate of authority so to act from the Insurance
Commissioner, which must be renewed annually on the first day
of January, or within six months thereafter. Such certificate shall
be issued by the Insurance Commissioner only upon the written
application of persons desiring such authority, such application
being approved and countersigned by the company such person
 desires to represent, and shall be upon a form approved by the
Insurance Commissioner, giving such information as he may
require. The Insurance Commissioner shall have the right to
refuse to issue or renew and to revoke any such certificate in his
discretion. No such certificate shall be valid, however, in any event
after the first day of July of the year following the issuing of such
certificate. Renewal certificates may be issued upon the
application of the company.
Any person who for compensation solicits or obtains insurance on
behalf of any insurance company, or transmits for a person other
than himself an application for a policy of insurance to or from
such company or offers or assumes to act in the negotiating of
such insurance, shall be an insurance agent within the intent of
this section, and shall thereby become liable to all the duties,
requirements, liabilities, and penalties to which an agent of such
company is subject.
Any person or company violating the provisions of this section
shall be fined in the sum of five hundred pesos. On the conviction
of any person acting as agent, sub-agent, or broker, of the
commission of any offense connected with the business of
insurance, the Insurance Commissioner shall immediately revoke
the certificate of authority issued to him and no such certificate
shall thereafter be issued to such convicted person.
A careful perusal of the above-quoted provision shows that the first
paragraph thereof prohibits a person from acting as agent, sub-agent or
broker in the solicitation or procurement of applications for insurance
without first procuring a certificate of authority so to act from the Insurance
Commissioner, while its second paragraph defines who is an insurance
agent within the intent of this section and, finally, the third paragraph
thereof prescribes the penalty to be imposed for its violation.
The respondent appellate court ruled that the petitioner is prosecuted not
under the second paragraph of Section 189 of the aforesaid Act but under
its first paragraph. Thus —
... it can no longer be denied that it was appellant's most active
endeavors that resulted in issuance of policy to Isidro, she was
there and then acting as agent, and received the pay thereof —
her defense that she was only acting as helper of her husband can
no longer be sustained, neither her point that she received no
compensation for issuance of the policy because
any person who for compensation solicits or obtains
insurance on behalf of any insurance company or
transmits for a person other than himself an application
for a policy of insurance to or from such company or
offers or assumes to act in the negotiating of such
insurance, shall be an insurance agent within the intent
of this section, and shall thereby become liable to all the
duties, requirements, liabilities, and penalties, to which
an agent of such company is subject. paragraph 2, Sec.
189, Insurance Law,
now it is true that information does not even allege that she had
obtained the insurance,for compensationwhich is the gist of the
offense in Section 189 of the Insurance Law in its 2nd paragraph,
but what appellant apparently overlooks is that she is prosecuted
not under the 2nd but under the 1st paragraph of Sec. 189
wherein it is provided that,
No person shall act as agent, sub-agent, or broker, in the
solicitation or procurement of applications for
insurance, or receive for services in obtaining new
insurance any commission or other compensation from
any insurance company doing business in the Philippine
Island, or agent thereof, without first procuring a
certificate of authority to act from the insurance
commissioner, which must be renewed annually on the
first day of January, or within six months thereafter.
therefore, there was no technical defect in the wording of the
charge, so that Errors 2 and 4 must be overruled. 12
From the above-mentioned ruling, the respondent appellate court seems to
imply that the definition of an insurance agent under the second paragraph
of Section 189 is not applicable to the insurance agent mentioned in the first
paragraph. Parenthetically, the respondent court concludes that under the
second paragraph of Section 189, a person is an insurance agent if he solicits
and obtains an insurance for compensation, but, in its first paragraph, there
is no necessity that a person solicits an insurance for compensation in order
to be called an insurance agent.
We find this to be a reversible error. As correctly pointed out by the Solicitor
General, the definition of an insurance agent as found in the second
paragraph of Section 189 is intended to define the word "agent" mentioned
in the first and second paragraphs of the aforesaid section. More
significantly, in its second paragraph, it is explicitly provided that the
definition of an insurance agent is within the intent of Section 189. Hence
—
Any person who for compensation ... shall be
an insurance agent within the intent of this section, ...
