G.R. No.

L-63915 April 24, 1985

LORENZO M. TAADA, ABRAHAM F. SARMIENTO, and MOVEMENT OF ATTORNEYS FOR BROTHERHOOD,
INTEGRITY AND NATIONALISM, INC. [MABINI], petitioners,
vs.
HON. JUAN C. TUVERA, in his capacity as Executive Assistant to the President, HON. JOAQUIN VENUS, in
his capacity as Deputy Executive Assistant to the President , MELQUIADES P. DE LA CRUZ, in his capacity
as Director, Malacaang Records Office, and FLORENDO S. PABLO, in his capacity as Director, Bureau of
Printing, respondents.

ESCOLIN, J .:
Invoking the people's right to be informed on matters of public concern, a right recognized in Section 6, Article IV of
the 1973 Philippine Constitution,
1
as well as the principle that laws to be valid and enforceable must be published in
the Official Gazette or otherwise effectively promulgated, petitioners seek a writ of mandamus to compel respondent
public officials to publish, and/or cause the publication in the Official Gazette of various presidential decrees, letters of
instructions, general orders, proclamations, executive orders, letter of implementation and administrative orders.
Specifically, the publication of the following presidential issuances is sought:
a] Presidential Decrees Nos. 12, 22, 37, 38, 59, 64, 103, 171, 179, 184, 197, 200, 234, 265, 286,
298, 303, 312, 324, 325, 326, 337, 355, 358, 359, 360, 361, 368, 404, 406, 415, 427, 429, 445,
447, 473, 486, 491, 503, 504, 521, 528, 551, 566, 573, 574, 594, 599, 644, 658, 661, 718, 731,
733, 793, 800, 802, 835, 836, 923, 935, 961, 1017-1030, 1050, 1060-1061, 1085, 1143, 1165,
1166, 1242, 1246, 1250, 1278, 1279, 1300, 1644, 1772, 1808, 1810, 1813-1817, 1819-1826, 1829-
1840, 1842-1847.
b] Letter of Instructions Nos.: 10, 39, 49, 72, 107, 108, 116, 130, 136, 141, 150, 153, 155, 161, 173,
180, 187, 188, 192, 193, 199, 202, 204, 205, 209, 211-213, 215-224, 226-228, 231-239, 241-245,
248, 251, 253-261, 263-269, 271-273, 275-283, 285-289, 291, 293, 297-299, 301-303, 309, 312-
315, 325, 327, 343, 346, 349, 357, 358, 362, 367, 370, 382, 385, 386, 396-397, 405, 438-440, 444-
445, 473, 486, 488, 498, 501, 399, 527, 561, 576, 587, 594, 599, 600, 602, 609, 610, 611, 612,
615, 641, 642, 665, 702, 712-713, 726, 837-839, 878-879, 881, 882, 939-940, 964,997,1149-
1178,1180-1278.
c] General Orders Nos.: 14, 52, 58, 59, 60, 62, 63, 64 & 65.
d] Proclamation Nos.: 1126, 1144, 1147, 1151, 1196, 1270, 1281, 1319-1526, 1529, 1532, 1535,
1538, 1540-1547, 1550-1558, 1561-1588, 1590-1595, 1594-1600, 1606-1609, 1612-1628, 1630-
1649, 1694-1695, 1697-1701, 1705-1723, 1731-1734, 1737-1742, 1744, 1746-1751, 1752, 1754,
1762, 1764-1787, 1789-1795, 1797, 1800, 1802-1804, 1806-1807, 1812-1814, 1816, 1825-1826,
1829, 1831-1832, 1835-1836, 1839-1840, 1843-1844, 1846-1847, 1849, 1853-1858, 1860, 1866,
1868, 1870, 1876-1889, 1892, 1900, 1918, 1923, 1933, 1952, 1963, 1965-1966, 1968-1984, 1986-
2028, 2030-2044, 2046-2145, 2147-2161, 2163-2244.
e] Executive Orders Nos.: 411, 413, 414, 427, 429-454, 457- 471, 474-492, 494-507, 509-510, 522,
524-528, 531-532, 536, 538, 543-544, 549, 551-553, 560, 563, 567-568, 570, 574, 593, 594, 598-
604, 609, 611- 647, 649-677, 679-703, 705-707, 712-786, 788-852, 854-857.
f] Letters of Implementation Nos.: 7, 8, 9, 10, 11-22, 25-27, 39, 50, 51, 59, 76, 80-81, 92, 94, 95,
107, 120, 122, 123.
g] Administrative Orders Nos.: 347, 348, 352-354, 360- 378, 380-433, 436-439.
The respondents, through the Solicitor General, would have this case dismissed outright on the ground that
petitioners have no legal personality or standing to bring the instant petition. The view is submitted that in the
absence of any showing that petitioners are personally and directly affected or prejudiced by the alleged non-
publication of the presidential issuances in question
2
said petitioners are without the requisite legal personality to
institute this mandamus proceeding, they are not being "aggrieved parties" within the meaning of Section 3, Rule 65
of the Rules of Court, which we quote:
SEC. 3. Petition for Mandamus.When any tribunal, corporation, board or person unlawfully
neglects the performance of an act which the law specifically enjoins as a duty resulting from an
office, trust, or station, or unlawfully excludes another from the use a rd enjoyment of a right or
office to which such other is entitled, and there is no other plain, speedy and adequate remedy in
the ordinary course of law, the person aggrieved thereby may file a verified petition in the proper
court alleging the facts with certainty and praying that judgment be rendered commanding the
defendant, immediately or at some other specified time, to do the act required to be done to Protect
the rights of the petitioner, and to pay the damages sustained by the petitioner by reason of the
wrongful acts of the defendant.
Upon the other hand, petitioners maintain that since the subject of the petition concerns a public right and its object is
to compel the performance of a public duty, they need not show any specific interest for their petition to be given due
course.
The issue posed is not one of first impression. As early as the 1910 case of Severino vs. Governor General,
3
this
Court held that while the general rule is that "a writ of mandamus would be granted to a private individual only in
those cases where he has some private or particular interest to be subserved, or some particular right to be
protected, independent of that which he holds with the public at large," and "it is for the public officers exclusively to
apply for the writ when public rights are to be subserved [Mithchell vs. Boardmen, 79 M.e., 469]," nevertheless, "when
the question is one of public right and the object of the mandamus is to procure the enforcement of a public duty, the
people are regarded as the real party in interest and the relator at whose instigation the proceedings are instituted
need not show that he has any legal or special interest in the result, it being sufficient to show that he is a citizen and
as such interested in the execution of the laws [High, Extraordinary Legal Remedies, 3rd ed., sec. 431].
Thus, in said case, this Court recognized the relator Lope Severino, a private individual, as a proper party to the
mandamus proceedings brought to compel the Governor General to call a special election for the position of
municipal president in the town of Silay, Negros Occidental. Speaking for this Court, Mr. Justice Grant T. Trent said:
We are therefore of the opinion that the weight of authority supports the proposition that the relator
is a proper party to proceedings of this character when a public right is sought to be enforced. If the
general rule in America were otherwise, we think that it would not be applicable to the case at bar
for the reason 'that it is always dangerous to apply a general rule to a particular case without
keeping in mind the reason for the rule, because, if under the particular circumstances the reason
for the rule does not exist, the rule itself is not applicable and reliance upon the rule may well lead
to error'
No reason exists in the case at bar for applying the general rule insisted upon by counsel for the
respondent. The circumstances which surround this case are different from those in the United
States, inasmuch as if the relator is not a proper party to these proceedings no other person could
be, as we have seen that it is not the duty of the law officer of the Government to appear and
represent the people in cases of this character.
The reasons given by the Court in recognizing a private citizen's legal personality in the aforementioned case apply
squarely to the present petition. Clearly, the right sought to be enforced by petitioners herein is a public right
recognized by no less than the fundamental law of the land. If petitioners were not allowed to institute this
proceeding, it would indeed be difficult to conceive of any other person to initiate the same, considering that the
Solicitor General, the government officer generally empowered to represent the people, has entered his appearance
for respondents in this case.
Respondents further contend that publication in the Official Gazette is not a sine qua non requirement for the
effectivity of laws where the laws themselves provide for their own effectivity dates. It is thus submitted that since the
presidential issuances in question contain special provisions as to the date they are to take effect, publication in the
Official Gazette is not indispensable for their effectivity. The point stressed is anchored on Article 2 of the Civil Code:
Art. 2. Laws shall take effect after fifteen days following the completion of their publication in the
Official Gazette, unless it is otherwise provided, ...
The interpretation given by respondent is in accord with this Court's construction of said article. In a long line of
decisions,
4
this Court has ruled that publication in the Official Gazette is necessary in those cases where the
legislation itself does not provide for its effectivity date-for then the date of publication is material for determining its
date of effectivity, which is the fifteenth day following its publication-but not when the law itself provides for the date
when it goes into effect.
Respondents' argument, however, is logically correct only insofar as it equates the effectivity of laws with the fact of
publication. Considered in the light of other statutes applicable to the issue at hand, the conclusion is easily reached
that said Article 2 does not preclude the requirement of publication in the Official Gazette, even if the law itself
provides for the date of its effectivity. Thus, Section 1 of Commonwealth Act 638 provides as follows:
Section 1. There shall be published in the Official Gazette [1] all important legisiative acts and
resolutions of a public nature of the, Congress of the Philippines; [2] all executive and
administrative orders and proclamations, except such as have no general applicability; [3] decisions
or abstracts of decisions of the Supreme Court and the Court of Appeals as may be deemed by
said courts of sufficient importance to be so published; [4] such documents or classes of
documents as may be required so to be published by law; and [5] such documents or classes of
documents as the President of the Philippines shall determine from time to time to have general
applicability and legal effect, or which he may authorize so to be published. ...
The clear object of the above-quoted provision is to give the general public adequate notice of the various laws which
are to regulate their actions and conduct as citizens. Without such notice and publication, there would be no basis for
the application of the maxim "ignorantia legis non excusat." It would be the height of injustice to punish or otherwise
burden a citizen for the transgression of a law of which he had no notice whatsoever, not even a constructive one.
Perhaps at no time since the establishment of the Philippine Republic has the publication of laws taken so vital
significance that at this time when the people have bestowed upon the President a power heretofore enjoyed solely
by the legislature. While the people are kept abreast by the mass media of the debates and deliberations in the
Batasan Pambansaand for the diligent ones, ready access to the legislative recordsno such publicity
accompanies the law-making process of the President. Thus, without publication, the people have no means of
knowing what presidential decrees have actually been promulgated, much less a definite way of informing
themselves of the specific contents and texts of such decrees. As the Supreme Court of Spain ruled: "Bajo la
denominacion generica de leyes, se comprenden tambien los reglamentos, Reales decretos, Instrucciones,
Circulares y Reales ordines dictadas de conformidad con las mismas por el Gobierno en uso de su potestad.
5

The very first clause of Section I of Commonwealth Act 638 reads: "There shall be published in the Official Gazette ...
." The word "shall" used therein imposes upon respondent officials an imperative duty. That duty must be enforced if
the Constitutional right of the people to be informed on matters of public concern is to be given substance and reality.
The law itself makes a list of what should be published in the Official Gazette. Such listing, to our mind, leaves
respondents with no discretion whatsoever as to what must be included or excluded from such publication.
The publication of all presidential issuances "of a public nature" or "of general applicability" is mandated by law.
Obviously, presidential decrees that provide for fines, forfeitures or penalties for their violation or otherwise impose a
burden or. the people, such as tax and revenue measures, fall within this category. Other presidential issuances
which apply only to particular persons or class of persons such as administrative and executive orders need not be
published on the assumption that they have been circularized to all concerned.
6

It is needless to add that the publication of presidential issuances "of a public nature" or "of general applicability" is a
requirement of due process. It is a rule of law that before a person may be bound by law, he must first be officially
and specifically informed of its contents. As Justice Claudio Teehankee said in Peralta vs. COMELEC
7
:
In a time of proliferating decrees, orders and letters of instructions which all form part of the law of
the land, the requirement of due process and the Rule of Law demand that the Official Gazette as
the official government repository promulgate and publish the texts of all such decrees, orders and
instructions so that the people may know where to obtain their official and specific contents.
The Court therefore declares that presidential issuances of general application, which have not been published, shall
have no force and effect. Some members of the Court, quite apprehensive about the possible unsettling effect this
decision might have on acts done in reliance of the validity of those presidential decrees which were published only
during the pendency of this petition, have put the question as to whether the Court's declaration of invalidity apply to
P.D.s which had been enforced or implemented prior to their publication. The answer is all too familiar. In similar
situations in the past this Court had taken the pragmatic and realistic course set forth in Chicot County Drainage
District vs. Baxter Bank
8
to wit:
The courts below have proceeded on the theory that the Act of Congress, having been found to be
unconstitutional, was not a law; that it was inoperative, conferring no rights and imposing no duties,
and hence affording no basis for the challenged decree. Norton v. Shelby County, 118 U.S. 425,
442; Chicago, 1. & L. Ry. Co. v. Hackett, 228 U.S. 559, 566. It is quite clear, however, that such
broad statements as to the effect of a determination of unconstitutionality must be taken with
qualifications. The actual existence of a statute, prior to such a determination, is an operative fact
and may have consequences which cannot justly be ignored. The past cannot always be erased by
a new judicial declaration. The effect of the subsequent ruling as to invalidity may have to be
considered in various aspects-with respect to particular conduct, private and official. Questions of
rights claimed to have become vested, of status, of prior determinations deemed to have finality
and acted upon accordingly, of public policy in the light of the nature both of the statute and of its
previous application, demand examination. These questions are among the most difficult of those
which have engaged the attention of courts, state and federal and it is manifest from numerous
decisions that an all-inclusive statement of a principle of absolute retroactive invalidity cannot be
justified.
Consistently with the above principle, this Court in Rutter vs. Esteban
9
sustained the right of a party under the
Moratorium Law, albeit said right had accrued in his favor before said law was declared unconstitutional by this Court.
Similarly, the implementation/enforcement of presidential decrees prior to their publication in the Official Gazette is
"an operative fact which may have consequences which cannot be justly ignored. The past cannot always be erased
by a new judicial declaration ... that an all-inclusive statement of a principle of absolute retroactive invalidity cannot be
justified."
From the report submitted to the Court by the Clerk of Court, it appears that of the presidential decrees sought by
petitioners to be published in the Official Gazette, only Presidential Decrees Nos. 1019 to 1030, inclusive, 1278, and
1937 to 1939, inclusive, have not been so published.
10
Neither the subject matters nor the texts of these PDs can be
ascertained since no copies thereof are available. But whatever their subject matter may be, it is undisputed that
none of these unpublished PDs has ever been implemented or enforced by the government. In Pesigan vs.
Angeles,
11
the Court, through Justice Ramon Aquino, ruled that "publication is necessary to apprise the public of the
contents of [penal] regulations and make the said penalties binding on the persons affected thereby. " The cogency of
this holding is apparently recognized by respondent officials considering the manifestation in their comment that "the
government, as a matter of policy, refrains from prosecuting violations of criminal laws until the same shall have been
published in the Official Gazette or in some other publication, even though some criminal laws provide that they shall
take effect immediately.
WHEREFORE, the Court hereby orders respondents to publish in the Official Gazette all unpublished presidential
issuances which are of general application, and unless so published, they shall have no binding force and effect.
SO ORDERED.
Relova, J., concurs.
Aquino, J., took no part.
Concepcion, Jr., J., is on leave.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 187587 June 5, 2013
NAGKAKAISANG MARALITA NG SITIO MASIGASIG, INC., Petitioner,
vs.
MILITARY SHRINE SERVICES - PHILIPPINE VETERANS AFFAIRS OFFICE, DEPARTMENT OF NATIONAL
DEFENSE, Respondent.
x - - - - - - - - - - - - - - - - - - - - - - - x
G.R. No. 187654
WESTERN BICUTAN LOT OWNERS ASSOCIATION, INC., represented by its Board of Directors, Petitioner,
vs.
MILITARY SHRINE SERVICES - PHILIPPINE VETERANS AFFAIRS OFFICE, DEPARTMENT OF NATIONAL
DEFENSE, Respondent.
D E C I S I O N
SERENO, CJ .:
Before us are consolidated Petitions for Review under Rule 45 of the Rules of Court assailing the
Decision
1
promulgated on 29 April 2009 of the Court of Appeals in CA-G.R. SP No. 97925.
THE FACTS
The facts, as culled from the records, are as follows:
On 12 July 1957, by virtue of Proclamation No. 423, President Carlos P. Garcia reserved parcels of land in the
Municipalities of Pasig, Taguig, Paraaque, Province of Rizal and Pasay City for a military reservation. The military
reservation, then known as Fort William McKinley, was later on renamed Fort Andres Bonifacio (Fort Bonifacio).
On 28 May 1967, President Ferdinand E. Marcos (President Marcos) issued Proclamation No. 208, amending
Proclamation No. 423, which excluded a certain area of Fort Bonifacio and reserved it for a national shrine. The
excluded area is now known as Libingan ng mga Bayani, which is under the administration of herein respondent
Military Shrine Services Philippine Veterans Affairs Office (MSS-PVAO).
Again, on 7 January 1986, President Marcos issued Proclamation No. 2476, further amending Proclamation No. 423,
which excluded barangaysLower Bicutan, Upper Bicutan and Signal Village from the operation of Proclamation No.
423 and declared it open for disposition under the provisions of Republic Act Nos. (R.A.) 274 and 730.
At the bottom of Proclamation No. 2476, President Marcos made a handwritten addendum, which reads:
"P.S. This includes Western Bicutan
(SGD.) Ferdinand E. Marcos"
2

The crux of the controversy started when Proclamation No. 2476 was published in the Official Gazette
3
on 3 February
1986, without the above-quoted addendum.
Years later, on 16 October 1987, President Corazon C. Aquino (President Aquino) issued Proclamation No. 172
which substantially reiterated Proclamation No. 2476, as published, but this time excluded Lots 1 and 2 of Western
Bicutan from the operation of Proclamation No. 423 and declared the said lots open for disposition under the
provisions of R.A. 274 and 730.
Memorandum Order No. 119, implementing Proclamation No. 172, was issued on the same day.
Through the years, informal settlers increased and occupied some areas of Fort Bonifacio including portions of the
Libingan ng mga Bayani. Thus, Brigadier General Fredelito Bautista issued General Order No. 1323 creating Task
Force Bantay (TFB), primarily to prevent further unauthorized occupation and to cause the demolition of illegal
structures at Fort Bonifacio.
On 27 August 1999, members of petitioner Nagkakaisang Maralita ng Sitio Masigasig, Inc. (NMSMI) filed a Petition
with the Commission on Settlement of Land Problems (COSLAP), where it was docketed as COSLAP Case No. 99-
434. The Petition prayed for the following: (1) the reclassification of the areas they occupied, covering Lot 3 of SWO-
13-000-298 of Western Bicutan, from public land to alienable and disposable land pursuant to Proclamation No.
2476; (2) the subdivision of the subject lot by the Director of Lands; and (3) the Land Management Bureaus
facilitation of the distribution and sale of the subject lot to its bona fide occupants.
4

On 1 September 2000, petitioner Western Bicutan Lot Owners Association, Inc. (WBLOAI) filed a Petition-in-
Intervention substantially praying for the same reliefs as those prayed for by NMSMI with regard to the area the
former then occupied covering Lot 7 of SWO-00-001302 in Western Bicutan.
5

Thus, on 1 September 2006, COSLAP issued a Resolution
6
granting the Petition and declaring the portions of land in
question alienable and disposable, with Associate Commissioner Lina Aguilar-General dissenting.
7

The COSLAP ruled that the handwritten addendum of President Marcos was an integral part of Proclamation No.
2476, and was therefore, controlling. The intention of the President could not be defeated by the negligence or
inadvertence of others. Further, considering that Proclamation
No. 2476 was done while the former President was exercising legislative powers, it could not be amended, repealed
or superseded, by a mere executive enactment. Thus, Proclamation No. 172 could not have superseded much less
displaced Proclamation No. 2476, as the latter was issued on October 16, 1987 when President Aquinos legislative
power had ceased.
In her Dissenting Opinion, Associate Commissioner Lina AguilarGeneral stressed that pursuant to Article 2 of the
Civil Code, publication is indispensable in every case. Likewise, she held that when the provision of the law is clear
and unambiguous so that there is no occasion for the court to look into legislative intent, the law must be taken as it
is, devoid of judicial addition or subtraction.
8
Finally, she maintained that the Commission had no authority to supply
the addendum originally omitted in the published version of Proclamation No. 2476, as to do so would be tantamount
to encroaching on the field of the legislature.
Herein respondent MSS-PVAO filed a Motion for Reconsideration,
9
which was denied by the COSLAP in a
Resolution dated 24 January 2007.
10

MSS-PVAO filed a Petition with the Court of Appeals seeking to reverse the COSLAP Resolutions dated 1
September 2006 and 24 January 2007.
Thus, on 29 April 2009, the then Court of Appeals First Division rendered the assailed Decision granting MSS-
PVAOs Petition, the dispositive portion of which reads:
IN VIEW OF ALL THE FOREGOING, the instant petition is hereby GRANTED. The Resolutions dated September 1,
2006 and January 24, 2007 issued by the Commission on the Settlement of Land Problems in COSLAP Case No. 99-
434 are hereby REVERSED and SET ASIDE. In lieu thereof, the petitions of respondents in COSLAP Case No. 99-
434 are DISMISSED, for lack of merit, as discussed herein. Further, pending urgent motions filed by respondents are
likewise
DENIED. SO ORDERED.
11
(Emphasis in the original)
Both NMSMI
12
and WBLOAI
13
appealed the said Decision by filing their respective Petitions for Review with this
Court under Rule 45 of the Rules of Court.
THE ISSUES
Petitioner NMSMI raises the following issues:
I
WHETHER OR NOT THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN RULING THAT
PROCLAMATION NO. 2476 DID NOT INCLUDE ANY PORTION OF WESTERN BICUTAN AS THE HANDWRITTEN
NOTATION BY PRESIDENT MARCOS ON THE SAID PROCLAMATION WAS NOT PUBLISHED IN THE OFFICIAL
GAZETTE.
II
WHETHER OR NOT THE HONORABLE COURT OF APPEALS SERIOUSLY ERRED IN RULING THAT
PROCLAMATION NO. 172 LIKEWISE EXCLUDED THE PORTION OF LAND OCCUPIED BY MEMBER OF
HEREIN PETITIONER.
III
WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN NOT CONSIDERING THAT THE HON.
COSLAP HAS BROAD POWERS TO RECOMMEND TO THE PRESIDENT >INNOVATIVE MEASURES TO
RESOLVE EXPEDITIOUSLY VARIOUS LAND CASES.
14

On the other hand, petitioner WBLOAI raises this sole issue:
WHETHER OR NOT THE HONORABLE COURT OF APPEALS ERRED IN HOLDING THAT THE SUBJECT
PROPERTY WAS NOT DECLARED ALIENABLE AND DISPOSABLE BY VIRTUE OF PROCLAMATION NO. 2476
BECAUSE THE HANDWRITTEN ADDENDUM OF PRESIDENT FERDINAND E. MARCOS INCLUDING WESTERN
BICUTAN IN PROCLAMATION NO. 2476 WAS NOT INCLUDED IN THE PUBLICATION.
15

Both Petitions boil down to the principal issue of whether the Court of Appeals erred in ruling that the subject lots
were not alienable and disposable by virtue of Proclamation No. 2476 on the ground that the handwritten addendum
of President Marcos was not included in the publication of the said law.
THE COURTS RULING
We deny the Petitions for lack of merit.
Considering that petitioners were occupying Lots 3 and 7 of Western Bicutan (subject lots), their claims were
anchored on the handwritten addendum of President Marcos to Proclamation No. 2476. They allege that the former
President intended to include all Western Bicutan in the reclassification of portions of Fort Bonifacio as disposable
public land when he made a notation just below the printed version of Proclamation No. 2476.
However, it is undisputed that the handwritten addendum was not included when Proclamation No. 2476 was
published in the Official Gazette.
The resolution of whether the subject lots were declared as reclassified and disposable lies in the determination of
whether the handwritten addendum of President Marcos has the force and effect of law. In relation thereto, Article 2
of the Civil Code expressly provides:
ART. 2. Laws shall take effect after fifteen days following the completion of their publication in the Official Gazette,
unless it is otherwise provided. This Code shall take effect one year after such publication.
Under the above provision, the requirement of publication is indispensable to give effect to the law, unless the law
itself has otherwise provided. The phrase "unless otherwise provided" refers to a different effectivity date other than
after fifteen days following the completion of the laws publication in the Official Gazette, but does not imply that the
requirement of publication may be dispensed with. The issue of the requirement of publication was already settled in
the landmark case Taada v. Hon. Tuvera,
16
in which we had the occasion to rule thus:
Publication is indispensable in every case, but the legislature may in its discretion provide that the usual fifteen-day
period shall be shortened or extended. An example, as pointed out by the present Chief Justice in his separate
concurrence in the original decision, is the Civil Code which did not become effective after fifteen days from its
publication in the Official Gazette but "one year after such publication." The general rule did not apply because it was
"otherwise provided."
It is not correct to say that under the disputed clause publication may be dispensed with altogether. The reason is that
such omission would offend due process insofar as it would deny the public knowledge of the laws that are supposed
to govern it. Surely, if the legislature could validly provide that a law shall become effective immediately upon its
approval notwithstanding the lack of publication (or after an unreasonably short period after publication), it is not
unlikely that persons not aware of it would be prejudiced as a result; and they would be so not because of a failure to
comply with it but simply because they did not know of its existence. Significantly, this is not true only of penal laws
as is commonly supposed. One can think of many non-penal measures, like a law on prescription, which must also
be communicated to the persons they may affect before they can begin to operate.
x x x x
The term "laws" should refer to all laws and not only to those of general application, for strictly speaking all laws
relate to the people in general albeit there are some that do not apply to them directly. An example is a law granting
citizenship to a particular individual, like a relative of President Marcos who was decreed instant naturalization. It
surely cannot be said that such a law does not affect the public although it unquestionably does not apply directly to
all the people. The subject of such law is a matter of public interest which any member of the body politic may
question in the political forums or, if he is a proper party, even in the courts of justice. In fact, a law without any
bearing on the public would be invalid as an intrusion of privacy or as class legislation or as an ultra vires act of the
legislature. To be valid, the law must invariably affect the public interest even if it might be directly applicable only to
one individual, or some of the people only, and not to the public as a whole.
We hold therefore that all statutes, including those of local application and private laws, shall be published as a
condition for their effectivity, which shall begin fifteen days after publication unless a different effectivity date is fixed
by the legislature.
Covered by this rule are presidential decrees and executive orders promulgated by the President in the exercise of
legislative powers whenever the same are validly delegated by the legislature or, at present, directly conferred by the
Constitution. Administrative rules and regulations must also be published if their purpose is to enforce or implement
existing law pursuant also to a valid delegation.
x x x x
Accordingly, even the charter of a city must be published notwithstanding that it applies to only a portion of the
national territory and directly affects only the inhabitants of that place. All presidential decrees must be published,
including even, say, those naming a public place after a favored individual or exempting him from certain prohibitions
or requirements. The circulars issued by the Monetary Board must be published if they are meant not merely to
interpret but to "fill in the details" of the Central Bank Act which that body is supposed to enforce.
x x x x
We agree that the publication must be in full or it is no publication at all since its purpose is to inform the public of the
contents of the laws. As correctly pointed out by the petitioners, the mere mention of the number of the presidential
decree, the title of such decree, its whereabouts (e.g., "with Secretary Tuvera"), the supposed date of effectivity, and
in a mere supplement of the Official Gazette cannot satisfy the publication requirement.1wphi1 This is not even
substantial compliance. This was the manner, incidentally, in which the General Appropriations Act for FY 1975, a
presidential decree undeniably of general applicability and interest, was "published" by the Marcos administration.
The evident purpose was to withhold rather than disclose information on this vital law.
x x x x
Laws must come out in the open in the clear light of the sun instead of skulking in the shadows with their dark, deep
secrets. Mysterious pronouncements and rumored rules cannot be recognized as binding unless their existence and
contents are confirmed by a valid publication intended to make full disclosure and give proper notice to the people.
The furtive law is like a scabbarded saber that cannot feint, parry or cut unless the naked blade is drawn. (Emphases
supplied)
Applying the foregoing ruling to the instant case, this Court cannot rely on a handwritten note that was not part of
Proclamation No. 2476 as published. Without publication, the note never had any legal force and effect.
Furthermore, under Section 24, Chapter 6, Book I of the Administrative Code, "the publication of any law, resolution
or other official documents in the Official Gazette shall be prima facie evidence of its authority." Thus, whether or not
President Marcos intended to include Western Bicutan is not only irrelevant but speculative. Simply put, the courts
may not speculate as to the probable intent of the legislature apart from the words appearing in the law.
17
This Court
cannot rule that a word appears in the law when, evidently, there is none. In Pagpalain Haulers, Inc. v. Hon.
Trajano,
18
we ruled that "under Article 8 of the Civil Code, 'judicial decisions applying or interpreting the laws or the
Constitution shall form a part of the legal system of the Philippines.' This does not mean, however, that courts can
create law. The courts exist for interpreting the law, not for enacting it. To allow otherwise would be violative of the
principle of separation of powers, inasmuch as the sole function of our courts is to apply or interpret the laws,
particularly where gaps or lacunae exist or where ambiguities becloud issues, but it will not arrogate unto itself the
task of legislating." The remedy sought in these Petitions is not judicial interpretation, but another legislation that
would amend the law to include petitioners' lots in the reclassification.
WHEREFORE, in view of the foregoing, the instant petitions are hereby DENIED for lack of merit. The assailed
Decision of the Court of Appeals in CA-G.R. CV No. 97925 dated 29 April 2009 is AFFIRMED in toto. Accordingly,
this Court's status quo order dated 17 June 2009 is hereby LIFTED. Likewise, all pending motions to cite respondent
in contempt is DENIED, having been rendered moot. No costs.
SO ORDERED.
MARIA LOURDES P. A. SERENO
Chief Justice, Chairperson
WE CONCUR:
TERESITA J. LEONARDO-DE CASTRO
Associate Justice
LUCAS P. BERSAMIN
Associate Justice
MARTIN S. VILLARAMA, JR.
Associate Justice
BIENVENIDO L. REYES
Associate Justice
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above Decision had been
reached in consultation before the case was assigned to the writer of the opinion of the Court's Division.
MARIA LOURDES P. A. SERENO
Chief Justice

Republic of the Philippines
SUPREME COURT
Baguio City
SECOND DIVISION

G.R. No. 104215 May 8, 1996
ERECTORS, INC., petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION, HON. JULIO ANDRES, JR. and FLORENCIO
BURGOS,respondents.

PUNO, J .:p
Petitioner Erectors, Inc. challenges the jurisdiction of respondent Labor Arbiter Julio F. Andres, Jr. to hear and decide
the complaint
1
for underpayment of wages and non-payment of overtime pay filed by private respondent Florencio
Burgos, an overseas contract worker.
The facts are undisputed:
In September 1979, petitioner recruited private respondent to work as service contract driver in Saudi Arabia for a
period of twelve (12) months with a salary of US$165.00 and an allowance of US$165.00 per month. They further
agreed that private respondent shall be entitled to a bonus of US$1,000.00 if after the 12-month period, he renews or
extends his employment contract without availing of his vacation or home leave. Their contract dated September 20,
1979, was duly approved by the Ministry of Labor and Employment.
The aforesaid contract was not implemented. In December, 1979, petitioner notified private respondent that the
position of service driver was no longer available. On December 14, 1979, they executed another contract which
changed the position of private respondent into that of helper/laborer with a salary of US$105.00 and an allowance of
US$105.00 per month. The second contract was not submitted to the Ministry of Labor and Employment for approval.
On December 18, 1979, private respondent left the country and worked at petitioner's Buraidah Sports Complex
project in Saudi Arabia, performing the job of a helper/laborer. He received a monthly salary and allowance of
US$210.00, in accordance with the second contract. Private respondent renewed his contract of employment after
one year. His salary and allowance were increased to US$231.00.
Private respondent returned to the Philippines on August 24, 1981. He then invoked his first employment contract. He
demanded from the petitioner the difference between his salary and allowance as indicated in the said contract, and
the amount actually paid to him, plus the contractual bonus which should have been awarded to him for not availing
of his vacation or home leave credits. Petitioner denied private respondent's claim.
On March 31, 1982, private respondent filed with the Labor Arbiter a complaint against the petitioner for
underpayment of wages and non-payment of overtime pay and contractual bonus.
On May 1, 1982, while the case was still in the conciliation stage, Executive Order (E.O. No. 797 creating the
Philippine Overseas Employment Administration (POEA) took effect. Section 4(a) of E.O. No. 797 vested the POEA
with "original and exclusive jurisdiction over all cases, including money claims, involving employer-employee relations
arising out of or by virtue of any law or contract involving Filipino workers for overseas employment."
2

Despite E.O. No. 797, respondent Labor Arbiter proceeded to try the case on the merits. On September 23, 1983, he
rendered a Decision
3
in favor of private respondent, the dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered ordering the respondent to pay the complainant as
follows:
1. The sum of US$2,496.00 in its peso equivalent on August 25, 1981 as difference between his
allowance as Service Driver as against his position as Helper/Laborer;
2. The sum of US$1,000.00 in its peso equivalent as of the same date, as his contractual bonus.
The complaints for non-payment/underpayment of overtime pay and unpaid wages or commission
are DISMISSED for lack of merit.
4

Petitioner appealed to respondent National Labor Relations Commission (NLRC). It questioned the jurisdiction of the
Labor Arbiter over the case in view of the enactment of E.O. No. 797.
In a Resolution dated July 17, 1991,
5
respondent NLRC dismissed the petitioner's appeal and upheld the Labor
Arbiter's jurisdiction. It ruled:
To begin with, the Labor Arbiter has the authority to decide this case. On May 29, 1978, the Labor
Arbiters were integrated into the Regional Offices under P.D. 1391. On May 1, 1980, P.D. 1691
was promulgated giving the Regional Offices of the Ministry of Labor and Employment the original
and exclusive jurisdiction over all cases arising out of or by virtue of any law or contract involving
Filipino workers for overseas employment. There is no dispute that the Labor Arbiter had the legal
authority over the case on hand, which accrued and was filed when the two above mentioned
Presidential Decrees were in force.
6

Petitioner filed this special civil action for certiorari reiterating the argument that:
The NLRC committed grave abuse of discretion tantamount to lack of jurisdiction in affirming the
Labor Arbiter's void judgment in the case a quo.
7

It asserts that E.O. No. 797 divested the Labor Arbiter of his authority to try and resolve cases arising from overseas
employment contract. Invoking this Court's ruling in Briad Agro Development Corp. vs. Dela Cerna,
8
petitioner argues
that E.O. No. 797 applies retroactively to affect pending cases, including the complaint filed by private respondent.
The petition is devoid of merit.
The rule is that jurisdiction over the subject matter is determined by the law in force at the time of the commencement
of the action.
9
On March 31, 1982, at the time private respondent filed his complaint against the petitioner, the
prevailing laws were Presidential Decree No. 1691
10
and Presidential Decree No. 1391
11
which vested the Regional
Offices of the Ministry of Labor and the Labor Arbiters with "original and exclusive jurisdiction over all cases involving
employer-employee relations including money claims arising out of any law or contracts involving Filipino workers for
overseas employment."
12
At the time of the filing of the complaint, the Labor Arbiter had clear jurisdiction over the
same.
E.O. No. 797 did not divest the Labor Arbiter's authority to hear and decide the case filed by private respondent prior
to its effectivity. Laws should only be applied prospectively unless the legislative intent to give them retroactive effect
is expressly declared or is necessarily implied from the language used.
13
We fail to perceive in the language of E.O.
No. 797 an intention to give it retroactive effect.
The case of Briad Agro Development Corp. vs. Dela Cerna
14
cited by the petitioner is not applicable to the case at
bar. In Briad, the Court applied the exception rather than the general rule. In this case, Briad Agro Development Corp.
and L.M. Camus Engineering Corp. challenged the jurisdiction of the Regional Director of the Department of Labor
and Employment over cases involving workers' money claims, since Article 217 of the Labor Code, the law in force at
the time of the filing of the complaint, vested in the Labor Arbiters exclusive jurisdiction over such cases. The Court
dismissed the petition in its Decision dated June 29, 1989.
15
It ruled that the enactment of E.O. No. 111, amending
Article 217 of the Labor Code, cured the Regional Director's lack of jurisdiction by giving the Labor Arbiter and the
Regional Director concurrent jurisdiction over all cases involving money claims. However, on November 9, 1989, the
Court, in a Resolution,
16
reconsidered and set aside its June 29 Decision and referred the case to the Labor Arbiter
for proper proceedings, in view of the promulgation of Republic Act (R.A.) 6715 which divested the Regional Directors
of the power to hear money claims. It bears emphasis that the Court accorded E.O. No. 111 and R.A. 6715 a
retroactive application because as curative statutes, they fall under the exceptions to the rule on prospectivity of laws.
E.O. No. 111, amended Article 217 of the Labor Code to widen the workers' access to the government for redress of
grievances by giving the Regional Directors and Labor Arbiters concurrent jurisdiction over cases involving money
claims. This amendment, however, created a situation where the jurisdiction of the Regional Directors and the Labor
Arbiters overlapped. As a remedy, R.A. 6715 further amended Article 217 by delineating their respective jurisdictions.
Under R.A. 6715, the Regional Director has exclusive original jurisdiction over cases involving money claims
provided: (1) the claim is presented by an employer or person employed in domestic or household service, or
househelper under the Code; (2) the claimant, no longer being employed, does not seek reinstatement; and (3) the
aggregate money claim of the employee or househelper does not exceed P5,000.00. All other cases are within the
exclusive and original jurisdiction of the Labor Arbiter. E.O. No. 111 and R.A. 6715 are therefore curative statutes. A
curative statute is enacted to cure defects in a prior law or to validate legal proceedings, instruments or acts of public
authorities which would otherwise be void for want of conformity with certain existing legal requirements.
The law at bar, E.O. No. 797, is not a curative statute. It was not intended to remedy any defect in the law. It created
the POEA to assume the functions of the Overseas Employment Development Board, the National Seamen Board
and the overseas employment functions of the Bureau of Employment Services. Accordingly, it gave the POEA
"original and exclusive jurisdiction over all cases, including money claims, involving employer-employee relations
arising out of or by virtue of any law or contract involving Filipino workers for overseas employment, including
seamen."
1
7 The rule on prospectivity of laws should therefore apply to E.O. No. 797. It should not affect jurisdiction
over cases filed prior to its effectivity.
Our ruling in Philippine-Singapore Ports Corp. vs. NLRC
18
is more apt to the case at bar. In this case, PSPC hired
Jardin to work in Saudi Arabia. Jardin filed a complaint against PSPC for illegal dismissal and recovery of backwages
on January 31, 1979 with the Labor Arbiter. PSPC questioned the jurisdiction of the Labor Arbiter because at that
time, the power to hear and decide cases involving overseas workers was vested in the Bureau of Employment
Services. We held:
When Jardin filed the complaint for illegal dismissal on January 31, 1979, Art. 217 (5) of the Labor
Code provided that Labor Arbiters and the NLRC shall have "exclusive jurisdiction to hear and
decide" all cases arising from employer-employee relations "unless expressly excluded by this
Code." At that time Art. 15 of the same Code had been amended by P.D. No. 1412 which took
effect on June 9, 1978. The pertinent provision of the said presidential decree states:
Art. 15. Bureau of Employment Services.
(a) . . .
(b) The Bureau shall have the original and exclusive jurisdiction over all matters or cases involving
employer-employee relations including money claims, arising out of or by virtue of any law or
contracts involving Filipino workers for overseas employment, except seamen. The decisions of the
Bureau shall be final and executory subject to appeal to the Secretary of Labor whose decision
shall be final and inappealable.
Considering that private respondent Jardin's claims undeniably arose out of an employer-employee
relationship with petitioner PSPC and that private respondent worked overseas or in Saudi Arabia,
the Bureau of Employment Services and not the Labor Arbiter had jurisdiction over the case. . . .
Art. 15 was further amended by P.D. No. 1691 which took effect on May 1, 1990. Such amendment
qualifies the jurisdiction of the Bureau of Employment Services as follows:
(b) The regional offices of the Ministry of Labor shall have the original and exclusive jurisdiction
over all matters or cases involving employer-employee relations including money claims, arising out
of or by virtue of any law or contracts involving Filipino workers for overseas employment except
seamen:Provided that the Bureau of Employment Services may, in the case of the National Capital
Region, exercise such power, whenever the Minister of Labor deems it appropriate. The decisions
of the regional offices or the Bureau of Employment Services if so authorized by the Minister of
Labor as provided in this Article, shall be appealable to the National Labor Relations Commission
upon the same grounds provided in Article 223 hereof. The decisions of the National Labor
Relations Commission shall be final and inappealable.
Hence, as further amended, Art. 15 provided for concurrent jurisdiction between the regional offices
of the then Ministry of Labor and Bureau of Employment Services "in the National Capital Region."
It is noteworthy that P.D. No. 1691, while likewise amending Art. 217 of the Labor Code, did not
alter the provision that Labor Arbiters shall have jurisdiction over all claims arising from employer-
employee relations "unless expressly excluded by this Code."
The functions of the Bureau of Employment Services were subsequently assumed by the Philippine
Overseas Employment Administration (POEA) on May 1, 1982 by virtue of Executive Order
No. 797 by granting the POEA "original and exclusive jurisdiction over all cases, including money
claims, involving employer-employee relations arising out of or by virtue of any law or contract
involving Filipino workers for overseas employment, including seamen." (Sec. 4 (a); Eastern
Shipping Lines v. Philippine Overseas Employment Administration [POEA], 200 SCRA 663 [1991]).
This development showed the legislative authority's continuing intent to exclude from the Labor
Arbiter's jurisdiction claims arising from overseas employment.
These amendments notwithstanding, when the complaint for illegal dismissal was filed on January
31, 1979, under Art. 15, as amended by P.D. No. 1412, it was the Bureau of Employment Services
which had jurisdiction over the case and not the Labor Arbiters. It is a settled rule that jurisdiction is
determined by the statute in force at the time of the commencement of the action (Municipality of
Sogod v. Rosal, 201 SCRA 632, 637 [1991]). P.D. 1691 which gave the regional offices of the
Ministry of Labor concurrent jurisdiction with the Bureau of Employment Services, was promulgated
more than a year after the complaint was filed. (emphasis supplied)
In sum, we hold that respondent NLRC did not commit grave abuse of discretion in upholding the jurisdiction of
respondent Labor Arbiter over the complaint filed by private respondent against the petitioner.
IN VIEW WHEREOF, the Petition is DISMISSED. Costs against petitioner.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 147964 January 20, 2004
FAR EAST BANK & TRUST CO., Petitioner,
vs.
ARTURO L. MARQUEZ, Respondent.
D E C I S I O N
PANGANIBAN, J .:
Under PD 957, the mortgage of a subdivision lot or a condominium unit is void, if executed by a property developer
without the prior written approval of the Housing and Land Use Regulatory Board (HLURB). That an encumbrance
has been constituted over an entire property, of which the subject lot or unit is merely a part, does not affect the
invalidity of the lien over the specific portion at issue.
The Case
Before us is a Petition for Review
1
under Rule 45 of the Rules of Court, assailing the April 27, 2001 Decision
2
of the
Court of Appeals (CA) in CA-GR SP No. 56813. The decretal portion of the Decision reads as follows:
"WHEREFORE, the petition for review is DENIED, for lack of merit."
3

The Facts
The undisputed facts of the case are summarized in the CA Decision as follows:
"1. On 13 March 1989, respondent [Arturo] Marquez entered into a Contract to Sell with Transamerican
Sales and Exposition (TSE), through the latters Owner/General Manager Engr. Jesus Garcia, involving a
52.5 sq. m. lot in Diliman, Quezon City with a three-storey townhouse unit denominated as Unit No. 10 to be
constructed thereon for a total consideration of P800,000.00. The parcel of land in question is a portion of
that property covered by TCT No. 156254 (now TCT No. 383697).
"2. On 22 May 1989, TSE obtained a loan from petitioner FEBTC in the amount of P7,650,000.00 and
mortgaged the property covered by TCT No. 156254.
"3. For failure of TSE to pay its obligation, petitioner FEBTC extrajudicially foreclosed the real estate
mortgage and became the highest bidder (P15.7 million) in the auction sale conducted for the purpose.
"4. Respondent had already paid a total of P600,000.00 when he stopped payment because the construction
of his townhouse unit slackened. He discovered later on that this was due to the foreclosure.
"5. Consequently, [respondent] instituted a case with the Office of Appeals, Adjudication and Legal
Affairs(OAALA) of the Housing and Land Use Regulatory Board (HLURB) on 29 January 1991 entitled
Arturo Marquez vs. Transamerican Sales, et al docketed as HLRB Case No. REM-012991-4712 to compel
TSE to complete the construction of the townhouse and to prevent the enforceability of the extra-judicial
foreclosure made by petitioner FEBTC and to have the mortgage between TSE and petitioner FEBTC
declared invalid, said mortgage having been entered into by the parties in violation of section 18 of P.D. 957.
"6. The OAALA ruled in favor of the respondent via a Decision dated 11 November 1991, the decretal
portion of which reads as follows:
WHEREFORE, premises considered, judgment is hereby rendered as follows:
1. Declaring the mortgage executed by and between x x x Engr. Jesus Garcia/Transamerican Sales and
Exposition and Far East Bank and Trust Company to be unenforceable against [respondent];
2. Ordering the x x x Far East Bank and Trust Company to compute and/or determine the loan value of the
[respondent] who was not able to complete or make full payment and accept payment and/or receive the
amortization from the [respondent] and upon full payment to deliver the title corresponding to Unit No. 10 of
that Townhouse Project located at No. 10 Panay Ave., Quezon City;
3. Ordering the Register of Deeds of Quezon City to cancel the annotations of the mortgage indebtedness
between x x x Engr. Jesus Garcia and Far East Bank and Trust Company;
4. Ordering, likewise, the Register of Deeds of Quezon City to cancel the annotation of the Certificate of
Sale in favor of the Far East Bank and Trust Company on Transfer Certificate of Title No. 156254 to which
the lot subject of this case is a part thereof, without prejudice to its right to require x x x Engr. Jesus
Garcia/Transamerican Sales and Exposition to constitute new collateral in lieu of said title sufficient in value
to cover the mortgage obligation.
x x x x x x x x x
"7. Petitioner FEBTC interposed a Petition for Review from the decision issued by the OAALA with the Board of
Commissioners of the HLURB, docketed as HLRB Case No. REM-A-1126, which in a Decision dated 18 July 1994
affirmed in toto the OAALA decision.
"8. Hence, petitioner FEBTC appealed the Decision dated 18 July 1994 to the Office of the President xxx.
x x x x x x x x x
"9. The Office of the President dismissed the appeal and affirmed the Decision dated 18 July 1994 x x x."
4
(Citations
omitted)
Petitioner then elevated the case to the CA through a Petition for review under Rule 43.
Ruling of the Court of Appeals
The CA found that petitioner had known that a "subdivision was forthcoming inasmuch as the loan was obtained by
TSE to partially finance the construction of a 20-unit townhouse project, as stated in the Whereas clause in the
mortgage contract."
5
Thus, the CA ruled that "petitioner should not have merely relied on the representation of TSE
that it had obtained the approval and authorization of the proper government agencies but should have required the
submission of said documents."
6

Further, the appellate court found that the Certification against forum shopping attached to the Petition before it had
not been made under oath, in violation of the Rules of Court.
Hence, this Petition.
7

The Issues
Petitioner raises the following issues for our consideration:
"Whether or not the mortgage contract violated Section 18 of P.D. 957, hence, void insofar as third persons are
concerned.
"Assuming arguendo that the mortgage contract violated Section 18 of P.D. 957, whether or not the remedy granted
and imposed by the HLURB, as sustained by the Office of the President and the Court of Appeals, is proper.
"Whether or not the inadvertent failure of the notary public to affix his signature on the Certification against forum
shopping executed by petitioner FEBTC in connection with the Petition for Review it filed with the Court of Appeals
provided a sufficient basis for the dismissal of the appeal."
8

The Court's Ruling
The Petition is partly meritorious.
First Issue:
Violation of Section 18 of PD 957
Section 18 of PD 957
9
provides as follows:
"SEC. 18. Mortgages. - No mortgage on any unit or lot shall be made by the owner or developer without prior written
approval of the Authority. Such approval shall not be granted unless it is shown that the proceeds of the mortgage
loan shall be used for the development of the condominium or subdivision project and effective measures have been
provided to ensure such utilization. The loan value of each lot or unit covered by the mortgage shall be determined
and the buyer thereof, if any, shall be notified before the release of the loan. The buyer may, at his option, pay his
installment for the lot or unit directly to the mortgagee who shall apply the payments to the corresponding mortgage
indebtedness secured by the particular lot or unit being paid for, with a view to enabling said buyer to obtain title over
the lot or unit promptly after full payment thereof."
Petitioner contends that the above-quoted provision does not apply to this case, because the land mortgaged to it
was one whole parcel, not of a "subdivision lot," but of an unsubdivided one. It insists that the written approval of the
National Housing Authority (now the Housing and Land Use Regulatory Board) was not a requirement for the
constitution of a mortgage on the property.
We are not persuaded. It is undisputed that the subject 52.5-square-meter lot with a three-storey town house unit
denominated as Unit No. 10 (the "lot") is part of the property mortgaged to petitioner and is covered by TCT No.
156254. The lot was technically described and segregated in a Contact to Sell that had been entered into before the
mortgage loan was contracted. The fact that the lot had no separate TCT did not make it less of a "subdivision lot"
entitled to the protection of PD 957.
That the subject of the mortgage loan was the entire land, not the individual subdivided lots, does not take the loan
beyond the coverage of Section 18 of PD 957. Undeniably, the lot was also mortgaged when the entire parcel of land,
of which it was a part, was encumbered.
Petitioner also contends that Section 18 of PD 957 is merely a directory provision, noncompliance with which does
not render the mortgage transaction void.
In determining whether a law is mandatory, it is necessary to ascertain the legislative intent, as stated by Sen. Arturo
M. Tolentino, an authority on civil law:
"There is no well-defined rule by which a mandatory or prohibitory law may, in all circumstances, be distinguished
from one which is directory, suppletory, or permissive. In the determination of this question, the prime object is to
ascertain the legislative intention. Generally speaking, those provisions which are mere matter of form, or which are
not material, do not affect any substantial right, and do not relate to the essence of the thing to be done, so that
compliance is a matter of convenience rather that substance, are considered to be directory. On the other hand,
statutory provisions which relate to matters of substance, affect substantial rights and are the very essence of the
thing required to be done, are regarded as mandatory."
10

In Philippine National Bank v. Office of the President,
11
we had occasion to mull over the intent of PD 957 thus:
"x x x [T]he unmistakable intent of the law [is] to protect innocent lot buyers from scheming subdivision developers.
As between these small lot buyers and the gigantic financial institutions which the developers deal with, it is obvious
that the law -- as an instrument of social justice -- must favor the weak. Indeed, the petitioner Bank had at its disposal
vast resources with which it could adequately protect its loan activities, and therefore is presumed to have conducted
the usual due diligence checking and ascertaining (whether thru ocular inspection or other modes of investigation)
the actual status, condition, utilization and occupancy of the property offered as collateral, x x x On the other hand,
private respondents obviously were powerless to discover the attempt of the land developer to hypothecate the
property being sold to them. It was precisely in order to deal with this kind of situation that P.D. 957 was enacted, its
very essence and intendment being to provide a protective mantle over helpless citizens who may fall prey to the
razzmatazz of what P.D. 957 termed unscrupulous subdivision and condominium sellers."
12

Concededly, PD 957 aims to protect innocent lot buyers. Section 18 of the decree directly addresses the problem of
fraud committed against buyers when the lot they have contracted to purchase, and which they have religiously paid
for, is mortgaged without their knowledge. The avowed purpose of PD 957 compels the reading of Section 18 as
prohibitory -- acts committed contrary to it are void.
13
Such construal ensures the attainment of the purpose of the
law: to protect lot buyers, so that they do not end up still homeless despite having fully paid for their home lots with
their hard-earned cash.
Petitioner argues that it is an innocent mortgagee whose lien must be respected and protected, since the title offered
as security was clean of any encumbrance or lien. We do not agree.
"x xx. As a general rule, where there is nothing on the certificate of title to indicate any cloud or vice in the ownership
of the property, or any encumbrance thereon, the purchaser is not required to explore further than what the Torrens
Title upon its face indicates in quest for any hidden defect or inchoate right that may subsequently defeat his right
thereto. This rule, however, admits of an exception as where the purchaser or mortgagee has knowledge of a defect
or lack of title in the vendor, or that he was aware of sufficient facts to induce a reasonably prudent man to inquire
into the status of the property in litigation."
14

Petitioner bank should have considered that it was dealing with a town house project that was already in progress. A
reasonable person should have been aware that, to finance the project, sources of funds could have been used other
than the loan, which was intended to serve the purpose only partially. Hence, there was need to verify whether any
part of the property was already the subject of any other contract involving buyers or potential buyers. In granting the
loan, petitioner bank should not have been content merely with a clean title, considering the presence of
circumstances indicating the need for a thorough investigation of the existence of buyers like respondent. Having
been wanting in care and prudence, the latter cannot be deemed to be an innocent mortgagee.
Petitioner cannot claim to be a mortgagee in good faith. Indeed it was negligent, as found by the Office of the
President and by the CA. Petitioner should not have relied only on the representation of the mortgagor that the latter
had secured all requisite permits and licenses from the government agencies concerned. The former should have
required the submission of certified true copies of those documents and verified their authenticity through its own
independent effort.
Having been negligent in finding out what respondents rights were over the lot, petitioner must be deemed to
possess constructive knowledge of those rights.
15

Second Issue:
Remedy Granted
To retain possession of the lot, petitioner claims that its rights as the buyer in the foreclosure sale are superior to
those of respondent.
We are not persuaded. Aside from being a buyer of the lot, petitioner was also the mortgagee, which, as previously
discussed, was presumed to know the rights of respondent over that lot. The conversion of the status of the former
from mortgagee to buyer-owner will not lessen the importance of such knowledge. Neither will the conversion set
aside the consequences of its negligence as a mortgagee.
The lot was mortgaged in violation of Section 18 of PD 957. Respondent, who was the buyer of the property, was not
notified of the mortgage before the release of the loan proceeds by petitioner. Acts executed against the provisions of
mandatory or prohibitory laws shall be void.
16
Hence, the mortgage over the lot is null and void insofar as private
respondent is concerned.
17

The remedy granted by the HLURB and sustained by the Office of the President is proper only insofar as it refers to
the lot of respondent.1wphi1 In short, the mortgage contract is void as against him. Since there is no law stating the
specifics of what should be done under the circumstances, that which is in accord with equity should be
ordered.1wphi1The remedy granted by the HLURB in the first and the second paragraphs of the dispositive portion
of its Decision insofar as it referred to respondent's lot is in accord with equity.
The HLURB, however, went overboard in its disposition in paragraphs 3 and 4, which pertained not only to the lot but
to the entire parcel of land mortgaged. Such ruling was improper. The subject of this litigation is limited only to the lot
that respondent is buying, not to the entire parcel of land. He has no personality or standing to bring suit on the whole
property, as he has actionable interest over the subject lot only.
Third Issue:
Certification Against Forum Shopping
We find no cogent reason to alter the ruling of the CA regarding the Certification against forum shopping that did not
bear the notary public's signature. It is worth emphasizing that despite petitioner's noncompliance with the technical
requirements regarding the Certification, the CA still ruled on the merits of the case.
18
In fact, there is no more need
to pass upon this issue inasmuch as, on the merits, we have already turned down petitioners plea against
respondent.
WHEREFORE, the Petition is PARTLY GRANTED. The Decision of the HLURB is AFFIRMED, but it shall be
applicable only to the 52.5-square-meter lot with a three-storey town house unit denominated as Unit No. 10. No
costs.
SO ORDERED
Davide Jr., C. J., (Chairman), Ynares-Santiago, Carpio and Azcuna, JJ., concur.

Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 161003 May 6, 2005
FELIPE O. MAGBANUA, CARLOS DE LA CRUZ, REMY ARNAIZ, BILLY ARNAIZ, ROLLY ARNAIZ, DOMINGO
SALARDA, JULIO CAHILIG and NICANOR LABUEN, petitioners,
vs.
RIZALINO UY, respondent.
D E C I S I O N
PANGANIBAN, J .:
Rights may be waived through a compromise agreement, notwithstanding a final judgment that has already settled
the rights of the contracting parties. To be binding, the compromise must be shown to have been voluntarily, freely
and intelligently executed by the parties, who had full knowledge of the judgment. Furthermore, it must not be
contrary to law, morals, good customs and public policy.
The Case
Before us is a Petition for Review
1
under Rule 45 of the Rules of Court, assailing the May 31, 2000 Decision
2
and the
October 30, 2003 Resolution
3
of the Court of Appeals (CA) in CA-GR SP No. 53581. The challenged Decision
disposed as follows:
"WHEREFORE, having found that public respondent NLRC committed grave abuse of discretion, the Court
hereby SETS ASIDE the two assailed Resolutions and REINSTATES the order of the Labor Arbiterdated
February 27, 1998."
4

The assailed Resolution denied reconsideration.
The Facts
The CA relates the facts in this wise:
"As a final consequence of the final and executory decision of the Supreme Court in Rizalino P. Uy v.
National Labor Relations Commission, et. al. (GR No. 117983, September 6, 1996) which affirmed with
modification the decision of the NLRC in NLRC Case No. V-0427-93, hearings were conducted [in the
National Labor Relations Commission Sub-Regional Arbitration Branch in Iloilo City] to determine the
amount of wage differentials due the eight (8) complainants therein, now [petitioners]. As computed, the
award amounted to P1,487,312.69 x x x.
"On February 3, 1997, [petitioners] filed a Motion for Issuance of Writ of Execution.
"On May 19, 1997, [respondent] Rizalino Uy filed a Manifestation requesting that the cases be terminated
and closed, stating that the judgment award as computed had been complied with to the satisfaction of
[petitioners]. Said Manifestation was also signed by the eight (8) [petitioners]. Together with the
Manifestation is a Joint Affidavit dated May 5, 1997 of [petitioners], attesting to the receipt of payment from
[respondent] and waiving all other benefits due them in connection with their complaint.
x x x x x x x x x
"On June 3, 1997, [petitioners] filed an Urgent Motion for Issuance of Writ of Execution wherein they
confirmed that each of them received P40,000 from [respondent] on May 2, 1997.
"On June 9, 1997, [respondent] opposed the motion on the ground that the judgment award had been fully
satisfied. In their Reply, [petitioners] claimed that they received only partial payments of the judgment award.
x x x x x x x x x
"On October 20, 1997, six (6) of the eight (8) [petitioners] filed a Manifestation requesting that the cases be
considered closed and terminated as they are already satisfied of what they have received (a total
ofP320,000) from [respondent]. Together with said Manifestation is a Joint Affidavit in the local dialect, dated
October 20, 1997, of the six (6) [petitioners] attesting that they have no more collectible amount from
[respondent] and if there is any, they are abandoning and waiving the same.
"On February 27, 1998, the Labor Arbiter issued an order denying the motion for issuance of writ of
execution and [considered] the cases closed and terminated x x x.
"On appeal, the [National Labor Relations Commission (hereinafter NLRC)] reversed the Labor Arbiter and
directed the immediate issuance of a writ of execution, holding that a final and executory judgment can no
longer be altered and that quitclaims and releases are normally frowned upon as contrary to public policy."
5

Ruling of the Court of Appeals
The CA held that compromise agreements may be entered into even after a final judgment.
6
Thus, petitioners validly
released respondent from any claims, upon the voluntary execution of a waiver pursuant to the compromise
agreement.
7

The appellate court denied petitioners motion for reconsideration for having been filed out of time.
8

Hence, this Petition.
9

The Issues
Petitioners raise the following issues for our consideration:
"1. Whether or not the final and executory judgment of the Supreme Court could be subject to compromise
settlement;
"2. Whether or not the petitioners affidavit waiving their awards in [the] labor case executed without the
assistance of their counsel and labor arbiter is valid;
"3. Whether or not the ignorance of the jurisprudence by the Court of Appeals and its erroneous counting of
the period to file [a] motion for reconsideration constitute a denial of the petitioners right to due process."
10

The Courts Ruling
The Petition has no merit.
First Issue:
Validity of the Compromise Agreement
A compromise agreement is a contract whereby the parties make reciprocal concessions in order to resolve their
differences and thus avoid or put an end to a lawsuit.
11
They adjust their difficulties in the manner they have agreed
upon, disregarding the possible gain in litigation and keeping in mind that such gain is balanced by the danger of
losing.
12
Verily, the compromise may be either extrajudicial (to prevent litigation) or judicial (to end a litigation).
13

A compromise must not be contrary to law, morals, good customs and public policy; and must have been freely and
intelligently executed by and between the parties.
14
To have the force of law between the parties,
15
it must comply
with the requisites and principles of contracts.
16
Upon the parties, it has the effect and the authority of res judicata,
once entered into.
17

When a compromise agreement is given judicial approval, it becomes more than a contract binding upon the parties.
Having been sanctioned by the court, it is entered as a determination of a controversy and has the force and effect of
a judgment.
18
It is immediately executory and not appealable, except for vices of consent or forgery.
19
The
nonfulfillment of its terms and conditions justifies the issuance of a writ of execution; in such an instance, execution
becomes a ministerial duty of the court.
20

Following these basic principles, apparently unnecessary is a compromise agreement after final judgment has been
entered. Indeed, once the case is terminated by final judgment, the rights of the parties are settled. There are no
more disputes that can be compromised.
Compromise Agreements
after Final J udgment
The Court is tasked, however, to determine the legality of a compromise agreement after final judgment, not
theprudence of entering into one. Petitioners vehemently argue that a compromise of a final judgment is invalid under
Article 2040 of the Civil Code, which we quote:
21

"Art. 2040. If after a litigation has been decided by a final judgment, a compromise should be agreed upon,
either or both parties being unaware of the existence of the final judgment, the compromise may
berescinded.
"Ignorance of a judgment which may be revoked or set aside is not a valid ground for attacking a
compromise." (Bold types supplied)
The first paragraph of Article 2040 refers to a scenario in which either or both of the parties are unaware of a courts
final judgment at the time they agree on a compromise. In this case, the law allows either of them to rescindthe
compromise agreement. It is evident from the quoted paragraph that such an agreement is not prohibited or void or
voidable. Instead, a remedy to impugn the contract, which is an action for rescission, is declared available.
22
The law
allows a party to rescind a compromise agreement, because it could have been entered into in ignorance of the fact
that there was already a final judgment. Knowledge of a decisions finality may affect the resolve to enter into a
compromise agreement.
The second paragraph, though irrelevant to the present case, refers to the instance when the courts decision is still
appealable or otherwise subject to modification. Under this paragraph, ignorance of the decision is not a ground to
rescind a compromise agreement, because the parties are still unsure of the final outcome of the case at this time.
Petitioners argument, therefore, fails to convince. Article 2040 of the Civil Code does not refer to the validity of a
compromise agreement entered into after final judgment. Moreover, an important requisite, which is lack of
knowledge of the final judgment, is wanting in the present case.
Supported by Case Law
The issue involving the validity of a compromise agreement notwithstanding a final judgment is not novel. Jesalva v.
Bautista
23
upheld a compromise agreement that covered cases pending trial, on appeal, and with final
judgment.
24
The Court noted that Article 2040 impliedly allowed such agreements; there was no limitation as to when
these should be entered into.
25
Palanca v. Court of Industrial Relations
26
sustained a compromise agreement,
notwithstanding a final judgment in which only the amount of back wages was left to be determined. The Court found
no evidence of fraud or of any showing that the agreement was contrary to law, morals, good customs, public order,
or public policy.
27

Gatchalian v. Arlegui
28
upheld the right to compromise prior to the execution of a final judgment. The Court ruled that
the final judgment had been novated and superseded by a compromise agreement.
29
Also, Northern Lines, Inc. v.
Court of Tax Appeals
30
recognized the right to compromise final and executory judgments, as long as such right was
exercised by the proper party litigants.
31

Rovero v. Amparo,
32
which petitioners cited, did not set any precedent that all compromise agreements after final
judgment were invalid. In that case, the customs commissioner imposed a fine on an importer, based on the
appraised value of the goods illegally brought to the country. The latters appeal, which eventually reached this Court,
was denied. Despite a final judgment, the customs commissioner still reappraised the value of the goods and
effectively reduced the amount of fine. Holding that he had no authority to compromise a final judgment, the Court
explained:
"It is argued that the parties to a case may enter into a compromise about even a final judgment rendered by
a court, and it is contended x x x that the reappraisal ordered by the Commissioner of Customs and
sanctioned by the Department of Finance was authorized by Section 1369 of the [Revised Administrative
Code]. The contention may be correct as regards private parties who are the owners of the property
subject-matter of the litigation, and who are therefore free to do with what they own or what is
awarded to them, as they please, even to the extent of renouncing the award, or condoning the
obligation imposed by the judgment on the adverse party. Not so, however, in the present case. Here,
the Commissioner of Customs is not a private party and is not the owner of the money involved in the fine
based on the original appraisal. He is a mere agent of the Government and acts as a trustee of the money or
property in his hands or coming thereto by virtue of a favorable judgment. Unless expressly authorized by
his principal or by law, he is not authorized to accept anything different from or anything less than what is
adjudicated in favor of the Government."
33
(Bold types supplied)
Compliance with the
Rule on Contracts
There is no justification to disallow a compromise agreement, solely because it was entered into after final judgment.
The validity of the agreement is determined by compliance with the requisites and principles of contracts, not by when
it was entered into. As provided by the law on contracts, a valid compromise must have the following elements: (1)
the consent of the parties to the compromise, (2) an object certain that is the subject matter of the compromise, and
(3) the cause of the obligation that is established.
34

In the present factual milieu, compliance with the elements of a valid contract is not in issue. Petitioners do not
challenge the factual finding that they entered into a compromise agreement with respondent. There are no
allegations of vitiated consent. Neither was there any proof that the agreement was defective or could be
characterized as rescissible,
35
voidable,
36
unenforceable,
37
or void.
38
Instead, petitioners base their argument on the
sole fact that the agreement was executed despite a final judgment, which the Court had previously ruled to be
allowed by law.
Petitioners voluntarily entered into the compromise agreement, as shown by the following facts: (1) they signed
respondents Manifestation (filed with the labor arbiter) that the judgment award had been satisfied;
39
(2) they
executed a Joint Affidavit dated May 5, 1997, attesting to the receipt of payment and the waiver of all other benefits
due them;
40
and (3) 6 of the 8 petitioners filed a Manifestation with the labor arbiter on October 20, 1997, requesting
that the cases be terminated because of their receipt of payment in full satisfaction of their claims.
41
These
circumstances also reveal that respondent has already complied with its obligation pursuant to the compromise
agreement. Having already benefited from the agreement, estoppel bars petitioners from challenging it.
Advantages of Compromise
A reciprocal concession inherent in a compromise agreement assures benefits for the contracting parties. For the
defeated litigant, obvious is the advantage of a compromise after final judgment. Liability arising from the judgment
may be reduced. As to the prevailing party, a compromise agreement assures receipt of payment. Litigants are
sometimes deprived of their winnings because of unscrupulous mechanisms meant to delay or evade the execution
of a final judgment.
The advantages of a compromise agreement appear to be recognized by the NLRC in its Rules of Procedure. As part
of the proceedings in executing a final judgment, litigants are required to attend a pre-execution conference to thresh
out matters relevant to the execution.
42
In the conference, any agreement that would settle the final judgment in a
particular manner is necessarily a compromise.
Novation of an Obligation
The principle of novation supports the validity of a compromise after final judgment. Novation, a mode of
extinguishing an obligation,
43
is done by changing the object or principal condition of an obligation, substituting the
person of the debtor, or surrogating a third person in the exercise of the rights of the creditor.
44

For an obligation to be extinguished by another, the law requires either of these two conditions: (1) the substitution is
unequivocally declared, or (2) the old and the new obligations are incompatible on every point.
45
A compromise of a
final judgment operates as a novation of the judgment obligation, upon compliance with either requisite.
46
In the
present case, the incompatibility of the final judgment with the compromise agreement is evident, because the latter
was precisely entered into to supersede the former.
Second Issue:
Validity of the Waiver
Having ruled on the validity of the compromise agreement in the present suit, the Court now turns its attention to the
waiver of claims or quitclaim executed by petitioners. The subject waiver was their concession when they entered into
the agreement. They allege, however, that the absence of their counsel and the labor arbiter when they executed the
waiver invalidates the document.
Not Determinative
of the Waivers Validity
The presence or the absence of counsel when a waiver is executed does not determine its validity. There is no law
requiring the presence of a counsel to validate a waiver. The test is whether it was executed voluntarily, freely and
intelligently; and whether the consideration for it was credible and reasonable.
47
Where there is clear proof that a
waiver was wangled from an unsuspecting or a gullible person, the law must step in to annul such transaction.
48
In
the present case, petitioners failed to present any evidence to show that their consent had been vitiated.
The law is silent with regard to the procedure for approving a waiver after a case has been terminated.
49
Relevant,
however, is this reference to the NLRCs New Rules of Procedure:
"Should the parties arrive at any agreement as to the whole or any part of the dispute, the same shall be
reduced to writing and signed by the parties and their respective counsel, or authorized representative, if
any,
50
before the Labor Arbiter.
"The settlement shall be approved by the Labor Arbiter after being satisfied that it was voluntarily entered
into by the parties and after having explained to them the terms and consequences thereof.
"A compromise agreement entered into by the parties not in the presence of the Labor Arbiter before whom
the case is pending shall be approved by him, if after confronting the parties, particularly the complainants,
he is satisfied that they understand the terms and conditions of the settlement and that it was entered into
freely and voluntarily by them and the agreement is not contrary to law, morals, and public policy."
51

This provision refers to proceedings in a mandatory/conciliation conference during the initial stage of the litigation.
Such provision should be made applicable to the proceedings in the pre-execution conference, for which the
procedure for approving a waiver after final judgment is not stated. There is no reason to make a distinction between
the proceedings in mandatory/conciliation and those in pre-execution conferences.
The labor arbiters absence when the waivers were executed was remedied upon compliance with the above
procedure. The Court observes that the arbiter made searching questions during the pre-execution conference to
ascertain whether petitioners had voluntarily and freely executed the waivers.
52
Likewise, there was evidence that
they made an intelligent choice, considering that the contents of the written waivers had been explained to
them.
53
The labor arbiters absence when those waivers were executed does not, therefore, invalidate them.
The Court declines to rule on the allegation that respondents counsels encroached upon the professional
employment of petitioners lawyer when they facilitated the waivers.
54
The present action is not the proper forum in
which to raise any charge of professional misconduct. More important, petitioners failed to present any supporting
evidence.
The third issue, which refers to the timely filing of petitioners Motion for Reconsideration filed with the CA, will no
longer be discussed because this Courts decision has resolved the case on the merits.
WHEREFORE, the Petition is DENIED and the assailed Decision AFFIRMED. Costs against petitioners.
SO ORDERED.
Sandoval-Gutierrez, Corona, Carpio-Morales, and Garcia, JJ., concur.

Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 187521 March 14, 2012
F.F. CRUZ & CO., INC., Petitioner,
vs.
HR CONSTRUCTION CORP., Respondent.
D E C I S I O N
REYES, J .:
This is a petition for review on certiorari under Rule 45 of the Rules of Court filed by petitioner F.F. Cruz & Co., Inc.
(FFCCI) assailing the Decision
1
dated February 6, 2009 and Resolution
2
dated April 13, 2009 issued by the Court of
Appeals (CA) in CA-G.R. SP No. 91860.
The Antecedent Facts
Sometime in 2004, FFCCI entered into a contract with the Department of Public Works and Highways (DPWH) for the
construction of the Magsaysay Viaduct, known as the Lower Agusan Development Project. On August 9, 2004,
FFCCI, in turn, entered into a Subcontract Agreement
3
with HR Construction Corporation (HRCC) for the supply of
materials, labor, equipment, tools and supervision for the construction of a portion of the said project called the East
Bank Levee and Cut-Off Channel in accordance with the specifications of the main contract.
The subcontract price agreed upon by the parties amounted to P31,293,532.72. Pursuant to the Subcontract
Agreement, HRCC would submit to FFCCI a monthly progress billing which the latter would then pay, subject to
stipulated deductions, within 30 days from receipt thereof.
The parties agreed that the requests of HRCC for payment should include progress accomplishment of its completed
works as approved by FFCCI. Additionally, they agreed to conduct a joint measurement of the completed works of
HRCC together with the representative of DPWH and consultants to arrive at a common quantity.
Thereafter, HRCC commenced the construction of the works pursuant to the Subcontract Agreement.
On September 17, 2004, HRCC submitted to FFCCI its first progress billing in the amount of P2,029,081.59 covering
the construction works it completed from August 16 to September 15, 2004.
4
However, FFCCI asserted that the
DPWH was then able to evaluate the completed works of HRCC only until July 25, 2004. Thus, FFCCI only approved
the gross amount of P423,502.88 for payment. Pursuant to the Subcontract Agreement, FFCCI deducted from the
said gross amount P42,350.29 for retention and P7,700.05 for expanded withholding tax leaving a net payment in the
amount of P373,452.54. This amount was paid by FFCCI to HRCC on December 3, 2004.
5

FFCCI and the DPWH then jointly evaluated the completed works of HRCC for the period of July 26 to September 25,
2004. FFCCI claimed that the gross amount due for the completed works during the said period wasP2,008,837.52.
From the said gross amount due, FFCCI deducted therefrom P200,883.75 for retention andP36,524.07 for expanded
withholding tax leaving amount of P1,771,429.45 as the approved net payment for the said period. FFCCI paid this
amount on December 21, 2004.
6

On October 29, 2004, HRCC submitted to FFCCI its second progress billing in the amount of P1,587,760.23 covering
its completed works from September 18 to 25, 2004.
7
FFCCI did not pay the amount stated in the second progress
billing, claiming that it had already paid HRCC for the completed works for the period stated therein.
On even date, HRCC submitted its third progress billing in the amount of P2,569,543.57 for its completed works from
September 26 to October 25, 2004.
8
FFCCI did not immediately pay the amount stated in the third progress billing,
claiming that it still had to evaluate the works accomplished by HRCC.
On November 25, 2004, HRCC submitted to FFCCI its fourth progress billing in the amount of P1,527,112.95 for the
works it had completed from October 26 to November 25, 2004.
Subsequently, FFCCI, after it had evaluated the completed works of HRCC from September 26 to November 25,
2004, approved the payment of the gross amount of P1,505,570.99 to HRCC. FFCCI deducted
therefromP150,557.10 for retention and P27,374.02 for expanded withholding tax leaving a net payment
of P1,327,639.87, which amount was paid to HRCC on March 11, 2005.
9

Meanwhile, HRCC sent FFCCI a letter
10
dated December 13, 2004 demanding the payment of its progress billings in
the total amount of P7,340,046.09, plus interests, within three days from receipt thereof. Subsequently, HRCC
completely halted the construction of the subcontracted project after taking its Christmas break on December 18,
2004.
On March 7, 2005, HRCC, pursuant to the arbitration clause in the Subcontract Agreement, filed with the
Construction Industry Arbitration Commission (CIAC) a Complaint
11
against FFCCI praying for the payment of the
following: (1) overdue obligation in the reduced amount of P4,096,656.53 as of December 15, 2004 plus legal
interest; (2) P1,500,000.00 as attorneys fees; (3) P80,000.00 as acceptance fee and representation expenses; and
(4) costs of litigation.
In its Answer,
12
FFCCI claimed that it no longer has any liability on the Subcontract Agreement as the three payments
it made to HRCC, which amounted to P3,472,521.86, already represented the amount due to the latter in view of the
works actually completed by HRCC as shown by the survey it conducted jointly with the DPWH. FFCCI further
asserted that the delay in the payment processing was primarily attributable to HRCC inasmuch as it presented
unverified work accomplishments contrary to the stipulation in the Subcontract Agreement regarding requests for
payment.
Likewise, FFCCI maintained that HRCC failed to comply with the condition stated under the Subcontract Agreement
for the payment of the latters progress billings, i.e. joint measurement of the completed works, and, hence, it was
justified in not paying the amount stated in HRCCs progress billings.
On June 16, 2005, an Arbitral Tribunal was created composed of Engineer Ricardo B. San Juan, Joven B. Joaquin
and Attorney Alfredo F. Tadiar, with the latter being appointed as the Chairman.
In a Preliminary Conference held on July 5, 2005, the parties defined the issues to be resolved in the proceedings
before the CIAC as follows:
1. What is the correct amount of [HRCCs] unpaid progress billing?
2. Did [HRCC] comply with the conditions set forth in subparagraph 4.3 of the Subcontract Agreement for
the submission, evaluation/processing and release of payment of its progress billings?
3. Did [HRCC] stop work on the project?
3.1 If so, is the work stoppage justified?
3.2 If so, what was the percentage and value of [HRCCs] work accomplishment at the time it
stopped work on the project?
4. Who between the parties should bear the cost of arbitration or in what proportion should it be shared by
the parties?
13

Likewise, during the said Preliminary Conference, HRCC further reduced the amount of overdue obligation it claimed
from FFCCI to P2,768,916.66. During the course of the proceedings before the CIAC, HRCC further reduced the said
amount to P2,635,397.77 the exact difference between the total amount of HRCCs progress billings
(P6,107,919.63) and FFCCIs total payments in favor of the latter (P3,472,521.86).
The CIAC Decision
On September 6, 2005, after due proceedings, the CIAC rendered a Decision
14
in favor of HRCC, the decretal portion
of which reads:
WHEREFORE, judgment is hereby rendered in favor of the Claimant HR CONSTRUCTION CORPORATION and
AWARD made on its monetary claim against Respondent F.F. CRUZ & CO., INC., as follows:
[P]2,239,452.63 as the balance of its unpaid billings and
101,161.57 as reimbursement of the arbitration costs.

[P]2,340,614.20


Total due the Claimant

Interest on the foregoing amount [P]2,239,452.63 shall be paid at the rate of 6% per annum from the date of this
Decision. After finality of this Decision, interest at the rate of 12% per annum shall be paid thereon until full payment
of the awarded amount shall have been made x x x.
SO ORDERED.
15

The CIAC held that the payment method adopted by FFCCI is actually what is known as the "back-to-back payment
scheme" which was not agreed upon under the Subcontract Agreement. As such, the CIAC ruled that FFCCI could
not impose upon HRCC its valuation of the works completed by the latter. The CIAC gave credence to HRCCs
valuation of its completed works as stated in its progress billings. Thus:
During the trial, [FFCCIs] Aganon admitted that [HRCCs] accomplishments are included in its own billings to the
DPWH together with a substantial mark-up to cover overhead costs and profit. He further admitted that it is only when
DPWH approves its (Respondents) billings covering [HRCCs] scope of work and pays for them, that [FFCCI] will in
turn pay [HRCC] for its billings on the sub-contracted works.
On clarificatory questioning by the Tribunal, [FFCCI] admitted that there is no "back-to-back" provision in the sub-
contract as basis for this sequential payment arrangement and, therefore, [FFCCIs] imposition thereof by withholding
payment to [HRCC] until it is first paid by the project owner on the Main Contract, clearly violates said sub-contract. It
[is] this unauthorized implementation of a back-to-back payment scheme that is seen to be the reason for [FFCCIs]
non-payment of the third progress billings.
It is accordingly the holding of this Arbitral Tribunal that [FFCCI] is not justified in withholding payment of [HRCCs]
third progress billing for this scheme that [HRCC] has not agreed to in the sub-contract agreement x x x.
x x x
The total retention money deducted by [FFCCI] from [HRCCs] three progress billings, amounts to [P]395,945.14 x x
x. The retention money is part of [HRCCs] progress billings and must, therefore, be credited to this account. The two
amounts (deductions and net payments) total [P]3,868,467.00 x x x. This represents the total gross payments that
should be credited and deducted from the total gross billings to arrive at what has not been paid to the [HRCC]. This
results in the amount of [P]2,239,452.63 ([P]6,107,919.63 - [P]3,868,467.00) as the correct balance of [HRCCs]
unpaid billings.
16

Further, the CIAC ruled that FFCCI had already waived its right under the Subcontract Agreement to require a joint
measurement of HRCCs completed works as a condition precedent to the payment of the latters progress billings.
Hence:
[FFCCI] admits that in all three instances where it paid [HRCC] for its progress billings, it never required compliance
with the aforequoted contractual provision of a prior joint quantification. Such repeated omission may reasonably be
construed as a waiver by [FFCCI] of its contractual right to require compliance of said condition and it is now too late
in the day to so impose it. Article 6 of the Civil Code expressly provides that "rights may be waived unless the waiver
is contrary to law, public order, public policy, morals or good customs". The tribunal cannot see any such violation in
this case.
x x x
[FFCCIs] omission to enforce the contractually required condition of payment, has led [HRCC] to believe it to be true
that indeed [FFCCI] has waived the condition of joint quantification and, therefore, [FFCCI] may not be permitted to
falsify such resulting position.
17

Likewise, the CIAC held that FFCCIs non-payment of the progress billings submitted by HRCC gave the latter the
right to rescind the Subcontract Agreement and, accordingly, HRCCs work stoppage was justified. It further opined
that, in effect, FFCCI had ratified the right of HRCC to stop the construction works as it did not file any counterclaim
against HRCC for liquidated damages arising therefrom.
FFCCI then filed a petition for review with CA assailing the foregoing disposition by the CIAC.
The CA Decision
On February 6, 2009, the CA rendered the herein assailed Decision
18
denying the petition for review filed by FFCCI.
The CA agreed with the CIAC that FFCCI had waived its right under the Subcontract Agreement to require a joint
quantification of HRCCs completed works.
The CA further held that the amount due to HRCC as claimed by FFCCI could not be given credence since the same
was based on a survey of the completed works conducted without the participation of HRCC. Likewise, being the
main contractor, it ruled that it was the responsibility of FFCCI to include HRCC in the joint measurement of the
completed works. Furthermore, the CA held that HRCC was justified in stopping its construction works on the project
as the failure of FFCCI to pay its progress billings gave the former the right to rescind the Subcontract Agreement.
FFCCI sought a reconsideration
19
of the said February 6, 2009 Decision but it was denied by the CA in its
Resolution
20
dated April 13, 2009.
Issues
In the instant petition, FFCCI submits the following issues for this Courts resolution:
[I.]
x x x First, [d]oes the act of [FFCCI] in conducting a verification survey of [HRCCs] billings in the latters presence
amount to a waiver of the right of [FFCCI] to verify and approve said billings? What, if any, is the legal significance of
said act?
[II.]
x x x Second, [d]oes the payment of [FFCCI] to [HRCC] based on the results of the above mentioned verification
survey result in the former being obliged to accept whatever accomplishment was reported by the latter?
[III.]
x x x Third, [d]oes the mere comparison of the payments made by [FFCCI] with the contested progress billings of
[HRCC] amount to an adjudication of the controversy between the parties?
[IV.]
x x x Fourth, [d]oes the failure of [FFCCI] to interpose a counterclaim against [HRCC] for liquidated damages due to
the latters work stoppage, amount to a ratification of such work stoppage?
[V.]
x x x Fifth, [d]id the [CA] disregard or overlook significant and material facts which would affect the result of the
litigation?
21

In sum, the crucial issues for this Courts resolution are: first, what is the effect of FFCCIs non-compliance with the
stipulation in the Subcontract Agreement requiring a joint quantification of the works completed by HRCC on the
payment of the progress billings submitted by the latter; and second, whether there was a valid rescission of the
Subcontract Agreement by HRCC.
The Courts Ruling
The petition is not meritorious.
Procedural Issue:
Finality and Conclusiveness of the CIACs Factual Findings
Before we delve into the substantial issues raised by FFCCI, we shall first address the procedural issue raised by
HRCC. According to HRCC, the instant petition merely assails the factual findings of the CIAC as affirmed by the CA
and, accordingly, not proper subjects of an appeal under Rule 45 of the Rules of Court. It likewise pointed out that
factual findings of the CIAC, when affirmed by the CA, are final and conclusive upon this Court.
Generally, the arbitral award of CIAC is final and may not be appealed except on questions of law.
Executive Order (E.O.) No. 1008
22
vests upon the CIAC original and exclusive jurisdiction over disputes arising from,
or connected with, contracts entered into by parties involved in construction in the Philippines. Under Section 19 of
E.O. No. 1008, the arbitral award of CIAC "shall be final and inappealable except on questions of law which shall be
appealable to the Supreme Court."
23

In Hi-Precision Steel Center, Inc. v. Lim Kim Steel Builders, Inc.,
24
we explained raison d etre for the rule on finality of
the CIACs arbitral award in this wise:
Voluntary arbitration involves the reference of a dispute to an impartial body, the members of which are chosen by
the parties themselves, which parties freely consent in advance to abide by the arbitral award issued after
proceedings where both parties had the opportunity to be heard. The basic objective is to provide a speedy and
inexpensive method of settling disputes by allowing the parties to avoid the formalities, delay, expense and
aggravation which commonly accompany ordinary litigation, especially litigation which goes through the entire
hierarchy of courts. Executive Order No. 1008 created an arbitration facility to which the construction industry in the
Philippines can have recourse. The Executive Order was enacted to encourage the early and expeditious settlement
of disputes in the construction industry, a public policy the implementation of which is necessary and important for the
realization of national development goals.
Aware of the objective of voluntary arbitration in the labor field, in the construction industry, and in any other area for
that matter, the Court will not assist one or the other or even both parties in any effort to subvert or defeat that
objective for their private purposes. The Court will not review the factual findings of an arbitral tribunal upon the artful
allegation that such body had "misapprehended the facts" and will not pass upon issues which are, at bottom, issues
of fact, no matter how cleverly disguised they might be as "legal questions." The parties here had recourse to
arbitration and chose the arbitrators themselves; they must have had confidence in such arbitrators. x x x
25
(Citation
omitted)
Thus, in cases assailing the arbitral award rendered by the CIAC, this Court may only pass upon questions of law.
Factual findings of construction arbitrators are final and conclusive and not reviewable by this Court on appeal. This
rule, however, admits of certain exceptions.
In Spouses David v. Construction Industry and Arbitration Commission,
26
we laid down the instances when this Court
may pass upon the factual findings of the CIAC, thus:
We reiterate the rule that factual findings of construction arbitrators are final and conclusive and not reviewable by
this Court on appeal, except when the petitioner proves affirmatively that: (1) the award was procured by corruption,
fraud or other undue means; (2) there was evident partiality or corruption of the arbitrators or of any of them; (3) the
arbitrators were guilty of misconduct in refusing to postpone the hearing upon sufficient cause shown, or in refusing to
hear evidence pertinent and material to the controversy; (4) one or more of the arbitrators were disqualified to act as
such under section nine of Republic Act No. 876 and willfully refrained from disclosing such disqualifications or of any
other misbehavior by which the rights of any party have been materially prejudiced; or (5) the arbitrators exceeded
their powers, or so imperfectly executed them, that a mutual, final and definite award upon the subject matter
submitted to them was not made. x x x
27
(Citation omitted)
Issues on the proper interpretation of the terms of the Subcontract Agreement involve questions of law.
A question of law arises when there is doubt as to what the law is on a certain state of facts, while there is a question
of fact when the doubt arises as to the truth or falsity of the alleged facts. For a question to be one of law, the same
must not involve an examination of the probative value of the evidence presented by the litigants or any of them. The
resolution of the issue must rest solely on what the law provides on the given set of circumstances. Once it is clear
that the issue invites a review of the evidence presented, the question posed is one of fact.
28

On the surface, the instant petition appears to merely raise factual questions as it mainly puts in issue the appropriate
amount that is due to HRCC. However, a more thorough analysis of the issues raised by FFCCI would show that it
actually asserts questions of law.
FFCCI primarily seeks from this Court a determination of whether amount claimed by HRCC in its progress billing
may be enforced against it in the absence of a joint measurement of the formers completed works. Otherwise stated,
the main question advanced by FFCCI is this: in the absence of the joint measurement agreed upon in the
Subcontract Agreement, how will the completed works of HRCC be verified and the amount due thereon be
computed?
The determination of the foregoing question entails an interpretation of the terms of the Subcontract Agreement vis--
vis the respective rights of the parties herein. On this point, it should be stressed that where an interpretation of the
true agreement between the parties is involved in an appeal, the appeal is in effect an inquiry of the law between the
parties, its interpretation necessarily involves a question of law.
29

Moreover, we are not called upon to examine the probative value of the evidence presented before the CIAC. Rather,
what is actually sought from this Court is an interpretation of the terms of the Subcontract Agreement as it relates to
the dispute between the parties.
First Substantive Issue: Effect of Non-compliance with the Joint Quantification Requirement on the Progress Billings
of HRCC
Basically, the instant issue calls for a determination as to which of the parties respective valuation of accomplished
works should be given credence. FFCCI claims that its valuation should be upheld since the same was the result of a
measurement of the completed works conducted by it and the DPWH. On the other hand, HRCC maintains that its
valuation should be upheld on account of FFCCIs failure to observe the joint measurement requirement in
ascertaining the extent of its completed works.
The terms of the Subcontract Agreement should prevail.
In resolving the dispute as to the proper valuation of the works accomplished by HRCC, the primordial consideration
should be the terms of the Subcontract Agreement. It is basic that if the terms of a contract are clear and leave no
doubt upon the intention of the contracting parties, the literal meaning of its stipulations shall control.
30

In Abad v. Goldloop Properties, Inc.,
31
we stressed that:
A courts purpose in examining a contract is to interpret the intent of the contracting parties, as objectively manifested
by them. The process of interpreting a contract requires the court to make a preliminary inquiry as to whether the
contract before it is ambiguous. A contract provision is ambiguous if it is susceptible of two reasonable alternative
interpretations. Where the written terms of the contract are not ambiguous and can only be read one way, the court
will interpret the contract as a matter of law. If the contract is determined to be ambiguous, then the interpretation of
the contract is left to the court, to resolve the ambiguity in the light of the intrinsic evidence.
32
(Emphasis supplied and
citation omitted)
Article 4 of the Subcontract Agreement, in part, contained the following stipulations:
ARTICLE 4
SUBCONTRACT PRICE
4.1 The total SUBCONTRACT Price shall be THIRTY ONE MILLION
TWO HUNDRED NINETY THREE THOUSAND FIVE HUNDRED THIRTY TWO PESOS & 72/100 ONLY
([P]31,293,532.72) inclusive of Value Added Tax x x x.
x x x
4.3 Terms of Payment
FFCCI shall pay [HRCC] within thirty (30) days upon receipt of the [HRCCs] Monthly Progress Billings subject to
deductions due to ten percent (10%) retention, and any other sums that may be due and recoverable by FFCCI from
[HRCC] under this SUBCONTRACT. In all cases, however, two percent (2%) expanded withholding tax on the
[HRCCs] income will be deducted from the monthly payments.
Requests for the payment by the [HRCC] shall include progress accomplishment of completed works (unit of work
accomplished x unit cost) as approved by [FFCCI]. Cut-off date of monthly billings shall be every 25th of the month
and joint measurement shall be conducted with the DPWHs representative, Consultants, FFCCI and [HRCC] to
arrive at a common/agreed quantity.
33
(Emphasis supplied)
Pursuant to the terms of payment agreed upon by the parties, FFCCI obliged itself to pay the monthly progress
billings of HRCC within 30 days from receipt of the same. Additionally, the monthly progress billings of HRCC should
indicate the extent of the works completed by it, the same being essential to the valuation of the amount that FFCCI
would pay to HRCC.
The parties further agreed that the extent of HRCCs completed works that would be indicated in the monthly
progress billings should be determined through a joint measurement conducted by FFCCI and HRCC together with
the representative of DPWH and the consultants.
It is the responsibility of FFCCI to call for the joint measurement of HRCCs completed works.
It bears stressing that the joint measurement contemplated under the Subcontract Agreement should be conducted
by the parties herein together with the representative of the DPWH and the consultants. Indubitably, FFCCI, being the
main contractor of DPWH, has the responsibility to request the representative of DPWH to conduct the said joint
measurement.
On this score, the testimony of Engineer Antonio M. Aganon, Jr., project manager of FFCCI, during the reception of
evidence before the CIAC is telling, thus:
MR. J. B. JOAQUIN:
Engr. Aganon, earlier there was a stipulation that in all the four billings, there never was a joint quantification.
PROF. A. F. TADIAR:
He admitted that earlier. Pinabasa ko sa kanya.
ENGR. R. B. SAN JUAN:
The joint quantification was done only between them and DPWH.
x x x x
ENGR. AGANON:
Puwede ko po bang i-explain sandali lang po regarding lang po doon sa quantification na iyon? Basically po as main
contractor of DPWH, we are the ones who [are] requesting for joint survey quantification with the owner, DPWH.
Ngayon po, although wala sa papel na nag-witness and [HRCC] still the same po, nandoon din po sila during that
time, kaya lang ho . . .
MR. J. B. JOAQUIN:
Hindi pumirma?
ENGR. AGANON:
Hindi sila puwede pumirma kasi ho kami po ang contractor ng DPWH hindi sila.
34
(Emphasis supplied)
FFCCI had waived its right to demand for a joint measurement of HRCCs completed works under the Subcontract
Agreement.
The CIAC held that FFCCI, on account of its failure to demand the joint measurement of HRCCs completed works,
had effectively waived its right to ask for the conduct of the same as a condition sine qua non to HRCCs submission
of its monthly progress billings.
We agree.
In People of the Philippines v. Donato,
35
this Court explained the doctrine of waiver in this wise:
Waiver is defined as "a voluntary and intentional relinquishment or abandonment of a known existing legal right,
advantage, benefit, claim or privilege, which except for such waiver the party would have enjoyed; the voluntary
abandonment or surrender, by a capable person, of a right known by him to exist, with the intent that such right shall
be surrendered and such person forever deprived of its benefit; or such conduct as warrants an inference of the
relinquishment of such right; or the intentional doing of an act inconsistent with claiming it."
As to what rights and privileges may be waived, the authority is settled:
x x x the doctrine of waiver extends to rights and privileges of any character, and, since the word waiver covers
every conceivable right, it is the general rule that a person may waive any matter which affects his property, and any
alienable right or privilege of which he is the owner or which belongs to him or to which he is legally entitled, whether
secured by contract, conferred with statute, or guaranteed by constitution, provided such rights and privileges rest in
the individual, are intended for his sole benefit, do not infringe on the rights of others, and further provided the waiver
of the right or privilege is not forbidden by law, and does not contravene public policy; and the principle is recognized
that everyone has a right to waive, and agree to waive, the advantage of a law or rule made solely for the benefit and
protection of the individual in his private capacity, if it can be dispensed with and relinquished without infringing on
any public right, and without detriment to the community at large. x x x
36
(Emphasis supplied and citations omitted)
Here, it is undisputed that the joint measurement of HRCCs completed works contemplated by the parties in the
Subcontract Agreement never materialized. Indeed, HRCC, on separate occasions, submitted its monthly progress
billings indicating the extent of the works it had completed sans prior joint measurement. Thus:
Progress Billing Period Covered Amount
1st Progress Billing dated September 17, 2004
37
August 16 to September 15, 2004 P2,029,081.59
2nd Progress Billing dated October 29, 2004
38
September 18 to 25, 2004 P1,587,760.23
3rd Progress Billing dated October 29, 2004
39
September 26 to October 25, 2004 P2,569,543.57
4th Progress Billing dated November 25, 2004 October 26 to November 25, 2004 P1,527,112.95
FFCCI did not contest the said progress billings submitted by HRCC despite the lack of a joint measurement of the
latters completed works as required under the Subcontract Agreement. Instead, FFCCI proceeded to conduct its own
verification of the works actually completed by HRCC and, on separate dates, made the following payments to
HRCC:
Date of Payment Period Covered Amount
December 3, 2004
40
April 2 to July 25, 2004 P373,452.24
December 21, 2004
41
July 26 to September 25, 2004 P1,771,429.45
March 11, 2005
42
September 26 to November 25, 2004 P1,327,639.87
FFCCIs voluntary payment in favor of HRCC, albeit in amounts substantially different from those claimed by the
latter, is a glaring indication that it had effectively waived its right to demand for the joint measurement of the
completed works. FFCCIs failure to demand a joint measurement of HRCCs completed works reasonably justified
the inference that it had already relinquished its right to do so. Indeed, not once did FFCCI insist on the conduct of a
joint measurement to verify the extent of HRCCs completed works despite its receipt of the four monthly progress
billings submitted by the latter.
FFCCI is already barred from contesting HRCCs valuation of the completed works having waived its right to demand
the joint measurement requirement.
In view of FFCCIs waiver of the joint measurement requirement, the CA, essentially echoing the CIACs disposition,
found that FFCCI is obliged to pay the amount claimed by HRCC in its monthly progress billings. The CA reasoned
thus:
Verily, the joint measurement that [FFCCI] claims it conducted without the participation of [HRCC], to which [FFCCI]
anchors its claim of full payment of its obligations to [HRCC], cannot be applied, nor imposed, on [HRCC]. In other
words, [HRCC] cannot be made to accept a quantification of its works when the said quantification was made without
its participation. As a consequence, [FFCCIs] claim of full payment cannot be upheld as this is a result of a
quantification that was made contrary to the express provisions of the Subcontract Agreement.
The Court is aware that by ruling so, [FFCCI] would seem to be placed at a disadvantage because it would result in
[FFCCI] having to pay exactly what [HRCC] was billing the former. If, on the other hand, the Court were to rule
otherwise[,] then [HRCC] would be the one at a disadvantage because it would be made to accept payment that is
less than what it was billing.
Circumstances considered, however, the Court deems it proper to rule in favor of [HRCC] because of the explicit
provision of the Subcontract Agreement that requires the participation of the latter in the joint measurement. If the
Court were to rule otherwise, then the Court would, in effect, be disregarding the explicit agreement of the parties in
their contract.
43

Essentially, the question that should be resolved is this: In view of FFCCIs waiver of its right to demand a joint
measurement of HRCCs completed works, is FFCCI now barred from disputing the claim of HRCC in its monthly
progress billings?
We rule in the affirmative.
As intimated earlier, the joint measurement requirement is a mechanism essentially granting FFCCI the opportunity to
verify and, if necessary, contest HRCCs valuation of its completed works prior to the submission of the latters
monthly progress billings.
In the final analysis, the joint measurement requirement seeks to limit the dispute between the parties with regard to
the valuation of HRCCs completed works. Accordingly, any issue which FFCCI may have with regard to HRCCs
valuation of the works it had completed should be raised and resolved during the said joint measurement instead of
raising the same after HRCC had submitted its monthly progress billings. Thus, having relinquished its right to ask for
a joint measurement of HRCCs completed works, FFCCI had necessarily waived its right to dispute HRCCs
valuation of the works it had accomplished.
Second Substantive Issue:
Validity of HRCCs Rescission of the Subcontract Agreement
Both the CA and the CIAC held that the work stoppage of HRCC was justified as the same is but an exercise of its
right to rescind the Subcontract Agreement in view of FFCCIs failure to pay the formers monthly progress billings.
Further, the CIAC stated that FFCCI could no longer assail the work stoppage of HRCC as it failed to file any
counterclaim against HRCC pursuant to the terms of the Subcontract Agreement.
For its part, FFCCI asserted that the work stoppage of HRCC was not justified and, in any case, its failure to raise a
counterclaim against HRCC for liquidated damages before the CIAC does not amount to a ratification of the latters
work stoppage.
The determination of the validity of HRCCs work stoppage depends on a determination of the following: first, whether
HRCC has the right to extrajudicially rescind the Subcontract Agreement; and second, whether FFCCI is already
barred from disputing the work stoppage of HRCC.
HRCC had waived its right to rescind the Subcontract Agreement.
The right of rescission is statutorily recognized in reciprocal obligations. Article 1191 of the Civil Code pertinently
reads:
Art. 1191. The power to rescind obligations is implied in reciprocal ones, in case one of the obligors should not
comply with what is incumbent upon him.
The injured party may choose between the fulfillment and the rescission of the obligation, with the payment of
damages in either case. He may also seek rescission, even after he has chosen fulfillment, if the latter should
become impossible.
The court shall decree the rescission claimed, unless there be just cause authorizing the fixing of a period.
This is understood to be without prejudice to the rights of third persons who have acquired the thing, in accordance
with Articles 1385 and 1388 and the Mortgage Law.
The rescission referred to in this article, more appropriately referred to as resolution is on the breach of faith by the
defendant which is violative of the reciprocity between the parties.
44
The right to rescind, however, may be waived,
expressly or impliedly.
45

While the right to rescind reciprocal obligations is implied, that is, that such right need not be expressly provided in
the contract, nevertheless the contracting parties may waive the same.
46

Contrary to the respective dispositions of the CIAC and the CA, we find that HRCC had no right to rescind the
Subcontract Agreement in the guise of a work stoppage, the latter having waived such right. Apropos is Article 11.2 of
the Subcontract Agreement, which reads:
11.2 Effects of Disputes and Continuing Obligations
Notwithstanding any dispute, controversy, differences or arbitration proceedings relating directly or indirectly to this
SUBCONTRACT Agreement and without prejudice to the eventual outcome thereof, [HRCC] shall at all times
proceed with the prompt performance of the Works in accordance with the directives of FFCCI and this
SUBCONTRACT Agreement.
47
(Emphasis supplied)
Hence, in spite of the existence of dispute or controversy between the parties during the course of the Subcontract
Agreement, HRCC had agreed to continue the performance of its obligations pursuant to the Subcontract Agreement.
In view of the provision of the Subcontract Agreement quoted above, HRCC is deemed to have effectively waived its
right to effect extrajudicial rescission of its contract with FFCCI.1wphi1 Accordingly, HRCC, in the guise of
rescinding the Subcontract Agreement, was not justified in implementing a work stoppage.
The costs of arbitration should be shared by the parties equally.
Section 1, Rule 142 of the Rules of Court provides:
Section 1. Costs ordinarily follow results of suit. Unless otherwise provided in these rules, costs shall be allowed to
the prevailing party as a matter of course, but the court shall have power, for special reasons, to adjudge that either
party shall pay the costs of an action, or that the same be divided, as may be equitable. No costs shall be allowed
against the Republic of the Philippines unless otherwise provided by law. (Emphasis supplied)
Although, generally, costs are adjudged against the losing party, courts nevertheless have discretion, for special
reasons, to decree otherwise.
Here, considering that the work stoppage of HRCC is not justified, it is only fitting that both parties should share in the
burden of the cost of arbitration equally. HRCC had a valid reason to institute the complaint against FFCCI in view of
the latters failure to pay the full amount of its monthly progress billings. However, we disagree with the CIAC and the
CA that only FFCCI should shoulder the arbitration costs. The arbitration costs should be shared equally by FFCCI
and HRCC in view of the latters unjustified work stoppage.
WHEREFORE, in consideration of the foregoing disquisitions, the Decision dated February 6, 2009 and Resolution
dated April 13, 2009 of the Court of Appeals in CA-G.R. SP No. 91860 are
hereby AFFIRMED withMODIFICATION that the arbitration costs shall be shared equally by the parties herein.
SO ORDERED.
BIENVENIDO L. REYES
Associate Justice
WE CONCUR:
ANTONIO T. CARPIO
Associate Justice
ARTURO D. BRION
Associate Justice
JOSE PORTUGAL PEREZ
Associate Justice
MARIA LOURDES P. A. SERENO
Associate Justice
A T T E S T A T I O N
I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to
the writer of the opinion of the Courts Division.
ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I certify that the
conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the
opinion of the Courts Division.
RENATO C. CORONA
Chief Justice


Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 141811 November 15, 2001
FIRST METRO INVESTMENT CORPORATION, petitioner,
vs.
ESTE DEL SOL MOUNTAIN RESERVE, INC., VALENTIN S. DAEZ, JR., MANUEL Q. SALIENTES, MA. ROCIO A.
DE VEGA, ALEXANDER G. ASUNCION, ALBERTO
*
M. LADORES, VICENTE M. DE VERA, JR., and FELIPE B.
SESE, respondents.
DE LEON, JR., J .:
Before us is a petition for review on certiorari of the Decision
1
of the Court of Appeals
2
dated November 8, 1999 in
CA-G.R. CV No. 53328 reversing the Decision
3
of the Regional Trial Court of Pasig City, Branch 159 dated June 2,
1994 in Civil Case No. 39224. Essentially, the Court of Appeals found and declared that the fees provided for in the
Underwriting and Consultancy Agreements executed by and between petitioner First Metro Investment Corp. (FMIC)
and respondent Este del Sol Mountain Reserve, Inc. (Este del Sol) simultaneously with the Loan Agreement dated
January 31, 1978 were mere subterfuges to camouflage the usurious interest charged by petitioner FMIC.
The facts of the case are as follows:
It appears that on January 31, 1978, petitioner FMIC granted respondent Este del Sol a loan of Seven Million Three
Hundred Eighty-Five Thousand Five Hundred Pesos (P7,385,500.00) to finance the construction and development of
the Este del Sol Mountain Reserve, a sports/resort complex project located at Barrio Puray, Montalban, Rizal.
4

Under the terms of the Loan Agreement, the proceeds of the loan were to be released on staggered basis. Interest on
the loan was pegged at sixteen (16%) percent per annum based on the diminishing balance. The loan was payable in
thirty-six (36) equal and consecutive monthly amortizations to commence at the beginning of the thirteenth month
from the date of the first release in accordance with the Schedule of Amortization.
5
In case of default, an acceleration
clause was, among others, provided and the amount due was made subject to a twenty (20%) percent one-time
penalty on the amount due and such amount shall bear interest at the highest rate permitted by law from the date of
default until full payment thereof plus liquidated damages at the rate of two (2%) percent per month compounded
quarterly on the unpaid balance and accrued interests together with all the penalties, fees, expenses or charges
thereon until the unpaid balance is fully paid, plus attorney's fees equivalent to twenty-five (25%) percent of the sum
sought to be recovered, which in no case shall be less than Twenty Thousand Pesos (P20,000.00) if the services of a
lawyer were hired.
6

In accordance with the terms of the Loan Agreement, respondent Este del Sol executed several documents
7
as
security for payment, among them, (a) a Real Estate Mortgage dated January 31, 1978 over two (2) parcels of land
being utilized as the site of its development project with an area of approximately One Million Twenty-Eight Thousand
and Twenty-Nine (1,028,029) square meters and particularly described in TCT Nos. N-24332 and N-24356 of the
Register of Deeds of Rizal, inclusive of all improvements, as well as all the machineries, equipment, furnishings and
furnitures existing thereon; and (b) individual Continuing Suretyship agreements by co-respondents Valentin S. Daez,
Jr., Manuel Q. Salientes, Ma. Rocio A. De Vega, Alexander G. Asuncion, Alberto M. Ladores, Vicente M. De Vera, Jr.
and Felipe B. Sese, all dated February 2, 1978, to guarantee the payment of all the obligations of respondent Este
del Sol up to the aggregate sum of Seven Million Five Hundred Thousand Pesos (P7,500,000.00) each.
8

Respondent Este del Sol also executed, as provided for by the Loan Agreement, an Underwriting Agreement on
January 31, 1978 whereby petitioner FMIC shall underwrite on a best-efforts basis the public offering of One Hundred
Twenty Thousand (120,000) common shares of respondent Este del Sol's capital stock for a one-time underwriting
fee of Two Hundred Thousand Pesos (P200,000.00). In addition to the underwriting fee, the Underwriting Agreement
provided that for supervising the public offering of the shares, respondent Este del Sol shall pay petitioner FMIC an
annual supervision fee of Two Hundred Thousand Pesos (P200,000.00) per annum for a period of four (4)
consecutive years. The Underwriting Agreement also stipulated for the payment by respondent Este del Sol to
petitioner FMIC a consultancy fee of Three Hundred Thirty-Two Thousand Five Hundred Pesos (P332,500.00) per
annum for a period of four (4) consecutive years. Simultaneous with the execution of and in accordance with the
terms of the Underwriting Agreement, a Consultancy Agreement was also executed on January 31, 1978 whereby
respondent Este del Sol engaged the services of petitioner FMIC for a fee as consultant to render general
consultancy services.
9

In three (3) letters all dated February 22, 1978 petitioner billed respondent Este del Sol for the amounts of [a] Two
Hundred Thousand Pesos (P200,000.00) as the underwriting fee of petitioner FMIC in connection with the public
offering of the common shares of stock of respondent Este del Sol; [b] One Million Three Hundred Thirty Thousand
Pesos (P1,330,000.00) as consultancy fee for a period of four (4) years; and [c] Two Hundred Thousand Pesos
(P200,000.00) as supervision fee for the year beginning February, 1978, in accordance to the Underwriting
Agreement.
10
The said amounts of fees were deemed paid by respondent Este del Sol to petitioner FMIC which
deducted the same from the first release of the loan.
Since respondent Este del Sol failed to meet the schedule of repayment in accordance with a revised Schedule of
Amortization, it appeared to have incurred a total obligation of Twelve Million Six Hundred Seventy-Nine Thousand
Six Hundred Thirty Pesos and Ninety-Eight Centavos (P12,679,630.98) per the petitioner's Statement of Account
dated June 23, 1980,
11
to wit:
STATEMENT OF ACCOUNT OF ESTE DEL SOL MOUNTAIN RESERVE, INC.
AS OF JUNE 23, 1980
PARTICULARS AMOUNT
Total amount due as of 11-22-78 per revised amortization schedule
dated 1-3-78 P7,999,631.42
Interest on P7,999,631.42 @ 16% p.a. from 11-22-78 to 2-22-79 (92
days) 327,096.04
Balance 8,326,727.46
One time penalty of 20% of the entire unpaid obligations under Section
6.02 (ii) of Loan Agreement 1,665,345.49
Past due interest under Section 6.02 (iii) of loan Agreement:
@ 19% p.a. from 2-22-79 to 11-30-79 (281 days)
@ 21% p.a. from 11-30-79 to 6-23-80 (206 days)
1,481,879.93
1,200,714.10
Other charges publication of extra judicial foreclosure of REM made
on 5-23-80 & 6-6-80 4,964.00
Total Amount Due and Collectible as of June 23, 1980 P12,679,630.98
Accordingly, petitioner FMIC caused the extrajudicial foreclosure of the real estate mortgage on June 23, 1980.
12
At
the public auction, petitioner FMIC was the highest bidder of the mortgaged properties for Nine Million Pesos
(P9,000,000.00). The total amount of Three Million One Hundred Eighty-Eight Thousand Six Hundred Thirty Pesos
and Seventy-Five Centavos (P3,188,630.75) was deducted therefrom, that is, for the publication fee for the
publication of the Sheriff's Notice of Sale, Four Thousand Nine Hundred Sixty-Four Pesos (P4,964.00); for Sheriff's
fees for conducting the foreclosure proceedings, Fifteen Thousand Pesos (P15,000.00); and for Attorney's fees,
Three Million One Hundred Sixty-Eight Thousand Six Hundred Sixty-Six Pesos and Seventy-Five Centavos
(P3,168,666.75). The remaining balance of Five Million Eight Hundred Eleven Thousand Three Hundred Sixty-Nine
Pesos and Twenty-Five Centavos (P5,811,369.25) was applied to interests and penalty charges and partly against
the principal, due as of June 23, 1980, thereby leaving a balance of Six Million Eight Hundred Sixty-Three Thousand
Two Hundred Ninety-Seven Pesos and Seventy-Three Centavos (P6,863,297.73) on the principal amount of the loan
as of June 23, 1980.
13

Failing to secure from the individual respondents, as sureties of the loan of respondent Este del Sol by virtue of their
continuing surety agreements, the payment of the alleged deficiency balance, despite individual demands sent to
each of them,
14
petitioner instituted on November 11, 1980 the instant collection suit
15
against the respondents to
collect the alleged deficiency balance of Six Million Eight Hundred Sixty-Three Thousand Two Hundred Ninety-Seven
Pesos and Seventy-Three Centavos (P6,863,297.73) plus interest thereon at twenty-one (21%) percent per annum
from June 24, 1980 until fully paid, and twenty-five (25%) percent thereof as and for attorney's fees and costs.
In their Answer, the respondents sought the dismissal of the case and set up several special and affirmative
defenses, foremost of which is that the Underwriting and Consultancy Agreements executed simultaneously with and
as integral parts of the Loan Agreement and which provided for the payment of Underwriting, Consultancy and
Supervision fees were in reality subterfuges resorted to by petitioner FMIC and imposed upon respondent Este del
Sol to camouflage the usurious interest being charged by petitioner FMIC.
16

The petitioner FMIC presented as its witnesses during the trial: Cesar Valenzuela, its former Senior Vice-President,
Felipe Neri, its Vice-President for Marketing, and Dennis Aragon, an Account Manager of its Account Management
Group, as well as documentary evidence. On the other hand, co-respondents Vicente M. De Vera, Jr. and Valentin S.
Daez, Jr., and Perfecto Doroja, former Senior Manager and Assistant Vice-President of FMIC, testified for the
respondents.
After the trial, the trial court rendered its decision in favor of petitioner FMIC, the dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered in favor of plaintiff and against defendants, ordering
defendants jointly and severally to pay to plaintiff the amount of P6,863,297.73 plus 21% interest per annum,
from June 24, 1980, until the entire amount is fully paid, plus the amount equivalent to 25% of the total
amount due, as attorney's fees, plus costs of suit.
Defendants' counterclaims are dismissed, for lack of merit.
Finding the decision of the trial court unacceptable, respondents interposed an appeal to the Court of Appeals. On
November 8, 1999, the appellate court reversed the challenged decision of the trial court. The appellate court found
and declared that the fees provided for in the Underwriting and Consultancy Agreements were mere subterfuges to
camouflage the excessively usurious interest charged by the petitioner FMIC on the loan of respondent Este del Sol;
and that the stipulated penalties, liquidated damages and attorney's fees were "excessive, iniquitous, unconscionable
and revolting to the conscience," and declared that in lieu thereof, the stipulated one time twenty (20%) percent
penalty on the amount due and ten (10%) percent of the amount due as attorney's fees would be reasonable and
suffice to compensate petitioner FMIC for those items. Thus, the appellate court dismissed the complaint as against
the individual respondents sureties and ordered petitioner FMIC to pay or reimburse respondent Este del Sol the
amount of Nine Hundred Seventy-One Thousand Pesos (P971,000.00) representing the difference between what is
due to the petitioner and what is due to respondent Este del Sol, based on the following computation:
17

A: DUE TO THE [PETITIONER]
Principal of Loan P7,382,500.00

Add: 20% one-time
Penalty
Attorney's fees
1,476,500.00
900,000.00 P9,759,000.00
Less: Proceeds of foreclosure Sale

9,000,000.00
Deficiency

P759,000.00
B. DUE TO [RESPONDENT ESTE DEL SOL]

Return of usurious interest in the form of:
Underwriting fee
Supervision fee
Consultancy fee
P 200,000.00
200,000.00
1,330,000.00

Total amount due Este

P1,730,000.00
The appellee is, therefore, obliged to return to the appellant Este del Sol the difference of P971,000.00 or
(P1,730,000.00 less P759,000.00).
Petitioner moved for reconsideration of the appellate court's adverse decision. However, this was denied in a
Resolution
18
dated February 9, 2000 of the appellate court.
Hence, the instant petition anchored on the following assigned errors:
19

THE APPELLATE COURT HAS DECIDED QUESTIONS OF SUBSTANCE IN A WAY NOT IN ACCORD WITH LAW
AND WITH APPLICABLE DECISIONS OF THIS HONORABLE COURT WHEN IT:
a] HELD THAT ALLEGEDLY THE UNDERWRITING AND CONSULTANCY AGREEMENTS SHOULD NOT
BE CONSIDERED SEPARATE AND DISTINCT FROM THE LOAN AGREEMENT, AND INSTEAD, THEY
SHOULD BE CONSIDERED AS A SINGLE CONTRACT.
b] HELD THAT THE UNDERWRITING AND CONSULTANCY AGREEMENTS ARE "MERE
SUBTERFUGES TO CAMOUFLAGE THE USURIOUS INTEREST CHARGED" BY THE PETITIONER.
c] REFUSED TO CONSIDER THE TESTIMONIES OF PETITIONER'S WITNESSES ON THE SERVICES
PERFORMED BY PETITIONER.
d] REFUSED TO CONSIDER THE FACT [i] THAT RESPONDENTS HAD WAIVED THEIR RIGHT TO
SEEK RECOVERY OF THE AMOUNTS THEY PAID TO PETITIONER, AND [ii] THAT RESPONDENTS
HAD ADMITTED THE VALIDITY OF THE UNDERWRITING AND CONSULTANCY AGREEMENTS.
e] MADE AN ERRONEOUS COMPUTATION ON SUPPOSEDLY "WHAT IS DUE TO EACH PARTY AFTER
THE FORECLOSURE SALE", AS SHOWN IN PP. 34-35 OF THE ASSAILED DECISION, EVEN
GRANTING JUST FOR THE SAKE OF ARGUMENT THAT THE APPELLATE COURT WAS CORRECT IN
STIGMATIZING [i] THE PROVISIONS OF THE LOAN AGREEMENT THAT REFER TO STIPULATED
PENALTIES, LIQUIDATED DAMAGES AND ATTORNEY'S FEES AS SUPPOSEDLY "EXCESSIVE,
INIQUITOUS AND UNCONSCIONABLE AND REVOLTING TO THE CONSCIENCE" AND [ii] THE
UNDERWRITING, SUPERVISION AND CONSULTANCY SERVICES AGREEMENT AS SUPPOSEDLY
"MERE SUBTERFUGES TO CAMOUFLAGE THE USURIOUS INTEREST CHARGED" UPON THE
RESPONDENT ESTE BY PETITIONER.
f] REFUSED TO CONSIDER THE FACT THAT RESPONDENT ESTE, AND THUS THE INDIVIDUAL
RESPONDENTS, ARE STILL OBLIGATED TO THE PETITIONER.
Petitioner essentially assails the factual findings and conclusion of the appellate court that the Underwriting and
Consultancy Agreements were executed to conceal a usurious loan. Inquiry upon the veracity of the appellate court's
factual findings and conclusion is not the function of this Court for the Supreme Court is not a trier of facts. Only when
the factual findings of the trial court and the appellate court are opposed to each other does this Court exercise its
discretion to re-examine the factual findings of both courts and weigh which, after considering the record of the case,
is more in accord with law and justice.
After a careful and thorough review of the record including the evidence adduced, we find no reason to depart from
the findings of the appellate court.
First, there is no merit to petitioner FMIC's contention that Central Bank Circular No. 905 which took effect on January
1, 1983 and removed the ceiling on interest rates for secured and unsecured loans, regardless of maturity, should be
applied retroactively to a contract executed on January 31, 1978, as in the case at bar, that is, while the Usury Law
was in full force and effect. It is an elementary rule of contracts that the laws, in force at the time the contract was
made and entered into, govern it.
20
More significantly, Central Bank Circular No. 905 did not repeal nor in any way
amend the Usury Law but simply suspended the latter's effectivity.
21
The illegality of usury is wholly the creature of
legislation. A Central Bank Circular cannot repeal a law. Only a law can repeal another law.
22
Thus, retroactive
application of a Central Bank Circular cannot, and should not, be presumed.
23

Second, when a contract between two (2) parties is evidenced by a written instrument, such document is ordinarily
the best evidence of the terms of the contract. Courts only need to rely on the face of written contracts to determine
the intention of the parties. However, this rule is not without exception.
24
The form of the contract is not conclusive for
the law will not permit a usurious loan to hide itself behind a legal form. Parol evidence is admissible to show that a
written document though legal in form was in fact a device to cover usury. If from a construction of the whole
transaction it becomes apparent that there exists a corrupt intention to violate the Usury Law, the courts should and
will permit no scheme, however ingenious, to becloud the crime of usury.
25

In the instant case, several facts and circumstances taken altogether show that the Underwriting and Consultancy
Agreements were simply cloaks or devices to cover an illegal scheme employed by petitioner FMIC to conceal and
collect excessively usurious interest, and these are:
a) The Underwriting and Consultancy Agreements are both dated January 31, 1978 which is the same date of the
Loan Agreement.
26
Furthermore, under the Underwriting Agreement payment of the supervision and consultancy fees
was set for a period of four (4) years
27
to coincide ultimately with the term of the Loan Agreement.
28
This fact means
that all the said agreements which were executed simultaneously were set to mature or shall remain effective during
the same period of time.
b) The Loan Agreement dated January 31, 1978 stipulated for the execution and delivery of an underwriting
agreement
29
and specifically mentioned that such underwriting agreement is a condition precedent
30
for petitioner
FMIC to extend the loan to respondent Este del Sol, indicating and as admitted by petitioner FMIC's employees,
31
that
such Underwriting Agreement is "part and parcel of the Loan Agreement."
32

c) Respondent Este del Sol was billed by petitioner on February 28, 1978 One Million Three Hundred Thirty
Thousand Pesos (P1,330,000.00)
33
as consultancy fee despite the clear provision in the Consultancy Agreement that
the said agreement is for Three Hundred Thirty-Two Thousand Five Hundred Pesos (P332,500.00) per annum for
four (4) years and that only the first year consultancy fee shall be due upon signing of the said consultancy
agreement.
34

d) The Underwriting, Supervision and Consultancy fees in the amounts of Two Hundred Thousand Pesos
(P200,000.00), and one Million Three Hundred Thirty Thousand Pesos (P1,330,000.00), respectively, were billed by
petitioner to respondent Este del Sol on February 22, 1978,
35
that is, on the same occasion of the first partial release
of the loan in the amount of Two Million Three Hundred Eighty-Two Thousand Five Hundred Pesos
(P2,382,500.00).
36
It is from this first partial release of the loan that the said corresponding bills for Underwriting,
Supervision and Constantly fees were conducted and apparently paid, thus, reverting back to petitioner FMIC the
total amount of One Million Seven Hundred Thirty Thousand Pesos (P1,730,000.00) as part of the amount loaned to
respondent Este del Sol.
37

e) Petitioner FMIC was in fact unable to organize an underwriting/selling syndicate to sell any share of stock of
respondent Este del Sol and much less to supervise such a syndicate, thus failing to comply with its obligation under
the Underwriting Agreement.
38
Besides, there was really no need for an Underwriting Agreement since respondent
Este del Sol had its own licensed marketing arm to sell its shares and all its shares have been sold through its
marketing arm.
39

f) Petitioner FMIC failed to comply with its obligation under the Consultancy Agreement,
40
aside from the fact that
there was no need for a Consultancy Agreement, since respondent Este del Sol's officers appeared to be more
competent to be consultants in the development of the projected sports/resort complex.
41

All the foregoing established facts and circumstances clearly belie the contention of petitioner FMIC that the Loan,
Underwriting and Consultancy Agreements are separate and independent transactions. The Underwriting and
Consultancy Agreements which were executed and delivered contemporaneously with the Loan Agreement on
January 31, 1978 were exacted by petitioner FMIC as essential conditions for the grant of the loan. An apparently
lawful loan is usurious when it is intended that additional compensation for the loan be disguised by an ostensibly
unrelated contract providing for payment by the borrower for the lender's services which are of little value or which
are not in fact to be rendered, such as in the instant case.
42
In this connection, Article 1957 of the New Civil Code
clearly provides that:
Art. 1957. Contracts and stipulations, under any cloak or device whatever, intended to circumvent the laws
against usury shall be void. The borrower may recover in accordance with the laws on usury.
In usurious loans, the entire obligation does not become void because of an agreement for usurious interest; the
unpaid principal debt still stands and remains valid but the stipulation as to the usurious interest is void, consequently,
the debt is to be considered without stipulation as to the interest.
43
The reason for this rule was adequately explained
in the case of Angel Jose Warehousing Co., Inc. v. Chelda Enterprises
44
where this Court held:
In simple loan with stipulation of usurious interest, the prestation of the debtor to pay the principal debt,
which is the cause of the contract (Article 1350, Civil Code), is not illegal. The illegality lies only as to the
prestation to pay the stipulated interest; hence, being separable, the latter only should be deemed void,
since it is the only one that is illegal.
Thus, the nullity of the stipulation on the usurious interest does not affect the lender's right to receive back the
principal amount of the loan. With respect to the debtor, the amount paid as interest under a usurious agreement is
recoverable by him, since the payment is deemed to have been made under restraint, rather than voluntarily.
45

This Court agrees with the factual findings and conclusion of the appellate court, to wit:
We find the stipulated penalties, liquidated damages and attorney's fees, excessive, iniquitous and
unconscionable and revolting to the conscience as they hardly allow the borrower any chance of survival in
case of default. And true enough, ESTE folded up when the appellee extrajudicially foreclosed on its
(ESTE's) development project and literally closed its offices as both the appellee and ESTE were at the time
holding office in the same building. Accordingly, we hold that 20% penalty on the amount due and 10% of
the proceeds of the foreclosure sale as attorney's fees would suffice to compensate the appellee, especially
so because there is no clear showing that the appellee hired the services of counsel to effect the
foreclosure, it engaged counsel only when it was seeking the recovery of the alleged deficiency.
Attorney's fees as provided in penal clauses are in the nature of liquidated damages. So long as such stipulation
does not contravene any law, morals, or public order, it is binding upon the parties. Nonetheless, courts are
empowered to reduce the amount of attorney's fees if the same is "iniquitous or unconscionable."
46
Articles 1229 and
2227 of the New Civil Code provide that:
Art. 1229. The judge shall equitably reduce the penalty when the principal obligation has been partly or
irregularly complied with by the debtor. Even if there has been no performance, the penalty may also be
reduced by the courts if it is iniquitous or unconscionable.
Art. 2227. Liquidated damages, whether intended as an indemnity or a penalty, shall be equitably reduced if
they are iniquitous or unconscionable.
In the case at bar, the amount of Three Million One Hundred Eighty-Eight Thousand Six Hundred Thirty Pesos and
Seventy-Five Centavos (93,188,630.75) for the stipulated attorney's fees equivalent to twenty-five (25%) percent of
the alleged amount due, as of the date of the auction sale on June 23, 1980, is manifestly exorbitant and
unconscionable. Accordingly, we agree with the appellate court that a reduction of the attorney's fees to ten (10%)
percent is appropriate and reasonable under the facts and circumstances of this case.
Lastly, there is no merit to petitioner FMIC's contention that the appellate court erred in awarding an amount allegedly
not asked nor prayed for by respondents. Whether the exact amount of the relief was not expressly prayed for is of no
moment for the reason that the relief was plainly warranted by the allegations of the respondents as well as by the
facts as found by the appellate court. A party is entitled to as much relief as the facts may warrant
47

In view of all the foregoing, the Court is convinced that the appellate court committed no reversible error in its
challenged Decision.
WHEREFORE, the instant petition is hereby DENIED, and the assailed Decision of the Court of Appeals is
AFFIRMED. Costs against petitioner.
SO ORDERED.
Bellosillo, Mendoza, Quisumbing, and Buena, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. Nos. 160054-55 July 21, 2004
MANOLO P. SAMSON, petitioner,
vs.
HON. REYNALDO B. DAWAY, in his capacity as Presiding Judge, Regional Trial Court of Quezon City,
Branch 90, PEOPLE OF THE PHILIPPINES and CATERPILLAR, INC., respondents.


D E C I S I O N


YNARES-SANTIAGO, J .:
Assailed in this petition for certiorari is the March 26, 2003 Order
1
of the Regional Trial Court of Quezon City, Branch
90, which denied petitioners (1) motion to quash the information; and (2) motion for reconsideration of the August
9, 2002 Order denying his motion to suspend the arraignment and other proceedings in Criminal Case Nos. Q-02-
108043-44. Petitioner also questioned its August 5, 2003 Order
2
which denied his motion for reconsideration.
The undisputed facts show that on March 7, 2002, two informations for unfair competition under Section 168.3 (a), in
relation to Section 170, of the Intellectual Property Code (Republic Act No. 8293), similarly worded save for the dates
and places of commission, were filed against petitioner Manolo P. Samson, the registered owner of ITTI Shoes. The
accusatory portion of said informations read:
That on or about the first week of November 1999 and sometime prior or subsequent thereto, in Quezon
City, Philippines, and within the jurisdiction of this Honorable Court, above-named accused, owner/proprietor
of ITTI Shoes/Mano Shoes Manufactuirng Corporation located at Robinsons Galleria, EDSA corner Ortigas
Avenue, Quezon City, did then and there willfully, unlawfully and feloniously distribute, sell and/or offer for
sale CATERPILLAR products such as footwear, garments, clothing, bags, accessories and paraphernalia
which are closely identical to and/or colorable imitations of the authentic Caterpillar products and likewise
using trademarks, symbols and/or designs as would cause confusion, mistake or deception on the part of
the buying public to the damage and prejudice of CATERPILLAR, INC., the prior adopter, user and owner of
the following internationally: "CATERPILLAR", "CAT", "CATERPILLAR & DESIGN", "CAT AND DESIGN",
"WALKING MACHINES" and "TRACK-TYPE TRACTOR & DESIGN."
CONTRARY TO LAW.
3

On April 19, 2002, petitioner filed a motion to suspend arraignment and other proceedings in view of the existence of
an alleged prejudicial question involved in Civil Case No. Q-00-41446 for unfair competition pending with the same
branch; and also in view of the pendency of a petition for review filed with the Secretary of Justice assailing the Chief
State Prosecutors resolution finding probable cause to charge petitioner with unfair competition. In an Order dated
August 9, 2002, the trial court denied the motion to suspend arraignment and other proceedings.
On August 20, 2002, petitioner filed a twin motion to quash the informations and motion for reconsideration of the
order denying motion to suspend, this time challenging the jurisdiction of the trial court over the offense charged. He
contended that since under Section 170 of R.A. No. 8293, the penalty4 of imprisonment for unfair competition does
not exceed six years, the offense is cognizable by the Municipal Trial Courts and not by the Regional Trial Court, per
R.A. No. 7691.
In its assailed March 26, 2003 Order, the trial court denied petitioners twin motions.6 A motion for reconsideration
thereof was likewise denied on August 5, 2003.
Hence, the instant petition alleging that respondent Judge gravely abused its discretion in issuing the assailed orders.
The issues posed for resolution are (1) Which court has jurisdiction over criminal and civil cases for violation of
intellectual property rights? (2) Did the respondent Judge gravely abuse his discretion in refusing to suspend the
arraignment and other proceedings in Criminal Case Nos. Q-02-108043-44 on the ground of (a) the existence of a
prejudicial question; and (b) the pendency of a petition for review with the Secretary of Justice on the finding of
probable cause for unfair competition?
Under Section 170 of R.A. No. 8293, which took effect on January 1, 1998, the criminal penalty for infringement of
registered marks, unfair competition, false designation of origin and false description or representation, is
imprisonment from 2 to 5 years and a fine ranging from Fifty Thousand Pesos to Two Hundred Thousand Pesos, to
wit:
SEC. 170. Penalties. Independent of the civil and administrative sanctions imposed by law, a criminal
penalty of imprisonment from two (2) years to five (5) years and a fine ranging from Fifty thousand pesos
(P50,000.00) to Two hundred thousand pesos (P200,000.00), shall be imposed on any person who is found
guilty of committing any of the acts mentioned in Section 155 [Infringement], Section 168 [Unfair
Competition] and Section 169.1 [False Designation of Origin and False Description or Representation].
Corollarily, Section 163 of the same Code states that actions (including criminal and civil) under Sections 150, 155,
164, 166, 167, 168 and 169 shall be brought before the proper courts with appropriate jurisdiction under existing
laws, thus
SEC. 163. Jurisdiction of Court. All actions under Sections 150, 155, 164 and 166 to 169 shall be brought
before the proper courts with appropriate jurisdiction under existing laws. (Emphasis supplied)
The existing law referred to in the foregoing provision is Section 27 of R.A. No. 166 (The Trademark Law) which
provides that jurisdiction over cases for infringement of registered marks, unfair competition, false designation of
origin and false description or representation, is lodged with the Court of First Instance (now Regional Trial Court)
SEC. 27. Jurisdiction of Court of First Instance. All actions under this Chapter [V Infringement] and
Chapters VI [Unfair Competition] and VII [False Designation of Origin and False Description or
Representation], hereof shall be brought before the Court of First Instance.
We find no merit in the claim of petitioner that R.A. No. 166 was expressly repealed by R.A. No. 8293. The repealing
clause of R.A. No. 8293, reads
SEC. 239. Repeals. 239.1. All Acts and parts of Acts inconsistent herewith, more particularly Republic
Act No. 165, as amended; Republic Act No. 166, as amended; and Articles 188 and 189 of the Revised
Penal Code; Presidential Decree No. 49, including Presidential Decree No. 285, as amended, are hereby
repealed. (Emphasis added)
Notably, the aforequoted clause did not expressly repeal R.A. No. 166 in its entirety, otherwise, it would not have
used the phrases "parts of Acts" and "inconsistent herewith;" and it would have simply stated "Republic Act No. 165,
as amended; Republic Act No. 166, as amended; and Articles 188 and 189 of the Revised Penal Code; Presidential
Decree No. 49, including Presidential Decree No. 285, as amended are hereby repealed." It would have removed all
doubts that said specific laws had been rendered without force and effect. The use of the phrases "parts of Acts" and
"inconsistent herewith" only means that the repeal pertains only to provisions which are repugnant or not susceptible
of harmonization with R.A. No. 8293.6 Section 27 of R.A. No. 166, however, is consistent and in harmony with
Section 163 of R.A. No. 8293. Had R.A. No. 8293 intended to vest jurisdiction over violations of intellectual property
rights with the Metropolitan Trial Courts, it would have expressly stated so under Section 163 thereof.
Moreover, the settled rule in statutory construction is that in case of conflict between a general law and a special law,
the latter must prevail. Jurisdiction conferred by a special law to Regional Trial Courts must prevail over that granted
by a general law to Municipal Trial Courts.7
In the case at bar, R.A. No. 8293 and R.A. No. 166 are special laws8 conferring jurisdiction over violations of
intellectual property rights to the Regional Trial Court. They should therefore prevail over R.A. No. 7691, which is a
general law.9 Hence, jurisdiction over the instant criminal case for unfair competition is properly lodged with the
Regional Trial Court even if the penalty therefor is imprisonment of less than 6 years, or from 2 to 5 years and a fine
ranging from P50,000.00 to P200,000.00.
In fact, to implement and ensure the speedy disposition of cases involving violations of intellectual property rights
under R.A. No. 8293, the Court issued A.M. No. 02-1-11-SC dated February 19, 2002 designating certain Regional
Trial Courts as Intellectual Property Courts. On June 17, 2003, the Court further issued a Resolution consolidating
jurisdiction to hear and decide Intellectual Property Code and Securities and Exchange Commission cases in specific
Regional Trial Courts designated as Special Commercial Courts.
The case of Mirpuri v. Court of Appeals,10 invoked by petitioner finds no application in the present case. Nowhere
in Mirpuri did we state that Section 27 of R.A. No. 166 was repealed by R.A. No. 8293. Neither did we make a
categorical ruling therein that jurisdiction over cases for violation of intellectual property rights is lodged with the
Municipal Trial Courts. The passing remark in Mirpuri on the repeal of R.A. No. 166 by R.A. No. 8293 was merely a
backgrounder to the enactment of the present Intellectual Property Code and cannot thus be construed as a
jurisdictional pronouncement in cases for violation of intellectual property rights.
Anent the second issue, petitioner failed to substantiate his claim that there was a prejudicial question. In his petition,
he prayed for the reversal of the March 26, 2003 order which sustained the denial of his motion to suspend
arraignment and other proceedings in Criminal Case Nos. Q-02-108043-44. For unknown reasons, however, he
made no discussion in support of said prayer in his petition and reply to comment. Neither did he attach a copy of the
complaint in Civil Case No. Q-00-41446 nor quote the pertinent portion thereof to prove the existence of a prejudicial
question.
At any rate, there is no prejudicial question if the civil and the criminal action can, according to law, proceed
independently of each other.11 Under Rule 111, Section 3 of the Revised Rules on Criminal Procedure, in the cases
provided in Articles 32, 33, 34 and 2176 of the Civil Code, the independent civil action may be brought by the
offended party. It shall proceed independently of the criminal action and shall require only a preponderance of
evidence.
In the case at bar, the common element in the acts constituting unfair competition under Section 168 of R.A. No.
8293 is fraud.12 Pursuant to Article 33 of the Civil Code, in cases of defamation, fraud, and physical injuries, a civil
action for damages, entirely separate and distinct from the criminal action, may be brought by the injured party.
Hence, Civil Case No. Q-00-41446, which as admitted13 by private respondent also relate to unfair competition, is an
independent civil action under Article 33 of the Civil Code. As such, it will not operate as a prejudicial question that
will justify the suspension of the criminal cases at bar.
Section 11 (c), Rule 116 of the Revised Rules on Criminal Procedure provides
SEC. 11. Suspension of arraignment. Upon motion by the proper party, the arraignment shall be
suspended in the following cases
x x x x x x x x x
(c) A petition for review of the resolution of the prosecutor is pending at either the Department of Justice, or
the Office of the President; Provided, that the period of suspension shall not exceed sixty (60) days counted
from the filing of the petition with the reviewing office.
While the pendency of a petition for review is a ground for suspension of the arraignment, the aforecited provision
limits the deferment of the arraignment to a period of 60 days reckoned from the filing of the petition with the
reviewing office. It follows, therefore, that after the expiration of said period, the trial court is bound to arraign the
accused or to deny the motion to defer arraignment.
In the instant case, petitioner failed to establish that respondent Judge abused his discretion in denying his motion to
suspend. His pleadings and annexes submitted before the Court do not show the date of filing of the petition for
review with the Secretary of Justice.14 Moreover, the Order dated August 9, 2002 denying his motion to suspend was
not appended to the petition. He thus failed to discharge the burden of proving that he was entitled to a suspension of
his arraignment and that the questioned orders are contrary to Section 11 (c), Rule 116 of the Revised Rules on
Criminal Procedure. Indeed, the age-old but familiar rule is that he who alleges must prove his allegations.
In sum, the dismissal of the petition is proper considering that petitioner has not established that the trial court
committed grave abuse of discretion. So also, his failure to attach documents relevant to his allegations warrants the
dismissal of the petition, pursuant to Section 3, Rule 46 of the Rules of Civil Procedure, which states:
SEC. 3. Contents and filing of petition; effect of non-compliance with requirements. The petition
shall contain the full names and actual addresses of all the petitioners and respondents, a concise statement
of the matters involved, the factual background of the case, and the grounds relied upon for the relief prayed
for.
It shall be filed in seven (7) clearly legible copies together with proof of service thereof on the respondent
with the original copy intended for the court indicated as such by the petitioner, and shall be accompanied
by a clearly legible duplicate original or certified true copy of the judgment, order, resolution, or
ruling subject thereof, such material portions of the record as are referred to therein, and other
documents relevant or pertinent thereto.
x x x x x x x x x
The failure of the petitioner to comply with any of the foregoing requirements shall be sufficient
ground for the dismissal of the petition. (Emphasis added)
WHEREFORE, in view of all the foregoing, the petition is dismissed.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Quisumbing, Carpio, and Azcuna, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 162155 August 28, 2007
COMMISSIONER OF INTERNAL REVENUE and ARTURO V. PARCERO in his official capacity as Revenue
District Officer of Revenue District No. 049 (Makati), Petitioners,
vs.
PRIMETOWN PROPERTY GROUP, INC., Respondent.
D E C I S I O N
CORONA, J .:
This petition for review on certiorari
1
seeks to set aside the August 1, 2003 decision
2
of the Court of Appeals (CA) in
CA-G.R. SP No. 64782 and its February 9, 2004 resolution denying reconsideration.
3

On March 11, 1999, Gilbert Yap, vice chair of respondent Primetown Property Group, Inc., applied for the refund or
credit of income tax respondent paid in 1997. In Yap's letter to petitioner revenue district officer Arturo V. Parcero of
Revenue District No. 049 (Makati) of the Bureau of Internal Revenue (BIR),
4
he explained that the increase in the
cost of labor and materials and difficulty in obtaining financing for projects and collecting receivables caused the real
estate industry to slowdown.
5
As a consequence, while business was good during the first quarter of 1997,
respondent suffered losses amounting to P71,879,228 that year.
6

According to Yap, because respondent suffered losses, it was not liable for income taxes.
7
Nevertheless, respondent
paid its quarterly corporate income tax and remitted creditable withholding tax from real estate sales to the BIR in the
total amount of P26,318,398.32.
8
Therefore, respondent was entitled to tax refund or tax credit.
9

On May 13, 1999, revenue officer Elizabeth Y. Santos required respondent to submit additional documents to support
its claim.
10
Respondent complied but its claim was not acted upon. Thus, on April 14, 2000, it filed a petition for
review
11
in the Court of Tax Appeals (CTA).
On December 15, 2000, the CTA dismissed the petition as it was filed beyond the two-year prescriptive period for
filing a judicial claim for tax refund or tax credit.
12
It invoked Section 229 of the National Internal Revenue Code
(NIRC):
Sec. 229. Recovery of Taxes Erroneously or Illegally Collected. -- No suit or proceeding shall be maintained in any
court for the recovery of any national internal revenue tax hereafter alleged to have been erroneously or illegally
assessed or collected, or of any penalty claimed to have been collected without authority, or of any sum alleged to
have been excessively or in any manner wrongfully collected, until a claim for refund or credit has been duly filed with
the Commissioner; but such suit or proceeding may be maintained, whether or not such tax, penalty, or sum has
been paid under protest or duress.
In any case, no such suit or proceeding shall be filed after the expiration of two (2) years from the date of
payment of the tax or penalty regardless of any supervening cause that may arise after payment:Provided,
however, That the Commissioner may, even without a claim therefor, refund or credit any tax, where on the face of
the return upon which payment was made, such payment appears clearly to have been erroneously paid. (emphasis
supplied)
The CTA found that respondent filed its final adjusted return on April 14, 1998. Thus, its right to claim a refund or
credit commenced on that date.
13

The tax court applied Article 13 of the Civil Code which states:
Art. 13. When the law speaks of years, months, days or nights, it shall be understood that years are of three
hundred sixty-five days each; months, of thirty days; days, of twenty-four hours, and nights from sunset to sunrise.
If the months are designated by their name, they shall be computed by the number of days which they respectively
have.
In computing a period, the first day shall be excluded, and the last included. (emphasis supplied)
Thus, according to the CTA, the two-year prescriptive period under Section 229 of the NIRC for the filing of judicial
claims was equivalent to 730 days. Because the year 2000 was a leap year, respondent's petition, which was filed
731 days
14
after respondent filed its final adjusted return, was filed beyond the reglementary period.
15

Respondent moved for reconsideration but it was denied.
16
Hence, it filed an appeal in the CA.
17

On August 1, 2003, the CA reversed and set aside the decision of the CTA.
18
It ruled that Article 13 of the Civil Code
did not distinguish between a regular year and a leap year. According to the CA:
The rule that a year has 365 days applies, notwithstanding the fact that a particular year is a leap year.
19

In other words, even if the year 2000 was a leap year, the periods covered by April 15, 1998 to April 14, 1999 and
April 15, 1999 to April 14, 2000 should still be counted as 365 days each or a total of 730 days. A statute which is
clear and explicit shall be neither interpreted nor construed.
20

Petitioners moved for reconsideration but it was denied.
21
Thus, this appeal.
Petitioners contend that tax refunds, being in the nature of an exemption, should be strictly construed against
claimants.
22
Section 229 of the NIRC should be strictly applied against respondent inasmuch as it has been
consistently held that the prescriptive period (for the filing of tax refunds and tax credits) begins to run on the day
claimants file their final adjusted returns.
23
Hence, the claim should have been filed on or before April 13, 2000 or
within 730 days, reckoned from the time respondent filed its final adjusted return.
The conclusion of the CA that respondent filed its petition for review in the CTA within the two-year prescriptive period
provided in Section 229 of the NIRC is correct. Its basis, however, is not.
The rule is that the two-year prescriptive period is reckoned from the filing of the final adjusted return.
24
But how
should the two-year prescriptive period be computed?
As already quoted, Article 13 of the Civil Code provides that when the law speaks of a year, it is understood to be
equivalent to 365 days. In National Marketing Corporation v. Tecson,
25
we ruled that a year is equivalent to 365 days
regardless of whether it is a regular year or a leap year.
26

However, in 1987, EO
27
292 or the Administrative Code of 1987 was enacted. Section 31, Chapter VIII, Book I thereof
provides:
Sec. 31. Legal Periods. "Year" shall be understood to be twelve calendar months; "month" of thirty days,
unless it refers to a specific calendar month in which case it shall be computed according to the number of days the
specific month contains; "day", to a day of twenty-four hours and; "night" from sunrise to sunset. (emphasis supplied)
A calendar month is "a month designated in the calendar without regard to the number of days it may contain."
28
It is
the "period of time running from the beginning of a certain numbered day up to, but not including, the corresponding
numbered day of the next month, and if there is not a sufficient number of days in the next month, then up to and
including the last day of that month."
29
To illustrate, one calendar month from December 31, 2007 will be from
January 1, 2008 to January 31, 2008; one calendar month from January 31, 2008 will be from February 1, 2008 until
February 29, 2008.
30

A law may be repealed expressly (by a categorical declaration that the law is revoked and abrogated by another) or
impliedly (when the provisions of a more recent law cannot be reasonably reconciled with the previous one).
31
Section
27, Book VII (Final Provisions) of the Administrative Code of 1987 states:
Sec. 27. Repealing clause. All laws, decrees, orders, rules and regulation, or portions thereof, inconsistent with
this Code are hereby repealed or modified accordingly.
A repealing clause like Sec. 27 above is not an express repealing clause because it fails to identify or designate the
laws to be abolished.
32
Thus, the provision above only impliedly repealed all laws inconsistent with the Administrative
Code of 1987.1avvphi1
Implied repeals, however, are not favored. An implied repeal must have been clearly and unmistakably intended by
the legislature. The test is whether the subsequent law encompasses entirely the subject matter of the former law and
they cannot be logically or reasonably reconciled.
33

Both Article 13 of the Civil Code and Section 31, Chapter VIII, Book I of the Administrative Code of 1987 deal with the
same subject matter the computation of legal periods. Under the Civil Code, a year is equivalent to 365 days
whether it be a regular year or a leap year. Under the Administrative Code of 1987, however, a year is composed of
12 calendar months. Needless to state, under the Administrative Code of 1987, the number of days is irrelevant.
There obviously exists a manifest incompatibility in the manner of computing legal periods under the Civil Code and
the Administrative Code of 1987. For this reason, we hold that Section 31, Chapter VIII, Book I of the Administrative
Code of 1987, being the more recent law, governs the computation of legal periods. Lex posteriori derogat priori.
Applying Section 31, Chapter VIII, Book I of the Administrative Code of 1987 to this case, the two-year prescriptive
period (reckoned from the time respondent filed its final adjusted return
34
on April 14, 1998) consisted of 24 calendar
months, computed as follows:
Year 1 1st calendar month April 15, 1998 to May 14, 1998
2nd calendar month May 15, 1998 to June 14, 1998
3rd calendar month June 15, 1998 to July 14, 1998
4th calendar month July 15, 1998 to August 14, 1998
5th calendar month August 15, 1998 to September 14, 1998
6th calendar month September 15, 1998 to October 14, 1998
7th calendar month October 15, 1998 to November 14, 1998
8th calendar month November 15, 1998 to December 14, 1998
9th calendar month December 15, 1998 to January 14, 1999
10th calendar month January 15, 1999 to February 14, 1999
11th calendar month February 15, 1999 to March 14, 1999
12th calendar month March 15, 1999 to April 14, 1999
Year 2 13th calendar month April 15, 1999 to May 14, 1999
14th calendar month May 15, 1999 to June 14, 1999
15th calendar month June 15, 1999 to July 14, 1999
16th calendar month July 15, 1999 to August 14, 1999
17th calendar month August 15, 1999 to September 14, 1999
18th calendar month September 15, 1999 to October 14, 1999
19th calendar month October 15, 1999 to November 14, 1999
20th calendar month November 15, 1999 to December 14, 1999
21st calendar month December 15, 1999 to January 14, 2000
22nd calendar month January 15, 2000 to February 14, 2000
23rd calendar month February 15, 2000 to March 14, 2000
24th calendar month March 15, 2000 to April 14, 2000
We therefore hold that respondent's petition (filed on April 14, 2000) was filed on the last day of the 24th calendar
month from the day respondent filed its final adjusted return. Hence, it was filed within the reglementary period.
Accordingly, the petition is hereby DENIED. The case is REMANDED to the Court of Tax Appeals which is ordered to
expeditiously proceed to hear C.T.A. Case No. 6113 entitled Primetown Property Group, Inc. v. Commissioner of
Internal Revenue and Arturo V. Parcero.
No costs.
SO ORDERED.
RENATO C. CORONA
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
Chairperson
ANGELINA SANDOVAL-GUTIERREZ
Associate Justice
ADOLFO S. AZCUNA
Associate Justice
CANCIO C. GARCIA
Associate Justice
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above decision had been
reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.
REYNATO S. PUNO
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
A.M. No. P-95-1167 February 9, 2010
CARMELITA LLEDO, Complainant,
vs.
ATTY. CESAR V. LLEDO, Branch Clerk of Court, Regional Trial Court, Branch 94, Quezon City,Respondent.
R E S O L U T I O N
NACHURA, J .:
May a government employee, dismissed from the service for cause, be allowed to recover the personal contributions
he paid to the Government Service Insurance System (GSIS)?
This is the question that confronts this Court in the instant case, the factual antecedents of which are as follows:
On December 21, 1998, this Court promulgated a Decision
1
in the above-captioned case, dismissing from the service
Atty. Cesar V. Lledo, former branch clerk of court of the Regional Trial Court of Quezon City, Branch 94. Cesars wife,
Carmelita, had filed an administrative case against him, charging the latter with immorality, abandonment, and
conduct unbecoming a public official.
During the investigation, it was established that Cesar had left his family to live with another woman with whom he
also begot children. He failed to provide support for his family. The investigating judge recommended Cesars
dismissal from the service. The Office of the Court Administrator (OCA) adopted the recommendation.
The Court, in its December 21, 1998 Decision, disposed of the case in this wise:
WHEREFORE, Cesar V. Lledo, branch clerk of court of RTC, Branch 94, Quezon City, is hereby DISMISSED from
the service, with forfeiture of all retirement benefits and leave credits and with prejudice to reemployment in any
branch or instrumentality of the government, including any government-owned or controlled corporation. This case is
REFERRED to the IBP Board of Governors pursuant to Section 1 of Rule 139-B of the Rules of Court.
SO ORDERED.
2

In a letter
3
dated January 15, 1999, Carmelita and her children wrote to then Chief Justice Hilario G. Davide, Jr.,
begging for humane consideration and asking that part of the money due Cesar be applied to the payment of the
arrearages of their amortized house and lot then facing foreclosure by the GSIS. They averred that Cesars
abandonment had been painful enough; and to lose their home of 26 years would be even more painful and traumatic
for the children.
The Court directed the OCA to comment. The OCA recommended that the Courts December 21, 1998 Decision be
reconsidered insofar as the forfeiture of Cesars leave credits was concerned, underscoring, however, that said
benefits would only be released to Carmelita and her children.
4

In a Resolution dated August 3, 1999,
5
the Court resolved to deny the motion for reconsideration for lack of merit.
On April 3, 2006, Cesar L. Lledo, Jr., Cesars son, wrote a letter
6
to then Chief Justice Artemio V. Panganiban. He
related that his father had been bedridden after suffering a severe stroke and acute renal failure. He had been
abandoned by his mistress and had been under Cesar Jr.s care since 2001. The latter appealed to the Court to
reconsider its December 21, 1998 Decision, specifically the forfeiture of leave credits, which money would be used to
pay for his fathers medical expenses. Cesar Jr. asked the Court for retroactive application of the Courts ruling
subsequent to his fathers dismissal, wherein the Court ruled that despite being dismissed from the service,
government employees are entitled to the monetary equivalent of their leave credits since these were earned prior to
dismissal.
Treating the letter as a motion for reconsideration, the Court, on May 3, 2006, granted the same, specifically on the
forfeiture of accrued leave credits.
7

Cesar Jr. wrote the Court again on November 27, 2006, expressing his gratitude for the Courts consideration of his
request for his fathers leave credits. He again asked for judicial clemency in connection with his fathers claim for
refund of the latters personal contributions to GSIS.
8