Patently, the definition of an insurance agent under the second paragraph
holds true with respect to the agent mentioned in the other two paragraphs
of the said section. The second paragraph of Section 189 is a definition and
interpretative clause intended to qualify the term "agent" mentioned in
both the first and third paragraphs of the aforesaid section.
Applying the definition of an insurance agent in the second paragraph to the
agent mentioned in the first and second paragraphs would give harmony to
the aforesaid three paragraphs of Section 189. Legislative intent must be
ascertained from a consideration of the statute as a whole. The particular
words, clauses and phrases should not be studied as detached and isolated
expressions, but the whole and every part of the statute must be considered
in fixing the meaning of any of its parts and in order to produce harmonious
whole. 13 A statute must be so construed as to harmonize and give effect to
all its provisions whenever possible. 14 The meaning of the law, it must be
borne in mind, is not to be extracted from any single part, portion or section
or from isolated words and phrases, clauses or sentences but from a general
consideration or view of the act as a whole. 15 Every part of the statute must
be interpreted with reference to the context. This means that every part of
the statute must be considered together with the other parts, and kept
subservient to the general intent of the whole enactment, not separately
and independently. 16 More importantly, the doctrine of associated words
(Noscitur a Sociis) provides that where a particular word or phrase in a
statement is ambiguous in itself or is equally susceptible of various
meanings, its true meaning may be made clear and specific by considering
the company in which it is found or with which it is associated. 17
Considering that the definition of an insurance agent as found in the second
paragraph is also applicable to the agent mentioned in the first paragraph,
to receive a compensation by the agent is an essential element for a
violation of the first paragraph of the aforesaid section. The appellate court
has established ultimately that the petitioner-accused did not receive any
compensation for the issuance of the insurance policy of Eugenio Isidro.
Nevertheless, the accused was convicted by the appellate court for,
according to the latter, the receipt of compensation for issuing an insurance
policy is not an essential element for a violation of the first paragraph of
Section 189 of the Insurance Act.
We rule otherwise. Under the Texas Penal Code 1911, Article 689, making it
a misdemeanor for any person for direct or indirect compensation to solicit
insurance without a certificate of authority to act as an insurance agent, an
information, failing to allege that the solicitor was to receive compensation
either directly or indirectly, charges no offense. 18 In the case of Bolen vs.
Stake, 19 the provision of Section 3750, Snyder's Compiled Laws of
Oklahoma 1909 is intended to penalize persons only who acted as insurance
solicitors without license, and while acting in such capacity negotiated and
concluded insurance contracts for compensation. It must be noted that the
information, in the case at bar, does not allege that the negotiation of an
insurance contracts by the accused with Eugenio Isidro was one for
compensation. This allegation is essential, and having been omitted, a
conviction of the accused could not be sustained. It is well-settled in Our
jurisprudence that to warrant conviction, every element of the crime must
be alleged and proved. 20
After going over the records of this case, We are fully convinced, as the
Solicitor General maintains, that accused did not violate Section 189 of the
Insurance Act.
WHEREFORE, the judgment appealed from is reversed and the accused is
acquitted of the crime charged, with costs de oficio.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-34964 January 31, 1973
CHINA BANKING CORPORATION and TAN KIM LIONG, petitioners-
appellants,
vs.
HON. WENCESLAO ORTEGA, as Presiding Judge of the Court of First
Instance of Manila, Branch VIII, and VICENTE G. ACABAN, respondents-
appellees.
Sy Santos, Del Rosario and Associates for petitioners-appellants.
Tagalo, Gozar and Associates for respondents-appellees.
MAKALINTAL, J.:
The only issue in this petition for certiorari to review the orders dated
March 4, 1972 and March 27, 1972, respectively, of the Court of First
Instance of Manila in its Civil Case No. 75138, is whether or not a banking
institution may validly refuse to comply with a court process garnishing the
bank deposit of a judgment debtor, by invoking the provisions of Republic
Act No. 1405. *
On December 17, 1968 Vicente Acaban filed a complaint in the court a
quo against Bautista Logging Co., Inc., B & B Forest Development
Corporation and Marino Bautista for the collection of a sum of money. Upon
motion of the plaintiff the trial court declared the defendants in default for
failure to answer within the reglementary period, and authorized the
Branch Clerk of Court and/or Deputy Clerk to receive the plaintiff's
evidence. On January 20, 1970 judgment by default was rendered against
the defendants.