The Court directed the GSIS to comment, within 10 days from notice, on Cesar Jr.s letter.
9
For failing to file the
required Comment, the Court, in a Resolution dated December 11, 2007,
10
required the GSIS to show cause why it
should not be held in contempt for failure to comply with the Resolution directing it to file its Comment. The Court
reiterated its December 11, 2007 Resolution on June 17, 2008, and directed compliance.
In a letter
11
dated April 16, 2009, Jason C. Teng, Regional Manager of the GSIS Quezon City Regional Office,
explained that a request for a refund of retirement premiums is disallowed. He explained:
The rate of contribution for both government and personal shares of retirement premiums was actuarially computed
to allow the GSIS to generate enough investment returns to be able to pay off future claims. During actuarial
computation, the expected demographics considered the percentages of different types of future claims (and non-
claims). As such, if those that were expected to have no future claim (e.g. those with forfeited retirement benefits)
were suddenly allowed to receive claims for payment of benefits, this would have a negative impact on the financial
viability of the GSIS.1avvphi1
Even as the Court noted the letter in its June 30, 2009 Resolution,
12
it further required the Board of Directors of the
GSIS (GSIS Board) to file a separate Comment within 10 days from notice.
In its Comment,
13
the GSIS Board said that Cesar is not entitled to the refund of his personal contributions of the
retirement premiums because "it is the policy of the GSIS that an employee/member who had been dismissed from
the service with forfeiture of retirement benefits cannot recover the retirement premiums he has paid unless the
dismissal provides otherwise." The GSIS Board pointed out that the Courts Decision did not provide that Cesar is
entitled to a refund of his retirement premiums.
There is no gainsaying that dismissal from the service carries with it the forfeiture of retirement benefits. Under the
Uniform Rules in Administrative Cases in the Civil Service, it is provided that:
14

Section 58. Administrative Disabilities Inherent in Certain Penalties.
a. The penalty of dismissal shall carry with it that of cancellation of eligibility, forfeiture of retirement benefits, and the
perpetual disqualification for reemployment in the government service, unless otherwise provided in the decision.
However, in the instant case, Cesar Jr. seeks only the return of his fathers personal contributions to the GSIS. He is
not claiming any of the benefits that Cesar would have been entitled to had he not been dismissed from the service,
such as retirement benefits.
To determine the propriety of Cesar Jr.s request, a reexamination of the laws governing the GSIS is in order.
The GSIS was created in 1936 by Commonwealth Act No. 186. It was intended to "promote the efficiency and welfare
of the employees of the Government of the Philippines" and to replace the pension systems in existence at that
time.
15

Section 9 of Commonwealth Act No. 186 states:
Section 9. Effect of dismissal or separation from service. Upon dismissal for cause of a member of the System,
the benefits under his membership policy shall be automatically forfeited to the System, except one-half of
the cash or surrender value, which amount shall be paid to such member, or in case of death, to his
beneficiary. In other cases of separation before maturity of a policy, the Government contributions shall cease, and
the insured member shall have the following options: (a) to collect the cash surrender value of the policy; or (b) to
continue the policy by paying the full premiums thereof; or (c) to obtain a paid up or extended term insurance in such
amount or period, respectively, as the paid premiums may warrant, in accordance with the conditions contained in
said policy; o[r] (d) to avail himself of such other options as may be provided in the policy.
16

In 1951, Commonwealth Act No. 186 was amended by Republic Act (R.A.) No. 660. R.A. No. 660 amended Sections
2(a), (d), and (f); 4; 5; 6; 7; 8; 10; 11; 12; 13; 14; 15; and 16 of Commonwealth Act No. 186. R.A. No. 660 likewise
added new provisions to the earlier law, one of which reads:
Section 8. The following new sections are hereby inserted in Commonwealth Act Numbered One hundred and eighty-
six:
II. Retirement Insurance Benefit
"Section 11. (a) Amount of annuity. Upon retirement a member shall be automatically entitled to a life annuity
payable monthly for at least five years and thereafter as long as he live. (sic) The amount of the monthly annuity at
the age of fifty-seven years shall be twenty pesos, plus, for each year of service rendered after the approval of this
Act, one and six-tenths per centum of the average monthly salary received by him during the last five years of
service, plus, for each year of service rendered prior to the approval of this Act, if said service was at least seven
years, one and two-tenths per centum of said average monthly salary: Provided, That this amount shall be adjusted
actuarially if retirement be at an age other than fifty-seven years: Provided, further, That the maximum amount of
monthly annuity at age fifty-seven shall not in any case exceed two-thirds of said average monthly salary or five
hundred pesos, whichever is the smaller amount: And provided, finally, That retirement benefit shall be paid not
earlier than one year after the approval of this Act. In lieu of this annuity, he may prior to his retirement elect one of
the following equivalent benefits:
"(1) Monthly annuity during his lifetime;
"(2) Monthly annuity during the joint-lives of the employee and his wife or other designated
beneficiary, which annuity, however, shall be reduced upon the death of either to one-half and be
paid to the survivor;
"(3) For those who are at least sixty-five years of age, lump sum payment of present value of
annuity for first five years and future annuity to be paid monthly; or
"(4) Such other benefit as may be approved by the System.
"(b) Survivors benefit. Upon death before he becomes eligible for retirement, his beneficiaries as
recorded in the application of retirement annuity filed with the System shall be paid his own premiums with
interest of three per centum per annum, compounded monthly. If on his death he is eligible for retirement,
then the automatic retirement annuity or the annuity chosen by him previously shall be paid accordingly.
"(c) Disability benefit. If he becomes permanently and totally disabled and his services are no longer
desirable, he shall be discharged and paid his own contributions with interest of three per centum per
annum, compounded monthly, if he has served less than five years; if he has served at least five years but
less than fifteen years, he shall be paid also the corresponding employer's premiums, without interest,
described in subsection (a) of section five hereof; and if he has served at least fifteen years he shall be
retired and be entitled to the benefit provided under subsection (a) of this section.
"(d) Upon dismissal for cause or on voluntary separation, he shall be entitled only to his own
premiums and voluntary deposits, if any, plus interest of three per centum per annum, compounded
monthly."
17

Thus, Section 11(d) of R.A. No. 660 should be deemed to have amended Commonwealth Act No. 186.
In 1977, then President Ferdinand Marcos issued Presidential Decree (P.D.) No. 1146, an act "Amending,
Expanding, Increasing and Integrating the Social Security and Insurance Benefits of Government Employees and
Facilitating the Payment thereof under Commonwealth Act No. 186, as amended, and for other purposes."
Section 4 of P.D. No. 1146 reads:
Section 4. Effect of Separation from the Service. A member shall continue to be a member, notwithstanding his
separation from the service and, unless the terms of his separation provide otherwise, he shall be entitled to whatever
benefits which shall have accrued or been earned at the time of his separation in the event of any contingency
compensable under this Act.
There is no provision in P.D. No. 1146 dealing specifically with GSIS members dismissed from the service for cause,
or their entitlement to the premiums they have paid.
Subsequently, R.A. No. 8291 was enacted in 1997, and it provides:
Section 1. Presidential Decree No. 1146, as amended, otherwise known as the "Revised Government Service
Insurance Act of 1977", is hereby amended to read as follows:
x x x x
SEC. 4. Effect of Separation from the Service. A member separated from the service shall continue to be a
member, and shall be entitled to whatever benefits he has qualified to in the event of any contingency compensable
under this Act.
It is noteworthy that none of the subsequent laws expressly repealed Section 9 of Commonwealth Act No. 186, as
amended. In fact, none of the subsequent laws expressly repealed the earlier laws. Be that as it may, we must still
resolve the issue of whether the same has been impliedly repealed.
We answer in the negative.
As a general rule, repeals by implication are not favored. When statutes are in pari materia, they should be construed
together. A law cannot be deemed repealed unless it is clearly manifested that the legislature so intended it.
18

The repealing clause of P.D. No. 1146 reads:
Section 48. Repealing Clause. All laws or parts of law specifically inconsistent herewith shall be considered amended
or repealed accordingly.
On the other hand R.A. No. 8291s repealing clause states:
SEC. 3. Repealing Clause. All laws and any other law or parts of law specifically inconsistent herewith are hereby
repealed or modified accordingly: Provided, That the rights under existing laws, rules and regulations vested upon or
acquired by an employee who is already in the service as of the effectivity of this Act shall remain in force and effect:
Provided, further, That subsequent to the effectivity of this Act, a new employee or an employee who has previously
retired or separated and is reemployed in the service shall be covered by the provisions of this Act.
This Court has previously determined the nature of similarly-worded repealing clauses. Thus:
The holding of this Court in Mecano vs. COA is instructive: "The question that should be asked is: What is the nature
of this repealing clause? It is certainly not an express repealing clause because it fails to identify or designate the act
or acts that are intended to be repealed. Rather, it is an example of a general repealing provision, as stated in
Opinion No. 73, s. 1991. It is a clause which predicates the intended repeal under the condition that a substantial
conflict must be found in existing and prior acts. The failure to add a specific repealing clause indicates that the intent
was not to repeal any existing law, unless an irreconcilable inconsistency and repugnancy exist in the terms of the
new and old laws. This latter situation falls under the category of an implied repeal."
19

There are two accepted instances of implied repeal. The first takes place when the provisions in the two acts on the
same subject matter are irreconcilably contradictory, in which case, the later act, to the extent of the conflict,
constitutes an implied repeal of the earlier one. The second occurs when the later act covers the whole subject of the
earlier one and is clearly intended as a substitute; thus, it will operate to repeal the earlier law.
20

Addressing the second instance, we pose the question: were the later enactments intended to substitute the earlier
ones? We hold that there was no such substitution.
P.D. No. 1146 was not intended to replace Commonwealth Act No. 186, as amended by R.A. No. 660, but "to expand
and improve the social security and insurance programs administered by the Government Service Insurance
System."
21
Thus, as the above-quoted repealing clause indicates, only the laws or parts of law specifically
inconsistent with P.D. No. 1146 were considered amended or repealed.
22

In fact, Section 34 of P.D. No. 1146 mandates that the GSIS, as created and established under Commonwealth Act
No. 186, shall implement the provisions of that law. Moreover, Section 13 states:
Section 13. Retirement Option. Employees who are in the government service upon the effectivity of this Act shall, at
the time of their retirement, have the option to retire under this Act or under Commonwealth Act No. 186, as
previously amended.
Accordingly, Commonwealth Act No. 186, as amended, had not been abrogated by P.D. No. 1146.
Meanwhile, R.A. No. 8291, although enacted to amend P.D. No. 1146, did not expressly repeal Commonwealth Act
No. 186.
Under the first instance of implied repeal, we are guided by the principle that in order to effect a repeal by implication,
the later statute must be so irreconcilably inconsistent with and repugnant to the existing law that they cannot be
reconciled and made to stand together. The clearest case of inconsistency must be made before the inference of
implied repeal can be drawn, for inconsistency is never presumed.
23

We now examine the effect of the later statutes on the provision specifically dealing with employees dismissed for
cause.
We again quote Section 11(d) of Commonwealth Act No. 186, as amended:
(d) Upon dismissal for cause or on voluntary separation, he shall be entitled only to his own premiums and voluntary
deposits, if any, plus interest of three per centum per annum, compounded monthly.
Compare this with Section 4 of P.D. No. 1146, to wit:
Section 4. Effect of Separation from the Service. A member shall continue to be a member, notwithstanding his
separation from the service and, unless the terms of his separation provide otherwise, he shall be entitled to whatever
benefits which shall have accrued or been earned at the time of his separation in the event of any contingency
compensable under this Act.
and Section 1 of R.A. No. 8291, which amended Section 4 of P.D. No. 1146 and the law in force at the time of
Cesars dismissal from the service:
SEC. 4. Effect of Separation from the Service. A member separated from the service shall continue to be a
member, and shall be entitled to whatever benefits he has qualified to in the event of any contingency compensable
under this Act.
There is no manifest inconsistency between Section 11(d) of Commonwealth Act No. 186, as amended, and Section
4 of R.A. No. 8291. The latter provision is a general statement intended to cover members separated from the service
whether the separation is voluntary or involuntary, and whether the same was for cause or not. Moreover, the same
deals only with the benefits the member is entitled to at the time of separation.
For the latter law to be deemed as having repealed the earlier law, it is necessary to show that the statutes or
statutory provisions deal with the same subject matter and that the latter be inconsistent with the former. There must
be a showing of repugnance, clear and convincing in character. The language used in the later statute must be such
as to render it irreconcilable with what had been formerly enacted. An inconsistency that falls short of that standard
does not suffice.
24

As mentioned earlier, neither P.D. No. 1146 nor R.A. No. 8291 contains any provision specifically dealing with
employees dismissed for cause and the status of their personal contributions. Thus, there is no inconsistency
between Section 11(d) of Commonwealth Act No. 186, as amended, and Section 4 of P.D. No. 1146, and,
subsequently, R.A. No. 8291. The inevitable conclusion then is that Section 11(d) of Commonwealth Act No. 186, as
amended, continues to govern cases of employees dismissed for cause and their claims for the return of their
personal contributions.
Finally, it should be remembered that the GSIS laws are in the nature of social legislation, to be liberally construed in
favor of the government employees.
25
The money subject of the instant request consists of personal contributions
made by the employee, premiums paid in anticipation of benefits expected upon retirement. The occurrence of a
contingency, i.e., his dismissal from the service prior to reaching retirement age, should not deprive him of the money
that belongs to him from the outset. To allow forfeiture of these personal contributions in favor of the GSIS would
condone undue enrichment.
Pursuant to the foregoing discussion, Cesar is entitled to the return of his premiums and voluntary deposits, if any,
with interest of three per centum per annum, compounded monthly.
WHEREFORE, the foregoing premises considered, the Government Service Insurance System is hereby DIRECTED
to return to Atty. Cesar Lledo his own premiums and voluntary deposits, if any, plus interest of three per centum per
annum, compounded monthly.
SO ORDERED.
ANTONIO EDUARDO B. NACHURA
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
ANTONIO T. CARPIO
Associate Justice
RENATO C. CORONA
Associate Justice
CONCHITA CARPIO MORALES
Associate Justice
PRESBITERO J. VELASCO, JR.
Associate Justice
TERESITA J. LEONARDO-DE CASTRO
Associate Justice
ARTURO D. BRION
Associate Justice
DIOSDADO M. PERALTA
Associate Justice
LUCAS P. BERSAMIN
Associate Justice
MARIANO C. DEL CASTILLO
Associate Justice
ROBERTO A. ABAD
Associate Justice
MARTIN S. VILLARAMA, JR.
Associate Justice
JOSE PORTUGAL PEREZ
Associate Justice
JOSE CATRAL MENDOZA
Associate Justice
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 159618 February 1, 2011
BAYAN MUNA, as represented by Rep. SATUR OCAMPO, Rep. CRISPIN BELTRAN, and Rep. LIZA L.
MAZA,Petitioner,
vs.
ALBERTO ROMULO, in his capacity as Executive Secretary, and BLAS F. OPLE, in his capacity as Secretary
of Foreign Affairs, Respondents.
D E C I S I O N
VELASCO, JR., J .:
The Case
This petition
1
for certiorari, mandamus and prohibition under Rule 65 assails and seeks to nullify the Non-Surrender
Agreement concluded by and between the Republic of the Philippines (RP) and the United States of America (USA).
The Facts
Petitioner Bayan Muna is a duly registered party-list group established to represent the marginalized sectors of
society. Respondent Blas F. Ople, now deceased, was the Secretary of Foreign Affairs during the period material to
this case. Respondent Alberto Romulo was impleaded in his capacity as then Executive Secretary.
2

Rome Statute of the International Criminal Court
Having a key determinative bearing on this case is the Rome Statute
3
establishing the International Criminal Court
(ICC) with "the power to exercise its jurisdiction over persons for the most serious crimes of international concern x x
x and shall be complementary to the national criminal jurisdictions."
4
The serious crimes adverted to cover those
considered grave under international law, such as genocide, crimes against humanity, war crimes, and crimes of
aggression.
5

On December 28, 2000, the RP, through Charge dAffaires Enrique A. Manalo, signed the Rome Statute which, by its
terms, is "subject to ratification, acceptance or approval" by the signatory states.
6
As of the filing of the instant
petition, only 92 out of the 139 signatory countries appear to have completed the ratification, approval and
concurrence process. The Philippines is not among the 92.
RP-US Non-Surrender Agreement
On May 9, 2003, then Ambassador Francis J. Ricciardone sent US Embassy Note No. 0470 to the Department of
Foreign Affairs (DFA) proposing the terms of the non-surrender bilateral agreement (Agreement, hereinafter) between
the USA and the RP.
Via Exchange of Notes No. BFO-028-03
7
dated May 13, 2003 (E/N BFO-028-03, hereinafter), the RP, represented by
then DFA Secretary Ople, agreed with and accepted the US proposals embodied under the US Embassy Note
adverted to and put in effect the Agreement with the US government. In esse, the Agreement aims to protect what it
refers to and defines as "persons" of the RP and US from frivolous and harassment suits that might be brought
against them in international tribunals.
8
It is reflective of the increasing pace of the strategic security and defense
partnership between the two countries. As of May 2, 2003, similar bilateral agreements have been effected by and
between the US and 33 other countries.
9

The Agreement pertinently provides as follows:
1. For purposes of this Agreement, "persons" are current or former Government officials, employees
(including contractors), or military personnel or nationals of one Party.
2. Persons of one Party present in the territory of the other shall not, absent the express consent of the first
Party,
(a) be surrendered or transferred by any means to any international tribunal for any purpose,
unless such tribunal has been established by the UN Security Council, or
(b) be surrendered or transferred by any means to any other entity or third country, or expelled to a
third country, for the purpose of surrender to or transfer to any international tribunal, unless such
tribunal has been established by the UN Security Council.
3. When the [US] extradites, surrenders, or otherwise transfers a person of the Philippines to a third country,
the [US] will not agree to the surrender or transfer of that person by the third country to any international
tribunal, unless such tribunal has been established by the UN Security Council, absent the express consent
of the Government of the Republic of the Philippines [GRP].
4. When the [GRP] extradites, surrenders, or otherwise transfers a person of the [USA] to a third country,
the [GRP] will not agree to the surrender or transfer of that person by the third country to any international
tribunal, unless such tribunal has been established by the UN Security Council, absent the express consent
of the Government of the [US].
5. This Agreement shall remain in force until one year after the date on which one party notifies the other of
its intent to terminate the Agreement. The provisions of this Agreement shall continue to apply with respect
to any act occurring, or any allegation arising, before the effective date of termination.
In response to a query of then Solicitor General Alfredo L. Benipayo on the status of the non-surrender agreement,
Ambassador Ricciardone replied in his letter of October 28, 2003 that the exchange of diplomatic notes constituted a
legally binding agreement under international law; and that, under US law, the said agreement did not require the
advice and consent of the US Senate.
10

In this proceeding, petitioner imputes grave abuse of discretion to respondents in concluding and ratifying
theAgreement and prays that it be struck down as unconstitutional, or at least declared as without force and effect.
For their part, respondents question petitioners standing to maintain a suit and counter that the Agreement, being in
the nature of an executive agreement, does not require Senate concurrence for its efficacy. And for reasons detailed
in their comment, respondents assert the constitutionality of the Agreement.
The Issues
I. WHETHER THE [RP] PRESIDENT AND THE [DFA] SECRETARY x x x GRAVELY ABUSED THEIR
DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION FOR CONCLUDING THE RP-US
NON SURRENDER AGREEMENT BY MEANS OF [E/N] BFO-028-03 DATED 13 MAY 2003, WHEN THE
PHILIPPINE GOVERNMENT HAS ALREADY SIGNED THE ROME STATUTE OF THE [ICC] ALTHOUGH
THIS IS PENDING RATIFICATION BY THE PHILIPPINE SENATE.
A. Whether by entering into the x x x Agreement Respondents gravely abused their discretion
when they capriciously abandoned, waived and relinquished our only legitimate recourse through
the Rome Statute of the [ICC] to prosecute and try "persons" as defined in the x x x Agreement, x
x x or literally any conduit of American interests, who have committed crimes of genocide, crimes
against humanity, war crimes and the crime of aggression, thereby abdicating Philippine
Sovereignty.
B. Whether after the signing and pending ratification of the Rome Statute of the [ICC] the [RP]
President and the [DFA] Secretary x x x are obliged by the principle of good faith to refrain from
doing all acts which would substantially impair the value of the undertaking as signed.
C. Whether the x x x Agreement constitutes an act which defeats the object and purpose of
theRome Statute of the International Criminal Court and contravenes the obligation of good faith
inherent in the signature of the President affixed on the Rome Statute of the International Criminal
Court, and if so whether the x x x Agreement is void and unenforceable on this ground.
D. Whether the RP-US Non-Surrender Agreement is void and unenforceable for grave abuse of
discretion amounting to lack or excess of jurisdiction in connection with its execution.
II. WHETHER THE RP-US NON SURRENDER AGREEMENT IS VOID AB INITIO FOR CONTRACTING
OBLIGATIONS THAT ARE EITHER IMMORAL OR OTHERWISE AT VARIANCE WITH UNIVERSALLY
RECOGNIZED PRINCIPLES OF INTERNATIONAL LAW.
III. WHETHER THE x x x AGREEMENT IS VALID, BINDING AND EFFECTIVE WITHOUT THE
CONCURRENCE BY AT LEAST TWO-THIRDS (2/3) OF ALL THE MEMBERS OF THE SENATE x x x.
11

The foregoing issues may be summarized into two: first, whether or not the Agreement was contracted validly, which
resolves itself into the question of whether or not respondents gravely abused their discretion in concluding it;
and second, whether or not the Agreement, which has not been submitted to the Senate for concurrence,
contravenes and undermines the Rome Statute and other treaties. But because respondents expectedly raised it, we
shall first tackle the issue of petitioners legal standing.
The Courts Ruling
This petition is bereft of merit.
Procedural Issue: Locus Standi of Petitioner
Petitioner, through its three party-list representatives, contends that the issue of the validity or invalidity of
theAgreement carries with it constitutional significance and is of paramount importance that justifies its standing.
Cited in this regard is what is usually referred to as the emergency powers cases,
12
in which ordinary citizens and
taxpayers were accorded the personality to question the constitutionality of executive issuances.
Locus standi is "a right of appearance in a court of justice on a given question."
13
Specifically, it is "a partys personal
and substantial interest in a case where he has sustained or will sustain direct injury as a result"
14
of the act being
challenged, and "calls for more than just a generalized grievance."
15
The term "interest" refers to material interest, as
distinguished from one that is merely incidental.
16
The rationale for requiring a party who challenges the validity of a
law or international agreement to allege such a personal stake in the outcome of the controversy is "to assure the
concrete adverseness which sharpens the presentation of issues upon which the court so largely depends for
illumination of difficult constitutional questions."
17

Locus standi, however, is merely a matter of procedure and it has been recognized that, in some cases, suits are not
brought by parties who have been personally injured by the operation of a law or any other government act, but by
concerned citizens, taxpayers, or voters who actually sue in the public interest.
18
Consequently, in a catena of
cases,
19
this Court has invariably adopted a liberal stance on locus standi.
Going by the petition, petitioners representatives pursue the instant suit primarily as concerned citizens raising
issues of transcendental importance, both for the Republic and the citizenry as a whole.
When suing as a citizen to question the validity of a law or other government action, a petitioner needs to meet
certain specific requirements before he can be clothed with standing. Francisco, Jr. v. Nagmamalasakit na mga
Manananggol ng mga Manggagawang Pilipino, Inc.
20
expounded on this requirement, thus:
In a long line of cases, however, concerned citizens, taxpayers and legislators when specific requirements have been
met have been given standing by this Court.
When suing as a citizen, the interest of the petitioner assailing the constitutionality of a statute must be direct and
personal. He must be able to show, not only that the law or any government act is invalid, but also that he sustained
or is in imminent danger of sustaining some direct injury as a result of its enforcement, and not merely that he suffers
thereby in some indefinite way. It must appear that the person complaining has been or is about to be denied some
right or privilege to which he is lawfully entitled or that he is about to be subjected to some burdens or penalties by
reason of the statute or act complained of. In fine, when the proceeding involves the assertion of a public right, the
mere fact that he is a citizen satisfies the requirement of personal interest.
21

In the case at bar, petitioners representatives have complied with the qualifying conditions or specific requirements
exacted under the locus standi rule. As citizens, their interest in the subject matter of the petition is direct and
personal. At the very least, their assertions questioning the Agreement are made of a public right, i.e., to ascertain
that the Agreement did not go against established national policies, practices, and obligations bearing on the States
obligation to the community of nations.
At any event, the primordial importance to Filipino citizens in general of the issue at hand impels the Court to brush
aside the procedural barrier posed by the traditional requirement of locus standi, as we have done in a long line of
earlier cases, notably in the old but oft-cited emergency powers cases
22
and Kilosbayan v. Guingona, Jr.
23
In cases of
transcendental importance, we wrote again in Bayan v. Zamora,
24
"The Court may relax the standing requirements
and allow a suit to prosper even where there is no direct injury to the party claiming the right of judicial review."
Moreover, bearing in mind what the Court said in Taada v. Angara, "that it will not shirk, digress from or abandon its
sacred duty and authority to uphold the Constitution in matters that involve grave abuse of discretion brought before it
in appropriate cases, committed by any officer, agency, instrumentality or department of the government,"
25
we
cannot but resolve head on the issues raised before us. Indeed, where an action of any branch of government is
seriously alleged to have infringed the Constitution or is done with grave abuse of discretion, it becomes not only the
right but in fact the duty of the judiciary to settle it. As in this petition, issues are precisely raised putting to the fore the
propriety of the Agreement pending the ratification of the Rome Statute.
Validity of the RP-US Non-Surrender Agreement
Petitioners initial challenge against the Agreement relates to form, its threshold posture being that E/N BFO-028-03
cannot be a valid medium for concluding the Agreement.
Petitioners contentionperhaps taken unaware of certain well-recognized international doctrines, practices, and
jargonsis untenable. One of these is the doctrine of incorporation, as expressed in Section 2, Article II of the
Constitution, wherein the Philippines adopts the generally accepted principles of international law and international
jurisprudence as part of the law of the land and adheres to the policy of peace, cooperation, and amity with all
nations.
26
An exchange of notes falls "into the category of inter-governmental agreements,"
27
which is an
internationally accepted form of international agreement. The United Nations Treaty Collections (Treaty Reference
Guide) defines the term as follows:
An "exchange of notes" is a record of a routine agreement, that has many similarities with the private law contract.
The agreement consists of the exchange of two documents, each of the parties being in the possession of the one
signed by the representative of the other. Under the usual procedure, the accepting State repeats the text of the
offering State to record its assent. The signatories of the letters may be government Ministers, diplomats or
departmental heads. The technique of exchange of notes is frequently resorted to, either because of its speedy
procedure, or, sometimes, to avoid the process of legislative approval.
28

In another perspective, the terms "exchange of notes" and "executive agreements" have been used interchangeably,
exchange of notes being considered a form of executive agreement that becomes binding through executive
action.
29
On the other hand, executive agreements concluded by the President "sometimes take the form of
exchange of notes and at other times that of more formal documents denominated agreements or protocols."
30
As
former US High Commissioner to the Philippines Francis B. Sayre observed in his work, The Constitutionality of
Trade Agreement Acts:
The point where ordinary correspondence between this and other governments ends and agreements whether
denominated executive agreements or exchange of notes or otherwise begin, may sometimes be difficult of ready
ascertainment.
31
x x x
It is fairly clear from the foregoing disquisition that E/N BFO-028-03be it viewed as the Non-Surrender Agreement
itself, or as an integral instrument of acceptance thereof or as consent to be boundis a recognized mode of
concluding a legally binding international written contract among nations.
Senate Concurrence Not Required
Article 2 of the Vienna Convention on the Law of Treaties defines a treaty as "an international agreement concluded
between states in written form and governed by international law, whether embodied in a single instrument or in two
or more related instruments and whatever its particular designation."
32
International agreements may be in the form of
(1) treaties that require legislative concurrence after executive ratification; or (2) executive agreements that are
similar to treaties, except that they do not require legislative concurrence and are usually less formal and deal with a
narrower range of subject matters than treaties.
33

Under international law, there is no difference between treaties and executive agreements in terms of their binding
effects on the contracting states concerned,
34
as long as the negotiating functionaries have remained within their
powers.
35
Neither, on the domestic sphere, can one be held valid if it violates the Constitution.
36
Authorities are,
however, agreed that one is distinct from another for accepted reasons apart from the concurrence-requirement
aspect.
37
As has been observed by US constitutional scholars, a treaty has greater "dignity" than an executive
agreement, because its constitutional efficacy is beyond doubt, a treaty having behind it the authority of the
President, the Senate, and the people;
38
a ratified treaty, unlike an executive agreement, takes precedence over any
prior statutory enactment.
39

Petitioner parlays the notion that the Agreement is of dubious validity, partaking as it does of the nature of a treaty;
hence, it must be duly concurred in by the Senate. Petitioner takes a cue from Commissioner of Customs v. Eastern
Sea Trading, in which the Court reproduced the following observations made by US legal scholars: "[I]nternational
agreements involving political issues or changes of national policy and those involving international arrangements of
a permanent character usually take the form of treaties [while] those embodying adjustments of detail carrying out
well established national policies and traditions and those involving arrangements of a more or less temporary nature
take the form of executive agreements."
40

Pressing its point, petitioner submits that the subject of the Agreement does not fall under any of the subject-
categories that are enumerated in the Eastern Sea Trading case, and that may be covered by an executive
agreement, such as commercial/consular relations, most-favored nation rights, patent rights, trademark and copyright
protection, postal and navigation arrangements and settlement of claims.
In addition, petitioner foists the applicability to the instant case of Adolfo v. CFI of Zambales and Merchant,
41
holding
that an executive agreement through an exchange of notes cannot be used to amend a treaty.
We are not persuaded.
The categorization of subject matters that may be covered by international agreements mentioned in Eastern Sea
Trading is not cast in stone. There are no hard and fast rules on the propriety of entering, on a given subject, into a
treaty or an executive agreement as an instrument of international relations. The primary consideration in the choice
of the form of agreement is the parties intent and desire to craft an international agreement in the form they so wish
to further their respective interests. Verily, the matter of form takes a back seat when it comes to effectiveness and
binding effect of the enforcement of a treaty or an executive agreement, as the parties in either international
agreement each labor under the pacta sunt servanda
42
principle.
As may be noted, almost half a century has elapsed since the Court rendered its decision in Eastern Sea Trading.
Since then, the conduct of foreign affairs has become more complex and the domain of international law wider, as to
include such subjects as human rights, the environment, and the sea. In fact, in the US alone, the executive
agreements executed by its President from 1980 to 2000 covered subjects such as defense, trade, scientific
cooperation, aviation, atomic energy, environmental cooperation, peace corps, arms limitation, and nuclear safety,
among others.
43
Surely, the enumeration in Eastern Sea Trading cannot circumscribe the option of each state on the
matter of which the international agreement format would be convenient to serve its best interest. As Francis Sayre
said in his work referred to earlier:
x x x It would be useless to undertake to discuss here the large variety of executive agreements as such concluded
from time to time. Hundreds of executive agreements, other than those entered into under the trade-agreement act,
have been negotiated with foreign governments. x x x They cover such subjects as the inspection of vessels,
navigation dues, income tax on shipping profits, the admission of civil air craft, custom matters and commercial
relations generally, international claims, postal matters, the registration of trademarks and copyrights, etc. x x x
And lest it be overlooked, one type of executive agreement is a treaty-authorized
44
or a treaty-implementing executive
agreement,
45
which necessarily would cover the same matters subject of the underlying treaty.
But over and above the foregoing considerations is the fact thatsave for the situation and matters contemplated in
Sec. 25, Art. XVIII of the Constitution
46
when a treaty is required, the Constitution does not classify any subject, like
that involving political issues, to be in the form of, and ratified as, a treaty. What the Constitution merely prescribes is
that treaties need the concurrence of the Senate by a vote defined therein to complete the ratification process.
Petitioners reliance on Adolfo
47
is misplaced, said case being inapplicable owing to different factual milieus. There,
the Court held that an executive agreement cannot be used to amend a duly ratified and existing treaty, i.e., the
Bases Treaty. Indeed, an executive agreement that does not require the concurrence of the Senate for its ratification
may not be used to amend a treaty that, under the Constitution, is the product of the ratifying acts of the Executive
and the Senate. The presence of a treaty, purportedly being subject to amendment by an executive agreement, does
not obtain under the premises.
Considering the above discussion, the Court need not belabor at length the third main issue raised, referring to the
validity and effectivity of the Agreement without the concurrence by at least two-thirds of all the members of the
Senate. The Court has, in Eastern Sea Trading,
48
as reiterated in Bayan,
49
given recognition to the obligatory effect of
executive agreements without the concurrence of the Senate:
x x x [T]he right of the Executive to enter into binding agreements without the necessity of subsequent Congressional
approval has been confirmed by long usage. From the earliest days of our history, we have entered executive
agreements covering such subjects as commercial and consular relations, most favored-nation rights, patent rights,
trademark and copyright protection, postal and navigation arrangements and the settlement of claims. The validity of
these has never been seriously questioned by our courts.
The Agreement Not in Contravention of the Rome Statute
It is the petitioners next contention that the Agreement undermines the establishment of the ICC and is null and void
insofar as it unduly restricts the ICCs jurisdiction and infringes upon the effectivity of the Rome Statute. Petitioner
posits that the Agreement was constituted solely for the purpose of providing individuals or groups of individuals with
immunity from the jurisdiction of the ICC; and such grant of immunity through non-surrender agreements allegedly
does not legitimately fall within the scope of Art. 98 of the Rome Statute. It concludes that state parties with non-
surrender agreements are prevented from meeting their obligations under the Rome Statute, thereby constituting a
breach of Arts. 27,
50
86,
51
89
52
and 90
53
thereof.
Petitioner stresses that the overall object and purpose of the Rome Statute is to ensure that those responsible for the
worst possible crimes are brought to justice in all cases, primarily by states, but as a last resort, by the ICC; thus, any
agreementlike the non-surrender agreementthat precludes the ICC from exercising its complementary function of
acting when a state is unable to or unwilling to do so, defeats the object and purpose of the Rome Statute.
Petitioner would add that the President and the DFA Secretary, as representatives of a signatory of the Rome
Statute, are obliged by the imperatives of good faith to refrain from performing acts that substantially devalue the
purpose and object of the Statute, as signed. Adding a nullifying ingredient to the Agreement, according to petitioner,
is the fact that it has an immoral purpose or is otherwise at variance with a priorly executed treaty.
Contrary to petitioners pretense, the Agreement does not contravene or undermine, nor does it differ from, the Rome
Statute. Far from going against each other, one complements the other. As a matter of fact, the principle of
complementarity underpins the creation of the ICC. As aptly pointed out by respondents and admitted by petitioners,
the jurisdiction of the ICC is to "be complementary to national criminal jurisdictions [of the signatory states]."
54
Art. 1
of the Rome Statute pertinently provides:
Article 1
The Court
An International Crimininal Court ("the Court") is hereby established. It x x x shall have the power to exercise its
jurisdiction over persons for the most serious crimes of international concern, as referred to in this Statute,
and shall be complementary to national criminal jurisdictions. The jurisdiction and functioning of the Court shall
be governed by the provisions of this Statute. (Emphasis ours.)
Significantly, the sixth preambular paragraph of the Rome Statute declares that "it is the duty of every State to
exercise its criminal jurisdiction over those responsible for international crimes." This provision indicates that primary
jurisdiction over the so-called international crimes rests, at the first instance, with the state where the crime was
committed; secondarily, with the ICC in appropriate situations contemplated under Art. 17, par. 1
55
of the Rome
Statute.
Of particular note is the application of the principle of ne bis in idem
56
under par. 3 of Art. 20, Rome Statute, which
again underscores the primacy of the jurisdiction of a state vis-a-vis that of the ICC. As far as relevant, the provision
states that "no person who has been tried by another court for conduct x x x [constituting crimes within its jurisdiction]
shall be tried by the [International Criminal] Court with respect to the same conduct x x x."
The foregoing provisions of the Rome Statute, taken collectively, argue against the idea of jurisdictional conflict
between the Philippines, as party to the non-surrender agreement, and the ICC; or the idea of the Agreement
substantially impairing the value of the RPs undertaking under the Rome Statute. Ignoring for a while the fact that the
RP signed the Rome Statute ahead of the Agreement, it is abundantly clear to us that the Rome Statute expressly
recognizes the primary jurisdiction of states, like the RP, over serious crimes committed within their respective
borders, the complementary jurisdiction of the ICC coming into play only when the signatory states are unwilling or
unable to prosecute.
Given the above consideration, petitioners suggestionthat the RP, by entering into the Agreement, violated its duty
required by the imperatives of good faith and breached its commitment under the Vienna Convention
57
to refrain from
performing any act tending to impair the value of a treaty, e.g., the Rome Statutehas to be rejected outright. For
nothing in the provisions of the Agreement, in relation to the Rome Statute, tends to diminish the efficacy of the
Statute, let alone defeats the purpose of the ICC. Lest it be overlooked, the Rome Statute contains a proviso that
enjoins the ICC from seeking the surrender of an erring person, should the process require the requested state to
perform an act that would violate some international agreement it has entered into. We refer to Art. 98(2) of the Rome
Statute, which reads:
Article 98
Cooperation with respect to waiver of immunity
and consent to surrender
x x x x
2. The Court may not proceed with a request for surrender which would require the requested State to act
inconsistently with its obligations under international agreements pursuant to which the consent of a sending State is
required to surrender a person of that State to the Court, unless the Court can first obtain the cooperation of the
sending State for the giving of consent for the surrender.
Moreover, under international law, there is a considerable difference between a State-Party and a signatory to a
treaty. Under the Vienna Convention on the Law of Treaties, a signatory state is only obliged to refrain from acts
which would defeat the object and purpose of a treaty;
58
whereas a State-Party, on the other hand, is legally obliged
to follow all the provisions of a treaty in good faith.
In the instant case, it bears stressing that the Philippines is only a signatory to the Rome Statute and not a State-
Party for lack of ratification by the Senate. Thus, it is only obliged to refrain from acts which would defeat the object
and purpose of the Rome Statute. Any argument obliging the Philippines to follow any provision in the treaty would be
premature.
As a result, petitioners argument that State-Parties with non-surrender agreements are prevented from meeting their
obligations under the Rome Statute, specifically Arts. 27, 86, 89 and 90, must fail. These articles are only legally
binding upon State-Parties, not signatories.
Furthermore, a careful reading of said Art. 90 would show that the Agreement is not incompatible with the Rome
Statute. Specifically, Art. 90(4) provides that "[i]f the requesting State is a State not Party to this Statute the requested
State, if it is not under an international obligation to extradite the person to the requesting State, shall give priority to
the request for surrender from the Court. x x x" In applying the provision, certain undisputed facts should be pointed
out: first, the US is neither a State-Party nor a signatory to the Rome Statute; and second, there is an international
agreement between the US and the Philippines regarding extradition or surrender of persons, i.e., the Agreement.
Clearly, even assuming that the Philippines is a State-Party, the Rome Statute still recognizes the primacy of
international agreements entered into between States, even when one of the States is not a State-Party to the Rome
Statute.
Sovereignty Limited by International Agreements
Petitioner next argues that the RP has, through the Agreement, abdicated its sovereignty by bargaining away the
jurisdiction of the ICC to prosecute US nationals, government officials/employees or military personnel who commit
serious crimes of international concerns in the Philippines. Formulating petitioners argument a bit differently, the RP,
by entering into the Agreement, does thereby abdicate its sovereignty, abdication being done by its waiving or
abandoning its right to seek recourse through the Rome Statute of the ICC for erring Americans committing
international crimes in the country.
We are not persuaded. As it were, the Agreement is but a form of affirmance and confirmance of the Philippines
national criminal jurisdiction. National criminal jurisdiction being primary, as explained above, it is always the
responsibility and within the prerogative of the RP either to prosecute criminal offenses equally covered by the Rome
Statute or to accede to the jurisdiction of the ICC. Thus, the Philippines may decide to try "persons" of the US, as the
term is understood in the Agreement, under our national criminal justice system. Or it may opt not to exercise its
criminal jurisdiction over its erring citizens or over US "persons" committing high crimes in the country and defer to
the secondary criminal jurisdiction of the ICC over them. As to "persons" of the US whom the Philippines refuses to
prosecute, the country would, in effect, accord discretion to the US to exercise either its national criminal jurisdiction
over the "person" concerned or to give its consent to the referral of the matter to the ICC for trial. In the same breath,
the US must extend the same privilege to the Philippines with respect to "persons" of the RP committing high crimes
within US territorial jurisdiction.
In the context of the Constitution, there can be no serious objection to the Philippines agreeing to undertake the
things set forth in the Agreement. Surely, one State can agree to waive jurisdictionto the extent agreed uponto
subjects of another State due to the recognition of the principle of extraterritorial immunity. What the Court wrote
inNicolas v. Romulo
59
a case involving the implementation of the criminal jurisdiction provisions of the RP-US
Visiting Forces Agreementis apropos:
Nothing in the Constitution prohibits such agreements recognizing immunity from jurisdiction or some aspects of
jurisdiction (such as custody), in relation to long-recognized subjects of such immunity like Heads of State, diplomats
and members of the armed forces contingents of a foreign State allowed to enter another States territory. x x x
To be sure, the nullity of the subject non-surrender agreement cannot be predicated on the postulate that some of its
provisions constitute a virtual abdication of its sovereignty. Almost every time a state enters into an international
agreement, it voluntarily sheds off part of its sovereignty. The Constitution, as drafted, did not envision a reclusive
Philippines isolated from the rest of the world. It even adheres, as earlier stated, to the policy of cooperation and
amity with all nations.
60

By their nature, treaties and international agreements actually have a limiting effect on the otherwise encompassing
and absolute nature of sovereignty. By their voluntary act, nations may decide to surrender or waive some aspects of
their state power or agree to limit the exercise of their otherwise exclusive and absolute jurisdiction. The usual
underlying consideration in this partial surrender may be the greater benefits derived from a pact or a reciprocal
undertaking of one contracting party to grant the same privileges or immunities to the other. On the rationale that the
Philippines has adopted the generally accepted principles of international law as part of the law of the land, a portion
of sovereignty may be waived without violating the Constitution.
61
Such waiver does not amount to an unconstitutional
diminution or deprivation of jurisdiction of Philippine courts.
62

Agreement Not Immoral/Not at Variance
with Principles of International Law
Petitioner urges that the Agreement be struck down as void ab initio for imposing immoral obligations and/or being at
variance with allegedly universally recognized principles of international law. The immoral aspect proceeds from the
fact that the Agreement, as petitioner would put it, "leaves criminals immune from responsibility for unimaginable
atrocities that deeply shock the conscience of humanity; x x x it precludes our country from delivering an American
criminal to the [ICC] x x x."
63

The above argument is a kind of recycling of petitioners earlier position, which, as already discussed, contends that
the RP, by entering into the Agreement, virtually abdicated its sovereignty and in the process undermined its treaty
obligations under the Rome Statute, contrary to international law principles.
64

The Court is not persuaded. Suffice it to state in this regard that the non-surrender agreement, as aptly described by
the Solicitor General, "is an assertion by the Philippines of its desire to try and punish crimes under its national law. x
x x The agreement is a recognition of the primacy and competence of the countrys judiciary to try offenses under its
national criminal laws and dispense justice fairly and judiciously."
Petitioner, we believe, labors under the erroneous impression that the Agreement would allow Filipinos and
Americans committing high crimes of international concern to escape criminal trial and punishment. This is manifestly
incorrect. Persons who may have committed acts penalized under the Rome Statute can be prosecuted and
punished in the Philippines or in the US; or with the consent of the RP or the US, before the ICC, assuming, for the
nonce, that all the formalities necessary to bind both countries to the Rome Statute have been met. For perspective,
what the Agreement contextually prohibits is the surrender by either party of individuals to international tribunals, like
the ICC, without the consent of the other party, which may desire to prosecute the crime under its existing laws. With
the view we take of things, there is nothing immoral or violative of international law concepts in the act of the
Philippines of assuming criminal jurisdiction pursuant to the non-surrender agreement over an offense considered
criminal by both Philippine laws and the Rome Statute.
No Grave Abuse of Discretion
Petitioners final point revolves around the necessity of the Senates concurrence in the Agreement. And without
specifically saying so, petitioner would argue that the non-surrender agreement was executed by the President, thru
the DFA Secretary, in grave abuse of discretion.
The Court need not delve on and belabor the first portion of the above posture of petitioner, the same having been
discussed at length earlier on. As to the second portion, We wish to state that petitioner virtually faults the President
for performing, through respondents, a task conferred the President by the Constitutionthe power to enter into
international agreements.
By constitutional fiat and by the nature of his or her office, the President, as head of state and government, is the sole
organ and authority in the external affairs of the country.
65
The Constitution vests in the President the power to enter
into international agreements, subject, in appropriate cases, to the required concurrence votes of the Senate. But as
earlier indicated, executive agreements may be validly entered into without such concurrence. As the President
wields vast powers and influence, her conduct in the external affairs of the nation is, as Bayan would put it, "executive
altogether." The right of the President to enter into or ratify binding executive agreements has been confirmed by long
practice.
66

In thus agreeing to conclude the Agreement thru E/N BFO-028-03, then President Gloria Macapagal-Arroyo,
represented by the Secretary of Foreign Affairs, acted within the scope of the authority and discretion vested in her by
the Constitution. At the end of the day, the Presidentby ratifying, thru her deputies, the non-surrender agreement
did nothing more than discharge a constitutional duty and exercise a prerogative that pertains to her office.
While the issue of ratification of the Rome Statute is not determinative of the other issues raised herein, it may
perhaps be pertinent to remind all and sundry that about the time this petition was interposed, such issue of
ratification was laid to rest in Pimentel, Jr. v. Office of the Executive Secretary.
67
As the Court emphasized in said
case, the power to ratify a treaty, the Statute in that instance, rests with the President, subject to the concurrence of
the Senate, whose role relative to the ratification of a treaty is limited merely to concurring in or withholding the
ratification. And concomitant with this treaty-making power of the President is his or her prerogative to refuse to
submit a treaty to the Senate; or having secured the latters consent to the ratification of the treaty, refuse to ratify
it.
68
This prerogative, the Court hastened to add, is the Presidents alone and cannot be encroached upon via a writ of
mandamus. Barring intervening events, then, the Philippines remains to be just a signatory to the Rome Statute.
Under Art. 125
69
thereof, the final acts required to complete the treaty process and, thus, bring it into force, insofar as
the Philippines is concerned, have yet to be done.
Agreement Need Not Be in the Form of a Treaty
On December 11, 2009, then President Arroyo signed into law Republic Act No. (RA) 9851, otherwise known as the
"Philippine Act on Crimes Against International Humanitarian Law, Genocide, and Other Crimes Against Humanity."
Sec. 17 of RA 9851, particularly the second paragraph thereof, provides:
Section 17. Jurisdiction. x x x x
In the interest of justice, the relevant Philippine authorities may dispense with the investigation or prosecution of a
crime punishable under this Act if another court or international tribunal is already conducting the investigation or
undertaking the prosecution of such crime. Instead, the authorities may surrender or extradite suspected or accused
persons in the Philippines to the appropriate international court, if any, or to another State pursuant to the applicable
extradition laws and treaties. (Emphasis supplied.)
A view is advanced that the Agreement amends existing municipal laws on the States obligation in relation to grave
crimes against the law of nations, i.e., genocide, crimes against humanity and war crimes. Relying on the above-
quoted statutory proviso, the view posits that the Philippine is required to surrender to the proper international tribunal
those persons accused of the grave crimes defined under RA 9851, if it does not exercise its primary jurisdiction to
prosecute them.
The basic premise rests on the interpretation that if it does not decide to prosecute a foreign national for violations of
RA 9851, the Philippines has only two options, to wit: (1) surrender the accused to the proper international tribunal; or
(2) surrender the accused to another State if such surrender is "pursuant to the applicable extradition laws and
treaties." But the Philippines may exercise these options only in cases where "another court or international tribunal is
already conducting the investigation or undertaking the prosecution of such crime;" otherwise, the Philippines must
prosecute the crime before its own courts pursuant to RA 9851.
Posing the situation of a US national under prosecution by an international tribunal for any crime under RA 9851, the
Philippines has the option to surrender such US national to the international tribunal if it decides not to prosecute
such US national here. The view asserts that this option of the Philippines under Sec. 17 of RA 9851 is not subject to
the consent of the US, and any derogation of Sec. 17 of RA 9851, such as requiring the consent of the US before the
Philippines can exercise such option, requires an amendatory law. In line with this scenario, the view strongly argues
that the Agreement prevents the Philippineswithout the consent of the USfrom surrendering to any international
tribunal US nationals accused of crimes covered by RA 9851, and, thus, in effect amends Sec. 17 of RA 9851.
Consequently, the view is strongly impressed that the Agreement cannot be embodied in a simple executive
agreement in the form of an exchange of notes but must be implemented through an extradition law or a treaty with
the corresponding formalities.
Moreover, consonant with the foregoing view, citing Sec. 2, Art. II of the Constitution, where the Philippines adopts,
as a national policy, the "generally accepted principles of international law as part of the law of the land," the Court is
further impressed to perceive the Rome Statute as declaratory of customary international law. In other words, the
Statute embodies principles of law which constitute customary international law or custom and for which reason it
assumes the status of an enforceable domestic law in the context of the aforecited constitutional provision. As a
corollary, it is argued that any derogation from the Rome Statute principles cannot be undertaken via a mere
executive agreement, which, as an exclusive act of the executive branch, can only implement, but cannot amend or
repeal, an existing law. The Agreement, so the argument goes, seeks to frustrate the objects of the principles of law
or alters customary rules embodied in the Rome Statute.
Prescinding from the foregoing premises, the view thus advanced considers the Agreement inefficacious, unless it is
embodied in a treaty duly ratified with the concurrence of the Senate, the theory being that a Senate- ratified treaty
partakes of the nature of a municipal law that can amend or supersede another law, in this instance Sec. 17 of RA
9851 and the status of the Rome Statute as constitutive of enforceable domestic law under Sec. 2, Art. II of the
Constitution.
We are unable to lend cogency to the view thus taken. For one, we find that the Agreement does not amend or is
repugnant to RA 9851. For another, the view does not clearly state what precise principles of law, if any,
theAgreement alters. And for a third, it does not demonstrate in the concrete how the Agreement seeks to frustrate
the objectives of the principles of law subsumed in the Rome Statute.
Far from it, as earlier explained, the Agreement does not undermine the Rome Statute as the former merely
reinforces the primacy of the national jurisdiction of the US and the Philippines in prosecuting criminal offenses
committed by their respective citizens and military personnel, among others. The jurisdiction of the ICC pursuant to
the Rome Statute over high crimes indicated thereat is clearly and unmistakably complementary to the national
criminal jurisdiction of the signatory states.
Moreover, RA 9851 clearly: (1) defines and establishes the crimes against international humanitarian law, genocide
and other crimes against humanity;
70
(2) provides penal sanctions and criminal liability for their commission;
71
and (3)
establishes special courts for the prosecution of these crimes and for the State to exercise primary criminal
jurisdiction.
72
Nowhere in RA 9851 is there a proviso that goes against the tenor of theAgreement.
The view makes much of the above quoted second par. of Sec. 17, RA 9851 as requiring the Philippine State to
surrender to the proper international tribunal those persons accused of crimes sanctioned under said law if it does not
exercise its primary jurisdiction to prosecute such persons. This view is not entirely correct, for the above quoted
proviso clearly provides discretion to the Philippine State on whether to surrender or not a person accused of the
crimes under RA 9851. The statutory proviso uses the word "may." It is settled doctrine in statutory construction that
the word "may" denotes discretion, and cannot be construed as having mandatory effect.
73
Thus, the pertinent second
pararagraph of Sec. 17, RA 9851 is simply permissive on the part of the Philippine State.1avvphi1
Besides, even granting that the surrender of a person is mandatorily required when the Philippines does not exercise
its primary jurisdiction in cases where "another court or international tribunal is already conducting the investigation or
undertaking the prosecution of such crime," still, the tenor of the Agreement is not repugnant to Sec. 17 of RA 9851.
Said legal proviso aptly provides that the surrender may be made "to another State pursuant to the applicable
extradition laws and treaties." The Agreement can already be considered a treaty following this Courts decision in
Nicolas v. Romulo
74
which cited Weinberger v. Rossi.
75
In Nicolas, We held that "an executive agreement is a treaty
within the meaning of that word in international law and constitutes enforceable domestic law vis--vis the United
States."
76

Likewise, the Philippines and the US already have an existing extradition treaty, i.e., RP-US Extradition Treaty, which
was executed on November 13, 1994. The pertinent Philippine law, on the other hand, is Presidential Decree No.
1069, issued on January 13, 1977. Thus, the Agreement, in conjunction with the RP-US Extradition Treaty, would
neither violate nor run counter to Sec. 17 of RA 9851.
The views reliance on Suplico v. Neda
77
is similarly improper. In that case, several petitions were filed questioning
the power of the President to enter into foreign loan agreements. However, before the petitions could be resolved by
the Court, the Office of the Solicitor General filed a Manifestation and Motion averring that the Philippine Government
decided not to continue with the ZTE National Broadband Network Project, thus rendering the petition moot. In
resolving the case, the Court took judicial notice of the act of the executive department of the Philippines (the
President) and found the petition to be indeed moot. Accordingly, it dismissed the petitions.
In his dissent in the abovementioned case, Justice Carpio discussed the legal implications of an executive
agreement. He stated that "an executive agreement has the force and effect of law x x x [it] cannot amend or repeal
prior laws."
78
Hence, this argument finds no application in this case seeing as RA 9851 is a subsequent law, not a
prior one. Notably, this argument cannot be found in the ratio decidendi of the case, but only in the dissenting opinion.
The view further contends that the RP-US Extradition Treaty is inapplicable to RA 9851 for the reason that under par.
1, Art. 2 of the RP-US Extradition Treaty, "[a]n offense shall be an extraditable offense if it is punishable under the
laws in both Contracting Parties x x x,"
79
and thereby concluding that while the Philippines has criminalized under RA
9851 the acts defined in the Rome Statute as war crimes, genocide and other crimes against humanity, there is no
similar legislation in the US. It is further argued that, citing U.S. v. Coolidge, in the US, a person cannot be tried in the
federal courts for an international crime unless Congress adopts a law defining and punishing the offense.
This view must fail.
On the contrary, the US has already enacted legislation punishing the high crimes mentioned earlier. In fact, as early
as October 2006, the US enacted a law criminalizing war crimes. Section 2441, Chapter 118, Part I, Title 18 of the
United States Code Annotated (USCA) provides for the criminal offense of "war crimes" which is similar to the war
crimes found in both the Rome Statute and RA 9851, thus:
(a) Offense Whoever, whether inside or outside the United States, commits a war crime, in any of the
circumstances described in subsection (b), shall be fined under this title or imprisoned for life or any term of
years, or both, and if death results to the victim, shall also be subject to the penalty of death.
(b) Circumstances The circumstances referred to in subsection (a) are that the person committing such
war crime or the victim of such war crime is a member of the Armed Forces of the United States or a
national of the United States (as defined in Section 101 of the Immigration and Nationality Act).
(c) Definition As used in this Section the term "war crime" means any conduct
(1) Defined as a grave breach in any of the international conventions signed at Geneva 12 August
1949, or any protocol to such convention to which the United States is a party;
(2) Prohibited by Article 23, 25, 27 or 28 of the Annex to the Hague Convention IV, Respecting the
Laws and Customs of War on Land, signed 18 October 1907;
(3) Which constitutes a grave breach of common Article 3 (as defined in subsection [d]) when
committed in the context of and in association with an armed conflict not of an international
character; or
(4) Of a person who, in relation to an armed conflict and contrary to the provisions of the Protocol
on Prohibitions or Restrictions on the Use of Mines, Booby-Traps and Other Devices as amended
at Geneva on 3 May 1996 (Protocol II as amended on 3 May 1996), when the United States is a
party to such Protocol, willfully kills or causes serious injury to civilians.
80
1avvphi1
Similarly, in December 2009, the US adopted a law that criminalized genocide, to wit:
1091. Genocide
(a) Basic Offense Whoever, whether in the time of peace or in time of war and with specific intent to
destroy, in whole or in substantial part, a national, ethnic, racial or religious group as such
(1) kills members of that group;
(2) causes serious bodily injury to members of that group;
(3) causes the permanent impairment of the mental faculties of members of the group through
drugs, torture, or similar techniques;
(4) subjects the group to conditions of life that are intended to cause the physical destruction of the
group in whole or in part;
(5) imposes measures intended to prevent births within the group; or
(6) transfers by force children of the group to another group;
shall be punished as provided in subsection (b).
81

Arguing further, another view has been advanced that the current US laws do not cover every crime listed within the
jurisdiction of the ICC and that there is a gap between the definitions of the different crimes under the US laws versus
the Rome Statute. The view used a report written by Victoria K. Holt and Elisabeth W. Dallas, entitled "On Trial: The
US Military and the International Criminal Court," as its basis.
At the outset, it should be pointed out that the report used may not have any weight or value under international law.
Article 38 of the Statute of the International Court of Justice (ICJ) lists the sources of international law, as follows: (1)
international conventions, whether general or particular, establishing rules expressly recognized by the contesting
states; (2) international custom, as evidence of a general practice accepted as law; (3) the general principles of law
recognized by civilized nations; and (4) subject to the provisions of Article 59, judicial decisions and the teachings of
the most highly qualified publicists of the various nations, as subsidiary means for the determination of rules of law.
The report does not fall under any of the foregoing enumerated sources. It cannot even be considered as the
"teachings of highly qualified publicists." A highly qualified publicist is a scholar of public international law and the
term usually refers to legal scholars or "academic writers."
82
It has not been shown that the authors
83
of this report are
highly qualified publicists.
Assuming arguendo that the report has weight, still, the perceived gaps in the definitions of the crimes are
nonexistent. To highlight, the table below shows the definitions of genocide and war crimes under the Rome Statute
vis--vis the definitions under US laws:
Rome Statute US Law
Article 6
Genocide
For the purpose of this Statute, "genocide" means
any of the following acts committed with intent to
destroy, in whole or in part, a national, ethnical, racial
or religious group, as such:
(a) Killing members of the group;
(b) Causing serious bodily or mental harm to
members of the group;
(c) Deliberately inflicting on the group
conditions of life calculated to bring about its
physical destruction in whole or in part;
(d) Imposing measures intended to prevent
births within the group;
(e) Forcibly transferring children of the group
to another group.
1091. Genocide
(a) Basic Offense Whoever, whether in the
time of peace or in time of war and with
specific intent to destroy, in whole or in
substantial part, a national, ethnic, racial or
religious group as such
(1) kills members of that group;
(2) causes serious bodily injury to
members of that group;
(3) causes the permanent
impairment of the mental faculties
of members of the group through
drugs, torture, or similar
techniques;
(4) subjects the group to conditions
of life that are intended to cause
the physical destruction of the
group in whole or in part;
(5) imposes measures intended to
prevent births within the group; or
(6) transfers by force children of
the group to another group;
shall be punished as provided in subsection
(b).
Article 8 (d) Definition As used in this Section the
War Crimes
2. For the purpose of this Statute, "war
crimes" means:
(a) Grave breaches of the Geneva
Conventions of 12 August 1949,
namely, any of the following acts
against persons or property
protected under the provisions of
the relevant Geneva Convention: x
x x
84

(b) Other serious violations of the
laws and customs applicable in
international armed conflict, within
the established framework of
international law, namely, any of
the following acts:
x x x x
(c) In the case of an armed conflict
not of an international character,
serious violations of article 3
common to the four Geneva
Conventions of 12 August 1949,
namely, any of the following acts
committed against persons taking
no active part in the hostilities,
including members of armed forces
who have laid down their arms and
those placed hors de combat by
sickness, wounds, detention or any
other cause:
x x x x
(d) Paragraph 2 (c) applies to
armed conflicts not of an
international character and thus
does not apply to situations of
internal disturbances and tensions,
such as riots, isolated and sporadic
acts of violence or other acts of a
similar nature.
(e) Other serious violations of the
laws and customs applicable in
armed conflicts not of an
international character, within the
established framework of
international law, namely, any of
the following acts: x x x.
term "war crime" means any conduct
(1) Defined as a grave breach in any of the
international conventions signed at Geneva
12 August 1949, or any protocol to such
convention to which the United States is a
party;
(2) Prohibited by Article 23, 25, 27 or 28 of
the Annex to the Hague Convention IV,
Respecting the Laws and Customs of War
on Land, signed 18 October 1907;
(3) Which constitutes a grave breach of
common Article 3 (as defined in subsection
[d]
85
) when committed in the context of and
in association with an armed conflict not of
an international character; or
(4) Of a person who, in relation to an armed
conflict and contrary to the provisions of the
Protocol on Prohibitions or Restrictions on
the Use of Mines, Booby-Traps and Other
Devices as amended at Geneva on 3 May
1996 (Protocol II as amended on 3 May
1996), when the United States is a party to
such Protocol, willfully kills or causes
serious injury to civilians.
86

Evidently, the gaps pointed out as to the definition of the crimes are not present. In fact, the report itself stated as
much, to wit:
Few believed there were wide differences between the crimes under the jurisdiction of the Court and crimes within
the Uniform Code of Military Justice that would expose US personnel to the Court. Since US military lawyers were
instrumental in drafting the elements of crimes outlined in the Rome Statute, they ensured that most of the crimes
were consistent with those outlined in the UCMJ and gave strength to complementarity for the US. Small areas of
potential gaps between the UCMJ and the Rome Statute, military experts argued, could be addressed through
existing military laws.
87
x x x
The report went on further to say that "[a]ccording to those involved, the elements of crimes laid out in the Rome
Statute have been part of US military doctrine for decades."
88
Thus, the argument proffered cannot stand.
Nonetheless, despite the lack of actual domestic legislation, the US notably follows the doctrine of incorporation. As
early as 1900, the esteemed Justice Gray in The Paquete Habana
89
case already held international law as part of the
law of the US, to wit:
International law is part of our law, and must be ascertained and administered by the courts of justice of appropriate
jurisdiction as often as questions of right depending upon it are duly presented for their determination. For this
purpose, where there is no treaty and no controlling executive or legislative act or judicial decision, resort must be
had to the customs and usages of civilized nations, and, as evidence of these, to the works of jurists and
commentators who by years of labor, research, and experience have made themselves peculiarly well acquainted
with the subjects of which they treat. Such works are resorted to by judicial tribunals, not for the speculations of their
authors concerning what the law ought to be, but for the trustworthy evidence of what the law really is.
90
(Emphasis
supplied.)
Thus, a person can be tried in the US for an international crime despite the lack of domestic legislation. The cited
ruling in U.S. v. Coolidge,
91
which in turn is based on the holding in U.S. v. Hudson,
92
only applies to common law
and not to the law of nations or international law.
93
Indeed, the Court in U.S. v. Hudson only considered the question,
"whether the Circuit Courts of the United States can exercise a common law jurisdiction in criminal cases."
94
Stated
otherwise, there is no common law crime in the US but this is considerably different from international law.
The US doubtless recognizes international law as part of the law of the land, necessarily including international
crimes, even without any local statute.
95
In fact, years later, US courts would apply international law as a source of
criminal liability despite the lack of a local statute criminalizing it as such. So it was that in Ex Parte Quirin
96
the US
Supreme Court noted that "[f]rom the very beginning of its history this Court has recognized and applied the law of
war as including that part of the law of nations which prescribes, for the conduct of war, the status, rights and duties
of enemy nations as well as of enemy individuals."
97
It went on further to explain that Congress had not undertaken
the task of codifying the specific offenses covered in the law of war, thus:
It is no objection that Congress in providing for the trial of such offenses has not itself undertaken to codify that
branch of international law or to mark its precise boundaries, or to enumerate or define by statute all the acts which
that law condemns. An Act of Congress punishing the crime of piracy as defined by the law of nations is an
appropriate exercise of its constitutional authority, Art. I, s 8, cl. 10, to define and punish the offense since it has
adopted by reference the sufficiently precise definition of international law. x x x Similarly by the reference in the 15th
Article of War to offenders or offenses that x x x by the law of war may be triable by such military commissions.
Congress has incorporated by reference, as within the jurisdiction of military commissions, all offenses which are
defined as such by the law of war x x x, and which may constitutionally be included within that jurisdiction.
98
x x x
(Emphasis supplied.)
This rule finds an even stronger hold in the case of crimes against humanity. It has been held that genocide, war
crimes and crimes against humanity have attained the status of customary international law. Some even go so far as
to state that these crimes have attained the status of jus cogens.
99

Customary international law or international custom is a source of international law as stated in the Statute of the
ICJ.
100
It is defined as the "general and consistent practice of states recognized and followed by them from a sense of
legal obligation."
101
In order to establish the customary status of a particular norm, two elements must concur: State
practice, the objective element; and opinio juris sive necessitates, the subjective element.
102

State practice refers to the continuous repetition of the same or similar kind of acts or norms by States.
103
It is
demonstrated upon the existence of the following elements: (1) generality; (2) uniformity and consistency; and (3)
duration.
104
While, opinio juris, the psychological element, requires that the state practice or norm "be carried out in
such a way, as to be evidence of a belief that this practice is rendered obligatory by the existence of a rule of law
requiring it."
105

"The term jus cogens means the compelling law."
106
Corollary, "a jus cogens norm holds the highest hierarchical
position among all other customary norms and principles."
107
As a result, jus cogens norms are deemed "peremptory
and non-derogable."
108
When applied to international crimes, "jus cogens crimes have been deemed so fundamental
to the existence of a just international legal order that states cannot derogate from them, even by agreement."
109

These jus cogens crimes relate to the principle of universal jurisdiction, i.e., "any state may exercise jurisdiction over
an individual who commits certain heinous and widely condemned offenses, even when no other recognized basis for
jurisdiction exists."
110
"The rationale behind this principle is that the crime committed is so egregious that it is
considered to be committed against all members of the international community"
111
and thus granting every State
jurisdiction over the crime.
112

Therefore, even with the current lack of domestic legislation on the part of the US, it still has both the doctrine of
incorporation and universal jurisdiction to try these crimes.
Consequently, no matter how hard one insists, the ICC, as an international tribunal, found in the Rome Statute is not
declaratory of customary international law.
The first element of customary international law, i.e., "established, widespread, and consistent practice on the part of
States,"
113
does not, under the premises, appear to be obtaining as reflected in this simple reality: As of October 12,
2010, only 114
114
States have ratified the Rome Statute, subsequent to its coming into force eight (8) years earlier, or
on July 1, 2002. The fact that 114 States out of a total of 194
115
countries in the world, or roughly 58.76%, have
ratified the Rome Statute casts doubt on whether or not the perceived principles contained in the Statute have
attained the status of customary law and should be deemed as obligatory international law. The numbers even tend
to argue against the urgency of establishing international criminal courts envisioned in the Rome Statute. Lest it be
overlooked, the Philippines, judging by the action or inaction of its top officials, does not even feel bound by the Rome
Statute. Res ipsa loquitur. More than eight (8) years have elapsed since the Philippine representative signed the
Statute, but the treaty has not been transmitted to the Senate for the ratification process.
And this brings us to what Fr. Bernas, S.J. aptly said respecting the application of the concurring elements, thus:
Custom or customary international law means "a general and consistent practice of states followed by them from a
sense of legal obligation [opinio juris] x x x." This statement contains the two basic elements of custom: the material
factor, that is how the states behave, and the psychological factor or subjective factor, that is, why they behave the
way they do.
x x x x
The initial factor for determining the existence of custom is the actual behavior of states. This includes several
elements: duration, consistency, and generality of the practice of states.
The required duration can be either short or long. x x x
x x x x
Duration therefore is not the most important element. More important is the consistency and the generality of the
practice. x x x
x x x x
Once the existence of state practice has been established, it becomes necessary to determine why states
behave the way they do. Do states behave the way they do because they consider it obligatory to behave thus or do
they do it only as a matter of courtesy? Opinio juris, or the belief that a certain form of behavior is obligatory, is what
makes practice an international rule. Without it, practice is not law.
116
(Emphasis added.)
Evidently, there is, as yet, no overwhelming consensus, let alone prevalent practice, among the different countries in
the world that the prosecution of internationally recognized crimes of genocide, etc. should be handled by a particular
international criminal court.
Absent the widespread/consistent-practice-of-states factor, the second or the psychological element must be deemed
non-existent, for an inquiry on why states behave the way they do presupposes, in the first place, that they are
actually behaving, as a matter of settled and consistent practice, in a certain manner. This implicitly requires belief
that the practice in question is rendered obligatory by the existence of a rule of law requiring it.
117
Like the first
element, the second element has likewise not been shown to be present.
Further, the Rome Statute itself rejects the concept of universal jurisdiction over the crimes enumerated therein as
evidenced by it requiring State consent.
118
Even further, the Rome Statute specifically and unequivocally requires
that: "This Statute is subject to ratification, acceptance or approval by signatory States."
119
These clearly negate the
argument that such has already attained customary status.
More importantly, an act of the executive branch with a foreign government must be afforded great respect. The
power to enter into executive agreements has long been recognized to be lodged with the President. As We held in
Neri v. Senate Committee on Accountability of Public Officers and Investigations, "[t]he power to enter into an
executive agreement is in essence an executive power. This authority of the President to enter into executive
agreements without the concurrence of the Legislature has traditionally been recognized in Philippine
jurisprudence."
120
The rationale behind this principle is the inviolable doctrine of separation of powers among the
legislative, executive and judicial branches of the government. Thus, absent any clear contravention of the law, courts
should exercise utmost caution in declaring any executive agreement invalid.
In light of the above consideration, the position or view that the challenged RP-US Non-Surrender Agreement ought
to be in the form of a treaty, to be effective, has to be rejected.
WHEREFORE, the petition for certiorari, mandamus and prohibition is hereby DISMISSED for lack of merit. No costs.
SO ORDERED.
PRESBITERO J. VELASCO, JR.
Associate Justice
WE CONCUR:
RENATO C. CORONA
Chief Justice
ANTONIO T. CARPIO
Associate Justice
CONCHITA CARPIO MORALES
Associate Justice
ANTONIO EDUARDO B. NACHURA
Associate Justice
TERESITA J. LEONARDO-DE CASTRO
Associate Justice
ARTURO D. BRION
Associate Justice
DIOSDADO M. PERALTA
Associate Justice
LUCAS P. BERSAMIN
Associate Justice
MARIANO C. DEL CASTILLO
Associate Justice
ROBERTO A. ABAD
Associate Justice
MARTIN S. VILLARAMA, JR.
Associate Justice
JOSE PORTUGAL PEREZ
Associate Justice
JOSE CATRAL MENDOZA
Associate Justice
MARIA LOURDES P. A. SERENO
Associate Justice
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above Decision
had been reached in consultation before the case was assigned to the writer of the opinion of the Court.
RENATO C. CORONA
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 166562 March 31, 2009
BENJAMIN G. TING, Petitioner,
vs.
CARMEN M. VELEZ-TING, Respondent.
D E C I S I O N
NACHURA, J .:
Before us is a petition for review on certiorari seeking to set aside the November 17, 2003 Amended Decision
1
of the
Court of Appeals (CA), and its December 13, 2004 Resolution
2
in CA-G.R. CV No. 59903. The appellate court, in its
assailed decision and resolution, affirmed the January 9, 1998 Decision
3
of the Regional Trial Court (RTC), Branch
23, Cebu City, declaring the marriage between petitioner and respondent null and void ab initio pursuant to Article 36
of the Family Code.
4

The facts follow.
Petitioner Benjamin Ting (Benjamin) and respondent Carmen Velez-Ting (Carmen) first met in 1972 while they were
classmates in medical school.
5
They fell in love, and they were wed on July 26, 1975 in Cebu City when respondent
was already pregnant with their first child.
At first, they resided at Benjamins family home in Maguikay, Mandaue City.
6
When their second child was born, the
couple decided to move to Carmens family home in Cebu City.
7
In September 1975, Benjamin passed the medical
board examinations
8
and thereafter proceeded to take a residency program to become a surgeon but shifted to
anesthesiology after two years. By 1979, Benjamin completed the preceptorship program for the said field
9
and, in
1980, he began working for Velez Hospital, owned by Carmens family, as member of its active staff,
10
while Carmen
worked as the hospitals Treasurer.
11

The couple begot six (6) children, namely Dennis, born on December 9, 1975; James Louis, born on August 25,
1977; Agnes Irene, born on April 5, 1981; Charles Laurence, born on July 21, 1986; Myles Vincent, born on July 19,
1988; and Marie Corinne, born on June 16, 1991.
12

On October 21, 1993, after being married for more than 18 years to petitioner and while their youngest child was only
two years old, Carmen filed a verified petition before the RTC of Cebu City praying for the declaration of nullity of their
marriage based on Article 36 of the Family Code. She claimed that Benjamin suffered from psychological incapacity
even at the time of the celebration of their marriage, which, however, only became manifest thereafter.
13

In her complaint, Carmen stated that prior to their marriage, she was already aware that Benjamin used to drink and
gamble occasionally with his friends.
14
But after they were married, petitioner continued to drink regularly and would
go home at about midnight or sometimes in the wee hours of the morning drunk and violent. He would confront and
insult respondent, physically assault her and force her to have sex with him. There were also instances when
Benjamin used his gun and shot the gate of their house.
15
Because of his drinking habit, Benjamins job as
anesthesiologist was affected to the point that he often had to refuse to answer the call of his fellow doctors and to
pass the task to other anesthesiologists. Some surgeons even stopped calling him for his services because they
perceived petitioner to be unreliable. Respondent tried to talk to her husband about the latters drinking problem, but
Benjamin refused to acknowledge the same.
16

Carmen also complained that petitioner deliberately refused to give financial support to their family and would even
get angry at her whenever she asked for money for their children. Instead of providing support, Benjamin would
spend his money on drinking and gambling and would even buy expensive equipment for his hobby.
17
He rarely
stayed home
18
and even neglected his obligation to his children.
19

Aside from this, Benjamin also engaged in compulsive gambling.
20
He would gamble two or three times a week and
would borrow from his friends, brothers, or from loan sharks whenever he had no money. Sometimes, Benjamin
would pawn his wifes own jewelry to finance his gambling.
21
There was also an instance when the spouses had to
sell their family car and even a portion of the lot Benjamin inherited from his father just to be able to pay off his
gambling debts.
22
Benjamin only stopped going to the casinos in 1986 after he was banned therefrom for having
caused trouble, an act which he said he purposely committed so that he would be banned from the gambling
establishments.
23

In sum, Carmens allegations of Benjamins psychological incapacity consisted of the following manifestations:
1. Benjamins alcoholism, which adversely affected his family relationship and his profession;
2. Benjamins violent nature brought about by his excessive and regular drinking;
3. His compulsive gambling habit, as a result of which Benjamin found it necessary to sell the family car
twice and the property he inherited from his father in order to pay off his debts, because he no longer had
money to pay the same; and
4. Benjamins irresponsibility and immaturity as shown by his failure and refusal to give regular financial
support to his family.
24

In his answer, Benjamin denied being psychologically incapacitated. He maintained that he is a respectable person,
as his peers would confirm. He said that he is an active member of social and athletic clubs and would drink and
gamble only for social reasons and for leisure. He also denied being a violent person, except when provoked by
circumstances.
25
As for his alleged failure to support his family financially, Benjamin claimed that it was Carmen
herself who would collect his professional fees from Velez Hospital when he was still serving there as practicing
anesthesiologist.
26
In his testimony, Benjamin also insisted that he gave his family financial support within his means
whenever he could and would only get angry at respondent for lavishly spending his hard-earned money on
unnecessary things.
27
He also pointed out that it was he who often comforted and took care of their children, while
Carmen played mahjong with her friends twice a week.
28

During the trial, Carmens testimony regarding Benjamins drinking and gambling habits and violent behavior was
corroborated by Susana Wasawas, who served as nanny to the spouses children from 1987 to 1992.
29
Wasawas
stated that she personally witnessed instances when Benjamin maltreated Carmen even in front of their children.
30

Carmen also presented as witness Dr. Pureza Trinidad-Oate, a psychiatrist.
31
Instead of the usual personal
interview, however, Dr. Oates evaluation of Benjamin was limited to the transcript of stenographic notes taken
during Benjamins deposition because the latter had already gone to work as an anesthesiologist in a hospital in
South Africa. After reading the transcript of stenographic notes, Dr. Oate concluded that Benjamins compulsive
drinking, compulsive gambling and physical abuse of respondent are clear indications that petitioner suffers from a
personality disorder.
32

To refute Dr. Oates opinion, petitioner presented Dr. Renato D. Obra, a psychiatrist and a consultant at the
Department of Psychiatry in Don Vicente Sotto Memorial Medical Center, as his expert witness.
33
Dr. Obra evaluated
Benjamins psychological behavior based on the transcript of stenographic notes, as well as the psychiatric
evaluation report prepared by Dr. A.J.L. Pentz, a psychiatrist from the University of Pretoria in South Africa, and his
(Dr. Obras) interview with Benjamins brothers.
34
Contrary to Dr. Oates findings, Dr. Obra observed that there is
nothing wrong with petitioners personality, considering the latters good relationship with his fellow doctors and his
good track record as anesthesiologist.
35

On January 9, 1998, the lower court rendered its Decision
36
declaring the marriage between petitioner and
respondent null and void. The RTC gave credence to Dr. Oates findings and the admissions made by Benjamin in
the course of his deposition, and found him to be psychologically incapacitated to comply with the essential
obligations of marriage. Specifically, the trial court found Benjamin an excessive drinker, a compulsive gambler,
someone who prefers his extra-curricular activities to his family, and a person with violent tendencies, which
character traits find root in a personality defect existing even before his marriage to Carmen. The decretal portion of
the decision reads:
WHEREFORE, all the foregoing considered, judgment is hereby rendered declaring the marriage between plaintiff
and defendant null and void ab initio pursuant to Art. 36 of the Family Code. x x x
x x x x
SO ORDERED.
37

Aggrieved, petitioner appealed to the CA. On October 19, 2000, the CA rendered a Decision
38
reversing the trial
courts ruling. It faulted the trial courts finding, stating that no proof was adduced to support the conclusion that
Benjamin was psychologically incapacitated at the time he married Carmen since Dr. Oates conclusion was based
only on theories and not on established fact,
39
contrary to the guidelines set forth in Santos v. Court of Appeals
40
and
in Rep. of the Phils. v. Court of Appeals and Molina.
41

Because of this, Carmen filed a motion for reconsideration, arguing that the Molina guidelines should not be applied
to this case since the Molina decision was promulgated only on February 13, 1997, or more than five years after she
had filed her petition with the RTC.
42
She claimed that the Molina ruling could not be made to apply retroactively, as it
would run counter to the principle of stare decisis. Initially, the CA denied the motion for reconsideration for having
been filed beyond the prescribed period. Respondent thereafter filed a manifestation explaining compliance with the
prescriptive period but the same was likewise denied for lack of merit. Undaunted, respondent filed a petition for
certiorari
43
with this Court. In a Resolution
44
dated March 5, 2003, this Court granted the petition and directed the CA
to resolve Carmens motion for reconsideration.
45
On review, the CA decided to reconsider its previous ruling. Thus,
on November 17, 2003, it issued an Amended Decision
46
reversing its first ruling and sustaining the trial courts
decision.
47

A motion for reconsideration was filed, this time by Benjamin, but the same was denied by the CA in its December 13,
2004 Resolution.
48

Hence, this petition.
For our resolution are the following issues:
I. Whether the CA violated the rule on stare decisis when it refused to follow the guidelines set forth under
the Santos and Molina cases;
II. Whether the CA correctly ruled that the requirement of proof of psychological incapacity for the
declaration of absolute nullity of marriage based on Article 36 of the Family Code has been liberalized; and
III. Whether the CAs decision declaring the marriage between petitioner and respondent null and void [is] in
accordance with law and jurisprudence.
We find merit in the petition.
I. On the issue of stare decisis.
The principle of stare decisis enjoins adherence by lower courts to doctrinal rules established by this Court in its final
decisions. It is based on the principle that once a question of law has been examined and decided, it should be
deemed settled and closed to further argument.
49
Basically, it is a bar to any attempt to relitigate the same
issues,
50
necessary for two simple reasons: economy and stability. In our jurisdiction, the principle is entrenched in
Article 8 of the Civil Code.
51

This doctrine of adherence to precedents or stare decisis was applied by the English courts and was later adopted by
the United States. Associate Justice (now Chief Justice) Reynato S. Punos discussion on the historical development
of this legal principle in his dissenting opinion in Lambino v. Commission on Elections
52
is enlightening:
The latin phrase stare decisis et non quieta movere means "stand by the thing and do not disturb the calm." The
doctrine started with the English Courts. Blackstone observed that at the beginning of the 18th century, "it is an
established rule to abide by former precedents where the same points come again in litigation." As the rule evolved,
early limits to its application were recognized: (1) it would not be followed if it were "plainly unreasonable"; (2) where
courts of equal authority developed conflicting decisions; and, (3) the binding force of the decision was the "actual
principle or principles necessary for the decision; not the words or reasoning used to reach the decision."
The doctrine migrated to the United States. It was recognized by the framers of the U.S. Constitution. According to
Hamilton, "strict rules and precedents" are necessary to prevent "arbitrary discretion in the courts." Madison agreed
but stressed that "x x x once the precedent ventures into the realm of altering or repealing the law, it should be
rejected." Prof. Consovoy well noted that Hamilton and Madison "disagree about the countervailing policy
considerations that would allow a judge to abandon a precedent." He added that their ideas "reveal a deep internal
conflict between the concreteness required by the rule of law and the flexibility demanded in error correction. It is this
internal conflict that the Supreme Court has attempted to deal with for over two centuries."
Indeed, two centuries of American case law will confirm Prof. Consovoy's observation although stare decisis
developed its own life in the United States. Two strains of stare decisis have been isolated by legal scholars. The
first, known as vertical stare decisis deals with the duty of lower courts to apply the decisions of the higher courts to
cases involving the same facts. The second, known as horizontal stare decisis requires that high courts must follow
its own precedents. Prof. Consovoy correctly observes that vertical stare decisis has been viewed as an obligation,
while horizontal stare decisis, has been viewed as a policy, imposing choice but not a command. Indeed, stare
decisis is not one of the precepts set in stone in our Constitution.
It is also instructive to distinguish the two kinds of horizontal stare decisis constitutional stare decisis and statutory
stare decisis. Constitutional stare decisis involves judicial interpretations of the Constitution while statutory stare
decisis involves interpretations of statutes. The distinction is important for courts enjoy more flexibility in refusing to
apply stare decisis in constitutional litigations. Justice Brandeis' view on the binding effect of the doctrine in
constitutional litigations still holds sway today. In soothing prose, Brandeis stated: "Stare decisis is not . . . a universal
and inexorable command. The rule of stare decisis is not inflexible. Whether it shall be followed or departed from, is a
question entirely within the discretion of the court, which is again called upon to consider a question once decided." In
the same vein, the venerable Justice Frankfurter opined: "the ultimate touchstone of constitutionality is the
Constitution itself and not what we have said about it." In contrast, the application of stare decisis on judicial
interpretation of statutes is more inflexible. As Justice Stevens explains: "after a statute has been construed, either by
this Court or by a consistent course of decision by other federal judges and agencies, it acquires a meaning that
should be as clear as if the judicial gloss had been drafted by the Congress itself." This stance reflects both respect
for Congress' role and the need to preserve the courts' limited resources.
In general, courts follow the stare decisis rule for an ensemble of reasons, viz.: (1) it legitimizes judicial institutions;
(2) it promotes judicial economy; and, (3) it allows for predictability. Contrariwise, courts refuse to be bound by the
stare decisis rule where (1) its application perpetuates illegitimate and unconstitutional holdings; (2) it cannot
accommodate changing social and political understandings; (3) it leaves the power to overturn bad constitutional law
solely in the hands of Congress; and, (4) activist judges can dictate the policy for future courts while judges that
respect stare decisis are stuck agreeing with them.
In its 200-year history, the U.S. Supreme Court has refused to follow the stare decisis rule and reversed its decisions
in 192 cases. The most famous of these reversals is Brown v. Board of Education which junked Plessy v. Ferguson's
"separate but equal doctrine." Plessy upheld as constitutional a state law requirement that races be segregated on
public transportation. In Brown, the U.S. Supreme Court, unanimously held that "separate . . . is inherently unequal."
Thus, by freeing itself from the shackles of stare decisis, the U.S. Supreme Court freed the colored Americans from
the chains of inequality. In the Philippine setting, this Court has likewise refused to be straitjacketed by the stare
decisis rule in order to promote public welfare. In La Bugal-B'laan Tribal Association, Inc. v. Ramos, we reversed our
original ruling that certain provisions of the Mining Law are unconstitutional. Similarly, in Secretary of Justice v.
Lantion, we overturned our first ruling and held, on motion for reconsideration, that a private respondent is bereft of
the right to notice and hearing during the evaluation stage of the extradition process.
An examination of decisions on stare decisis in major countries will show that courts are agreed on the factors that
should be considered before overturning prior rulings. These are workability, reliance, intervening developments in
the law and changes in fact. In addition, courts put in the balance the following determinants: closeness of the voting,
age of the prior decision and its merits.
The leading case in deciding whether a court should follow the stare decisis rule in constitutional litigations is Planned
Parenthood v. Casey. It established a 4-pronged test. The court should (1) determine whether the rule has proved to
be intolerable simply in defying practical workability; (2) consider whether the rule is subject to a kind of reliance that
would lend a special hardship to the consequences of overruling and add inequity to the cost of repudiation; (3)
determine whether related principles of law have so far developed as to have the old rule no more than a remnant of
an abandoned doctrine; and, (4) find out whether facts have so changed or come to be seen differently, as to have
robbed the old rule of significant application or justification.
53

To be forthright, respondents argument that the doctrinal guidelines prescribed in Santos and Molina should not be
applied retroactively for being contrary to the principle of stare decisis is no longer new. The same argument was also
raised but was struck down in Pesca v. Pesca,
54
and again in Antonio v. Reyes.
55
In these cases, we explained that
the interpretation or construction of a law by courts constitutes a part of the law as of the date the statute is enacted.
It is only when a prior ruling of this Court is overruled, and a different view is adopted, that the new doctrine may have
to be applied prospectively in favor of parties who have relied on the old doctrine and have acted in good faith, in
accordance therewith under the familiar rule of "lex prospicit, non respicit."
II. On liberalizing the required proof for the declaration of nullity of marriage under Article 36.
Now, petitioner wants to know if we have abandoned the Molina doctrine.
We have not.
In Edward Kenneth Ngo Te v. Rowena Ong Gutierrez Yu-Te,
56
we declared that, in hindsight, it may have been
inappropriate for the Court to impose a rigid set of rules, as the one in Molina, in resolving all cases of psychological
incapacity. We said that instead of serving as a guideline, Molina unintentionally became a straightjacket, forcing all
cases involving psychological incapacity to fit into and be bound by it, which is not only contrary to the intention of the
law but unrealistic as well because, with respect to psychological incapacity, no case can be considered as on "all
fours" with another.
57

By the very nature of cases involving the application of Article 36, it is logical and understandable to give weight to
the expert opinions furnished by psychologists regarding the psychological temperament of parties in order to
determine the root cause, juridical antecedence, gravity and incurability of the psychological incapacity. However,
such opinions, while highly advisable, are not conditions sine qua non in granting petitions for declaration of nullity of
marriage.
58
At best, courts must treat such opinions as decisive but not indispensable evidence in determining the
merits of a given case. In fact, if the totality of evidence presented is enough to sustain a finding of psychological
incapacity, then actual medical or psychological examination of the person concerned need not be resorted to.
59
The
trial court, as in any other given case presented before it, must always base its decision not solely on the expert
opinions furnished by the parties but also on the totality of evidence adduced in the course of the proceedings.
It was for this reason that we found it necessary to emphasize in Ngo Te that each case involving the application of
Article 36 must be treated distinctly and judged not on the basis of a priori assumptions, predilections or
generalizations but according to its own attendant facts. Courts should interpret the provision on a case-to-case
basis, guided by experience, the findings of experts and researchers in psychological disciplines, and by decisions of
church tribunals.
Far from abandoning Molina, we simply suggested the relaxation of the stringent requirements set forth therein,
cognizant of the explanation given by the Committee on the Revision of the Rules on the rationale of the Rule on
Declaration of Absolute Nullity of Void Marriages and Annulment of Voidable Marriages (A.M. No. 02-11-10-SC), viz.:
To require the petitioner to allege in the petition the particular root cause of the psychological incapacity and to attach
thereto the verified written report of an accredited psychologist or psychiatrist have proved to be too expensive for the
parties. They adversely affect access to justice o poor litigants. It is also a fact that there are provinces where these
experts are not available. Thus, the Committee deemed it necessary to relax this stringent requirement enunciated in
the Molina Case. The need for the examination of a party or parties by a psychiatrist or clinical psychologist and the
presentation of psychiatric experts shall now be determined by the court during the pre-trial conference.
60

But where, as in this case, the parties had the full opportunity to present professional and expert opinions of
psychiatrists tracing the root cause, gravity and incurability of a partys alleged psychological incapacity, then such
expert opinion should be presented and, accordingly, be weighed by the court in deciding whether to grant a petition
for nullity of marriage.
III. On petitioners psychological incapacity.
Coming now to the main issue, we find the totality of evidence adduced by respondent insufficient to prove that
petitioner is psychologically unfit to discharge the duties expected of him as a husband, and more particularly, that he
suffered from such psychological incapacity as of the date of the marriage eighteen (18) years ago. Accordingly, we
reverse the trial courts and the appellate courts rulings declaring the marriage between petitioner and respondent
null and void ab initio.
The intendment of the law has been to confine the application of Article 36 to the most serious cases of personality
disorders clearly demonstrative of an utter insensitivity or inability to give meaning and significance to the
marriage.
61
The psychological illness that must have afflicted a party at the inception of the marriage should be a
malady so grave and permanent as to deprive one of awareness of the duties and responsibilities of the matrimonial
bond he or she is about to assume.
62
1avvphi1.zw+
In this case, respondent failed to prove that petitioners "defects" were present at the time of the celebration of their
marriage. She merely cited that prior to their marriage, she already knew that petitioner would occasionally drink and
gamble with his friends; but such statement, by itself, is insufficient to prove any pre-existing psychological defect on
the part of her husband. Neither did the evidence adduced prove such "defects" to be incurable.
The evaluation of the two psychiatrists should have been the decisive evidence in determining whether to declare the
marriage between the parties null and void. Sadly, however, we are not convinced that the opinions provided by
these experts strengthened respondents allegation of psychological incapacity. The two experts provided
diametrically contradicting psychological evaluations: Dr. Oate testified that petitioners behavior is a positive
indication of a personality disorder,
63
while Dr. Obra maintained that there is nothing wrong with petitioners
personality. Moreover, there appears to be greater weight in Dr. Obras opinion because, aside from analyzing the
transcript of Benjamins deposition similar to what Dr. Oate did, Dr. Obra also took into consideration the
psychological evaluation report furnished by another psychiatrist in South Africa who personally examined Benjamin,
as well as his (Dr. Obras) personal interview with Benjamins brothers.
64
Logically, therefore, the balance tilts in favor
of Dr. Obras findings.
Lest it be misunderstood, we are not condoning petitioners drinking and gambling problems, or his violent outbursts
against his wife. There is no valid excuse to justify such a behavior. Petitioner must remember that he owes love,
respect, and fidelity to his spouse as much as the latter owes the same to him. Unfortunately, this court finds
respondents testimony, as well as the totality of evidence presented by the respondent, to be too inadequate to
declare him psychologically unfit pursuant to Article 36.
It should be remembered that the presumption is always in favor of the validity of marriage. Semper praesumitur pro
matrimonio.
65
In this case, the presumption has not been amply rebutted and must, perforce, prevail.
WHEREFORE, premises considered, the petition for review on certiorari is GRANTED. The November 17, 2003
Amended Decision and the December 13, 2004 Resolution of the Court of Appeals in CA-G.R. CV No. 59903 are
accordingly REVERSED and SET ASIDE.
SO ORDERED.
ANTONIO EDUARDO B. NACHURA
Associate Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
CONCHITA CARPIO MORALES
*

Associate Justice
MINITA V. CHICO-NAZARIO
Associate Justice
DIOSDADO M. PERALTA
Associate Justice
A T T E S T A T I O N
I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the
writer of the opinion of the Courts Division.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson, Third Division
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution and the Division Chairperson's Attestation, I certify that the
conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the
opinion of the Courts Division.
REYNATO S. PUNO
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 162336 February 1, 2010
HILARIO P. SORIANO, Petitioner,
vs.
PEOPLE OF THE PHILIPPINES, BANGKO SENTRAL NG PILIPINAS (BSP), PHILIPPINE DEPOSIT INSURANCE
CORPORATION (PDIC), PUBLIC PROSECUTOR ANTONIO C.BUAN, and STATE PROSECUTOR ALBERTO R.
FONACIER, Respondents.
D E C I S I O N
DEL CASTILLO, J .:
A bank officer violates the DOSRI
2
law when he acquires bank funds for his personal benefit, even if such acquisition
was facilitated by a fraudulent loan application. Directors, officers, stockholders, and their related interests cannot be
allowed to interpose the fraudulent nature of the loan as a defense to escape culpability for their circumvention of
Section 83 of Republic Act (RA) No. 337.
3

Before us is a Petition for Review on Certiorari
4
under Rule 45 of the Rules of Court, assailing the September 26,
2003 Decision
5
and the February 5, 2004 Resolution
6
of the Court of Appeals (CA) in CA-G.R. SP No. 67657. The
challenged Decision disposed as follows:
WHEREFORE, premises considered, the instant petition for certiorari is hereby DENIED.
7

Factual Antecedents
Sometime in 2000, the Office of Special Investigation (OSI) of the Bangko Sentral ng Pilipinas (BSP), through its
officers,
8
transmitted a letter
9
dated March 27, 2000 to Jovencito Zuo, Chief State Prosecutor of the Department of
Justice (DOJ). The letter attached as annexes five affidavits,
10
which would allegedly serve as bases for filing criminal
charges for Estafa thru Falsification of Commercial Documents, in relation to Presidential Decree (PD) No.
1689,
11
and for Violation of Section 83 of RA 337, as amended by PD 1795,
12
against, inter alia, petitioner herein
Hilario P. Soriano. These five affidavits, along with other documents, stated that spouses Enrico and Amalia Carlos
appeared to have an outstanding loan of P8 million with the Rural Bank of San Miguel (Bulacan), Inc. (RBSM), but
had never applied for nor received such loan; that it was petitioner, who was then president of RBSM, who had
ordered, facilitated, and received the proceeds of the loan; and that the P8 million loan had never been authorized by
RBSM's Board of Directors and no report thereof had ever been submitted to the Department of Rural Banks,
Supervision and Examination Sector of the BSP. The letter of the OSI, which was not subscribed under oath, ended
with a request that a preliminary investigation be conducted and the corresponding criminal charges be filed against
petitioner at his last known address.
Acting on the letter-request and its annexes, State Prosecutor Albert R. Fonacier proceeded with the preliminary
investigation. He issued a subpoena with the witnesses affidavits and supporting documents attached, and required
petitioner to file his counter-affidavit. In due course, the investigating officer issued a Resolution finding probable
cause and correspondingly filed two separate informations against petitioner before the Regional Trial Court (RTC) of
Malolos, Bulacan.
13

The first Information,
14
dated November 14, 2000 and docketed as Criminal Case No. 237-M-2001, was for estafa
through falsification of commercial documents, under Article 315, paragraph 1(b), of the Revised Penal Code (RPC),
in relation to Article 172 of the RPC and PD 1689. It basically alleged that petitioner and his co-accused, in abuse of
the confidence reposed in them as RBSM officers, caused the falsification of a number of loan documents, making it
appear that one Enrico Carlos filled up the same, and thereby succeeded in securing a loan and converting the loan
proceeds for their personal gain and benefit.
15
The information reads:
That in or about the month of April, 1997, and thereafter, in San Miguel, Bulacan, and within the jurisdiction of this
Honorable Court, the said accused HILARIO P. SORIANO and ROSALINDA ILAGAN, as principals by direct
participation, with unfaithfulness or abuse of confidence and taking advantage of their position as President of the
Rural Bank of San Miguel (Bulacan), Inc. and Branch Manager of the Rural Bank of San Miguel San Miguel Branch
[sic], a duly organized banking institution under Philippine Laws, conspiring, confederating and mutually helping one
another, did then and there, willfully and feloniously falsify loan documents consisting of undated loan
application/information sheet, credit proposal dated April 14, 1997, credit proposal dated April 22, 1997, credit
investigation report dated April 15, 1997, promissory note dated April 23, 1997, disclosure statement on loan/credit
transaction dated April 23, 1997, and other related documents, by making it appear that one Enrico Carlos filled up
the application/information sheet and filed the aforementioned loan documents when in truth and in fact Enrico Carlos
did not participate in the execution of said loan documents and that by virtue of said falsification and with deceit and
intent to cause damage, the accused succeeded in securing a loan in the amount of eight million pesos
(PhP8,000,000.00) from the Rural Bank of San Miguel San Ildefonso branch in the name of Enrico Carlos which
amount of PhP8 million representing the loan proceeds the accused thereafter converted the same amount to their
own personal gain and benefit, to the damage and prejudice of the Rural Bank of San Miguel San Ildefonso branch,
its creditors, the Bangko Sentral ng Pilipinas, and the Philippine Deposit Insurance Corporation.
CONTRARY TO LAW.
16

The other Information
17
dated November 10, 2000 and docketed as Criminal Case No. 238-M-2001, was for violation
of Section 83 of RA 337, as amended by PD 1795. The said provision refers to the prohibition against the so-called
DOSRI loans. The information alleged that, in his capacity as President of RBSM, petitioner indirectly secured an P8
million loan with RBSM, for his personal use and benefit, without the written consent and approval of the bank's
Board of Directors, without entering the said transaction in the bank's records, and without transmitting a copy of the
transaction to the supervising department of the bank. His ruse was facilitated by placing the loan in the name of an
unsuspecting RBSM depositor, one Enrico Carlos.
18
The information reads:
That in or about the month of April, 1997, and thereafter, and within the jurisdiction of this Honorable Court, the said
accused, in his capacity as President of the Rural Bank of San Miguel (Bulacan), Inc., did then and there, willfully and
feloniously indirectly borrow or secure a loan with the Rural Bank of San Miguel San Ildefonso branch, a domestic
rural banking institution created, organized and existing under Philippine laws, amounting to eight million pesos
(PhP8,000,000.00), knowing fully well that the same has been done by him without the written consent and approval
of the majority of the board of directors of the said bank, and which consent and approval the said accused
deliberately failed to obtain and enter the same upon the records of said banking institution and to transmit a copy
thereof to the supervising department of the said bank, as required by the General Banking Act, by using the name of
one depositor Enrico Carlos of San Miguel, Bulacan, the latter having no knowledge of the said loan, and one in
possession of the said amount of eight million pesos (PhP8,000,000.00), accused converted the same to his own
personal use and benefit, in flagrant violation of the said law.
CONTRARY TO LAW.
19

Both cases were raffled to Branch 79 of the RTC of Malolos, Bulacan.
20

On June 8, 2001, petitioner moved to quash
21
these informations on two grounds: that the court had no jurisdiction
over the offense charged, and that the facts charged do not constitute an offense.
On the first ground, petitioner argued that the letter transmitted by the BSP to the DOJ constituted the complaint and
hence was defective for failure to comply with the mandatory requirements of Section 3(a), Rule 112 of the Rules of
Court, such as the statement of address of petitioner and oath and subscription.
22
Moreover, petitioner argued that
the officers of OSI, who were the signatories to the "letter-complaint," were not authorized by the BSP Governor,
much less by the Monetary Board, to file the complaint. According to petitioner, this alleged fatal oversight violated
Section 18, pars. (c) and (d) of the New Central Bank Act (RA 7653).
On the second ground, petitioner contended that the commission of estafa under paragraph 1(b) of Article 315 of the
RPC is inherently incompatible with the violation of DOSRI law (as set out in Section 83
23
of RA 337, as amended by
PD 1795),
24
hence a person cannot be charged for both offenses. He argued that a violation of DOSRI law requires
the offender to obtain a loan from his bank, without complying with procedural, reportorial, or ceiling requirements.
On the other hand, estafa under par. 1(b), Article 315 of the RPC requires the offender to misappropriate or convert
something that he holds in trust, or on commission, or for administration, or under any other obligation involving
the duty to return the same.
25

Essentially, the petitioner theorized that the characterization of possession is different in the two offenses. If petitioner
acquired the loan as DOSRI, he owned the loaned money and therefore, cannot misappropriate or convert it as
contemplated in the offense of estafa. Conversely, if petitioner committed estafa, then he merely held the money in
trust for someone else and therefore, did not acquire a loan in violation of DOSRI rules.
Ruling of the Regional Trial Court
In an Order
26
dated August 8, 2001, the trial court denied petitioner's Motion to Quash for lack of merit. The lower
court agreed with the prosecution that the assailed OSI letter was not the complaint-affidavit itself; thus, it need not
comply with the requirements under the Rules of Court. The trial court held that the affidavits, which were attached to
the OSI letter, comprised the complaint-affidavit in the case. Since these affidavits were duly subscribed and sworn to
before a notary public, there was adequate compliance with the Rules. The trial court further held that the two
offenses were separate and distinct violations, hence the prosecution of one did not pose a bar to the other.
27

Petitioners Motion for Reconsideration was likewise denied in an Order dated September 5, 2001.
28