To satisfy the judgment, the plaintiff sought the garnishment of the bank
deposit of the defendant B & B Forest Development Corporation with the
China Banking Corporation. Accordingly, a notice of garnishment was issued
by the Deputy Sheriff of the trial court and served on said bank through its
cashier, Tan Kim Liong. In reply, the bank' cashier invited the attention of
the Deputy Sheriff to the provisions of Republic Act No. 1405 which, it was
alleged, prohibit the disclosure of any information relative to bank deposits.
Thereupon the plaintiff filed a motion to cite Tan Kim Liong for contempt of
court.
In an order dated March 4, 1972 the trial court denied the plaintiff's motion.
However, Tan Kim Liong was ordered "to inform the Court within five days
from receipt of this order whether or not there is a deposit in the China
Banking Corporation of defendant B & B Forest Development Corporation,
and if there is any deposit, to hold the same intact and not allow any
withdrawal until further order from this Court." Tan Kim Liong moved to
reconsider but was turned down by order of March 27, 1972. In the same
order he was directed "to comply with the order of this Court dated March
4, 1972 within ten (10) days from the receipt of copy of this order, otherwise
his arrest and confinement will be ordered by the Court." Resisting the two
orders, the China Banking Corporation and Tan Kim Liong instituted the
instant petition.
The pertinent provisions of Republic Act No. 1405 relied upon by the
petitioners reads:
Sec. 2. All deposits of whatever nature with banks or banking
institutions in the Philippines including investments in bonds
issued by the Government of the Philippines, its political
subdivisions and its instrumentalities, are hereby considered as of
absolutely confidential nature and may not be examined, inquired
or looked into by any person, government official, bureau or
office, except upon written permission of the depositor, or in
cases of impeachment, or upon order of a competent court in
cases of bribery or dereliction of duty of public officials, or in cases
where the money deposited or invested is the subject matter of
the litigation.
Sec 3. It shall be unlawful for any official or employee of a banking
institution to disclose to any person other than those mentioned
in Section two hereof any information concerning said deposits.
Sec. 5. Any violation of this law will subject offender upon
conviction, to an imprisonment of not more than five years or a
fine of not more than twenty thousand pesos or both, in the
discretion of the court.
The petitioners argue that the disclosure of the information required by the
court does not fall within any of the four (4) exceptions enumerated in
Section 2, and that if the questioned orders are complied with Tan Kim Liong
may be criminally liable under Section 5 and the bank exposed to a possible
damage suit by B & B Forest Development Corporation. Specifically referring
to this case, the position of the petitioners is that the bank deposit of
judgment debtor B & B Forest Development Corporation cannot be subject
to garnishment to satisfy a final judgment against it in view of the
aforequoted provisions of law.
We do not view the situation in that light. The lower court did not order an
examination of or inquiry into the deposit of B & B Forest Development
Corporation, as contemplated in the law. It merely required Tan Kim Liong
to inform the court whether or not the defendant B & B Forest Development
Corporation had a deposit in the China Banking Corporation only for
purposes of the garnishment issued by it, so that the bank would hold the
same intact and not allow any withdrawal until further order. It will be noted
from the discussion of the conference committee report on Senate Bill No.
351 and House Bill No. 3977, which later became Republic Act 1405, that it
was not the intention of the lawmakers to place bank deposits beyond the
reach of execution to satisfy a final judgment. Thus:
Mr. MARCOS. Now, for purposes of the record, I should like the
Chairman of the Committee on Ways and Means to clarify this
further. Suppose an individual has a tax case. He is being held
liable by the Bureau of Internal Revenue for, say, P1,000.00 worth
of tax liability, and because of this the deposit of this individual is
attached by the Bureau of Internal Revenue.
Mr. RAMOS. The attachment will only apply after the court has
pronounced sentence declaring the liability of such person. But
where the primary aim is to determine whether he has a bank
deposit in order to bring about a proper assessment by the Bureau
of Internal Revenue, such inquiry is not authorized by this
proposed law.