Aggrieved, petitioner filed a Petition for Certiorari
29
with the CA, reiterating his arguments before the trial court.
Ruling of the Court of Appeals
The CA denied the petition on both issues presented by petitioner.
On the first issue, the CA determined that the BSP letter, which petitioner characterized to be a fatally infirm
complaint, was not actually a complaint, but a transmittal or cover letter only. This transmittal letter merely contained
a summary of the affidavits which were attached to it. It did not contain any averment of personal knowledge of the
events and transactions that constitute the elements of the offenses charged. Being a mere transmittal letter, it need
not comply with the requirements of Section 3(a) of Rule 112 of the Rules of Court.
30

The CA further determined that the five affidavits attached to the transmittal letter should be considered as the
complaint-affidavits that charged petitioner with violation of Section 83 of RA 337 and for Estafa thru Falsification of
Commercial Documents. These complaint-affidavits complied with the mandatory requirements set out in the Rules of
Court they were subscribed and sworn to before a notary public and subsequently certified by State Prosecutor
Fonacier, who personally examined the affiants and was convinced that the affiants fully understood their sworn
statements.
31

Anent the second ground, the CA found no merit in petitioner's argument that the violation of the DOSRI law and the
commission of estafa thru falsification of commercial documents are inherently inconsistent with each other. It
explained that the test in considering a motion to quash on the ground that the facts charged do not constitute an
offense, is whether the facts alleged, when hypothetically admitted, constitute the elements of the offense charged.
The appellate court held that this test was sufficiently met because the allegations in the assailed informations, when
hypothetically admitted, clearly constitute the elements of Estafa thru Falsification of Commercial Documents and
Violation of DOSRI law.
32

Petitioners Motion for Reconsideration
33
was likewise denied for lack of merit.
Hence, this petition.
Issues
Restated, petitioner raises the following issues
34
for our consideration:
I
Whether the complaint complied with the mandatory requirements provided under Section 3(a), Rule 112 of the Rules
of Court and Section 18, paragraphs (c) and (d) of RA 7653.
II
Whether a loan transaction within the ambit of the DOSRI law (violation of Section 83 of RA 337, as amended) could
also be the subject of Estafa under Article 315 (1) (b) of the Revised Penal Code.
III
Is a petition for certiorari under Rule 65 the proper remedy against an Order denying a Motion to Quash?
IV
Whether petitioner is entitled to a writ of injunction.
Our Ruling
The petition lacks merit.
First Issue:
Whether the complaint complied with the mandatory requirements provided under Section 3(a), Rule 112 of
the Rules of Court and Section 18, paragraphs (c) and (d) of
Republic Act No. 7653
Petitioner moved to withdraw the first issue from the instant petition
On March 5, 2007, the Court noted
35
petitioner's Manifestation and Motion for Partial Withdrawal of the
Petition
36
dated February 7, 2007. In the said motion, petitioner informed the Court of the promulgation of a Decision
entitledSoriano v. Hon. Casanova,
37
which also involved petitioner and similar BSP letters to the DOJ. According to
petitioner, the said Decision allegedly ruled squarely on the nature of the BSP letters and the validity of the sworn
affidavits attached thereto. For this reason, petitioner moved for the partial withdrawal of the instant petition insofar as
it involved the issue of "whether or not a court can legally acquire jurisdiction over a complaint which failed to comply
with the mandatory requirements provided under Section 3(a), Rule 112 of the Rules of Court and Section 18,
paragraphs (c) and (d) of RA 7653".
38

Given that the case had already been submitted for resolution of the Court when petitioner filed his latest motion, and
that all respondents had presented their positions and arguments on the first issue, the Court deems it proper to rule
on the same.
In Soriano v. Hon. Casanova, the Court held that the affidavits attached to the BSP transmittal letter complied with
the mandatory requirements under the Rules of Court.
To be sure, the BSP letters involved in Soriano v. Hon. Casanova
39
are not the same as the BSP letter involved in the
instant case. However, the BSP letters in Soriano v. Hon. Casanova and the BSP letter subject of this case are
similar in the sense that they are all signed by the OSI officers of the BSP, they were not sworn to by the said officers,
they all contained summaries of their attached affidavits, and they all requested the conduct of a preliminary
investigation and the filing of corresponding criminal charges against petitioner Soriano. Thus, the principle of stare
decisis dictates that the ruling in Soriano v. Hon. Casanova be applied in the instant case once a question of law
has been examined and decided, it should be deemed settled and closed to further argument.
40

We held in Soriano v. Hon. Casanova, after a close scrutiny of the letters transmitted by the BSP to the DOJ, that
these were not intended to be the complaint, as envisioned under the Rules. They did not contain averments of
personal knowledge of the events and transactions constitutive of any offense. The letters merely transmitted for
preliminary investigation the affidavits of people who had personal knowledge of the acts of petitioner. We ruled that
these affidavits, not the letters transmitting them, initiated the preliminary investigation. Since these affidavits were
subscribed under oath by the witnesses who executed them before a notary public, then there was substantial
compliance with Section 3(a), Rule 112 of the Rules of Court.
Anent the contention that there was no authority from the BSP Governor or the Monetary Board to file a criminal case
against Soriano, we held that the requirements of Section 18, paragraphs (c) and (d) of RA 7653 did not apply
because the BSP did not institute the complaint but merely transmitted the affidavits of the complainants to the DOJ.
We further held that since the offenses for which Soriano was charged were public crimes, authority holds that it can
be initiated by "any competent person" with personal knowledge of the acts committed by the offender. Thus, the
witnesses who executed the affidavits clearly fell within the purview of "any competent person" who may institute the
complaint for a public crime.
The ruling in Soriano v. Hon. Casanova has been adopted and elaborated upon in the recent case of Santos-Concio
v. Department of Justice.
41
Instead of a transmittal letter from the BSP, the Court in Santos-Concio was faced with an
NBI-NCR Report, likewise with affidavits of witnesses as attachments. Ruling on the validity of the witnesses sworn
affidavits as bases for a preliminary investigation, we held:
The Court is not unaware of the practice of incorporating all allegations in one document denominated as "complaint-
affidavit." It does not pronounce strict adherence to only one approach, however, for there are cases where the extent
of ones personal knowledge may not cover the entire gamut of details material to the alleged offense. The private
offended party or relative of the deceased may not even have witnessed the fatality, in which case the peace officer
or law enforcer has to rely chiefly on affidavits of witnesses. The Rules do not in fact preclude the attachment of a
referral or transmittal letter similar to that of the NBI-NCR. Thus, in Soriano v. Casanova, the Court held:
A close scrutiny of the letters transmitted by the BSP and PDIC to the DOJ shows that these were not intended to
be the complaint envisioned under the Rules. It may be clearly inferred from the tenor of the letters that the officers
merely intended to transmit the affidavits of the bank employees to the DOJ. Nowhere in the transmittal letters is
there any averment on the part of the BSP and PDIC officers of personal knowledge of the events and transactions
constitutive of the criminal violations alleged to have been made by the accused. In fact, the letters clearly stated that
what the OSI of the BSP and the LIS of the PDIC did was to respectfully transmit to the DOJ for preliminary
investigation the affidavits and personal knowledge of the acts of the petitioner. These affidavits were subscribed
under oath by the witnesses who executed them before a notary public. Since the affidavits, not the letters
transmitting them, were intended to initiate the preliminary investigation, we hold that Section 3(a), Rule 112 of the
Rules of Court was substantially complied with.
Citing the ruling of this Court in Ebarle v. Sucaldito, the Court of Appeals correctly held that a complaint for purposes
of preliminary investigation by the fiscal need not be filed by the offended party. The rule has been that,unless the
offense subject thereof is one that cannot be prosecuted de oficio, the same may be filed, for preliminary
investigation purposes, by any competent person. The crime of estafa is a public crime which can be initiated by
"any competent person." The witnesses who executed the affidavits based on their personal knowledge of the acts
committed by the petitioner fall within the purview of "any competent person" who may institute the complaint for a
public crime. x x x (Emphasis and italics supplied)
A preliminary investigation can thus validly proceed on the basis of an affidavit of any competent person, without the
referral document, like the NBI-NCR Report, having been sworn to by the law enforcer as the nominal complainant.
To require otherwise is a needless exercise. The cited case of Oporto, Jr. v. Judge Monserate does not appear to
dent this proposition. After all, what is required is to reduce the evidence into affidavits, for while reports and even
raw information may justify the initiation of an investigation, the preliminary investigation stage can be held only after
sufficient evidence has been gathered and evaluated which may warrant the eventual prosecution of the case in
court.
42

Following the foregoing rulings in Soriano v. Hon. Casanova and Santos-Concio v. Department of Justice, we hold
that the BSP letter, taken together with the affidavits attached thereto, comply with the requirements provided under
Section 3(a), Rule 112 of the Rules of Court and Section 18, paragraphs (c) and (d) of RA 7653.
Second Issue:
Whether a loan transaction within the ambit of the DOSRI law (violation of Section 83 of RA 337, as amended) could
be the subject of Estafa under Article 315 (1) (b) of the
Revised Penal Code
The second issue was raised by petitioner in the context of his Motion to Quash Information on the ground that the
facts charged do not constitute an offense.
43
It is settled that in considering a motion to quash on such ground, the
test is "whether the facts alleged, if hypothetically admitted, would establish the essential elements of the offense
charged as defined by law. The trial court may not consider a situation contrary to that set forth in the criminal
complaint or information. Facts that constitute the defense of the petitioner[s] against the charge under the
information must be proved by [him] during trial. Such facts or circumstances do not constitute proper grounds for a
motion to quash the information on the ground that the material averments do not constitute the offense".
44

We have examined the two informations against petitioner and we find that they contain allegations which, if
hypothetically admitted, would establish the essential elements of the crime of DOSRI violation and estafa thru
falsification of commercial documents.
In Criminal Case No. 238-M-2001 for violation of DOSRI rules, the information alleged that petitioner Soriano was the
president of RBSM; that he was able to indirectly obtain a loan from RBSM by putting the loan in the name of
depositor Enrico Carlos; and that he did this without complying with the requisite board approval, reportorial, and
ceiling requirements.
In Criminal Case No. 237-M-2001 for estafa thru falsification of commercial documents, the information alleged that
petitioner, by taking advantage of his position as president of RBSM, falsified various loan documents to make it
appear that an Enrico Carlos secured a loan of P8 million from RBSM; that petitioner succeeded in obtaining the loan
proceeds; that he later converted the loan proceeds to his own personal gain and benefit; and that his action caused
damage and prejudice to RBSM, its creditors, the BSP, and the PDIC.
Significantly, this is not the first occasion that we adjudge the sufficiency of similarly worded informations. In Soriano
v. People,
45
involving the same petitioner in this case (but different transactions), we also reviewed the sufficiency of
informations for DOSRI violation and estafa thru falsification of commercial documents, which were almost identical,
mutatis mutandis, with the subject informations herein. We held in Soriano v. People that there is no basis for the
quashal of the informations as "they contain material allegations charging Soriano with violation of DOSRI rules and
estafa thru falsification of commercial documents".
Petitioner raises the theory that he could not possibly be held liable for estafa in concurrence with the charge for
DOSRI violation. According to him, the DOSRI charge presupposes that he acquired a loan, which would make the
loan proceeds his own money and which he could neither possibly misappropriate nor convert to the prejudice of
another, as required by the statutory definition of estafa.
46
On the other hand, if petitioner did not acquire any loan,
there can be no DOSRI violation to speak of. Thus, petitioner posits that the two offenses cannot co-exist. This theory
does not persuade us.
Petitioners theory is based on the false premises that the loan was extended to him by the bank in his own name,
and that he became the owner of the loan proceeds. Both premises are wrong.
The bank money (amounting to P8 million) which came to the possession of petitioner was money held in trust or
administration by him for the bank, in his
fiduciary capacity as the President of said bank.
47
It is not accurate to say that petitioner became the owner of theP8
million because it was the proceeds of a loan. That would have been correct if the bank knowingly extended the loan
to petitioner himself. But that is not the case here. According to the information for estafa, the loan was supposed to
be for another person, a certain "Enrico Carlos"; petitioner, through falsification, made it appear that said "Enrico
Carlos" applied for the loan when in fact he ("Enrico Carlos") did not. Through such fraudulent device, petitioner
obtained the loan proceeds and converted the same. Under these circumstances, it cannot be said that petitioner
became the legal owner of the P8 million. Thus, petitioner remained the banks fiduciary with respect to that money,
which makes it capable of misappropriation or conversion in his hands.
The next question is whether there can also be, at the same time, a charge for DOSRI violation in such a situation
wherein the accused bank officer did not secure a loan in his own name, but was alleged to have used the name of
another person in order to indirectly secure a loan from the bank. We answer this in the affirmative. Section 83 of RA
337 reads:
Section 83. No director or officer of any banking institution shall, either directly or indirectly, for himself or as the
representative or agent of others, borrow any of the deposits of funds of such bank, nor shall he become a guarantor,
indorser, or surety for loans from such bank to others, or in any manner be an obligor for moneys borrowed from the
bank or loaned by it, except with the written approval of the majority of the directors of the bank, excluding the
director concerned. Any such approval shall be entered upon the records of the corporation and a copy of such entry
shall be transmitted forthwith to the Superintendent of Banks. The office of any director or officer of a bank who
violates the provisions of this section shall immediately become vacant and the director or officer shall be punished
by imprisonment of not less than one year nor more than ten years and by a fine of not less than one thousand nor
more than ten thousand pesos. x x x
The prohibition in Section 83 is broad enough to cover various modes of borrowing.[48] It covers loans by a bank
director or officer (like herein petitioner) which are made either: (1) directly, (2) indirectly, (3) for himself, (4) or as the
representative or agent of others. It applies even if the director or officer is a mere guarantor, indorser or surety for
someone else's loan or is in any manner an obligor for money borrowed from the bank or loaned by it. The covered
transactions are prohibited unless the approval, reportorial and ceiling requirements under Section 83 are complied
with. The prohibition is intended to protect the public, especially the depositors,[49] from the overborrowing of bank
funds by bank officers, directors, stockholders and related interests, as such overborrowing may lead to bank
failures.[50] It has been said that "banking institutions are not created for the benefit of the directors [or officers].
While directors have great powers as directors, they have no special privileges as individuals. They cannot use the
assets of the bank for their own benefit except as permitted by law. Stringent restrictions are placed about them so
that when acting both for the bank and for one of themselves at the same time, they must keep within certain
prescribed lines regarded by the legislature as essential to safety in the banking business".
51

A direct borrowing is obviously one that is made in the name of the DOSRI himself or where the DOSRI is a named
party, while an indirect borrowing includes one that is made by a third party, but the DOSRI has a stake in the
transaction.
52
The latter type indirect borrowing applies here. The information in Criminal Case 238-M-2001
alleges that petitioner "in his capacity as President of Rural Bank of San Miguel San Ildefonso branch x x x
indirectly borrow[ed] or secure[d] a loan with [RBSM] x x x knowing fully well that the same has been done by him
without the written consent and approval of the majority of the board of directors x x x, and which consent and
approval the said accused deliberately failed to obtain and enter the same upon the records of said banking institution
and to transmit a copy thereof to the supervising department of the said bank x x x by using the name of one
depositor Enrico Carlos x x x, the latter having no knowledge of the said loan, and once in possession of the said
amount of eight million pesos (P8 million), [petitioner] converted the same to his own personal use and benefit".
53

The foregoing information describes the manner of securing the loan as indirect; names petitioner as the benefactor
of the indirect loan; and states that the requirements of the law were not complied with. It contains all the required
elements
54
for a violation of Section 83, even if petitioner did not secure the loan in his own name.
The broad interpretation of the prohibition in Section 83 is justified by the fact that it even expressly covers loans to
third parties where the third parties are aware of the transaction (such as principals represented by the DOSRI), and
where the DOSRIs interest does not appear to be beneficial but even burdensome (such as in cases when the
DOSRI acts as a mere guarantor or surety). If the law finds it necessary to protect the bank and the banking system
in such situations, it will surely be illogical for it to exclude a case like this where the DOSRI acted for his own benefit,
using the name of an unsuspecting person. A contrary interpretation will effectively allow a DOSRI to use dummies to
circumvent the requirements of the law.
In sum, the informations filed against petitioner do not negate each other.
Third Issue:
Is a Rule 65 petition for certiorari the proper remedy against an Order denying a Motion to Quash?
This issue may be speedily resolved by adopting our ruling in Soriano v. People,
55
where we held:
In fine, the Court has consistently held that a special civil action for certiorari is not the proper remedy to assail the
denial of a motion to quash an information. The proper procedure in such a case is for the accused to enter a plea, go
to trial without prejudice on his part to present the special defenses he had invoked in his motion to quash and if after
trial on the merits, an adverse decision is rendered, to appeal therefrom in the manner authorized by law. Thus,
petitioners should not have forthwith filed a special civil action for certiorari with the CA and instead, they should have
gone to trial and reiterated the special defenses contained in their motion to quash. There are no special or
exceptional circumstances in the present case that would justify immediate resort to a filing of a petition for certiorari.
Clearly, the CA did not commit any reversible error, much less, grave abuse of discretion in dismissing the petition.
56

Fourth Issue:
Whether petitioner is entitled to a writ of injunction
The requisites to justify an injunctive relief are: (1) the right of the complainant is clear and unmistakable; (2) the
invasion of the right sought to be protected is material and substantial; and (3) there is an urgent and paramount
necessity for the writ to prevent serious damage. A clear legal right means one clearly founded in or granted by law or
is "enforceable as a matter of law." Absent any clear and unquestioned legal right, the issuance of an injunctive writ
would constitute grave abuse of discretion.
57
Caution and prudence must, at all times, attend the issuance of an
injunctive writ because it effectively disposes of the main case without trial and/or due process.
58
InOlalia v.
Hizon,
59
the Court held as follows:
It has been consistently held that there is no power the exercise of which is more delicate, which requires greater
caution, deliberation and sound discretion, or more dangerous in a doubtful case, than the issuance of an injunction.
It is the strong arm of equity that should never be extended unless to cases of great injury, where courts of law
cannot afford an adequate or commensurate remedy in damages.
Every court should remember that an injunction is a limitation upon the freedom of action of the [complainant] and
should not be granted lightly or precipitately. It should be granted only when the court is fully satisfied that the law
permits it and the emergency demands it.
Given this Court's findings in the earlier issues of the instant case, we find no compelling reason to grant the
injunctive relief sought by petitioner.
WHEREFORE, the petition is DENIED. The assailed September 26, 2003 Decision as well as the February 5, 2004
Resolution of the Court of Appeals in CA-G.R. SP No. 67657 are AFFIRMED. Costs against petitioner.
SO ORDERED.
MARIANO C. DEL CASTILLO
Associate Justice
WE CONCUR:
ANTONIO T. CARPIO
Associate Justice
Chairperson
RENATO C. CORONA
*

Associate Justice
ARTURO D. BRION
Associate Justice
JOSE P. PEREZ
Associate Justice
A T T E S T A T I O N
I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to
the writer of the opinion of the Court's Division.
ANTONIO T. CARPIO
Associate Justice
Chairperson, Second Division
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairperson's attestation, it is hereby certified
that the conclusions in the above Decision had been reached in consultation before the case was assigned to the
writer of the opinion of the Courts Division.
REYNATO S. PUNO
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 177190 February 23, 2011
LAND BANK OF THE PHILIPPINES, Petitioner,
vs.
HON. ERNESTO P. PAGAYATAN, in his capacity as Presiding Judge of the Regional Trial Court, Branch 46,
San Jose, Occidental Mindoro; and JOSEFINA S. LUBRICA, in her capacity as Assignee of Federico
Suntay, Respondents.
D E C I S I O N
VELASCO, JR., J .:
The Case
This Petition for Review on Certiorari under Rule 45 seeks to annul the August 17, 2006 Decision
1
and March 27,
2007 Resolution
2
of the Court of Appeals (CA) in CA-G.R. SP No. 93206, which affirmed the Order dated March 4,
2005
3
of the Regional Trial Court (RTC), Branch 46 in San Jose, Occidental Mindoro, in Agrarian Case No. 1390 for
the fixing of just compensation, entitled Land Bank of the Philippines v. Josefina S. Lubrica, in her capacity as
assignee of Federico Suntay, and Hon. Teodoro A. Cidro, as Provincial Agrarian Reform Adjudicator of San Jose,
Occidental Mindoro. The RTC Order affirmed the Decision dated March 21, 2003
4
of the Provincial Agrarian Reform
Adjudicator (PARAD) of San Jose, Occidental Mindoro in Case No. DCN-0405-0022-02, entitled Josefina S. Lubrica,
in her capacity as Assignee of Federico Suntay v. Hon. Hernani A. Braganza, in his capacity as Secretary of the
Department of Agrarian Reform, and Land Bank of the Philippines.
The Facts
On October 21, 1972, the 3,682.0286-hectare Suntay Estate, consisting of irrigated/unirrigated rice and corn lands
covered by Transfer Certificate of Title No. T-31(1326) located in the Barangays of Gen. Emilio Aguinaldo, Sta. Lucia,
and San Nicolas in Sablayan, Occidental Mindoro, was subjected to the operation of Presidential Decree No. 27,
under its Operation Land Transfer (OLT), with the farmer-beneficiaries declared as owners of the property. However,
a 300-hectare portion of the land was subjected to the Comprehensive Agrarian Reform Program (CARP) instead of
the OLT. Thus, Certificates of Landownership Award were issued to the farmer-beneficiaries in possession of the
land.
5
Such application of the CARP to the 300-hectare land was later the subject of a case before the Department of
Agrarian Reform Adjudicatory Board (DARAB), which ruled that the subject land should have been the subject of OLT
instead of CARP. The landowner admitted before the PARAD that said case was pending with this Court and
docketed as G.R. No. 108920, entitled Federico Suntay v. Court of Appeals.
Meanwhile, the owner of the land remained unpaid for the property. Thus, Josefina S. Lubrica, in her capacity as
assignee of the owner of the property, Federico Suntay, filed a Petition for Summary Determination of Just
Compensation with the PARAD, docketed as Case No. DCN-0405-0022-2002. Thereafter, the PARAD issued its
Decision dated March 21, 2003, the dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered:
1. Fixing the preliminary just compensation for 431.1407 hectare property at P166,150.00 per hectare or a
total of P71,634,027.30.
2. Directing the Land Bank of the Philippines to immediately pay the aforestated amount to the Petitioner;
3. Directing the DAR to immediately comply with all applicable requirements so that the subject property
may be formally distributed and turned over to the farmer beneficiaries thereof, in accordance with the
Decision of the DARAB Central in DARAB Case No. 2846.
No cost.
SO ORDERED.
6

Petitioner Land Bank of the Philippines (LBP) filed a Motion for Reconsideration dated April 10, 2003 of the above
decision, but the PARAD denied the motion in an Order dated December 15, 2003.
7

The LBP then filed a Petition dated March 4, 2004 with the RTC docketed as Agrarian Case No. 1390, appealing the
PARAD Decision. In the Petition, the LBP argued that because G.R. No. 108920 was pending with this Court in
relation to the 300-hectare land subject of the instant case, the Petition for Summary Determination of Just
Compensation filed before the PARAD was premature. The LBP argued further that the PARAD could only make an
award of up to PhP 5 million only. The PARAD, therefore, could not award an amount of PhP 71,634,027.30. The
LBP also contended that it could not satisfy the demand for payment of Lubrica, considering that the documents
necessary for it to undertake a preliminary valuation of the property were still with the Department of Agrarian Reform
(DAR).
By way of answer, Lubrica filed a Motion to Deposit the Preliminary Valuation under Section 16(e) of Republic Act No.
(RA) 6657 and Ad Cautelam Answer dated June 18, 2004.
8
In the said motion, Lubrica claimed that since the DAR
already took possession of the disputed property, the LBP is duty-bound to deposit the compensation determined by
the PARAD in a bank accessible to the landowner.
In an Order dated March 4, 2005, the RTC resolved Lubricas motion, as follows:
The foregoing considered and as prayed for by the respondent-movant The Land Compensation Department, Land
Bank of the Philipines, is hereby directed to deposit the preliminary compensation as determined by the PARAD, in
case and bonds in the total amount of Php 71,634,027.30, with the Land Bank of the Philippines, Manila, within seven
(7) days from receipt of this order, and to notify this Court of compliance within such period.
9

Thus, the LBP filed an Omnibus Motion dated March 17, 2005 praying for the reconsideration of the above order, the
admission of an amended petition impleading the DAR, and the issuance of summons to the new defendants. In the
Omnibus Motion, the LBP contended:
In this AMENDED PETITION, Land Bank impleaded the DAR as respondent because DAR is the lead agency of the
government in the implementation of the agrarian reform. It is the one which is responsible in identifying the lands to
be covered by agrarian reform program, placing/identifying the farmer beneficiaries, parcellary mapping of the land,
and determining the land value covered by PD 27/EO 228. The documents DAR prepares is placed in a folder called
"claim folder" which it forwards to Land Bank for processing and payment.
21. At present there is no claim folder prepared and submitted by DAR to Land Bank, and therefore Land Bank has
no claim folder to process and no basis to pay the landowner.
10

In an Order dated December 8, 2005,
11
the RTC denied the Omnibus Motion finding no reversible error in its Order
dated March 4, 2005 and denying the motion to amend the petition for being unnecessary towards land valuation.
Thus, the LBP appealed the RTC Orders dated March 4, 2005 and December 8, 2005 to the CA through a Petition for
Certiorari dated February 13, 2006. The LBP argued that without the claim folder from the DAR, it could not
preliminarily determine the valuation of the covered lands and process the compensation claims. Moreover, it said
that the amount to be deposited under Sec. 16 of RA 6657, or the Agrarian Reform Law of 1988, is the offered
purchase price of DAR for the land contained in the notice of acquisition and not the price determined in an
administrative proceeding before the PARAD.
Afterwards, on August 17, 2006, the CA issued the assailed decision, the dispositive portion of which reads:
WHEREFORE, premises considered, the petition is hereby DENIED DUE COURSE, and subsequently DISMISSED
for lack of merit.
SO ORDERED.
12

The LBP moved for reconsideration of the CA Decision, but the CA did not reconsider it, as stated in its Resolution
dated March 27, 2007.
Hence, the LBP filed this petition.
The Issue
What is the proper amount to be deposited under Section 16 of Republic Act No. 6657? Is it the PARAD/DARAB
determined valuation or the preliminary valuation as determined by the DAR/LBP?
13

The Ruling of the Court
The petition is meritorious.
Private respondent Lubrica argues that, under the doctrines of res judicata and stare decisis, the instant case must
be dismissed in light of the decision of this Court in Lubrica v. Land Bank of the Philippines,
14
the dispositive portion
of which reads:
WHEREFORE, premises considered, the petition is GRANTED. The assailed Amended Decision dated October 27,
2005 of the Court of Appeals in CA-G.R. SP No. 77530 is REVERSED and SET ASIDE. The Decision dated May 26,
2004 of the Court of Appeals affirming (a) the March 31, 2003 Order of the Special Agrarian Court ordering the
respondent Land Bank of the Philippines to deposit the just compensation provisionally determined by the PARAD;
(b) the May 26, 2003 Resolution denying respondents Motion for Reconsideration; and (c) the May 27, 2003 Order
directing Teresita V. Tengco, respondents Land Compensation Department Manager to comply with the March 31,
2003 Order, is REINSTATED. The Regional Trial Court of San Jose, Occidental Mindoro, Branch 46, acting as
Special Agrarian Court is ORDERED to proceed with dispatch in the trial of Agrarian Case Nos. R-1339 and R-1340,
and to compute the final valuation of the subject properties based on the aforementioned formula.
SO ORDERED. (Emphasis supplied.)
The principles of res judicata and stare decisis do not apply to the case at bar.
In Lanuza v. Court of Appeals,
15
the Court discussed the principle of res judicata, to wit:
Res judicata means a matter adjudged, a thing judicially acted upon or decided; a thing or matter settled by judgment.
The doctrine of res judicata provides that a final judgment, on the merits rendered by a court of competent jurisdiction
is conclusive as to the rights of the parties and their privies and constitutes an absolute bar to subsequent actions
involving the same claim, demand, or cause of action. The elements of res judicata are (a) identity of parties or at
least such as representing the same interest in both actions; (b) identity of rights asserted and relief prayed for, the
relief being founded on the same facts; and (c) the identity in the two (2) particulars is such that any judgment which
may be rendered in the other action will, regardless of which party is successful, amount to res judicata in the action
under consideration. (Emphasis supplied.)
In Lubrica, the issue was as follows:
Petitioners insist that the determination of just compensation should be based on the value of the expropriated
properties at the time of payment. Respondent LBP, on the other hand, claims that the value of the realties should be
computed as of October 21, 1972 when P.D. No. 27 took effect.
16

While the Court directed that the valuation made by the PARAD be the amount to be deposited in favor of the
landowner, it was done only because the PARADs valuation was based on the time the payment was made.
The issue before Us is whether the RTC acted properly in ordering the deposit or payment to the landowner of the
preliminary valuation of the land made by the PARAD. This is considering that Sec. 16(e) of RA 6657 clearly requires
the initial valuation made by the DAR and LBP be deposited or paid to the landowner before taking possession of the
latters property, not the preliminary valuation made by the PARAD.
Evidently, the second element of res judicata is not present. The relief prayed for in Lubrica is that the amount for
deposit in favor of the landowner be determined on the basis of the time of payment and not of the time of taking. But
here, the prayer of the LBP is for the deposit of the valuation of the LBP and DAR and not that of the PARAD. These
are two distinct and separate issues. Res judicata, therefore, cannot apply.
We cannot apply the principle of stare decisis to the instant case, too. The Court explained the principle in Ting v.
Velez-Ting:
17

The principle of stare decisis enjoins adherence by lower courts to doctrinal rules established by this Court in its final
decisions. It is based on the principle that once a question of law has been examined and decided, it should be
deemed settled and closed to further argument. Basically, it is a bar to any attempt to relitigate the same issues,
necessary for two simple reasons: economy and stability. In our jurisdiction, the principle is entrenched in Article 8 of
the Civil Code. (Emphasis supplied.)
To reiterate, Lubrica and the instant case have different issues. Hence, stare decisis is also inapplicable here.
The LBP posits that under Sec. 16(e) of RA 6657, and as espoused in Land Bank of the Philippines v. Court of
Appeals,
18
it is the purchase price offered by the DAR in its notice of acquisition of the land that must be deposited in
an accessible bank in the name of the landowner before taking possession of the land, not the valuation of the
PARAD.
The Court agrees with the LBP. The RTC erred when it ruled:
Under Section 16 (e) the payment of the provisional compensation determined by the PARAD in the summary
administrative proceedings under Section 16 (d) should precede the taking of the land. In the present case, the taking
of the property even preceded the mere determination of a provisional compensation by more than 30 years.
19

Sec. 16 of RA 6657 contains the procedure for the acquisition of private lands, viz:
SEC. 16. Procedure for Acquisition of Private Lands.For purposes of acquisition of private lands, the following
procedures shall be followed:
(a) After having identified the land, the landowners and the beneficiaries, the DAR shall send its notice to
acquire the land to the owners thereof, by personal delivery or registered mail, and post the same in a
conspicuous place in the municipal building and barangay hall of the place where the property is located.
Said notice shall contain the offer of the DAR to pay a corresponding value in accordance with the valuation
set forth in Sections 17, 18, and other pertinent provisions hereof.
(b) Within thirty (30) days from the date of receipt of written notice by personal delivery or registered mail,
the landowner, his administrator or representative shall inform the DAR of his acceptance or rejection of the
offer.
(c) If the landowner accepts the offer of the DAR, the LBP shall pay the landowner the purchase price of the
land within thirty (30) days after he executes and delivers a deed of transfer in favor of the Government and
surrenders the Certificate of Title and other muniments of title.
(d) In case of rejection or failure to reply, the DAR shall conduct summary administrative proceedings to
determine the compensation of the land by requiring the landowner, the LBP and other interested parties to
submit evidence as to the just compensation for the land, within fifteen (15) days from the receipt of the
notice. After the expiration of the above period, the matter is deemed submitted for decision. The DAR shall
decide the case within thirty (30) days after it is submitted for decision.
(e) Upon receipt by the landowner of the corresponding payment or in case of rejection or no response from
the landowner, upon the deposit with an accessible bank designated by the DAR of the compensation in
cash or LBP bonds in accordance with this Act, the DAR shall take immediate possession of the land and
shall request the proper Register of Deeds to issue a Transfer Certificate of Title (TCT) in the name of the
Republic of the Philippines. The DAR shall thereafter proceed with the redistribution of the land to the
qualified beneficiaries.
(f) Any party who disagrees with the decision may bring the matter to the court of proper jurisdiction for final
determination of just compensation. (Emphasis supplied.)
Conspicuously, there is no mention of the PARAD in the foregoing Sec. 16(e) when it speaks of "the deposit with an
accessible bank designated by the DAR of the compensation in cash or LBP bonds in accordance with this Act."
Moreover, it is only after the DAR has made its final determination of the initial valuation of the land that the
landowner may resort to the judicial determination of the just compensation for the land. Clearly, therefore, it is the
initial valuation made by the DAR and LBP that is contained in the letter-offer to the landowner under Sec. 16(a), said
valuation of which must be deposited and released to the landowner prior to taking possession of the property.
This too was the Courts interpretation of the above provision in Land Bank of the Philippines v. Heir of Trinidad S.
Vda. De Arieta:
20

It was thus erroneous for the CA to conclude that the provisional compensation required to be deposited as provided
in Section 16 (e) is the sum determined by the DARAB/PARAD/RARAD in a summary administrative proceeding
merely because the word "deposit" appeared for the first time in the sub-paragraph immediately succeeding that sub-
paragraph where the administrative proceeding is mentioned (sub-paragraph d). On the contrary, sub-paragraph (e)
should be related to sub-paragraphs (a), (b) and (c) considering that the taking of possession by the State of the
private agricultural land placed under the CARP is the next step after the DAR/LBP has complied with notice
requirements which include the offer of just compensation based on the initial valuation by LBP. To construe sub-
paragraph (e) as the appellate court did would hamper the land redistribution process because the government still
has to wait for the termination of the summary administrative proceeding before it can take possession of the lands.
Contrary to the CAs view, the deposit of provisional compensation is made even before the summary administrative
proceeding commences, or at least simultaneously with it, once the landowner rejects the initial valuation ("offer") by
the LBP. Such deposit results from his rejection of the DAR offer (based on the LBPs initial valuation). Both the
conduct of summary administrative proceeding and deposit of provisional compensation follow as a consequence of
the landowners rejection under both the compulsory acquisition and VOS. This explains why the words "rejection or
failure to reply" and "rejection or no response from the landowner" are found in sub-paragraphs (d) and (e). Such
"rejection"/"no response from the landowner" could not possibly refer to the award of just compensation in the
summary administrative proceeding considering that the succeeding sub-paragraph (f) states that the landowner who
disagrees with the same is granted the right to petition in court for final determination of just compensation. As it is,
the CAs interpretation would have loosely interchanged the terms "rejected the offer" and "disagrees with the
decision", which is far from what the entire provision plainly conveys.
x x x x
Under the law, the LBP is charged with the initial responsibility of determining the value of lands placed under land
reform and the compensation to be paid for their taking. Once an expropriation proceeding or the acquisition of
private agricultural lands is commenced by the DAR, the indispensable role of LBP begins. EO No. 405, issued on
June 14, 1990, provides that the DAR is required to make use of the determination of the land valuation and
compensation by the LBP as the latter is primarily responsible for the determination of the land valuation and
compensation. In fact, the LBP can disagree with the decision of the DAR in the determination of just compensation,
and bring the matter to the RTC designated as [Special Agrarian Court] for final determination of just compensation.
The amount of "offer" which the DAR gives to the landowner as compensation for his land, as mentioned in Section
16 (b) and (c), is based on the initial valuation by the LBP. This then is the amount which may be accepted or
rejected by the landowner under the procedure established in Section 16. Perforce, such initial valuation by the LBP
also becomes the basis of the deposit of provisional compensation pending final determination of just compensation,
in accordance with sub-paragraph (e). (Emphasis supplied.)
It is clear from Sec. 16 of RA 6657 that it is the initial valuation made by the DAR and the LBP that must be released
to the landowner in order for DAR to take possession of the property. Otherwise stated, Sec. 16 of RA 6657 does not
authorize the release of the PARADs determination of just compensation for the land which has not yet become final
and executory.
Moreover, it bears pointing out that, pursuant to DAR Administrative Order No. 02, Series of 1996, entitled Revised
Rules and Procedures Governing the Acquisition of Agricultural Lands subject of Voluntary Offer to Sell and
Compulsory Acquisition pursuant to Republic Act No. 6657, the DAR Municipal Office (DARMO) first prepares a claim
folder (CF) containing the necessary documents for the valuation of the land. The DARMO then forwards this claim
folder to the DAR Provincial Office (DARPO) which, in turn, has the following duties: "Receives claim folder and
forwards to the DAR-LBP Pre-Processing Unit (PPU) for review/evaluation of documents. Gathers lacking
documents, if any."
21
The DAR-LBP PPU then forwards the CF to the LBP-Land Valuation and Landowners
Compensation Office (LVLCO) which "receives and evaluates the CF for completeness, consistency and document
sufficiency. Gathers additional valuation documents."
22
Thereafter, the LBP-LVLCO "determines land valuation based
on valuation inputs" and "prepares and sends Memo of Valuation, Claim Folder Profile and Valuation Summary
(MOV-CFPVS)" to the DARPO.
23
The DARPO then "sends Notice of Valuation and Acquisition to LO [landowner] by
personal delivery with proof of service or by registered mail with return card, attaching copy of MOV-CFPVS and
inviting LOs attention to the submission of documents required for payment of claim."
24

Notably, DAR failed to prepare the claim folder which is necessary for the LBP to make a valuation of the land to be
expropriated. The proper remedy would have been to ask the DAR and LBP to determine such initial valuation and to
have the amount deposited to his account, in accordance with Sec. 16 of RA 6657. Nevertheless, it was erroneous
for private respondent to have filed a Petition for Determination of Just Compensation with PARAD when the remedy
that she was seeking was for the deposit of the initial valuation that the DAR and LBP should have made.
Contrary to the CAs ruling, the RTCs failure to distinguish between the initial valuation that is contemplated in Sec.
16 of RA 6657 and the just compensation subject of judicial determination is a gross and patent error that can be
considered as grave abuse of discretion. Gross abuse of discretion is defined, as follows:
A special civil action for certiorari, under Rule 65, is an independent action based on the specific grounds therein
provided and will lie only if there is no appeal or any other plain, speedy, and adequate remedy in the ordinary course
of law. A petition for certiorari will prosper only if grave abuse of discretion is alleged and proved to exist. "Grave
abuse of discretion," under Rule 65, has a specific meaning. It is the arbitrary or despotic exercise of power due to
passion, prejudice or personal hostility; or the whimsical, arbitrary, or capricious exercise of power that amounts to an
evasion or refusal to perform a positive duty enjoined by law or to act at all in contemplation of law. For an act to be
struck down as having been done with grave abuse of discretion, the abuse of discretion must be patent and
gross.
25
x x x (Emphasis supplied.)
It should also be pointed out that in the related Land Bank of the Philippines v. Pagayatan,
26
the Court had found the
presiding judge of the RTC, Branch 16 in San Jose, Occidental Mindoro, herein respondent Judge Ernesto P.
Pagayatan, guilty of Gross Ignorance of the Law or Procedure and Gross Misconduct for holding Teresita V. Tengco,
Acting Chief of the Land Compensation Department of the LBP, and Leticia Lourdes A. Camara, Chief of the Land
Compensation Department of the LBP, guilty of indirect contempt for allegedly disobeying the very same Order dated
March 4, 2005 of the RTC. In that case, Court ruled:
The partiality of respondent was highlighted when, out of his selective invocation of judicial courtesy, he refused to
resolve Leticia and Teresitas February 14, 2007 Urgent Manifestation of Compliance and Motion and other pending
incidents in view of the pendency before the appellate court of the LBPs Omnibus Motion praying for, among other
things, the quashal of the warrant of arrest, whereas he had earlier found Leticia and Teresita guilty of contempt
despite the pendency before the appellate court of LBPs motion for reconsideration of the dismissal of the petition in
CA-G.R. SP No. 93206.
Evidently, the RTC had already acted with partiality in deciding the case and with grave abuse of discretion.
Moreover, in order to give life and breath to Sec. 16 of RA 6657, as well as DAR Administrative Order No. 02, Series
of 1996, the Court is constrained to direct the DAR and the LBP to make the initial valuation of the subject land as of
the time of its taking and to deposit the valuation in the name of the landowner or his estate, in accordance with RA
6657 and the pertinent decisions of this Court on the matter.1avvphi1
The length of time that has elapsed that the landowner has not received any compensation for the land cannot justify
the release of the PARAD valuation to the landowner. Sec. 16 of RA 6657 only allows the release of the initial
valuation of the DAR and the LBP to the landowner prior to the determination by the courts of the final just
compensation due. Besides, it must be stressed that it was only sometime in 2003 that the assignee of the landowner
filed a petition for determination of just compensation with the PARAD. Clearly, the landowner slept on his right to
demand payment of the initial valuation of the land. Nevertheless, such lapse of time demands that the DAR and the
LBP act with dispatch in determining such initial valuation and to deposit it in favor of the landowner at the soonest
possible time.
WHEREFORE, the petition is GRANTED. The CAs August 17, 2006 Decision and March 27, 2007 Resolution in CA-
G.R. SP No. 93206 are hereby REVERSED and SET ASIDE. The DAR and the LBP are hereby given three (3)
months from receipt of notice that this Decision has become final and executory, within which to determine the initial
valuation of the subject lot and to deposit its initial value to the account of private respondent Lubrica.
The PARAD Decision dated March 21, 2003 in Case No. DCN-0405-0022-02 is hereby ANNULLED and SET ASIDE.
The RTC Order dated March 4, 2005 in Agrarian Case No. 1390 is also ANNULLED and SET ASIDE.
No costs.
SO ORDERED.
PRESBITERO J. VELASCO, JR.
Associate Justice
WE CONCUR:
RENATO C. CORONA
Chief Justice
Chairperson
ANTONIO EDUARDO B. NACHURA
*

Associate Justice
MARIANO C. DEL CASTILLO
Associate Justice
JOSE PORTUGAL PEREZ
Associate Justice
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above Decision had been
reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.
RENATO C. CORONA
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 162155 August 28, 2007
COMMISSIONER OF INTERNAL REVENUE and ARTURO V. PARCERO in his official capacity as Revenue
District Officer of Revenue District No. 049 (Makati), Petitioners,
vs.
PRIMETOWN PROPERTY GROUP, INC., Respondent.
D E C I S I O N
CORONA, J .:
This petition for review on certiorari
1
seeks to set aside the August 1, 2003 decision
2
of the Court of Appeals (CA) in
CA-G.R. SP No. 64782 and its February 9, 2004 resolution denying reconsideration.
3

On March 11, 1999, Gilbert Yap, vice chair of respondent Primetown Property Group, Inc., applied for the refund or
credit of income tax respondent paid in 1997. In Yap's letter to petitioner revenue district officer Arturo V. Parcero of
Revenue District No. 049 (Makati) of the Bureau of Internal Revenue (BIR),
4
he explained that the increase in the
cost of labor and materials and difficulty in obtaining financing for projects and collecting receivables caused the real
estate industry to slowdown.
5
As a consequence, while business was good during the first quarter of 1997,
respondent suffered losses amounting to P71,879,228 that year.
6

According to Yap, because respondent suffered losses, it was not liable for income taxes.
7
Nevertheless, respondent
paid its quarterly corporate income tax and remitted creditable withholding tax from real estate sales to the BIR in the
total amount of P26,318,398.32.
8
Therefore, respondent was entitled to tax refund or tax credit.
9

On May 13, 1999, revenue officer Elizabeth Y. Santos required respondent to submit additional documents to support
its claim.
10
Respondent complied but its claim was not acted upon. Thus, on April 14, 2000, it filed a petition for
review
11
in the Court of Tax Appeals (CTA).
On December 15, 2000, the CTA dismissed the petition as it was filed beyond the two-year prescriptive period for
filing a judicial claim for tax refund or tax credit.
12
It invoked Section 229 of the National Internal Revenue Code
(NIRC):
Sec. 229. Recovery of Taxes Erroneously or Illegally Collected. -- No suit or proceeding shall be maintained in any
court for the recovery of any national internal revenue tax hereafter alleged to have been erroneously or illegally
assessed or collected, or of any penalty claimed to have been collected without authority, or of any sum alleged to
have been excessively or in any manner wrongfully collected, until a claim for refund or credit has been duly filed with
the Commissioner; but such suit or proceeding may be maintained, whether or not such tax, penalty, or sum has
been paid under protest or duress.
In any case, no such suit or proceeding shall be filed after the expiration of two (2) years from the date of
payment of the tax or penalty regardless of any supervening cause that may arise after payment:Provided,
however, That the Commissioner may, even without a claim therefor, refund or credit any tax, where on the face of
the return upon which payment was made, such payment appears clearly to have been erroneously paid. (emphasis
supplied)
The CTA found that respondent filed its final adjusted return on April 14, 1998. Thus, its right to claim a refund or
credit commenced on that date.
13

The tax court applied Article 13 of the Civil Code which states:
Art. 13. When the law speaks of years, months, days or nights, it shall be understood that years are of three
hundred sixty-five days each; months, of thirty days; days, of twenty-four hours, and nights from sunset to sunrise.
If the months are designated by their name, they shall be computed by the number of days which they respectively
have.
In computing a period, the first day shall be excluded, and the last included. (emphasis supplied)
Thus, according to the CTA, the two-year prescriptive period under Section 229 of the NIRC for the filing of judicial
claims was equivalent to 730 days. Because the year 2000 was a leap year, respondent's petition, which was filed
731 days
14
after respondent filed its final adjusted return, was filed beyond the reglementary period.
15

Respondent moved for reconsideration but it was denied.
16
Hence, it filed an appeal in the CA.
17

On August 1, 2003, the CA reversed and set aside the decision of the CTA.
18
It ruled that Article 13 of the Civil Code
did not distinguish between a regular year and a leap year. According to the CA:
The rule that a year has 365 days applies, notwithstanding the fact that a particular year is a leap year.
19

In other words, even if the year 2000 was a leap year, the periods covered by April 15, 1998 to April 14, 1999 and
April 15, 1999 to April 14, 2000 should still be counted as 365 days each or a total of 730 days. A statute which is
clear and explicit shall be neither interpreted nor construed.
20

Petitioners moved for reconsideration but it was denied.
21
Thus, this appeal.
Petitioners contend that tax refunds, being in the nature of an exemption, should be strictly construed against
claimants.
22
Section 229 of the NIRC should be strictly applied against respondent inasmuch as it has been
consistently held that the prescriptive period (for the filing of tax refunds and tax credits) begins to run on the day
claimants file their final adjusted returns.
23
Hence, the claim should have been filed on or before April 13, 2000 or
within 730 days, reckoned from the time respondent filed its final adjusted return.
The conclusion of the CA that respondent filed its petition for review in the CTA within the two-year prescriptive period
provided in Section 229 of the NIRC is correct. Its basis, however, is not.
The rule is that the two-year prescriptive period is reckoned from the filing of the final adjusted return.
24
But how
should the two-year prescriptive period be computed?
As already quoted, Article 13 of the Civil Code provides that when the law speaks of a year, it is understood to be
equivalent to 365 days. In National Marketing Corporation v. Tecson,
25
we ruled that a year is equivalent to 365 days
regardless of whether it is a regular year or a leap year.
26

However, in 1987, EO
27
292 or the Administrative Code of 1987 was enacted. Section 31, Chapter VIII, Book I thereof
provides:
Sec. 31. Legal Periods. "Year" shall be understood to be twelve calendar months; "month" of thirty days,
unless it refers to a specific calendar month in which case it shall be computed according to the number of days the
specific month contains; "day", to a day of twenty-four hours and; "night" from sunrise to sunset. (emphasis supplied)
A calendar month is "a month designated in the calendar without regard to the number of days it may contain."
28
It is
the "period of time running from the beginning of a certain numbered day up to, but not including, the corresponding
numbered day of the next month, and if there is not a sufficient number of days in the next month, then up to and
including the last day of that month."
29
To illustrate, one calendar month from December 31, 2007 will be from
January 1, 2008 to January 31, 2008; one calendar month from January 31, 2008 will be from February 1, 2008 until
February 29, 2008.
30

A law may be repealed expressly (by a categorical declaration that the law is revoked and abrogated by another) or
impliedly (when the provisions of a more recent law cannot be reasonably reconciled with the previous one).
31
Section
27, Book VII (Final Provisions) of the Administrative Code of 1987 states:
Sec. 27. Repealing clause. All laws, decrees, orders, rules and regulation, or portions thereof, inconsistent with
this Code are hereby repealed or modified accordingly.
A repealing clause like Sec. 27 above is not an express repealing clause because it fails to identify or designate the
laws to be abolished.
32
Thus, the provision above only impliedly repealed all laws inconsistent with the Administrative
Code of 1987.1avvphi1
Implied repeals, however, are not favored. An implied repeal must have been clearly and unmistakably intended by
the legislature. The test is whether the subsequent law encompasses entirely the subject matter of the former law and
they cannot be logically or reasonably reconciled.
33