Mr. MARCOS. But under our rules of procedure and under the Civil
Code, the attachment or garnishment of money deposited is
allowed. Let us assume, for instance, that there is a preliminary
attachment which is for garnishment or for holding liable all
moneys deposited belonging to a certain individual, but such
attachment or garnishment will bring out into the open the value
of such deposit. Is that prohibited by this amendment or by this
law?
 Mr. RAMOS. It is only prohibited to the extent that the inquiry is
limited, or rather, the inquiry is made only for the purpose of
satisfying a tax liability already declared for the protection of the
right in favor of the government; but when the object is merely to
inquire whether he has a deposit or not for purposes of taxation,
then this is fully covered by the law.
Mr. MARCOS. And it protects the depositor, does it not?
Mr. RAMOS. Yes, it protects the depositor.
Mr. MARCOS. The law prohibits a mere investigation into the
existence and the amount of the deposit.
Mr. RAMOS. Into the very nature of such deposit.
Mr. MARCOS. So I come to my original question. Therefore,
preliminary garnishment or attachment of the deposit is not
allowed?
Mr. RAMOS. No, without judicial authorization.
Mr. MARCOS. I am glad that is clarified. So that the established
rule of procedure as well as the substantive law on the matter is
amended?
Mr. RAMOS. Yes. That is the effect.
Mr. MARCOS. I see. Suppose there has been a decision, definitely
establishing the liability of an individual for taxation purposes and
this judgment is sought to be executed ... in the execution of that
judgment, does this bill, or this proposed law, if approved, allow
the investigation or scrutiny of the bank deposit in order to
execute the judgment?
Mr. RAMOS. To satisfy a judgment which has become executory.
Mr. MARCOS. Yes, but, as I said before, suppose the tax liability is
P1,000,000 and the deposit is half a million, will this bill allow
scrutiny into the deposit in order that the judgment may be
executed?
Mr. RAMOS. Merely to determine the amount of such money to
satisfy that obligation to the Government, but not to determine
whether a deposit has been made in evasion of taxes.
xxx xxx xxx
Mr. MACAPAGAL. But let us suppose that in an ordinary civil
action for the recovery of a sum of money the plaintiff wishes to
attach the properties of the defendant to insure the satisfaction
of the judgment. Once the judgment is rendered, does the
gentleman mean that the plaintiff cannot attach the bank deposit
of the defendant?
Mr. RAMOS. That was the question raised by the gentleman from
Pangasinan to which I replied that outside the very purpose of this
law it could be reached by attachment.
Mr. MACAPAGAL. Therefore, in such ordinary civil cases it can be
attached?
Mr. RAMOS. That is so.
(Vol. II, Congressional Record, House of Representatives, No. 12,
pp. 3839-3840, July 27, 1955).
It is sufficiently clear from the foregoing discussion of the conference
committee report of the two houses of Congress that the prohibition
against examination of or inquiry into a bank deposit under Republic Act
1405 does not preclude its being garnished to insure satisfaction of a
judgment. Indeed there is no real inquiry in such a case, and if the existence
of the deposit is disclosed the disclosure is purely incidental to the execution
process. It is hard to conceive that it was ever within the intention of
Congress to enable debtors to evade payment of their just debts, even if
ordered by the Court, through the expedient of converting their assets into
cash and depositing the same in a bank.
WHEREFORE, the orders of the lower court dated March 4 and 27, 1972,
respectively, are hereby affirmed, with costs against the petitioners-
appellants.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. L-37867 February 22, 1982
BOARD OF ADMINISTRATORS, PHILIPPINES VETERANS
ADMINISTRATION, petitioner,
vs.
HON. JOSE G. BAUTISTA, in his capacity as Presiding Judge of the CFI
Manila, Branch III, and CALIXTO V. GASILAO, respondents.
GUERRERO, J.:
This is a petition to review on certiorari the decision of respondent Court of
First Instance of Manila, Branch III, rendered on October 25, 1973 in Civil
Case No. 90450 for mandamus filed by Calixto V. Gasilao against the Board
of Administrators of the Philippine Veterans Administration.
The facts as found by the Court a quo to have been established by the
pleadings find by the parties are stated in the decision under review from
which We quote the following:
Calixto V. Gasilao, pauper litigant and petitioner in the above-
entitled case, was a veteran in good standing during World War II.
On October 19, 1955, he filed a claim for disability pension under
Section 9, Republic Act No. 65. The claim was disapproved by the
Philippine Veterans Board (now Board of Administrators,
Philippine Veterans Administration).
Meanwhile, Republic Act 65 was amended by Republic Act 1362
on June 22, 1955 by including as part of the benefit of P50.00,
P10.00 a month for each of the unmarried minor children below
18 of the veteran Republic Act No. 1362 was implemented by the
respondents only on July 1, 1955.
On June 18, 1957, Section 9 of Republic Act No. 65 was further
amended by Republic Act 1920 increasing the life pension of the
veteran to P100.00 a month and maintaining the P10.00 a month
each for the unmarried minor children below 18.
Fortunately, on August 8, 1968, the claim of the petitioner which
was disapproved in December, 1955 was reconsidered and his
claim was finally approved at the rate of P100.00 a month, life
pension, and the additional Pl0.00 for each of his ten unmarried
minor children below 18. In view of the approval of the claim of
petitioner, he requested respondents that his claim be made
retroactive as of the date when his original application was flied
or disapproved in 1955. Respondents did not act on his request.
On June 22, 1969, Section 9 of Republic Act No. 65 was amended
by Republic Act No. 5753 which increased the life pension of the
veteran to P200.00 a month and granted besides P30.00 a month
 for the wife and P30.00 a month each for his unmarried minor
children below 18. In view of the new law, respondents increased
the monthly pension of petitioner to P125.00 effective January 15,
1971 due to insufficient funds to cover full implementation. His
wife was given a monthly pension of P7.50 until January 1, 1972
when Republic Act 5753 was fully implemented.
Petitioner now claims that he was deprived of his right to the
pension from October 19, 1955 to June 21, 1957 at the rate of
P50.00 per month plus P10.00 a month each for his six (6)
unmarried minor children below 18. lie also alleges that from June
22, 1957 to August 7, 1968 he is entitled to the difference of
P100.00 per month plus P10.00 a month each for his seven (7)
unmarried nor children below 18. Again, petitioner asserts the
difference of P100.00 per month, plus P30.00 a month for his wife
and the difference of P20.00 a month each for his four (4)
unmarried minor children below 18 from June 22, 1969 up to
January 14, 1971 and finally, the difference of P75.00 per month
plus P30.00 a month for his wife and the difference of P20.00 a
month for his three (3) unmarried minor children below 18 from
January 15, 1971 to December 31, 1971. 1
According to the records, the parties, through their respective counsels,
filed on September 24, 1973 the following stipulation of facts in the lower
Court:
STIPULATION OF FACTS
COME NOW the parties thru their respective counsel, and unto
this Honorable Court, respectfully state that they agree on the
following facts which may be considered as proved without the
need of the introduction of any evidence thereon, to wit:
1. Petitioner was a veteran in good standing during the last World
War that took active participation in the liberation drive against
the enemy, and due to his military service, he was rendered
disabled.
2. The Philippine Veterans Administration, formerly the Philippine
Veterans Board, (now Philippine Veterans Affairs Office) is an
agency of the Government charged with the administration of
different laws giving various benefits in favor of veterans and their
orphans/or widows and parents; that it has the power to adopt
rules and regulations to implement said laws and to pass upon the
merits and qualifications of persons applying for rights and
privileges extended by this Act pursuant to such rules and
regulations as it may adopt to insure the speedy and honest
fulfillment of its aims and purposes.
3. On July 23, 1955, petitioner filed a claim (Claim No. Dis-12336)
for disability pension under Section 9 of RA 65, with the Philippine
Veterans Board (later succeeded by the Philippine Veterans
Administration, now Philippine Veterans Affairs Office), alleging
that he was suffering from PTB, which he incurred in line of duty.
4. Due to petitioner's failure to complete his supporting papers
and submit evidence to establish his service connected illness, his
claim was disapproved by the Board of the defunct Philippine
Veterans Board on December 18, 1955.