Both Article 13 of the Civil Code and Section 31, Chapter VIII, Book I of the Administrative Code of 1987 deal with the
same subject matter the computation of legal periods. Under the Civil Code, a year is equivalent to 365 days
whether it be a regular year or a leap year. Under the Administrative Code of 1987, however, a year is composed of
12 calendar months. Needless to state, under the Administrative Code of 1987, the number of days is irrelevant.
There obviously exists a manifest incompatibility in the manner of computing legal periods under the Civil Code and
the Administrative Code of 1987. For this reason, we hold that Section 31, Chapter VIII, Book I of the Administrative
Code of 1987, being the more recent law, governs the computation of legal periods. Lex posteriori derogat priori.
Applying Section 31, Chapter VIII, Book I of the Administrative Code of 1987 to this case, the two-year prescriptive
period (reckoned from the time respondent filed its final adjusted return
34
on April 14, 1998) consisted of 24 calendar
months, computed as follows:
Year 1 1st calendar month April 15, 1998 to May 14, 1998
2nd calendar month May 15, 1998 to June 14, 1998
3rd calendar month June 15, 1998 to July 14, 1998
4th calendar month July 15, 1998 to August 14, 1998
5th calendar month August 15, 1998 to September 14, 1998
6th calendar month September 15, 1998 to October 14, 1998
7th calendar month October 15, 1998 to November 14, 1998
8th calendar month November 15, 1998 to December 14, 1998
9th calendar month December 15, 1998 to January 14, 1999
10th calendar month January 15, 1999 to February 14, 1999
11th calendar month February 15, 1999 to March 14, 1999
12th calendar month March 15, 1999 to April 14, 1999
Year 2 13th calendar month April 15, 1999 to May 14, 1999
14th calendar month May 15, 1999 to June 14, 1999
15th calendar month June 15, 1999 to July 14, 1999
16th calendar month July 15, 1999 to August 14, 1999
17th calendar month August 15, 1999 to September 14, 1999
18th calendar month September 15, 1999 to October 14, 1999
19th calendar month October 15, 1999 to November 14, 1999
20th calendar month November 15, 1999 to December 14, 1999
21st calendar month December 15, 1999 to January 14, 2000
22nd calendar month January 15, 2000 to February 14, 2000
23rd calendar month February 15, 2000 to March 14, 2000
24th calendar month March 15, 2000 to April 14, 2000
We therefore hold that respondent's petition (filed on April 14, 2000) was filed on the last day of the 24th calendar
month from the day respondent filed its final adjusted return. Hence, it was filed within the reglementary period.
Accordingly, the petition is hereby DENIED. The case is REMANDED to the Court of Tax Appeals which is ordered to
expeditiously proceed to hear C.T.A. Case No. 6113 entitled Primetown Property Group, Inc. v. Commissioner of
Internal Revenue and Arturo V. Parcero.
No costs.
SO ORDERED.
RENATO C. CORONA
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
Chairperson
ANGELINA SANDOVAL-GUTIERREZ
Associate Justice
ADOLFO S. AZCUNA
Associate Justice
CANCIO C. GARCIA
Associate Justice
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above decision had been
reached in consultation before the case was assigned to the writer of the opinion of the Courts Division.
REYNATO S. PUNO
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 175080 November 24, 2010
EUGENIO R. REYES, joined by TIMOTHY JOSEPH M. REYES, MA. GRACIA S. REYES, ROMAN GABRIEL M.
REYES, and MA. ANGELA S. REYES, Petitioners,
vs.
LIBRADA F. MAURICIO (deceased) and LEONIDA F. MAURICIO, Respondents.
D E C I S I O N
PEREZ, J .:
Subject of this petition is the Decision
1
of the Court of Appeals dated 10 August 2006 in CA-G.R. SP No. 87148,
affirming the Decision dated 7 July 1998 and Resolution dated 28 September 2004 of the Department of Agrarian
Reform Adjudication Board (DARAB).
Eugenio Reyes (Eugenio) was the registered owner of a parcel of land located at Turo, Bocaue, Bulacan, with an
area of four thousand five hundred twenty-seven (4,527) square meters, more or less, and covered by Transfer
Certificate of Title (TCT) No. 109456(M). Said title came from and cancelled TCT No. T-62290 registered in the name
of Eufracia and Susana Reyes, siblings of Eugenio. The subject property was adjudicated to Eugenio by virtue of an
extrajudicial settlement among the heirs following the death of his parents.
The controversy stemmed from a complaint filed before the DARAB of Malolos, Bulacan by respondents Librada F.
Mauricio (Librada), now deceased, and her alleged daughter Leonida F. Mauricio (Leonida) for annulment of contract
denominated as Kasunduan and between Librada and Eugenio as parties. Respondents also prayed for maintenance
of their peaceful possession with damages.
Respondents alleged that they are the legal heirs of the late Godofredo Mauricio (Godofredo), who was the lawful
and registered tenant of Eugenio through his predecessors-in-interest to the subject land; that from 1936 until his
death in May 1994, Godofredo had been working on the subject land and introduced improvements consisting of fruit-
bearing trees, seasonal crops, a residential house and other permanent improvements; that through fraud, deceit,
strategy and other unlawful means, Eugenio caused the preparation of a document denominated as Kasunduan
dated 28 September 1994 to eject respondents from the subject property, and had the same notarized by Notary
Public Ma. Sarah G. Nicolas in Pasig, Metro Manila; that Librada never appeared before the Notary Public; that
Librada was illiterate and the contents of the Kasunduan were not read nor explained to her; that Eugenio took undue
advantage of the weakness, age, illiteracy, ignorance, indigence and other handicaps of Librada in the execution of
the Kasunduan rendering it void for lack of consent; and that Eugenio had been employing all illegal means to eject
respondents from the subject property. Respondents prayed for the declaration of nullity of the Kasunduan and for an
order for Eugenio to maintain and place them in peaceful possession and cultivation of the subject property.
Respondents likewise demanded payment of damages.
2
During trial, respondents presented a leasehold contract
executed between Susana and Godofredo to reaffirm the existing tenancy agreement.
3

Eugenio averred that no tenancy relationship existed between him and respondents. He clarified that Godofredos
occupation of the subject premises was based on the formers mere tolerance and accommodation. Eugenio denied
signing a tenancy agreement, nor authorizing any person to sign such an agreement. He maintained that Librada,
accompanied by a relative, voluntarily affixed her signature to the Kasunduan and that she was fully aware of the
contents of the document. Moreover, Librada received P50,000.00 from Eugenio on the same day of the execution of
the Kasunduan. Eugenio also questioned the jurisdiction of the DARAB since the principal relief sought by
respondents is the annulment of the contract, over which jurisdiction is vested on the regular courts. Eugenio also
asserted that Leonida had no legal personality to file the present suit.
4

Based on the evidence submitted by both parties, the Provincial Adjudicator
5
concluded that Godofredo was the
tenant of Eugenio, and Librada, being the surviving spouse, should be maintained in peaceful possession of the
subject land. The dispositive portion of the decision reads:
WHEREFORE, in view of the foregoing, judgment is hereby rendered in favor of plaintiff Librada Mauricio and against
defendant Eugenio R. Reyes and order is hereby issued:
1. Declaring the kasunduan null and void;
2. Ordering defendant to respect the peaceful possession of herein plaintiff Librada Mauricio over the
subject landholding;
3. Ordering plaintiff to return the amount of P50,000.00 to herein defendant;
4. No pronouncement as to costs.
6

On appeal, two issues were presented to and taken up by the DARAB, namely: (1) Whether or not there is tenancy
relation between the parties; and (2) whether or not the Kasunduan dated 28 September 1994 is valid and
enforceable. The DARAB held that the Mauricios are former tenants of Spouses Reyes. It found that when Spouses
Reyes died, siblings Eufracia, Susana and Eugenio, among others inherited the subject property. Under the law, they
were subrogated to the rights and substituted to the "obligations" of their late parents as the agricultural lessors over
the farmholding tenanted by respondents. Moreover, the DARAB banked on the Kasunduang Buwisan sa Sakahan or
the leasehold contract executed by Susana in favor of Godofredo to support the tenancy relationship. Furthermore,
the DARAB declared the other Kasunduan as void by relying on the evaluation of the Provincial Adjudicator as to the
legal incapacity of Librada to enter into such a contract.
7

Eugenio filed a motion for reconsideration which was denied by the DARAB on 28 September 2004.
8

Aggrieved by the DARAB ruling, Eugenio filed a petition for review with the Court of Appeals. On 10 July 2006, the
Court of Appeals issued a resolution regarding the status of Leonida as a legal heir and allowed her to substitute
Librada, who died during the pendency of the case.
9
On 10 August 2006, the Court of Appeals affirmed the decision
and resolution of the DARAB. It sustained the factual findings of the DARAB with respect to the tenancy relation
between Godofredo and Spouses Reyes and the nullity of the Kasunduan.
10

Undaunted, Eugenio filed the instant petition. Eugenio submits that no tenancy relationship exists between him and
respondents. He insists that the Kasunduang Buwisan sa Sakahan allegedly executed between Godofredo and
Susana in 1993 giving the former the right to occupy and cultivate the subject property is unenforceable against
Eugenio, having been entered into without his knowledge and consent. Eugenio further asserts that per records of the
Department of Agrarian Reform (DAR), no leasehold contract was entered into by Godofredo and Eugenio with
respect to the disputed property. Eugenio attributes error on the part of the Court of Appeals in concluding that a
tenancy relationship existed between the parties despite the absence of some of the essential requisites of a tenancy
relationship such as personal cultivation and the subject land being agricultural. Finally, Eugenio defends the validity
of the Kasunduan entered into between him and Librada wherein the latter agreed to vacate the subject property, in
that it was voluntarily entered into and the contents thereof were mutually understood by the parties.
11

In a Resolution dated 7 February 2007, this Court denied the petition for failure to show that the Court of Appeals
committed reversible error in its challenged decision and resolution. The Court also dismissed the issues raised as
factual. However, upon filing of a motion for reconsideration by Eugenio, this Court reinstated the petition and
required respondent Leonida to comment on the petition.
12

In her comment, respondent prayed for the denial of the petition because the jurisdiction of this Court is limited to
review of errors of law and not of facts.
13

In the main, Eugenio insists that no tenancy relationship existed between him and Godofredo. This is a question of
fact beyond the province of this Court in a petition for review under Rule 45 of the Rules of Court in which only
questions of law may be raised.
14
Absent any of the obtaining exceptions
15
to this rule, the findings of facts of the
Provincial Adjudicator, as affirmed by DARAB and especially by the Court of Appeals, are binding on this Court.
The DARAB ruling outlined how the tenancy relationship between Godofredo and the Mauricios came about, thus:
This Board, after a thorough evaluation of the evidences, is convinced that the Mauricios are former tenants of the
parents of the herein Defendant-Appeallant. A perusal of Exhibit "H" which is the Tax Declaration of the property in
controversy proves that upon the death of the parents of Defendant-Appellant, the property was the subject matter of
their extra-judicial partition/settlement and this property was initially under the ownership of the appellants sisters,
Eufracia and Susana Reyes until the same property was finally acquired/transferred in the name of Respondent-
Appellant. Obviously, in order to re-affirm the fact that the Mauricios are really the tenants, Susana Reyes had
voluntarily executed the Leasehold Contract with Godofredo Librada being the tenant on the property and to prove
that she (Susana Reyes) was the predecessor-in-interest of Respondent-Appeallant Eugenio Reyes. x x x. The
"Kasunduang Buwisan sa Sakahan" alleging that their tenancy relationship began in the year 1973 and their
agreement as to the rental shall remain until further revised.
16

This is a contest of "Kasunduans." Respondents rely on a Kasunduan of tenancy. Petitioners swear by a Kasunduan
of termination of tenancy.
Librada claims that her late husband had been working on the land since 1936 until his death in 1994. She presented
the Kasunduang Buwisan sa Sakahan dated 26 May 1993 and executed by Godofredo and Susana which reaffirmed
the leasehold tenancy over the subject land. On the other hand, Eugenio disputes the claims of Librada and
presented another Kasunduan executed between him and Librada on 28 September 1994 which effectively
terminates the leasehold tenancy when the latter allegedly agreed to vacate the subject premises in exchange of
monetary considerations.
This second Kasunduan is the subject of the instant complaint. In its disquisition, the DARAB nullified the second
Kasunduan, to wit:
x x x Insofar as this "Kasunduan" is concerned, and after reading the transcript of the testimony of the old woman
Librada Mauricio, this Board is convinced that indeed the purpose of the document was to eject her from the
farmholding but that Librada Mauricio wanted to return the money she received because the contents of the
document was never explained to her being illiterate who cannot even read or write. This Board is even further
convinced after reading the transcript of the testimonies that while the document was allegedly signed by the parties
in Turo, Bocaue, Bulacan, the same document was notarized in Pasig, Metro Manila, thus, the Notary Public was not
in a position to explain much less ascertain the veracity of the contents of the alleged "Kasunduan" as to whether or
not Plaintiff-Appellee Librada Mauricio had really understood the contents thereof. This Board further adheres to the
principle that it cannot substitute its own evaluation of the testimony of the witnesses with that of the personal
evaluation of the Adjudicator a quo who, in the case at bar, had the best opportunity to observe the demeanor of the
witness Librada Mauricio while testifying on the circumstances relevant to the execution of the alleged "Kasunduan."
Furthermore, this Board adheres to the principle that in all contractual, property or other relations, when one of the
parties is at a disadvantage on account of his moral dependence, ignorance, mental weakness or other handicap, the
courts (and in the case at bar, this Board) must be vigilant for his protection (Art. 24, New Civil Code). In the case at
bar, Plaintiff-Appellee is already eighty-one (81) years old who can neither read nor write, thus, she just simply signs
her name with her thumbmark.
17

Applying the principle that only questions of law may be entertained by this Court, we defer to the factual ruling of the
Provincial Adjudicator, as affirmed by DARAB and the Court of Appeals, which clearly had the opportunity to closely
examine the witnesses and their demeanor on the witness stand.
Assuming that the leasehold contract between Susana and Godofredo is void, our conclusion remains. We agree with
the Court of Appeals that a tenancy relationship cannot be extinguished by mere expiration of term or period in a
leasehold contract; or by the sale, alienation or the transfer of legal possession of the landholding. Section 9 of
Republic Act No. 1199 or the Agricultural Tenancy Act provides:
SECTION 9. Severance of Relationship. The tenancy relationship is extinguished by the voluntary surrender of the
land by, or the death or incapacity of, the tenant, but his heirs or the members of his immediate farm household may
continue to work the land until the close of the agricultural year. The expiration of the period of the contract as fixed
by the parties, and the sale or alienation of the land does not of themselves extinguish the relationship. In the latter
case, the purchaser or transferee shall assume the rights and obligations of the former landholder in relation to the
tenant. In case of death of the landholder, his heir or heirs shall likewise assume his rights and obligations.
(Emphasis supplied)
Moreover, Section 10 of Republic Act No. 3844 (Code of Agrarian Reforms of the Philippines) likewise provides:
SEC. 10. Agricultural Leasehold Relation Not Extinguished by Expiration of Period, etc. The agricultural leasehold
relation under this Code shall not be extinguished by mere expiration of the term or period in a leasehold contract nor
by the sale, alienation or transfer of the legal possession of the landholding. In case the agricultural lessor sells,
alienates or transfers the legal possession of the landholding, the purchaser or transferee thereof shall be subrogated
to the rights and substituted to the obligations of the agricultural lessor. (Emphasis supplied)
As an incidental issue, Leonidas legal standing as a party was also assailed by Eugenio.1avvphi1 Eugenio submitted
that the complaint was rendered moot with the death of Librada, Godofredos sole compulsory heir. Eugenio
contended that Leonida is a mere ward of Godofredo and Librada, thus, not a legal heir.
18

We are in full accord with the Court of Appeals when it ruled that Eugenio cannot collaterally attack the status of
Leonida in the instant petition.
19

It is settled law that filiation cannot be collaterally attacked.
20
Well-known civilista Dr. Arturo M. Tolentino, in his book
"Civil Code of the Philippines, Commentaries and Jurisprudence," noted that the aforecited doctrine is rooted from the
provisions of the Civil Code of the Philippines. He explained thus:
The legitimacy of the child cannot be contested by way of defense or as a collateral issue in another action for a
different purpose. The necessity of an independent action directly impugning the legitimacy is more clearly expressed
in the Mexican code (article 335) which provides: "The contest of the legitimacy of a child by the husband or his heirs
must be made by proper complaint before the competent court; any contest made in any other way is void." This
principle applies under our Family Code. Articles 170 and 171 of the code confirm this view, because they refer to
"the action to impugn the legitimacy." This action can be brought only by the husband or his heirs and within the
periods fixed in the present articles.
21

In Braza v. City Civil Registrar of Himamaylan City, Negros Occidental,
22
the Court stated that legitimacy and filiation
can be questioned only in a direct action seasonably filed by the proper party, and not through collateral attack.
23

The same rule is applied to adoption such that it cannot also be made subject to a collateral attack. In Reyes v.
Sotero,
24
this Court reiterated that adoption cannot be assailed collaterally in a proceeding for the settlement of a
decedents estate.
25
Furthermore, in Austria v. Reyes,
26
the Court declared that the legality of the adoption by the
testatrix can be assailed only in a separate action brought for that purpose and cannot be subject to collateral
attack.
27

Against these jurisprudential backdrop, we have to leave out the status of Leonida from the case for annulment of the
"Kasunduan" that supposedly favors petitioners cause.
WHEREFORE, based on the foregoing premises, the instant petition for review on certiorari is DENIED and the
Decision dated 10 August 2006 of the Court of Appeals in CA-G.R. SP No. 87148 is AFFIRMED.
SO ORDERED.
JOSE PORTUGAL PEREZ
Associate Justice
WE CONCUR:
RENATO C. CORONA
Chief Justice
Chairperson
PRESBITERO J. VELASCO, JR.
Associate Justice
TERESITA J. LEONARDO-DE CASTRO
Associate Justice
DIOSDADO M. PERALTA
*

Associate Justice
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above Decision
were reached in consultation before the case was assigned to the writer of the opinion of the Court.
RENATO C. CORONA
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 133978 November 12, 2002
JOSE S. CANCIO, JR., represented by ROBERTO L. CANCIO, petitioner,
vs.
EMERENCIANA ISIP, respondent.
D E C I S I O N
YNARES-SANTIAGO, J .:
The instant petition for review under Rule 45 of the Rules of Court raises pure questions of law involving the March
20, 1998
1
and June 1, 1998
2
Orders
3
rendered by the Regional Trial Court of Pampanga, Branch 49, in Civil Case
No. G-3272.
The undisputed facts are as follows:
Petitioner, assisted by a private prosecutor, filed three cases of Violation of B.P. No. 22 and three cases of Estafa,
against respondent for allegedly issuing the following checks without sufficient funds, to wit: 1) Interbank Check No.
25001151 in the amount of P80,000.00; 2) Interbank Check No. 25001152 in the amount of P 80,000.00; and 3)
Interbank Check No. 25001157 in the amount of P30,000.00.
4

The Office of the Provincial Prosecutor dismissed Criminal Case No. 13356, for Violation of B.P. No. 22 covering
check no. 25001151 on the ground that the check was deposited with the drawee bank after 90 days from the date of
the check. The two other cases for Violation of B.P. No. 22 (Criminal Case No. 13359 and 13360) were filed with and
subsequently dismissed by the Municipal Trial Court of Guagua, Pampanga, Branch 1, on the ground of "failure to
prosecute."
5

Meanwhile, the three cases for Estafa were filed with the Regional Trial Court of Pampanga, Branch 49, and
docketed as Criminal Case Nos. G-3611 to G-3613. On October 21, 1997, after failing to present its second witness,
the prosecution moved to dismiss the estafa cases against respondent. The prosecution likewise reserved its right to
file a separate civil action arising from the said criminal cases. On the same date, the trial court granted the motions
of the prosecution. Thus-
Upon motion of the prosecution for the dismissal of these cases without prejudice to the refiling of the civil aspect
thereof and there being no comment from the defense, let these cases be dismissed without prejudice to the refiling
of the civil aspect of the cases.
SO ORDER[ED].
6

On December 15, 1997, petitioner filed the instant case for collection of sum of money, seeking to recover the
amount of the checks subject of the estafa cases. On February 18, 1998, respondent filed a motion to dismiss the
complaint contending that petitioners action is barred by the doctrine of res judicata. Respondent further prayed that
petitioner should be held in contempt of court for forum-shopping.
7

On March 20, 1998, the trial court found in favor of respondent and dismissed the complaint. The court held that the
dismissal of the criminal cases against respondent on the ground of lack of interest or failure to prosecute is an
adjudication on the merits which amounted to res judicata on the civil case for collection. It further held that the filing
of said civil case amounted to forum-shopping.
On June 1, 1998, the trial court denied petitioners motion for reconsideration.
8
Hence, the instant petition.
The legal issues for resolution in the case at bar are: 1) whether the dismissal of the estafa cases against respondent
bars the institution of a civil action for collection of the value of the checks subject of the estafa cases; and 2) whether
the filing of said civil action violated the anti-forum-shopping rule.
An act or omission causing damage to another may give rise to two separate civil liabilities on the part of the offender,
i.e., (1) civil liability ex delicto, under Article 100 of the Revised Penal Code;
9
and (2) independent civil liabilities, such
as those (a) not arising from an act or omission complained of as felony [e.g. culpa contractual or obligations arising
from law under Article 31
10
of the Civil Code,
11
intentional torts under Articles 32
12
and 34,
13
and culpa aquiliana under
Article 2176
14
of the Civil Code]; or (b) where the injured party is granted a right to file an action independent and
distinct from the criminal action [Article 33,
15
Civil Code].
16
Either of these two possible liabilities may be enforced
against the offender subject, however, to the caveat under Article 2177 of the Civil Code that the offended party
"cannot recover damages twice for the same act or omission" or under both causes.
17

The modes of enforcement of the foregoing civil liabilities are provided for in the Revised Rules of Criminal
Procedure. Though the assailed order of the trial court was issued on March 20, 1998, the said Rules, which took
effect on December 1, 2000, must be given retroactive effect in the instant case considering that statutes regulating
the procedure of the court are construed as applicable to actions pending and undetermined at the time of their
passage.
18

Section 1, Rule 111, of the Revised Rules of Criminal Procedure provides:
SECTION 1. Institution of criminal and civil actions. (a) When a criminal action is instituted, the civil action for the
recovery of civil liability arising from the offense charged shall be deemed instituted with the criminal action unless the
offended party waives the civil action, reserves the right to institute it separately or institutes the civil action prior to
the criminal action.
The reservation of the right to institute separately the civil action shall be made before the prosecution starts
presenting its evidence and under circumstances affording the offended party a reasonable opportunity to make such
reservation.
x x x x x x x x x
Where the civil action has been filed separately and trial thereof has not yet commenced, it may be consolidated with
the criminal action upon application with the court trying the latter case. If the application is granted, the trial of both
actions shall proceed in accordance with section 2 of this Rule governing consolidation of the civil and criminal
actions.
Under the 1985 Rules on Criminal Procedure, as amended in 1988 and under the present Rules, the civil liability ex-
delicto is deemed instituted with the criminal action, but the offended party is given the option to file a separate civil
action before the prosecution starts to present evidence.
19

Anent the independent civil actions under Articles 31, 32, 33, 34 and 2176 of the Civil Code, the old rules considered
them impliedly instituted with the civil liability ex-delicto in the criminal action, unless the offended party waives the
civil action, reserves his right to institute it separately, or institutes the civil action prior to the criminal action. Under
the present Rules, however, the independent civil actions may be filed separately and prosecuted independently even
without any reservation in the criminal action. The failure to make a reservation in the criminal action is not a waiver
of the right to file a separate and independent civil action based on these articles of the Civil Code.
20

In the case at bar, a reading of the complaint filed by petitioner show that his cause of action is based on culpa
contractual, an independent civil action. Pertinent portion of the complaint reads:
x x x x x x x x x
2. That plaintiff is the owner/proprietor to CANCIOS MONEY EXCHANGE with office address at Guagua,
Pampanga;
3. That on several occasions, particularly on February 27, 1993 to April 17 1993, inclusive, defendant drew,
issued and made in favor of the plaintiff the following checks:
CHECK NO. DATE AMOUNT
1. Interbank Check No. 25001151 March 10, 1993 P80,000.00
2. Interbank Check No. 25001152 March 27, 1993 P80,000.00
3. Interbank Check No. 25001157 May 17, 1993 P30,000.00
in exchange of cash with the assurance that the said checks will be honored for payment on their
maturity dates, copy of the aforementioned checks are hereto attached and marked.
4. That when the said checks were presented to the drawee bank for encashment, the same were all
dishonored for reason of DRAWN AGAINST INSUFFICIENT FUNDS (DAIF);
5. That several demands were made upon the defendant to make good the checks but she failed and
refused and still fails and refuses without justifiable reason to pay plaintiff;
6. That for failure of the defendant without any justifiable reason to pay plaintiff the value of the checks, the
latter was forced to hire the services of undersigned counsel and agreed to pay the amount of P30,000.00
as attorneys fees and P1,000.00 per appearance in court;
7. That for failure of the defendant without any justifiable reason to pay plaintiff and forcing the plaintiff to
litigate, the latter will incur litigation expenses in the amount of P20,000.00.
IN VIEW OF THE FOREGOING, it is prayed of this Court that after due notice and hearing a judgment be rendered
ordering defendant to pay plaintiff as follows:
a. the principal sum of P190,000.00 plus the legal interest;
b. attorneys fees of P30,000.00 plus P1,000.00 per court appearance;
c. litigation expenses in the amount of P20,000.00
PLAINTIFF prays for other reliefs just and equitable under the premises.
x x x x x x x x x.
21

Evidently, petitioner sought to enforce respondents obligation to make good the value of the checks in exchange for
the cash he delivered to respondent. In other words, petitioners cause of action is the respondents breach of the
contractual obligation. It matters not that petitioner claims his cause of action to be one based on delict.
22
The nature
of a cause of action is determined by the facts alleged in the complaint as constituting the cause of action. The
purpose of an action or suit and the law to govern it is to be determined not by the claim of the party filing the action,
made in his argument or brief, but rather by the complaint itself, its allegations and prayer for relief.
23

Neither does it matter that the civil action reserved in the October 21, 1997 order of the trial court was the civil action
ex delicto. To reiterate, an independent civil action arising from contracts, as in the instant case, may be filed
separately and prosecuted independently even without any reservation in the criminal action. Under Article 31 of the
Civil Code "[w]hen the civil action is based on an obligation not arising from the act or omission complained of as a
felony, [e.g. culpa contractual] such civil action may proceed independently of the criminal proceedings and
regardless of the result of the latter." Thus, in Vitola, et al. v. Insular Bank of Asia and America,
24
the Court, applying
Article 31 of the Civil Code, held that a civil case seeking to recover the value of the goods subject of a Letter of
Credit-Trust Receipt is a civil action ex contractu and not ex delicto. As such, it is distinct and independent from the
estafa case filed against the offender and may proceed regardless of the result of the criminal proceedings.
One of the elements of res judicata is identity of causes of action.
25
In the instant case, it must be stressed that the
action filed by petitioner is an independent civil action, which remains separate and distinct from any criminal
prosecution based on the same act.
26
Not being deemed instituted in the criminal action based on culpa criminal, a
ruling on the culpability of the offender will have no bearing on said independent civil action based on an entirely
different cause of action, i.e., culpa contractual.
In the same vein, the filing of the collection case after the dismissal of the estafa cases against respondent did not
amount to forum-shopping. The essence of forum-shopping is the filing of multiple suits involving the same parties for
the same cause of action, either simultaneously or successively, to secure a favorable judgment. Although the cases
filed by petitioner arose from the same act or omission of respondent, they are, however, based on different causes
of action. The criminal cases for estafa are based on culpa criminal while the civil action for collection is anchored on
culpa contractual. Moreover, there can be no forum-shopping in the instant case because the law expressly allows
the filing of a separate civil action which can proceed independently of the criminal action.
27

Clearly, therefore, the trial court erred in dismissing petitioners complaint for collection of the value of the checks
issued by respondent. Being an independent civil action which is separate and distinct from any criminal prosecution
and which require no prior reservation for its institution, the doctrine of res judicata and forum-shopping will not
operate to bar the same.
WHEREFORE, in view of all the foregoing, the instant petition is GRANTED. The March 20, 1998 and June 1, 1998
Orders of the Regional Trial Court of Pampanga, Branch 49, in Civil Case No. G-3272 are REVERSED and SET
ASIDE. The instant case is REMANDED to the trial court for further proceedings.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Vitug, Carpio, and Azcuna, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 158995 September 26, 2006
L.G. FOODS CORPORATION and VICTORINO GABOR, Vice-President and General Manager, petitioners,
vs.
HON. PHILADELFA B. PAGAPONG-AGRAVIADOR, in her capacity as Presiding Judge of Regional Trial
Court, Branch 43, Bacolod City, and SPS. FLORENTINO and THERESA VALLEJERA, respondents.
D E C I S I O N
GARCIA, J .:
Assailed and sought to be set aside in this petition for review on certiorari is the Decision
1
dated April 25, 2003 of the
Court of Appeals (CA), as reiterated in its Resolution of July 10, 2003,
2
in CA-G.R. SP No. 67600, affirming an earlier
Order of the Regional Trial Court (RTC) of Bacolod City, Branch 43, which denied the petitioners' motion to dismiss in
Civil Case No. 99-10845, an action for damages arising from a vehicular accident thereat instituted by the herein
private respondents - the spouses Florentino Vallejera and Theresa Vallejera - against the petitioners.
The antecedent facts may be briefly stated as follows:
On February 26, 1996, Charles Vallereja, a 7-year old son of the spouses Florentino Vallejera and Theresa Vallejera,
was hit by a Ford Fiera van owned by the petitioners and driven at the time by their employee, Vincent Norman
Yeneza y Ferrer. Charles died as a result of the accident.
In time, an Information for Reckless Imprudence Resulting to Homicide was filed against the driver before the
Municipal Trial Court in Cities (MTCC), Bacolod City, docketed as Criminal Case No. 67787, entitled People of the
Philippines v. Vincent Norman Yeneza.
Unfortunately, before the trial could be concluded, the accused driver committed suicide, evidently bothered by
conscience and remorse. On account thereof, the MTCC, in its order of September 30, 1998, dismissed the criminal
case.
On June 23, 1999, in the RTC of Bacolod City, the spouses Vallejera filed a complaint
3
for damages against the
petitioners as employers of the deceased driver, basically alleging that as such employers, they failed to exercise due
diligence in the selection and supervision of their employees. Thereat docketed as Civil Case No. 99-10845, the
complaint was raffled to Branch 43 of the court.
In their Answer with Compulsory Counterclaim,
4
the petitioners as defendants denied liability for the death of the
Vallejeras' 7-year old son, claiming that they had exercised the required due diligence in the selection and
supervision of their employees, including the deceased driver. They thus prayed in their Answer for the dismissal of
the complaint for lack of cause of action on the part of the Vallejera couple.
During pre-trial, the defendant petitioners insisted that their dismissal prayer be resolved. Hence, the trial court
required them to file within ten days a memorandum of authorities supportive of their position.
Instead, however, of the required memorandum of authorities, the defendant petitioners filed a Motion to Dismiss,
principally arguing that the complaint is basically a "claim for subsidiary liability against an employer" under the
provision of Article 103
5
of the Revised Penal Code. Prescinding therefrom, they contend that there must first be a
judgment of conviction against their driver as a condition sine qua non to hold them liable. Ergo, since the driver died
during the pendency of the criminal action, the sine qua non condition for their subsidiary liability was not fulfilled,
hence the of lack of cause of action on the part of the plaintiffs. They further argue that since the plaintiffs did not
make a reservation to institute a separate action for damages when the criminal case was filed, the damage suit in
question is thereby deemed instituted with the criminal action. which was already dismissed.
In an Order dated September 4, 2001,
6
the trial court denied the motion to dismiss for lack of merit and set the case
for pre-trial. With their motion for reconsideration having been denied by the same court in its subsequent order
7
of
September 26, 2001, the petitioners then went on certiorari to the CA in CA-G.R. SP No. 67600, imputing grave
abuse of discretion on the part of the trial judge in refusing to dismiss the basic complaint for damages in Civil Case
No. 99-10845.
In the herein assailed decision
8
dated April 25, 2003, the CA denied the petition and upheld the trial court. Partly says
the CA in its challenged issuance:
xxx xxx xxx
It is clear that the complaint neither represents nor implies that the responsibility charged was the petitioner's
subsidiary liability under Art. 103, Revised Penal Code. As pointed out [by the trial court] in the Order of
September 4, 2001, the complaint does not even allege the basic elements for such a liability, like the
conviction of the accused employee and his insolvency. Truly enough, a civil action to enforce subsidiary
liability separate and distinct from the criminal action is even unnecessary.
xxx xxx xxx
Specifically, Civil Case No. 99-10845 exacts responsibility for fault or negligence under Art. 2176, Civil
Code, which is entirely separate and distinct from the civil liability arising from negligence under the Revised
Penal Code. Verily, therefore, the liability under Art. 2180, Civil Code, is direct and immediate, and not
conditioned upon prior recourse against the negligent employee or prior showing of the latter's insolvency.
(Underscoring in the original.)
In time, the petitioners moved for a reconsideration but their motion was denied by the CA in its resolution
9
of July 10,
2003. Hence, the petitioners' present recourse on their submission that the appellate court committed reversible error
in upholding the trial court's denial of their motion to dismiss.
We DENY.
As the Court sees it, the sole issue for resolution is whether the spouses Vallejeras' cause of action in Civil Case No.
99-10845 is founded on Article 103 of the Revised Penal Code, as maintained by the petitioners, or derived from
Article 2180
10
of the Civil Code, as ruled by the two courts below.
It thus behooves us to examine the allegations of the complaint for damages in Civil Case No. 99-10845. That
complaint alleged, inter alia, as follows:
xxx xxx xxx
3. That defendant [LG Food Corporation] is the registered owner of a Ford Fiera Van with Plate No. NMS
881 and employer sometime February of 1996 of one Vincent Norman Yeneza y Ferrer, a salesman of said
corporation;
4. That sometime February 26, 1996 at around 2:00 P.M. at Rosario St., Bacolod City, the minor son of said
plaintiffs [now respondents], Charles Vallejera, 7 years old, was hit and bumped by above-described vehicle
then driven by said employee, Vincent Norman Yeneza y Ferrer;
5. That the mishap was due to the gross fault and negligence of defendant's employee, who drove said
vehicle, recklessly, negligently and at a high speed without regard to traffic condition and safety of other
road users and likewise to the fault and negligence of the owner employer, herein defendants LG Food
Corporation who failed to exercise due diligence in the selection and supervision of his employee, Vincent
Norman Yeneza y Ferrer;
6. That as a result of said incident, plaintiffs' son suffered multiple body injuries which led to his untimely
demise on that very day;
7. That a criminal case was filed against the defendant's employee, docketed as Criminal Case No. 67787,
(earlier filed as Crim. Case No. 96-17570 before RTC) before MTC-Branch III, entitled "People v. Yeneza"
for "Reckless Imprudence resulting to Homicide," but the same was dismissed because pending litigation,
then remorse-stricken [accused] committed suicide;
xxx xxx xxx
8. That the injuries and complications as well as the resultant death suffered by the late minor Charles
Vallejera were due to the negligence and imprudence of defendant's employee;
9. That defendant LG Foods Corporation is civilly liable for the negligence/imprudence of its
employee since it failed to exercise the necessary diligence required of a good father of the family in
the selection and supervision of his employee, Vincent Norman Yeneza y Ferrer which diligence if
exercised, would have prevented said incident. (Bracketed words and emphasis ours.)
Nothing in the foregoing allegations suggests, even remotely, that the herein petitioners are being made to account
for their subsidiary liability under Article 103 of the Revised Penal Code. As correctly pointed out by the trial court in
its order of September 4, 2001 denying the petitioners' Motion to Dismiss, the complaint did not even aver the basic
elements for the subsidiary liability of an employer under Article 103 of the Revised Penal Code, such as the prior
conviction of the driver in the criminal case filed against him nor his insolvency.
Admittedly, the complaint did not explicitly state that plaintiff Vallejeras were suing the defendant petitioners for
damages based on quasi-delict. Clear it is, however, from the allegations of the complaint that quasi-delict was their
choice of remedy against the petitioners. To stress, the plaintiff spouses alleged in their complaint gross fault and
negligence on the part of the driver and the failure of the petitioners, as employers, to exercise due diligence in the
selection and supervision of their employees. The spouses further alleged that the petitioners are civilly liable for the
negligence/imprudence of their driver since they failed to exercise the necessary diligence required of a good father
of the family in the selection and supervision of their employees, which diligence, if exercised, could have prevented
the vehicular accident that resulted to the death of their 7-year old son.
Section 2, Rule 2, of the 1997 Rules of Civil Procedure defines cause of action as the "act or omission by which a
party violates the right of another." Such act or omission gives rise to an obligation which may come from law,
contracts, quasi contracts, delicts or quasi-delicts.
11

Corollarily, an act or omission causing damage to another may give rise to two separate civil liabilities on the part of
the offender, i.e., 1) civil liability ex delicto;
12
and 2) independent civil liabilities, such as those (a) not arising from an
act or omission complained of as felony (e.g., culpa contractual or obligations arising from law;
13
the intentional
torts;
14
and culpa aquiliana
15
); or (b) where the injured party is granted a right to file an action independent and
distinct from the criminal action.
16
Either of these two possible liabilities may be enforced against the offender.
17

Stated otherwise, victims of negligence or their heirs have a choice between an action to enforce the civil liability
arising from culpa criminal under Article 100 of the Revised Penal Code, and an action for quasi-delict (culpa
aquiliana) under Articles 2176 to 2194 of the Civil Code. If, as here, the action chosen is for quasi-delict, the plaintiff
may hold the employer liable for the negligent act of its employee, subject to the employer's defense of exercise of
the diligence of a good father of the family. On the other hand, if the action chosen is for culpa criminal, the plaintiff
can hold the employer subsidiarily liable only upon proof of prior conviction of its employee.
18

Article 1161
19
of the Civil Code provides that civil obligation arising from criminal offenses shall be governed by penal
laws subject to the provision of Article 2177
20
and of the pertinent provision of Chapter 2, Preliminary Title on Human
Relation, and of Title XVIII of this Book, regulating damages. Plainly, Article 2177 provides for the alternative
remedies the plaintiff may choose from in case the obligation has the possibility of arising indirectly from the
delict/crime or directly from quasi-delict/tort. The choice is with the plaintiff who makes known his cause of action in
his initiatory pleading or complaint,
21
and not with the defendant who can not ask for the dismissal of the plaintiff's
cause of action or lack of it based on the defendant's perception that the plaintiff should have opted to file a claim
under Article 103 of the Revised Penal Code.
Under Article 2180 of the Civil Code, the liability of the employer is direct or immediate. It is not conditioned upon
prior recourse against the negligent employee and a prior showing of insolvency of such employee.
22

Here, the complaint sufficiently alleged that the death of the couple's minor son was caused by the negligent act of
the petitioners' driver; and that the petitioners themselves were civilly liable for the negligence of their driver for failing
"to exercise the necessary diligence required of a good father of the family in the selection and supervision of [their]
employee, the driver, which diligence, if exercised, would have prevented said accident."
Had the respondent spouses elected to sue the petitioners based on Article 103 of the Revised Penal Code, they
would have alleged that the guilt of the driver had been proven beyond reasonable doubt; that such accused driver is
insolvent; that it is the subsidiary liability of the defendant petitioners as employers to pay for the damage done by
their employee (driver) based on the principle that every person criminally liable is also civilly liable.
23
Since there was
no conviction in the criminal case against the driver, precisely because death intervened prior to the termination of the
criminal proceedings, the spouses' recourse was, therefore, to sue the petitioners for their direct and primary liability
based on quasi-delict.
Besides, it is worthy to note that the petitioners, in their Answer with Compulsory Counter-Claim,
24
repeatedly made
mention of Article 2180 of the Civil Code and anchored their defense on their allegation that "they had exercised due
diligence in the selection and supervision of [their] employees." The Court views this defense as an admission that
indeed the petitioners acknowledged the private respondents' cause of action as one for quasi-delict under Article
2180 of the Civil Code.
All told, Civil Case No. 99-10845 is a negligence suit brought under Article 2176 - Civil Code to recover damages
primarily from the petitioners as employers responsible for their negligent driver pursuant to Article 2180 of the Civil
Code. The obligation imposed by Article 2176 is demandable not only for one's own acts or omissions, but also for
those of persons for whom one is responsible. Thus, the employer is liable for damages caused by his employees
and household helpers acting within the scope of their assigned tasks, even though the former is not engaged in any
business or industry.
Citing Maniago v. CA,
25
petitioner would argue that Civil Case No. 99-10845 should have been dismissed for failure
of the respondent spouses to make a reservation to institute a separate civil action for damages when the criminal
case against the driver was filed.
The argument is specious.
To start with, the petitioners' reliance on Maniago is obviously misplaced. There, the civil case was filed while the
criminal case against the employee was still pending. Here, the criminal case against the employee driver was
prematurely terminated due to his death. Precisely, Civil Case No. 99-10845 was filed by the respondent spouses
because no remedy can be obtained by them against the petitioners with the dismissal of the criminal case against
their driver during the pendency thereof.
The circumstance that no reservation to institute a separate civil action for damages was made when the criminal
case was filed is of no moment for the simple reason that the criminal case was dismissed without any
pronouncement having been made therein. In reality, therefor, it is as if there was no criminal case to speak of in the
first place. And for the petitioners to insist for the conviction of their driver as a condition sine qua non to hold them
liable for damages is to ask for the impossible.
IN VIEW WHEREOF, the instant petition is DENIED for lack of merit.
Costs against the petitioners.
SO ORDERED.
Puno, Chairperson, Sandoval-Gutierrez, Corona, Azcuna, J.J., concur.
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 157547 February 23, 2011
HEIRS OF EDUARDO SIMON, Petitioners,
vs.
ELVIN
*
CHAN AND THE COURT OF APPEALS, Respondent.
D E C I S I O N
BERSAMIN, J .:
There is no independent civil action to recover the civil liability arising from the issuance of an unfunded check
prohibited and punished under Batas Pambansa Bilang 22 (BP 22).
Antecedents
On July 11, 1997, the Office of the City Prosecutor of Manila filed in the Metropolitan Trial Court of Manila (MeTC) an
information charging the late Eduardo Simon (Simon) with a violation of BP 22, docketed as Criminal Case No.
275381 entitled People v. Eduardo Simon. The accusatory portion reads:
That sometime in December 1996 in the City of Manila, Philippines, the said accused, did then and there willfully,
unlawfully and feloniously make or draw and issue to Elvin Chan to apply on account or for value Landbank Check
No. 0007280 dated December 26, 1996 payable to cash in the amount of P336,000.00 said accused well knowing
that at the time of issue she/he/they did not have sufficient funds in or credit with the drawee bank for payment of
such check in full upon its presentment, which check when presented for payment within ninety (90) days from the
date thereof was subsequently dishonored by the drawee bank for Account Closed and despite receipt of notice of
such dishonor, said accused failed to pay said Elvin Chan the amount of the check or to make arrangement for full
payment of the same within five (5) banking days after receiving said notice.
CONTRARY TO LAW.
1

More than three years later, or on August 3, 2000, respondent Elvin Chan commenced in the MeTC in Pasay City a
civil action for the collection of the principal amount of P336,000.00, coupled with an application for a writ of
preliminary attachment (docketed as Civil Case No. 915-00).
2
He alleged in his complaint the following:
xxx
2. Sometime in December 1996 defendant employing fraud, deceit, and misrepresentation encashed a
check dated December 26, 1996 in the amount of P336,000.00 to the plaintiff assuring the latter that the
check is duly funded and that he had an existing account with the Land Bank of the Philippines, xerox copy
of the said check is hereto attached as Annex "A";
3. However, when said check was presented for payment the same was dishonored on the ground that the
account of the defendant with the Land Bank of the Philippines has been closed contrary to his
representation that he has an existing account with the said bank and that the said check was duly funded
and will be honored when presented for payment;
4. Demands had been made to the defendant for him to make good the payment of the value of the check,
xerox copy of the letter of demand is hereto attached as Annex "B", but despite such demand defendant
refused and continues to refuse to comply with plaintiffs valid demand;
5. Due to the unlawful failure of the defendant to comply with the plaintiffs valid demands, plaintiff has been
compelled to retain the services of counsel for which he agreed to pay as reasonable attorneys fees the
amount of P50,000.00 plus additional amount of P2,000.00 per appearance.
ALLEGATION IN SUPPORT OF PRAYER
FOR PRELIMINARY ATTACHMENT
6. The defendant as previously alleged has been guilty of fraud in contracting the obligation upon which this
action is brought and that there is no sufficient security for the claims sought in this action which fraud
consist in the misrepresentation by the defendant that he has an existing account and sufficient funds to
cover the check when in fact his account was already closed at the time he issued a check;
7. That the plaintiff has a sufficient cause of action and this action is one which falls under Section 1, sub-
paragraph (d), Rule 57 of the Revised Rules of Court of the Philippines and the amount due the plaintiff is as
much as the sum for which the plaintiff seeks the writ of preliminary attachment;
8. That the plaintiff is willing and able to post a bond conditioned upon the payment of damages should it be
finally found out that the plaintiff is not entitled to the issuance of a writ of preliminary attachment.
3

On August 9, 2000, the MeTC in Pasay City issued a writ of preliminary attachment, which was implemented on
August 17, 2000 through the sheriff attaching a Nissan vehicle of Simon.
4

On August 17, 2000, Simon filed an urgent motion to dismiss with application to charge plaintiffs attachment bond for
damages,
5
pertinently averring:
xxx
On the ground of litis pendentia, that is, as a consequence of the pendency of another action between the instant
parties for the same cause before the Metropolitan Trial Court of Manila, Branch X (10) entitled "People of the
Philippines vs. Eduardo Simon", docketed thereat as Criminal Case No. 275381-CR, the instant action is dismissable
under Section 1, (e), Rule 16, 1997 Rules of Civil Procedure, xxx
xxx
While the instant case is civil in nature and character as contradistinguished from the said Criminal Case No. 915-00
in the Metropolitan Trial Court of Manila, Branch X (10), the basis of the instant civil action is the herein plaintiffs
criminal complaint against defendant arising from a charge of violation of Batas Pambansa Blg. 22 as a consequence
of the alleged dishonor in plaintiffs hands upon presentment for payment with drawee bank a Land Bank Check No.
0007280 dated December 26, 1996 in the amount of P336,000- drawn allegedly issued to plaintiff by defendant who
is the accused in said case, a photocopy of the Criminal information filed by the Assistant City Prosecutor of Manila
on June 11, 1997 hereto attached and made integral part hereof as Annex "1".
It is our understanding of the law and the rules, that, "when a criminal action is instituted, the civil action for recovery
of civil liability arising from the offense charged is impliedly instituted with the criminal action, unless the offended
party expressly waives the civil action or reserves his right to institute it separately xxx.
On August 29, 2000, Chan opposed Simons urgent motion to dismiss with application to charge plaintiffs attachment
bond for damages, stating:
1. The sole ground upon which defendant seeks to dismiss plaintiffs complaint is the alleged pendency of
another action between the same parties for the same cause, contending among others that the pendency
of Criminal Case No. 275381-CR entitled "People of the Philippines vs. Eduardo Simon" renders this case
dismissable;
2. The defendant further contends that under Section 1, Rule 111 of the Revised Rules of Court, the filing of
the criminal action, the civil action for recovery of civil liability arising from the offense charged is impliedly
instituted with the criminal action which the plaintiff does not contest; however, it is the submission of the
plaintiff that an implied reservation of the right to file a civil action has already been made, first, by the fact
that the information for violation of B.P. 22 in Criminal Case No. 2753841 does not at all make any allegation
of damages suffered by the plaintiff nor is there any claim for recovery of damages; on top of this the plaintiff
as private complainant in the criminal case, during the presentation of the prosecution evidence was not
represented at all by a private prosecutor such that no evidence has been adduced by the prosecution on
the criminal case to prove damages; all of these we respectfully submit demonstrate an effective implied
reservation of the right of the plaintiff to file a separate civil action for damages;
3. The defendant relies on Section 3 sub-paragraph (a) Rule 111 of the Revised Rules of Court which
mandates that after a criminal action has been commenced the civil action cannot be instituted until final
judgment has been rendered in the criminal action; however, the defendant overlooks and conveniently
failed to consider that under Section 2, Rule 111 which provides as follows:
In the cases provided for in Articles 31, 32, 33, 34 and 2177 of the Civil Code of the Philippines, an
independent civil action entirely separate and distinct from the criminal action, may be brought by the injured
party during the pendency of criminal case provided the right is reserved as required in the preceding
section. Such civil action shall proceed independently of the criminal prosecution, and shall require only a
preponderance of evidence.
In as much as the case is one that falls under Art. 33 of the Civil Code of the Philippines as it is based on
fraud, this action therefore may be prosecuted independently of the criminal action;
4. In fact we would even venture to state that even without any reservation at all of the right to file a separate
civil action still the plaintiff is authorized to file this instant case because the plaintiff seeks to enforce an
obligation which the defendant owes to the plaintiff by virtue of the negotiable instruments law. The plaintiff
in this case sued the defendant to enforce his liability as drawer in favor of the plaintiff as payee of the
check. Assuming the allegation of the defendant of the alleged circumstances relative to the issuance of the
check, still when he delivered the check payable to bearer to that certain Pedro Domingo, as it was payable
to cash, the same may be negotiated by delivery by who ever was the bearer of the check and such
negotiation was valid and effective against the drawer;
5. Indeed, assuming as true the allegations of the defendant regarding the circumstances relative to the
issuance of the check it would be entirely impossible for the plaintiff to have been aware that such check
was intended only for a definite person and was not negotiable considering that the said check was payable
to bearer and was not even crossed;
6. We contend that what cannot be prosecuted separate and apart from the criminal case without a
reservation is a civil action arising from the criminal offense charged. However, in this instant case since the
liability of the defendant are imposed and the rights of the plaintiff are created by the negotiable instruments
law, even without any reservation at all this instant action may still be prosecuted;
7. Having this shown, the merits of plaintiffs complaint the application for damages against the bond is
totally without any legal support and perforce should be dismissed outright.
6

On October 23, 2000, the MeTC in Pasay City granted Simons urgent motion to dismiss with application to charge
plaintiffs attachment bond for damages,
7
dismissing the complaint of Chan because:
xxx
After study of the arguments of the parties, the court resolves to GRANT the Motion to Dismiss and the application to
charge plaintiffs bond for damages.
For "litis pendentia" to be a ground for the dismissal of an action, the following requisites must concur: (a) identity of
parties or at least such as to represent the same interest in both actions; (b) identity of rights asserted and relief
prayed for, the relief being founded on the same acts; and (c) the identity in the two (2) cases should be such that the
judgment, which may be rendered in one would, regardless of which party is successful, amount to res judicata in the
other. xxx
A close perusal of the herein complaint denominated as "Sum of Money" and the criminal case for violation of BP Blg.
22 would readily show that the parties are not only identical but also the cause of action being asserted, which is the
recovery of the value of Landbank Check No. 0007280 in the amount of P336,000.00. In both civil and criminal cases,
the rights asserted and relief prayed for, the reliefs being founded on the same facts, are identical.
Plaintiffs claim that there is an effective implied waiver of his right to pursue this civil case owing to the fact that there
was no allegation of damages in BP Blg. 22 case and that there was no private prosecutor during the presentation of
prosecution evidence is unmeritorious. It is basic that when a complaint or criminal Information is filed, even wi thout
any allegation of damages and the intention to prove and claim them, the offended party has the right to prove and
claim for them, unless a waiver or reservation is made or unless in the meantime, the offended party has instituted a
separate civil action. xxx The over-all import of the said provision conveys that the waiver which includes indemnity
under the Revised Penal Code, and damages arising under Articles 32, 33, and 34 of the Civil Code must be both
clear and express. And this must be logically so as the primordial objective of the Rule is to prevent the offended
party from recovering damages twice for the same act or omission of the accused.
Indeed, the evidence discloses that the plaintiff did not waive or made a reservation as to his right to pursue the civil
branch of the criminal case for violation of BP Blg. 22 against the defendant herein. To the considered view of this
court, the filing of the instant complaint for sum of money is indeed legally barred. The right to institute a separate civil
action shall be made before the prosecution starts to present its evidence and under circumstances affording the
offended party a reasonable opportunity to make such reservation. xxx
Even assuming the correctness of the plaintiffs submission that the herein case for sum of money is one based on
fraud and hence falling under Article 33 of the Civil Code, still prior reservation is required by the Rules, to wit:
"In the cases provided for in Articles 31, 32, 33, 34 and 2177 of the Civil Code of the Philippines, an independent civil
action entirely separate and distinct from the criminal action, may be brought by the injured party during the pendency
of criminal case provided the right is reserved as required in the preceding section. Such civil action shall proceed
independently of the criminal prosecution, and shall require only a preponderance of evidence."
xxx
WHEREFORE, premises considered, the court resolves to:
1. Dismiss the instant complaint on the ground of "litis pendentia";
2. Dissolve/Lift the Writ of Attachment issued by this court on August 14, 2000;
3. Charge the plaintiffs bond the amount of P336,000.00 in favor of the defendant for the damages
sustained by the latter by virtue of the implementation of the writ of attachment;
4. Direct the Branch Sheriff of this Court to RESTORE with utmost dispatch to the defendants physical
possession the vehicle seized from him on August 16, 2000; and
5. Direct the plaintiff to pay the defendant the sum of P5,000.00 by way of attorneys fees.
SO ORDERED.
Chans motion for reconsideration was denied on December 20, 2000,
8
viz:
Considering that the plaintiffs arguments appear to be a mere repetition of his previous submissions, and which
submissions this court have already passed upon; and taking into account the inapplicability of the ratio decidendi in
the Tactaquin vs. Palileo case which the plaintiff cited as clearly in that case, the plaintiff therein expressly made a
reservation to file a separate civil action, the Motion for Reconsideration is DENIED for lack of merit.
SO ORDERED.
On July 31, 2001, the Regional Trial Court (RTC) in Pasay City upheld the dismissal of Chans complaint, disposing:
9