5. On August 8, 1968, petitioner was able to complete his
supporting papers and, after due investigation and processing,
the Board of Administrators found out that his disability was 100%
thus he was awarded the full benefits of section 9 of RA 65, and
was therefore given a pension of P100.00 a month and with an
additional P 10.00 a month for each of his unmarried minor
children pursuant to RA 1920, amending section 9 of RA 65.
6. RA 5753 was approved on June 22, 1969, providing for an
increase in the basic pension to P200.00 a month and the
additional pension, to P30.00 a month for the wife and each of the
unmarried minor children. Petitioner's monthly pension was,
however, increased only on January 15, 1971, and by 25% of the
increases provided by law, due to the fact that it was only on said
date that funds were released for the purpose, and the amount
so released was only sufficient to pay only 25% of the increase.
7. On January 15, 1972, more funds were released to implement
fully RA 5753 and snow payment in full of the benefits thereunder
from said date.
WHEREFORE, it is respectfully prayed that a decision be rendered
in accordance with the foregoing stipulation of facts. It is likewise
prayed that the parties be granted a period of (15) days within
which to file their memoranda. 2
Upon consideration of the foregoing and the Memoranda filed by the
parties, the lower Court rendered judgment against therein respondent
Board of Administrators, the dispositive portion of which reads as follows:
WHEREFORE, premises considered, judgment is hereby rendered
for petitioner and the respondents are ordered to make
petitioner's pension effective as of December 18, 1955 at the rate
of P50.00 per month; and the rate increased to P100.00 per
month plus P10.00 per month each for his ten unmarried minor
children below 18 years of age from June 22, 1957 up to August
7..1968; to pay the difference of P100.00 per month plus P30.00
per month and P20.00 per month each for his ten unmarried
children below 18 years of age from June 22, 1969 up to January
15, 1971, the difference of P75.00 per month plus P22.50 per
month for his wife and P20.00 per month each for his unmarried
nor children then below 18 years of age from January 16, 1971 up
to December 31, 1971.
SO ORDERED.
Manila, October 25, 1973. 3
In its Petition before this Court, the Board of Administrators of the
Philippine Veterans Administration, through the Office of the Solicitor
General, challenges the abovementioned decision of the Court a quo on the
following grounds:
1. The lower Court erred in ordering the petitioners to retroact
the effectivity of their award to respondent Calixto V. Gasilao of
full benefits under section 9 of RA 65 to December 18, 1955, the
date when his application was disapproved due to dis failure to
complete his supporting papers and submit evidence to establish
his service connected illness, and not August 8, 1968, the date
when he was able to complete his papers and allow processing
and approval of his application.
2. The lower Court erred in ordering payment of claims which had
prescribed.
3. The lower Court erred in allowing payment of claims under a
law for which no funds had been released. 4
The question raised under the first assigned error is: When should private
respondent Gasilao's pension benefits start
The lower Court, quoting excerpts from Our decision in Begosa vs. Chairman
Philippine Veterans Administration, 5ruled that Gasilao's pension benefits
should retroact to the date of the disapproval of his claim on December 18,
1955, and not commence from the approval thereon on August 8, 1968 as
contended by the Board of Administrators.
Petitioner maintains the stand that the facts of the Begosa case are not
similar to those of the case at bar to warrant an application of the ruling
therein on the retroactivity of a pension award to the date of prior
disapproval of the claim. In the Begosa case, the Supreme Court speaking
thru then Associate Justice, now Chief Justice Fernando, affirmed the
decision of the lower Court, and ruled in part as follows:
 From the facts just set out, it will be noted that plaintiff filed his
said claim for disability pension as far back as March 4, 1955; that
it was erroneously disapproved on June 21, 1955, because his
dishonorable discharge from the Army was not a good or proper
ground for the said disapproval and that on reconsideration asked
for by him on November 1, 1957, which he continued to follow
up, the Board of Administrators, Philippine Veterans
Administration, composed of herein defendants, which took over
the duties of the Philippine Veterans Board, finally approved his
claim on September 2, 1964, at the rate of P30.00 a month. 6
Had it not been for the said error, it appears that there was no
good ground to deny the said claim, so that the latter was valid
and meritorious even as of the date of its filing on March 4, 1955,
hence to make the same effective only as of the date of its
approval on September 2, 1964 — according to defendant's stand
— would be greatly unfair and prejudicial to plaintiff. 7
In other words, the favorable award which claimant Begosa finally obtained
on September 2, 1964 was made to retroact to the date of prior disapproval
of the claim on June 2, 1955 for the reason that such disapproval was
erroneously made.
In the instant case, on the other hand, the herein claim of respondent
Gasilao was denied on December 18, 1955 because of his "failure to
complete his supporting papers and submit evidence to establish his
service-connected illness" (Stipulation of Facts, Par. 4, ante). Nonetheless,
the Stipulation of Facts admitted in par. 1 that "Petitioner was a veteran in
good standing during the last World War that took active participation in
the liberation drive against the enemy, and due to his military service, he
was rendered disabled." From this admission in par. 1, it can reasonably be
deduced that the action on the claim of Gasilao was merely suspended by
the Philippine Veterans Administration pending the completion of the
required supporting papers and evidence to establish his service-connected
illness. Hence, Our ruling in the Begosa case making retroactive the award
in favor of the veteran still holds.
Republic Act No. 65 otherwise known as the Veterans' Bill of Rights, as
amended, does not explicitly provide for the effectivity of pension awards.
However, petitioner seeks to remedy this legislative deficiency by citing
Section 15 of the law which in part reads as follows:
Sec. 15. Any person who desires to take advantage of the rights
and privileges provided for in this Act should file his application
with the Board ...
Petitioner contends that since the foregoing section impliedly requires that
the application filed should first be approved by the Board of Administrators
before the claimant could receive his pension, therefore, an award of
pension benefits should commence form the date of he approval of the
application.
This stand of the petitioner does not appear to be in consonance with the
spirit and intent of the law, considering that Republic Act 65 is a veteran
pension law which must be accorded a liberal construction and
interpretation in order to favor those entitled to the rights, privileges and
benefits granted thereunder, among which are the right to resume old
positions in the government, educational benefits, the privilege to take
promotional examinations, a life pension for the incapacitated, pensions for
widow and children, hospitalization and medical care benefits.
As it is generally known, the purpose of Congress in granting veteran
pensions is to compensate, as far as may be, a class of men who suffered in
the service for the hardships they endured and the dangers they
encountered, 8 and more particularly, those who have become
incapacitated for work owing to sickness, disease or injuries sustained while
in line of duty. 9 A veteran pension law is, therefore, a governmental
expression of gratitude to and recognition of those who rendered service
for the country, especially during times of war or revolution, by extending
to them regular monetary aid. For this reason, it is the general rule that a
liberal construction is given to pension statutes in favor of those entitled to
pension. Courts tend to favor the pensioner, but such constructional
preference is to be considered with other guides to interpretation, and a
construction of pension laws must depend on its own particular language. 10
Significantly, the original text of RA 65 provided that:
Sec. 6. It also shall be the duty of the Board (then the Philippine
Veterans Board) to pass upon the merits and qualifications of
persons applying for the rights and/or privileges extended by this
Act, pursuant to such rules as it may adopt to insure the
speedy and honest fulfillment of its aims and purposes. (Emphasis
supplied.)
The foregoing provision clearly makes it incumbent upon the implementing
Board to carry out the provisions of the statute in the most expeditious way
possible and without unnecessary delay. In the Begosa case, it took nine
years (from June 2, 1955 to September 2, 1964) before the claimant finally
obtained his pension grant, whereas in the instant case, it took about twelve
years (from December, 1955 to August 8, 1968) for respondent Gasilao to
receive his pension claim. To Our mind, it would be more in consonance
with the spirit and intentment of the law that the benefits therein granted
be received and enjoyed at the earliest possible time by according
retroactive effect to the grant of the pension award as We have done in
the Begosa case.
On the other hand, if the pension awards are made effective only upon
approval of the corresponding application which would be dependent on
the discretion of the Board of Administrators which as noted above had
been abused through inaction extending to nine years, even to twelve years,
the noble and humanitarian purposes for which the law had enacted could
easily be thwarted or defeated.
On the issue of prescription, petitioner cites Article 1144 of the Civil Code
which provides:
Art. 1144. The following actions must be brought within ten years
from the time the right of action accrues:
(1) Upon a written contract;
(2) Upon an obligation created by law; and
(3) Upon a judgment.
Petitioner now contends that since the action was filed in the lower Court
on April 13, 1973 seeking the payment of alleged claims which have accrued
more than ten (10) years prior to said date, the same should have been
disallowed as to the prescribed claims.
The obligation of the government to pay pension was created by law (Sec.
9, R.A. 65). Hence, the ten-year prescriptive period should be counted from
the date of passage of the law which is September 25, 1946, the reason
being that it is only from said date that private respondent could have filed
his application. Taking September 25, 1946 as the point of reference, the
actual filing of Gasilao's application on July 23, 1955 was clearly made within
and effectively interrupted the prescriptive period. It is not the date of the
commencement of the action in the lower Court which should be reckoned
with, for it was not on said date that Gasilao first sought to claim his pension
benefits, but on July 23, 1955 when he filed his application with the defunct
Philippine Veterans Board. As We had the occasion to state in the case
of Vda. de Nator vs. C.I.R., 11 "the basis of prescription is the unwarranted
failure to bring the matter to the attention of those who are by law
authorized to take cognizance thereof."
The Stipulation of Facts do not show and neither do the records indicate
when Gasilao attempted to reinstate his claim after the same was
disapproved on December 18, 1955. What is evident is that he did take steps
to reinstate his claim because on August 8, 1968, herein petitioner finally
approved his application. We find it more logical to presume that upon
being properly notified of the disapproval of his application and the reasons
therefor, Gasilao, being the interested party that he was proceeded to work
for the completion of the requirements of the Board, as in fact he was
successful in meeting such requirements. There is nothing in the record to
show intentional abandonment of the claim to as to make the prescriptive
period continue to run again.

The third ground relied upon in support of this Petition involves the issue as
to whether or not the payment of increased pension provided in the
amendatory Act, R.A. 5753, could be ordered, even where there was no
actual release of funds for the purpose, although the law itself expressly
provided for an appropriation. In the case of Board of Adminitrators,
Philippine Veterans Administration vs. Hon. Agcoili, et al., 12 penned by Chief
Justice Fred Ruiz Castro, the same issue was treated in this wise:

... The inability of the petitioner to pay Abrera the differential of

P60.00 in monthly pension is attributed by it, in its own words, "to
the failure of Congress to appropriate the necessary funds to
cover all claims for benefits, pensions and allowances." And the
petitioner states that it has "no alternative but to suspend (full
implementation of said laws until such time, as sufficient funds
have been appropriated by Congress" to cover the total amount
of all approved claims.

We find the explanation of the petitioner satisfactory, but we

nevertheless hold that as a matter of law Abrera is entitled to a
monthly pension of P120.00 from January 1, 1972 when Republic
Act 5753 was implemented up to the present, if his physical
disability rating has continued and continues to be 60%. Payment
to him of what is due him from January 1, 1972 must however
remain subject to the availability of Government funds duly set
aside for the purpose and subject further periodic re-rating of his
physical disability.

But even if we have thus defined the precise terms, nature and
scope of the entitlement of the respondent Abrera, for the
guidance of petitioner, we nevertheless refrain from ordering the
petitioner to pay the amount of P120.00 per month from January
1, 1972 that is due to the respondent by virtue of the mandate of
section 9 of Republic Act 65, as amended by Republic Act
5753, because the Government has thus far not provided the
necessary funds to pay all valid claims duly approved under the
authority of said statute. 13 (Emphasis supplied.)

ACCORDINGLY, the judgment of the Court a quo is hereby modified to read

as follows:

WHEREFORE, premises considered, the Board of Administrators

of the Philippine Veterans Administration (now the Philippine
Veterans Affairs Office) is hereby ordered to make Gasilao's
pension effective December 18, 1955 at the rate of P50-00 per
month plus P10.00 per month for each of his then unmarried
minor children below 18, and the former amount increased to
P100.00 from June 22, 1957 to August 7, 1968.

The differentials in pension to which said Gasilao, his wife and his
unmarried minor children below 18 are entitled for the period
from June 22, 1969 to January 14, 1972 by virtue of Republic Act
No. 5753 are hereby declared subject to the availability of
Government funds appropriated for the purpose.

SO ORDERED.