WHEREFORE, finding no error in the appealed decision, the same is hereby AFFIRMED in toto.
SO ORDERED.
On September 26, 2001, Chan appealed to the Court of Appeals (CA) by petition for review,
10
challenging the
propriety of the dismissal of his complaint on the ground of litis pendentia.
In his comment,
11
Simon countered that Chan was guilty of bad faith and malice in prosecuting his alleged civil claim
twice in a manner that caused him (Simon) utter embarrassment and emotional sufferings; and that the dismissal of
the civil case because of the valid ground of litis pendentia based on Section 1 (e), Rule 16 of the 1997 Rules of Civil
Procedure was warranted.
On June 25, 2002, the CA promulgated its assailed decision,
12
overturning the RTC, viz:
xxx
As a general rule, an offense causes two (2) classes of injuries. The first is the social injury produced by the criminal
act which is sought to be repaired through the imposition of the corresponding penalty, and the second is the
personal injury caused to the victim of the crime which injury is sought to be compensated through indemnity which is
also civil in nature. Thus, "every person criminally liable for a felony is also civilly liable."
The offended party may prove the civil liability of an accused arising from the commission of the offense in the
criminal case since the civil action is either deemed instituted with the criminal action or is separately instituted.
Rule 111, Section 1 of the Revised Rules of Criminal Procedure, which became effective on December 1, 2000,
provides that:
(a) When a criminal action is instituted, the civil action for the recovery of civil liability arising from the offense charged
shall be deemed instituted with the criminal action unless the offended party waives the civil action, reserves the right
to institute it separately or institute the civil action prior to the criminal action.
Rule 111, Section 2 further states:
After the criminal action has been commenced, the separate civil action arising therefrom cannot be instituted until
final judgment has been entered in the criminal action.
However, with respect to civil actions for recovery of civil liability under Articles 32, 33, 34 and 2176 of the Civil Code
arising from the same act or omission, the rule has been changed.
In DMPI Employees Credit Association vs. Velez, the Supreme Court pronounced that only the civil liability arising
from the offense charged is deemed instituted with the criminal action unless the offended party waives the civil
action, reserves his right to institute it separately, or institutes the civil action prior to the criminal action. Speaking
through Justice Pardo, the Supreme Court held:
"There is no more need for a reservation of the right to file the independent civil action under Articles 32, 33, 34 and
2176 of the Civil Code of the Philippines. The reservation and waiver referred to refers only to the civil action for the
recovery of the civil liability arising from the offense charged. This does not include recovery of civil liability under
Articles 32, 33, 34, and 2176 of the Civil Code of the Philippines arising from the same act or omission which may be
prosecuted separately without a reservation".
Rule 111, Section 3 reads:
Sec. 3. When civil action may proceed independently. In the cases provided in Articles 32, 33, 34, and 2176 of the
Civil Code of the Philippines, the independent civil action may be brought by the offended party. It shall proceed
independently of the criminal action and shall require only a preponderance of evidence. In no case, however, may
the offended party recover damages twice for the same act or omission charged in the criminal action.
The changes in the Revised Rules on Criminal Procedure pertaining to independent civil actions which became
effective on December 1, 2000 are applicable to this case.
Procedural laws may be given retroactive effect to actions pending and undetermined at the time of their passage.
There are no vested rights in the rules of procedure. xxx
Thus, Civil Case No. CV-94-124, an independent civil action for damages on account of the fraud committed against
respondent Villegas under Article 33 of the Civil Code, may proceed independently even if there was no reservation
as to its filing."
It must be pointed that the abovecited case is similar with the instant suit. The complaint was also brought on
allegation of fraud under Article 33 of the Civil Code and committed by the respondent in the issuance of the check
which later bounced. It was filed before the trial court, despite the pendency of the criminal case for violation of BP 22
against the respondent. While it may be true that the changes in the Revised Rules on Criminal Procedure pertaining
to independent civil action became effective on December 1, 2000, the same may be given retroactive application
and may be made to apply to the case at bench, since procedural rules may be given retroactive application. There
are no vested rights in the rules of procedure.
In view of the ruling on the first assigned error, it is therefore an error to adjudge damages in favor of the petitioner.
WHEREFORE, the petition is hereby GRANTED. The Decision dated July 13, 2001 rendered by the Regional Trial
Court of Pasay City, Branch 108 affirming the dismissal of the complaint filed by petitioner is hereby REVERSED and
SET ASIDE. The case is hereby REMANDED to the trial court for further proceedings.
SO ORDERED.
On March 14, 2003, the CA denied Simons motion for reconsideration.
13

Hence, this appeal, in which the petitioners submit that the CA erroneously premised its decision on the assessment
that the civil case was an independent civil action under Articles 32, 33, 34, and 2176 of the Civil Code; that the CAs
reliance on the ruling in DMPI Employees Credit Cooperative Inc. v. Velez
14
stretched the meaning and intent of the
ruling, and was contrary to Sections 1 and 2 of Rule 111 of the Rules of Criminal Procedure; that this case was a
simple collection suit for a sum of money, precluding the application of Section 3 of Rule 111 of the Rules of Criminal
Procedure.
15

In his comment,
16
Chan counters that the petition for review should be denied because the petitioners used the wrong
mode of appeal; that his cause of action, being based on fraud, was an independent civil action; and that the
appearance of a private prosecutor in the criminal case did not preclude the filing of his separate civil action.
Issue
The lone issue is whether or not Chans civil action to recover the amount of the unfunded check (Civil Case No. 915-
00) was an independent civil action.
Ruling
The petition is meritorious.
A
Applicable Law and Jurisprudence on the
Propriety of filing a separate civil action based on BP 22
The Supreme Court has settled the issue of whether or not a violation of BP 22 can give rise to civil liability in Banal
v. Judge Tadeo, Jr.,
17
holding:
xxx
Article 20 of the New Civil Code provides:
Every person who, contrary to law, wilfully or negligently causes damage to another, shall indemnify the latter for the
same.
Regardless, therefore, of whether or not a special law so provides, indemnification of the offended party may be had
on account of the damage, loss or injury directly suffered as a consequence of the wrongful act of another. The
indemnity which a person is sentenced to pay forms an integral part of the penalty imposed by law for the
commission of a crime (Quemel v. Court of Appeals, 22 SCRA 44, citing Bagtas v. Director of Prisons, 84 Phil 692).
Every crime gives rise to a penal or criminal action for the punishment of the guilty party, and also to civil action for
the restitution of the thing, repair of the damage, and indemnification for the losses (United States v. Bernardo, 19
Phil 265).
xxx
Civil liability to the offended party cannot thus be denied. The payee of the check is entitled to receive the payment of
money for which the worthless check was issued. Having been caused the damage, she is entitled to recompense.
Surely, it could not have been the intendment of the framers of Batas Pambansa Blg. 22 to leave the offended private
party defrauded and empty-handed by excluding the civil liability of the offender, giving her only the remedy, which in
many cases results in a Pyrrhic victory, of having to file a separate civil suit. To do so may leave the offended party
unable to recover even the face value of the check due her, thereby unjustly enriching the errant drawer at the
expense of the payee. The protection which the law seeks to provide would, therefore, be brought to naught.
xxx
However, there is no independent civil action to recover the value of a bouncing check issued in contravention of BP
22. This is clear from Rule 111 of the Rules of Court, effective December 1, 2000, which relevantly provides:
Section 1. Institution of criminal and civil actions. - (a) When a criminal action is instituted, the civil action for the
recovery of civil liability arising from the offense charged shall be deemed instituted with the criminal action unless the
offended party waives the civil action, reserves the right to institute it separately or institutes the civil action prior to
the criminal action.
The reservation of the right to institute separately the civil action shall be made before the prosecution starts
presenting its evidence and under circumstances affording the offended party a reasonable opportunity to make such
reservation.
When the offended party seeks to enforce civil liability against the accused by way of moral, nominal, temperate, or
exemplary damages without specifying the amount thereof in the complaint or information, the filing fees therefor
shall constitute a first lien on the judgment awarding such damages.
Where the amount of damages, other than actual, is specified in the complaint or information, the corresponding filing
fees shall be paid by the offended party upon the filing thereof in court.
Except as otherwise provided in these Rules, no filing fees shall be required for actual damages.
No counterclaim, cross-claim or third-party complaint may be filed by the accused in the criminal case, but any cause
of action which could have been the subject thereof may be litigated in a separate civil action. (1a)
(b) The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to include the corresponding civil
action. No reservation to file such civil action separately shall be allowed.
18

Upon filing of the aforesaid joint criminal and civil actions, the offended party shall pay in full the filing fees based on
the amount of the check involved, which shall be considered as the actual damages claimed. Where the complaint or
information also seeks to recover liquidated, moral, nominal, temperate or exemplary damages, the offended party
shall pay the filing fees based on the amounts alleged therein. If the amounts are not so alleged but any of these
damages are subsequently awarded by the court, the filing fees based on the amount awarded shall constitute a first
lien on the judgment.
Where the civil action has been filed separately and trial thereof has not yet commenced, it may be consolidated with
the criminal action upon application with the court trying the latter case. If the application is granted, the trial of both
actions shall proceed in accordance with section 2 of the Rule governing consolidation of the civil and criminal
actions.
Section 3. When civil action may proceed independently. In the cases provided in Articles 32, 33, 34 and 2176 of
the Civil Code of the Philippines, the independent civil action may be brought by the offended party. It shall proceed
independently of the criminal action and shall require only a preponderance of evidence. In no case, however, may
the offended party recover damages twice for the same act or omission charged in the criminal action.
The aforequoted provisions of the Rules of Court, even if not yet in effect when Chan commenced Civil Case No.
915-00 on August 3, 2000, are nonetheless applicable. It is axiomatic that the retroactive application of procedural
laws does not violate any right of a person who may feel adversely affected, nor is it constitutionally objectionable.
The reason is simply that, as a general rule, no vested right may attach to, or arise from, procedural laws.
19
Any new
rules may validly be made to apply to cases pending at the time of their promulgation, considering that no party to an
action has a vested right in the rules of procedure,
20
except that in criminal cases, the changes do not retroactively
apply if they permit or require a lesser quantum of evidence to convict than what is required at the time of the
commission of the offenses, because such retroactivity would be unconstitutional for being ex post facto under the
Constitution.
21

Moreover, the application of the rule would not be precluded by the violation of any assumed vested right, because
the new rule was adopted from Supreme Court Circular 57-97 that took effect on November 1, 1997.
Supreme Court Circular 57-97 states:
Any provision of law or Rules of Court to the contrary notwithstanding, the following rules and guidelines shall
henceforth be observed in the filing and prosecution of all criminal cases under Batas Pambansa Blg. 22 which
penalizes the making or drawing and issuance of a check without funds or credit:
1. The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to necessarily include the
corresponding civil action, and no reservation to file such civil action separately shall be allowed or
recognized.
22

2. Upon the filing of the aforesaid joint criminal and civil actions, the offended party shall pay in full the filing
fees based upon the amount of the check involved which shall be considered as the actual damages
claimed, in accordance with the schedule of fees in Section 7 (a) and Section 8 (a), Rule 141 of the Rules of
Court as last amended by Administrative Circular No. 11-94 effective August 1, 1994. Where the offended
party further seeks to enforce against the accused civil liability by way of liquidated, moral, nominal,
temperate or exemplary damages, he shall pay the corresponding filing fees therefor based on the amounts
thereof as alleged either in the complaint or information. If not so alleged but any of these damages are
subsequently awarded by the court, the amount of such fees shall constitute a first lien on the judgment.
3. Where the civil action has heretofore been filed separately and trial thereof has not yet commenced, it
may be consolidated with the criminal action upon application with the court trying the latter case. If the
application is granted, the trial of both actions shall proceed in accordance with the pertinent procedure
outlined in Section 2 (a) of Rule 111 governing the proceedings in the actions as thus consolidated.
4. This Circular shall be published in two (2) newspapers of general circulation and shall take effect on
November 1, 1997.
The reasons for issuing Circular 57-97 were amply explained in Hyatt Industrial Manufacturing Corporation v. Asia
Dynamic Electrix Corporation,
23
thus:
xxx
We agree with the ruling of the Court of Appeals that upon filing of the criminal cases for violation of B.P. 22, the civil
action for the recovery of the amount of the checks was also impliedly instituted under Section 1(b) of Rule 111 of the
2000 Rules on Criminal Procedure. Under the present revised Rules, the criminal action for violation of B.P. 22 shall
be deemed to include the corresponding civil action. The reservation to file a separate civil action is no longer
needed. The Rules provide:
Section 1. Institution of criminal and civil actions.
(a) x x x
(b) The criminal action for violation of Batas Pambansa Blg. 22 shall be deemed to include the
corresponding civil action. No reservation to file such civil action separately shall be allowed.
Upon filing of the aforesaid joint criminal and civil actions, the offended party shall pay in full the filing fees based on
the amount of the check involved, which shall be considered as the actual damages claimed. Where the complaint or
information also seeks to recover liquidated, moral, nominal, temperate or exemplary damages, the offended party
shall pay additional filing fees based on the amounts alleged therein. If the amounts are not so alleged but any of
these damages are subsequently awarded by the court, the filing fees based on the amount awarded shall constitute
a first lien on the judgment.
Where the civil action has been filed separately and trial thereof has not yet commenced, it may be consolidated with
the criminal action upon application with the court trying the latter case. If the application is granted, the trial of both
actions shall proceed in accordance with section 2 of this Rule governing consolidation of the civil and criminal
actions.1avvphi1
The foregoing rule was adopted from Circular No. 57-97 of this Court. It specifically states that the criminal action for
violation of B.P. 22 shall be deemed to include the corresponding civil action. It also requires the complainant to pay
in full the filing fees based on the amount of the check involved. Generally, no filing fees are required for criminal
cases, but because of the inclusion of the civil action in complaints for violation of B.P. 22, the Rules require the
payment of docket fees upon the filing of the complaint. This rule was enacted to help declog court dockets which are
filled with B.P. 22 cases as creditors actually use the courts as collectors. Because ordinarily no filing fee is charged
in criminal cases for actual damages, the payee uses the intimidating effect of a criminal charge to collect his credit
gratis and sometimes, upon being paid, the trial court is not even informed thereof. The inclusion of the civil action in
the criminal case is expected to significantly lower the number of cases filed before the courts for collection based on
dishonored checks. It is also expected to expedite the disposition of these cases. Instead of instituting two separate
cases, one for criminal and another for civil, only a single suit shall be filed and tried. It should be stressed that the
policy laid down by the Rules is to discourage the separate filing of the civil action. The Rules even prohibit the
reservation of a separate civil action, which means that one can no longer file a separate civil case after the criminal
complaint is filed in court. The only instance when separate proceedings are allowed is when the civil action is filed
ahead of the criminal case. Even then, the Rules encourage the consolidation of the civil and criminal cases. We
have previously observed that a separate civil action for the purpose of recovering the amount of the dishonored
checks would only prove to be costly, burdensome and time-consuming for both parties and would further delay the
final disposition of the case. This multiplicity of suits must be avoided. Where petitioners rights may be fully
adjudicated in the proceedings before the trial court, resort to a separate action to recover civil liability is clearly
unwarranted. In view of this special rule governing actions for violation of B.P. 22, Article 31 of the Civil Code cited by
the trial court will not apply to the case at bar.
24

The CAs reliance on DMPI Employees Credit Association v. Velez
25
to give due course to the civil action of Chan
independently and separately of Criminal Case No. 275381 was unwarranted. DMPI Employees, which involved a
prosecution for estafa, is not on all fours with this case, which is a prosecution for a violation of BP 22. Although the
Court has ruled that the issuance of a bouncing check may result in two separate and distinct crimes of estafa and
violation of BP 22,
26
the procedures for the recovery of the civil liabilities arising from these two distinct crimes are
different and non-interchangeable. In prosecutions of estafa, the offended party may opt to reserve his right to file a
separate civil action, or may institute an independent action based on fraud pursuant to Article 33 of the Civil
Code,
27
as DMPI Employees has allowed. In prosecutions of violations of BP 22, however, the Court has adopted a
policy to prohibit the reservation or institution of a separate civil action to claim the civil liability arising from the
issuance of the bouncing check upon the reasons delineated in Hyatt Industrial Manufacturing Corporation, supra.
To repeat, Chans separate civil action to recover the amount of the check involved in the prosecution for the violation
of BP 22 could not be independently maintained under both Supreme Court Circular 57-97 and the aforequoted
provisions of Rule 111 of the Rules of Court, notwithstanding the allegations of fraud and deceit.
B
Aptness of the dismissal of the civil action
on the ground of litis pendentia
Did the pendency of the civil action in the MeTC in Manila (as the civil aspect in Criminal Case No. 275381) bar the
filing of Civil Case No. 915-00 in the MeTC in Pasay City on the ground of litis pendentia?
For litis pendentia to be successfully invoked as a bar to an action, the concurrence of the following requisites is
necessary, namely: (a) there must be identity of parties or at least such as represent the same interest in both
actions; (b) there must be identity of rights asserted and reliefs prayed for, the reliefs being founded on the same
facts; and, (c) the identity in the two cases should be such that the judgment that may be rendered in one would,
regardless of which party is successful, amount to res judicata in respect of the other. Absent the first two requisites,
the possibility of the existence of the third becomes nil.
28

A perusal of Civil Case No. 01-0033 and Criminal Case No. 275381 ineluctably shows that all the elements of litis
pendentia are attendant. First of all, the parties in the civil action involved in Criminal Case No. 275381 and in Civil
Case No. 915-00, that is, Chan and Simon, are the same. Secondly, the information in Criminal Case No. 275381
and the complaint in Civil Case No. 915-00 both alleged that Simon had issued Landbank Check No. 0007280
worth P336,000.00 payable to "cash," thereby indicating that the rights asserted and the reliefs prayed for, as well as
the facts upon which the reliefs sought were founded, were identical in all respects. And, thirdly, any judgment
rendered in one case would necessarily bar the other by res judicata; otherwise, Chan would be recovering twice
upon the same claim.
It is clear, therefore, that the MeTC in Pasay City properly dismissed Civil Case No. 915-00 on the ground of litis
pendentia through its decision dated October 23, 2000; and that the RTC in Pasay City did not err in affirming the
MeTC.
Wherefore, we grant the petition for review on certiorari, and, accordingly, we reverse and set aside the decision
promulgated by the Court of Appeals on June 25, 2002. We reinstate the decision rendered on October 23, 2000 by
the Metropolitan Trial Court, Branch 45, in Pasay City.
Costs of suit to be paid by the respondent.
SO ORDERED.
LUCAS P. BERSAMIN
Associate Justice
WE CONCUR:
ARTURO D. BRION
**

Associate Justice
Acting Chairperson
ROBERTO A. ABAD
***

Associate Justice
MARTIN S. VILLARAMA, JR.
Associate Justice
MARIA LOURDES P. A. SERENO
Associate Justice
A T T E S T A T I O N
I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to
the writer of the opinion of the Courts Division.
ARTURO D. BRION
Associate Justice
Acting Chairperson
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairpersons Attestation, I certify that the
conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the
opinion of the Courts Division.
RENATO C. CORONA
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION

G.R. No. L-22554 August 29, 1975
DELFIN LIM and JIKIL TAHA, plaintiffs-appellants,
vs.
FRANCISCO PONCE DE LEON AND ORLANDO MADDELA, defendants-appellees.
Ricardo L. Manalilig for plaintiffs-appellants.
Iigo R. Pea for defendants-appellees.

MARTIN, J .:
Appeal on a question of law from the decision of the Court of First Instance of Palawan in Civil Case No. 416, entitled
"Delfin Lim and Jikil Taha vs. Francisco Ponce de Leon and Orlando Maddela", dismissing the complaint of the
plaintiffs and ordering them to pay each of the defendants jointly and severally the sum of P500.00 by way of actual
damages; P500.00 by way of attorney's fees; and P1,000.00 by way of exemplary damages.
On April 29, 1961, plaintiff-appellant Jikil Taha sold to a certain Alberto Timbangcaya of Brooke's Point, Palawan a
motor launch named M/L "SAN RAFAEL". A year later or on April 9, 1962 Alberto Timbangcaya filed a complaint with
the Office of the Provincial Fiscal of Palawan alleging that after the sale Jikil Taha forcibly took away the motor launch
from him.
On May 14, 1962, after conducting a preliminary investigation, Fiscal Francisco Ponce de Leon in his capacity as
Acting Provincial Fiscal of Palawan, filed with the Court of First Instance of Palawan the corresponding information for
Robbery the Force and Intimidation upon Persons against Jikil Taha. The case was docketed as Criminal Case No.
2719.
On June 15, 1962, Fiscal Francisco Ponce de Leon, upon being informed that the motor launch was in Balabac,
Palawan, wrote the Provincial Commander of Palawan requesting him to direct the detachment commander-in
Balabac to impound and take custody of the motor launch.
1

On June 26, 1962, Fiscal Ponce de Leon reiterated his request to the Provincial Commander to impound the motor
launch, explaining that its subsequent sale to a third party, plaintiff-appellant Delfin Lim, cannot prevent the court from
taking custody of the same.
2
So, on July 6, 1962 upon order of the Provincial Commander, defendant-appellee
Orlando Maddela, Detachment Commander of Balabac, Palawan, seized the motor launch "SAN RAFAEL" from
plaintiff-appellant Delfin Lim and impounded it.
On July 15, 1962 plaintiff-appellant Delfin Lim pleaded with Orlando Maddela to return the motor launch but the latter
refused. Likewise, on September 20, 1962, Jikil Taha through his counsel made representations with Fiscal Ponce de
Leon to return the seized property to plaintiff-appellant Delfin Lim but Fiscal Ponce de Leon refused, on the ground
that the same was the subject of a criminal offense.
All efforts to recover the motor launch going to naught, plaintiffs-appellants Delfin Lim and Jikil Taha, on November
19, 1962, filed with the Court of First Instance of Palawan a complaint for damages against defendants-appellees
Fiscal Francisco Ponce de Leon and Orlando Maddela, alleging that on July 6, 1962 Orlando Maddela entered the
premises of Delfin Lim without a search warrant and then and there took away the hull of the motor launch without his
consent; that he effected the seizure upon order of Fiscal Ponce de Leon who knew fully well that his office was not
vested with authority to order the seizure of a private property; that said motor launch was purchased by Delfin Lim
from Jikil Taha in consideration of Three Thousand Pesos (P3,000.00), Two Thousand Pesos (P2,000.00) of which
has been given to Jikil Taha as advance payment; that as a consequence of the unlawful seizure of the motor launch,
its sale did not materialize; and that since July 6, 1962, the said motor launch had been moored at the Balabac Bay,
Palawan and because of exposure to the elements it had become worthless and beyond repair. For the alleged
violation of their constitutional rights, plaintiffs-appellants prayed that defendants-appellees be ordered to pay jointly
and severally each of them the sum of P5,750.00 representing actual, moral and exemplary damages and attorney's
fees.
In their answer, defendants-appellees denied the material allegations of the complaint and as affirmative defenses
alleged that the motor launch in question which was sold by Jikil Taha to Alberto Timbangcaya on April 29, 1961 was
sometime in April 1962, forcibly taken with violence upon persons and with intent to gain by Jikil Taha from Alfredo
Timbangcaya without the latter's knowledge and consent, thus giving rise to the filing of a criminal charge of robbery
against Jikil Taha; that Fiscal Ponce de Leon, in his capacity as Acting Provincial Fiscal of Palawan ordered Orlando
Maddela to seize and impound the motor launch "SAN RAFAEL", for being the corpus delicti of the robbery; and that
Orlando Maddela merely obeyed the orders of his superior officer to impound said launch. By way of counterclaim,
defendants-appellees alleged that because of the malicious and groundless filing of the complaint by plaintiffs-
appellants, they were constrained to engage the services of lawyers, each of them paying P500.00 as attorney's fees;
and that they suffered moral damages in the amount of P5,000.00 each and actual damages in the amount of
P500.00 each. They also prayed that each of them awarded exemplary damages in the amount of P1,000.00.
On September 13, 1965, the trial court rendered its decision, upholding the validity of the seizure of the motor launch
on the ground that "the authority to impound evidences or exhibits or corpus delicti in a case pending investigation is
inherent in the Provincial Fiscal who controls the prosecution and who introduces those exhibits in the court."
Accordingly, the trial court dismissed the complaint of plaintiffs-appellants and ordered them to pay jointly and
severally each of the defendants-appellees the amount of P500.00 by way of actual damages another amount of
P500.00 for attorney's fees and P1,000.00 as exemplary damages.
Hence, this appeal.
Two vital issues call for resolution by this Court. First, whether or not defendant-appellee Fiscal Ponce de Leon had
the power to order the seizure of the motor launch in question without a warrant of search and seizure even if the
same was admittedly the corpus delicti of the crime. Second, whether or not defendants-appellees are civilly liable to
plaintiffs-appellants for damages allegedly suffered by them granting that the seizure of the motor launch was
unlawful.
The gravamen of plaintiffs-appellants' argument is that the taking of the motor launch on July 6, 1962 by Orlando
Maddela upon the order of Fiscal Ponce de Loon was in violation of the constitutional guarantee against
unreasonable searches and seizures since it was done without a warrant.
The pertinent provision of the Constitution then in force reads:
3) The right of the people to be secure in their persons, houses, papers and effects against
unreasonable searches and seizures shall not be violated, and no warrants shall issue but upon
probable cause, to be determined by the judge after examination under oath or affirmation of the
complainant and the witnesses he may produce, and particularly describing the place to be
searched, and the persons or things to be seized.
3

A cursory reading of the above provision easily brings into focus the unreasonableness of the seizure of the
aforementioned motor launch. A search and seizure to be reasonable, must be effected by means of a valid search
warrant. And for a search warrant to be valid: (1) it must be issued upon probable cause; (2) the probable cause must
be determined by the judge himself and not by the applicant or any other person; (3) in the determination of probable
cause, the judge must examine, under oath or affirmation, the complainant and such witnesses as the latter may
produce; and (4) the warrant issued must particularly describe the place to be searched and persons or things to be
seized.
4
Thus in a long line of decisions, this Court has declared invalid search warrants which were issued in utter
disregard of the constitutional injunction.
5

Defendants-appellees admitted that when Orlando Maddela entered the premises of Delfin Lim and impounded the
motor launch he was not armed with a search warrant; that he effected the seizure of the motor launch in the
absence of and without the consent of Delfin Lim. There can be no question that without the proper search warrant,
no public official has the right to enter the premises of another without his consent for the purpose of search and
seizure.
6
And since in the present case defendants-appellees seized the motor launch without a warrant, they have
violated the constitutional right of plaintiffs-appellants against unreasonable search and seizure.
Defendants-appellees however would want to justify the seizure of the motor launch even without a warrant because
of Fiscal Ponce de Leon's alleged inherent power to order the seizure of a personal property which is thecorpus
delicti of a crime, he being a quasi judicial officer who has the control of the prosecution and the presentation of the
evidence in the criminal case. They argue that inasmuch as the motor launch in question was allegedly stolen by Jikil
Taha from Timbangcaya, Fiscal Ponce de Leon could order its seizure even without a search warrant. We cannot
agree. Under the old Constitution
7
the power to issue a search warrant is vested in a judge or magistrate and in no
other officer and no search and seizure can be made without a proper warrant. At the time the act complained of was
committed, there was no law or rule that recognized the authority of Provincial Fiscals to issue a search warrant. In
his vain attempt to justify the seizure of the motor launch in question without a warrant Fiscal Ponce de Leon invoked
the provisions of Republic Act No. 732, which amended Sections 1674 and 1687 of the Revised Administrative Code.
But there is nothing in said law which confers upon the provincial fiscal; the authority to issue warrants, much less to
order without warrant the seizure of a personal property even if it is the corpus delicti of a crime. True, Republic Act
No. 732 has broadened the power of provincial fiscals to conduct preliminary investigations, but said law did not
divest the judge or magistrate of its power to determine, before issuing the corresponding warrant, whether or not
probable cause exists therefor.
8

Moreover, under Sections 2 and 3 of Rule 122 of the Rules of Court 9 which complement the constitutional provision
earlier cited, two principles are made clear, namely: (1) that in the seizure of a stolen property search warrant is still
necessary; and (2) that in issuing a search warrant the judge alone determines whether or not there is a probable
cause. The fact that a thing is a corpus delicti of a crime does not justify its seizure without a warrant. As held in U.S.
v. de los Reyes and Esguerra,
10
citing McClurg v. Brenton:
11

The mere fact that a man is an officer, whether of high or low degree, gives him no more right than
is possessed by the ordinary private citizen to break in upon the privacy of a home and subject its
occupant to the indignity of a search for the evidence of crime, without a legal warrant procured for
that purpose. No amount of incriminating evidence whatever its source, will supply the place of
such warrant. At the closed door of the home be it palace or hovel even bloodhounds must wait till
the law, by authoritative process, bids it open. (Emphasis supplied.)
Defendant-appellee Fiscal Ponce de Leon would also invoke lack of time to procure a search warrant as an excuse
for the seizure of the motor launch without one. He claimed that the motor launch had to be seized immediately in
order to preserve it and to prevent its removal out of the locality, since Balabac, Palawan, where the motor launch
was at the time, could only be reached after three to four days' travel by boat.
12
The claim cannot be sustained. The
records show that on June 15, 1962
13
Fiscal Ponce de Leon made the first request to the Provincial Commander for
the impounding of the motor launch; and on June 26, 1962
14
another request was made. The seizure was not
effected until July 6, 1962. In short, Fiscal Ponce de Leon had all the time to procure a search warrant had he wanted
to and which he could have taken in less than a day, but he did not. Besides, there is no basis for the apprehension
that the motor launch might be moved out of Balabac because even prior to its seizure the motor launch was already
without its engine.
15
In sum, the fact that there was no time to secure a search warrant would not legally justify a
search without one.
16

As to whether or not they are entitled to damages, plaintiffs-appellants anchor their claim for damages on Articles 32
and 2219 of the New Civil Code which provide in part as follows:
ART. 32. Any public officer or employee, or any private individual, who directly or indirectly
obstructs, defeats, violates or in any manner impedes or impairs any of the following rights and
liberties of another person shall be liable to the latter for damages.
xxx xxx xxx
(9) The rights to be secure in one's person, house, papers, and effects against unreasonable
searches and seizures.
xxx xxx xxx
The indemnity shall include moral damages. Exemplary damages may also be adjudicated.
ART. 2219. Moral damages may be recovered in the following and analogous cases:
xxx xxx xxx
(6) Illegal search;
xxx xxx xxx
(1) Acts and action referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34 and 35.
Pursuant to the foregoing provisions, a person whose constitutional rights have been violated or impaired is entitled
to actual and moral damages from the public officer or employee responsible therefor. In addition, exemplary
damages may also be awarded. In the instant case, plaintiff-appellant Delfin Lim claimed that he purchased the motor
launch from Jikil Taha in consideration of P3,000.00, having given P2,000.00 as advanced payment; that since or
seizure on July 6, 1962 the motor launch had been moored at Balabac Bay and because of exposure to the elements
it has become worthless at the time of the filing of the present action; that because of the illegality of the seizure of
the motor launch, he suffered moral damages in the sum of P1,000.00; and that because of the violation of their
constitutional rights they were constrained to engage the services of a lawyer whom they have paid P1,500.00 for
attorney's fees. We find these claims of Delfin Lim amply supported by the evidence and therefore should be awarded
the sum of P3,000.00 as actual damages; P1,000.00 as moral damages and P750.00 for attorney's fees. However,
with respect co plaintiff Jikil Taha, he is not entitled to recover any damage which he alleged he had suffered from the
unlawful seizure of the motor launch inasmuch as he had already transferred the ownership and possession of the
motor launch to Delfin Lim at the time it was seized and therefore, he has no legal standing to question the validity of
the seizure. Well settled is the rule that the legality of a seizure can be contested only by the party whose rights have
been impaired thereby, and that the objection to an unlawful search and seizure is purely personal and cannot be
availed of by third parties.
17
Consequently, one who is not the owner, lessee, or lawful occupant of the premise
searched cannot raise the question of validity of the search and seizure.
18
Jikil Taha is not without recourse though.
He can still collect from his co-plaintiff, Delfin Lim the unpaid balance of P1,000.00.
Defendant-appellee Fiscal Ponce de Leon wanted to wash his hands of the incident by claiming that "he was in good
faith, without malice and without the slightest intention of inflicting injury to plaintiff-appellant, Jikil Taha"
19
when he
ordered the seizure of the motor launch. We are not prepared to sustain his defense of good faith. To be liable under
Article 32 of the New Civil Code it is enough that there was a violation of the constitutional rights of the plaintiffs and it
is not required that defendants should have acted with malice or bad faith. Dr. Jorge Bocobo, Chairman of the Code
Commission, gave the following reasons during the public hearings of the Joint Senate and House Committees, why
good faith on the part of the public officer or employee is immaterial. Thus:
DEAN BOCOBO. Article 32, regarding individual rights; Attorney Cirilo Paredes proposes that
Article 32 be so amended as to make a public official liable for violation of another person's
constitutional rights only if the public official acted maliciously or in bad faith. The Code
Commission opposes this suggestion for these reasons:
The very nature of Article 32 is that the wrong may be civil or criminal. It is not necessary therefore
that there should be malice or bad faith. To make such a requisite would defeat the main purpose
of Article 32 which is the effective protection of individual rights. Public officials in the past have
abused their powers on the pretext of justifiable motives or good faith in the performance of their
duties. Precisely, the object of the Article is to put an end to official abuse by the plea of good faith.
In the United States this remedy is in he nature of a tort.
Mr. Chairman, this article is firmly one of the fundamental articles introduced in the New Civil Code
to implement democracy. There is no real democracy if a public official is abusing, and we made
the article so strong and so comprehensive that it concludes an abuse of individual rights even if
done in good faith, that official is liable. As a matter of fact, we know that there are very few public
officials who openly and definitely abuse the individual rights of the citizens. In most cases, the
abuse is justified on a plea of desire to enforce the law to comply with one's duty. And so, if we
should limit the scope of this article, that would practically nullify the object of the article. Precisely,
the opening object of the article is to put an end to abuses which are justified by a plea of good
faith, which is in most cases the plea of officials abusing individual rights.
20

But defendant-appellee Orlando Maddela cannot be held accountable because he impounded the motor launch upon
the order of his superior officer. While a subordinate officer may be held liable for executing unlawful orders of his
superior officer, there are certain circumstances which would warrant Maddela's exculpation from liability. The
records show that after Fiscal Ponce de Leon made his first request to the Provincial Commander on June 15, 1962
Maddela was reluctant to impound the motor launch despite repeated orders from his superior officer.
21
It was only
after he was furnished a copy of the reply of Fiscal Ponce de Leon, dated June 26, 1962, to the letter of the Provincial
Commander, justifying the necessity of the seizure of the motor launch on the ground that the subsequent sale of the
launch to Delfin Lim could not prevent the court from taking custody of the same,
22
that he impounded the motor
launch on July 6, 1962. With said letter coming from the legal officer of the province, Maddela was led to believe that
there was a legal basis and authority to impound the launch. Then came the order of his superior officer to explain for
the delay in the seizure of the motor launch.
23
Faced with a possible disciplinary action from his Commander,
Maddela was left with no alternative but to seize the vessel. In the light of the above circumstances. We are not
disposed to hold Maddela answerable for damages.
IN VIEW OF THE FOREGOING, the decision appealed from is hereby reversed and another one entered declaring
the seizure illegal and ordering defendant-appellee Fiscal Francisco Ponce de Leon to pay to plaintiff-appellant Delfin
Lim the sum of P3,000.00 as actual damages, plus P1,000.00 moral damages, and, in addition, P750.00 for
attorney's fees. With costs against defendant-appellee Fiscal Ponce de Leon.
SO ORDERED.
Castro (Chairman), Teehankee, Makasiar and Esguerra, JJ., concur.
Muoz Palma, J, is on leave.
THIRD DIVISION
[G.R. No. 119398. July 2, 1999]
EDUARDO M. COJUANGCO JR., petitioner vs. COURT OF APPEALS, THE PHILIPPINE CHARITY
SWEEPSTAKES OFFICE and FERNANDO O. CARRASCOSO JR., respondents.
D E C I S I O N
PANGANIBAN, J .:
To hold public officers personally liable for moral and exemplary damages and for attorneys fees for acts done in the
performance of official functions, the plaintiff must prove that these officers exhibited acts characterized by evident bad faith,
malice, or gross negligence. But even if their acts had not been so tainted, public officers may still be held liable for nominal
damages if they had violated the plaintiffs constitutional rights.
The Case

Before us is a Petition for Review under Rule 45 of the Rules of Court seeking to set aside the Decision
[1]
of the Court of
Appeals
[2]
in CA-GR CV No. 39252 promulgated on September 9, 1994. The assailed Decision reversed the Regional Trial
Court (RTC) of Manila, Branch 2, in Civil Case No. 91-55873, which disposed of the controversy in favor of herein petitioner in
the following manner:
[3]

WHEREFORE, judgment is hereby rendered in favor of the plaintiff and against the defendants, ordering them, jointly and
severally the following:
ON THE FIRST CAUSE OF ACTION
1. To pay P143,000.00 plus interest thereon from March 26, 1986 until complete payment thereof;
2. To pay P28,000.00 plus interest thereon [from] June 8, 1986 until complete payment thereof;
3. To pay P142,700.00 plus interest thereon from July 10, 1987 until complete payment thereof;
4. To pay P70,000.00 plus interest thereon from February 1, 1987 until complete payment thereof;
5. To pay P140,000.00 plus interest thereon from March 22, 1987 until complete payment thereof;
6. To pay P28,000.00 plus interest thereon from April 26, 1987 until complete payment thereof;
7. To pay P14,000.00 plus interest thereon from May 17, 1987 until complete payment thereof;
8. To pay P140,000.00 plus interest thereon from August 9, 1987 until complete payment thereof;
9. To pay P174,000.00 plus interest thereon from December 13, 1987 until complete payment thereof;
10. To pay P140,000.00 plus interest thereon from September 18, 1988 until complete payment thereof;
11. All income derived from the foregoing amounts.
ON THE SECOND CAUSE OF ACTION
Ordering defendant Fernando O. Carrascoso the following:
1. To pay moral damages in the amount of One Hundred Thousand Pesos (P100,000.00);
2. To pay exemplary damages in the amount of Twenty Thousand Pesos (P20,000.00);
3. To pay attorneys fees in the amount of Thirty Thousand Pesos (P30,000.00);
4. To pay the costs of suit.
The counterclaim is ordered dismissed, for lack of merit.
SO ORDERED.
In a Resolution
[4]
dated March 7, 1995, Respondent Court denied petitioners Motion for Reconsideration.
The Facts

The following is the Court of Appeals undisputed narration of the facts:
Plaintiff [herein petitioner] is a known businessman-sportsman owning several racehorses which he entered in the sweepstakes
races between the periods covering March 6, 1986 to September 18, 1989. Several of his horses won the races on various dates,
landing first, second or third places, respectively, and winning prizes together with the 30% due for trainer/grooms which are
itemized as follows:
Date Place Stake Horse Racewinning 30% Due Net Amount
Winner Prize Claims Training Withheld by
Grooms PCSO
03/25/86 1st Hansuyen 200,000.00 57,000.00 143,000.00
06/08/86 2nd Stronghold 40,000.00 12,000.00 28,000.00
07/10/86 1st Kahala 200,000.00 57,300.00 142,700.00
02/01/87 1st Devil's Brew 100,000.00 30,000.00 70,000.00
03/22/87 1st Time to Explode 200,000.00 60,000.00 140,000.00
04/26/87 3rd Stormy Petril 40,000.00 12,000.00 28,000.00
05/17/87 1st Starring Role 20,000.00 6,000.00 14,000.00
08/09/87 1st Star Studded 200,000.00 60,000.00 140,000.00
12/13/87 2nd Charade 250,000.00 75,000.00 174,000.00
09/18/88 1st Hair Trigger 200,000.00 60,000.00 140,000.00
TOTAL 1,450,000.00 429,300.00 1,020,700.00
[Herein petitioner] sent letters of demand (Exhibits A, dated July 3, 1986; B dated August 18, 1986; and C, dated September
11, 1990) to the defendants [herein private respondents] for the collection of the prizes due him. And [herein private
respondents] consistently replied (Exhibits 2 and 3) that the demanded prizes are being withheld on advice of Commissioner
Ramon A. Diaz of the Presidential Commission on Good Government. Finally on January 30, 1991, this case was filed before
the Regional Trial Court of Manila. But before receipt of the summons on February 7, 1991, Presidential Commission on Good
Government advi[s]ed defendants that it poses no more objection to the remittance of the prize winnings (Exh. 6) to [herein
petitioner]. Immediately, this was communicated to Atty. Estelito Mendoza by [Private Respondent Fernando] Carrascoso
[Jr.].
[5]

As culled from the pleadings of the parties, Atty. Estelito P. Mendoza, petitioners counsel, refused to accept the prizes at
this point, reasoning that the matter had already been brought to court.
Ruling of the Trial Court

The trial court ruled that Respondent Philippine Charity Sweepstakes Office (PCSO) and its then chairman, Respondent
Fernando O. Carrascoso Jr., had no authority to withhold the subject racehorse winnings of petitioner, since no writ of
sequestration therefor had been issued by the Presidential Commission on Good Government (PCGG). It held that it was
Carrascosos unwarranted personal initiative not to release the prizes. Having been a previous longtime associate of petitioner in
his horse racing and breeding activities, he had supposedly been aware that petitioners winning horses were not ill-gotten. The
trial court held that, by not paying the winnings, Carrascoso had acted in bad faith amounting to the persecution and harassment
of petitioner and his family.
[6]
It thus ordered the PCSO and Carrascoso to pay in solidum petitioners claimed winnings plus
interests. It further ordered Carrascoso to pay moral and exemplary damages, attorneys fees and costs of suit.
While the case was pending with the Court of Appeals, petitioner moved for the partial execution pending appeal of the
RTC judgment, praying for the payment of the principal amount of his prize winnings. Private respondents posed no objection
thereto and manifested their readiness to release the amount prayed for. Hence, the trial court issued on February 14, 1992, an
Order
[7]
for the issuance of a writ of execution in the amount of P1,020,700. Accordingly, on May 20, 1992, Respondent PCSO
delivered the amount to petitioner.
Ruling of the Court of Appeals

Before the appellate court, herein private respondents assigned the following errors:
[8]

I
THE COURT A QUO ERRED IN HOLDING THAT DEFENDANTS-APPELLANTS ACTED IN BAD FAITH IN
WITHHOLDING PLAINTIFF-APPELLEE[S] PRIZE[S];
II.
THE COURT A QUO ERRED [IN] AWARDING MORAL DAMAGES, EXEMPLARY DAMAGES AND ATTORNEYS
FEES IN FAVOR OF PLAINTIFF-APPELLEE.
In reversing the trial courts finding of bad faith on the part of Carrascoso, the Court of Appeals held that the former PCSO
chairman was merely carrying out the instruction of the PCGG in regard to the prize winnings of petitioner. It noted that, at the
time, the scope of the sequestration of the properties of former President Ferdinand E. Marcos and his cronies was not well-
defined. Respondent Court explained:
[9]

xxx Under those equivocalities, defendant Carrascoso could not be faulted in asking further instructions from the PCGG, the
official government agency on the matter, on what to do with the prize winnings of the [petitioner], and more so, to obey the
instructions subsequently given. The actions taken may be a hard blow on [petitioner] but defendant Carrascoso had no
alternative. It was the safest he could do in order to protect public interest, act within the powers of his position and serve the
public demands then prevailing. More importantly, it was the surest way to avoid a possible complaint for neglect of duty or
misfeasance of office or an anti-graft case against him.
The Court of Appeals also noted that the following actuations of Carrascoso negated bad faith: (1) he promptly replied to
petitioners demand for the release of his prizes, citing PCGGs instruction to withhold payment thereof; (2) upon PCGGs
subsequent advice to release petitioners winnings, he immediately informed petitioner thereof; and (3) he interposed no
objection to the partial execution, pending appeal, of the RTC decision. Respondent Court finally disposed as follows:
[10]

IN VIEW OF ALL THE FOREGOING, the judgment appealed from is REVERSED and SET ASIDE and a new one
entered DISMISSING this case. No pronouncement as to costs.
On September 29, 1994, petitioner filed a Motion for Reconsideration, which was denied on March 7, 1995. Hence, this
petition.
[11]

Issues

Petitioner asks this Court to resolve the following issues:
a. Whether the Court of Appeals had jurisdiction over the appeal of respondent Philippine Charity Sweepstakes Office
(PCSO);
b. Whether the appeal of respondent Carrascoso, Jr. should have been dismissed for his failure to file an appeal brief;
c. Whether the Court of Appeals had jurisdiction to review and reverse the judgment on a cause of action which was not
appealed from by the respondents;
d. Whether the award for damages against respondent Carrascoso, Jr. is warranted by evidence and the law.
[12]

Being related, the first two issues will be discussed jointly.
The Courts Ruling

The petition is partly meritorious.
First and Second Issues: Effect of PCSOs Appeal Brief

Petitioner contends that the appeal filed by the PCSO before Respondent Court of Appeals should have been dismissed
outright. The appealed RTC decision ruled on two causes of action: (1) a judgment againstboth PCSO and Carrascoso to jointly
and severally pay petitioner his winnings plus interest and income; and (2) a judgment against Carrascoso alone for moral and
exemplary damages, as well as attorneys fees and costs. The PCSO, through the Office of the Government Corporate Counsel
(OGCC), appealed only the second item: the impropriety of the award of damages xxx. This appealed portion, however,
condemned only Carrascoso, not the PCSO. Technically, petitioner claims, PCSO could not have appealed the second portion of
the RTC Decision which ruled against Carrascoso only, and not against the government corporation.
Petitioner further avers that Carrascoso failed to file his own appeal brief; accordingly, his appeal should have been
dismissed. The PCSO brief, he submits, could not have inured to the benefit of Carrascoso, because the latter was no longer
chairman of that office at the time the brief was filed and, hence, could no longer be represented by the OGCC.
On the other hand, respondents aver that the withholding of petitioners racehorse winnings by Respondent Carrascoso
occurred during the latters incumbency as PCSO chairman. According to him, he had honestly believed that it was within the
scope of his authority not to release said winnings, in view of then President Corazon C. Aquinos Executive Order No. 2 (EO 2),
in which she decreed the following:
(1) Freeze all assets and properties in the Philippines in which former President Marcos and/or his wife, Mrs. Imelda
Romualdez Marcos, their close friends, subordinates, business associates, dummies, agents, or nominees have any interest or
participation;
(2) Prohibit any person from transferring, conveying, encumbering or otherwise depleting or concealing such assets and
properties or from assisting or taking part in their transfer, encumbrance, concealment, or dissipation, under pain of such
penalties as are prescribed by law.
Moreover, he argues that he sought the advice of the PCGG as to the nature of the subject racehorse winnings, and he was
told that they were part of petitioners sequestered properties. Under these circumstances and in his belief that said winnings
were fruits of petitioners ill-gotten properties, he deemed it his duty to withhold them. The chairman of the PCSO, he adds, is
empowered by law to order the withholding of prize winnings.
The representation of the OGCC on behalf of the PCSO and Mr. Carrascoso is pursuant to its basic function to act as the
principal law office of all government-owned or controlled corporations, their subsidiaries, other corporate offsprings and
government acquired asset corporations and xxx [to] exercise control and supervision over all legal departments or divisions
maintained separately and such powers and functions as are now or may hereafter be provided by law.
[13]
The OGCC was
therefore duty-bound to defend the PCSO because the latter, under its charter,
[14]
is a government-owned corporation. The
government counsels representation extends to the concerned government functionarys officers when the issue involves the
latters official acts or duties.
[15]

Granting that upon his separation from the government, Carrascoso ceased to be entitled to the legal services of the
government corporate counsel, this development does not automatically revoke or render ineffective his notice of appeal of the
trial courts Decision. The filing of an appellants brief is not an absolute requirement for the perfection of an appeal.
[16]
Besides,
when noncompliance with the Rules of Court is not intended for delay or does not prejudice the adverse party, the dismissal of an
appeal on a mere technicality may be stayed and the court may, at its sound discretion, exercise its equity jurisdiction.
[17]
The
emerging trend in our jurisprudence is to afford every party-litigant the amplest opportunity for the proper and just determination
of his cause, free from the constraints of technicalities.
[18]

What is important is that Respondent Carrascoso filed his notice of appeal on time and that his counsel before the lower
court, who was presumed to have continued representing him on appeal,
[19]
had filed an appeal brief on his behalf. The
Manifestation of Carrascoso before the Court of Appeals that he intended to hire the services of another counsel and to file his
own brief did not ipso facto effect a change of counsel under the existing rules of procedure. The former counsel must first file a
formal petition withdrawing his appearance with the clients consent, and the newly appointed attorney should formally enter his
appearance before the appellate court with notice to the adverse party.
[20]
But other than Carrascosos manifestation of
his intention to hire a counsel of his own, the requisites for a change of counsel were not fully complied with. Nevertheless, as
stated earlier, even an effective change of attorney will not abrogate the pleadings filed before the court by the former counsel.
All in all, we hold that the appellate court committed no reversible error in not dismissing the appeal, since this matter was
addressed to its sound discretion, and since such discretion was exercised reasonably in accordance with the doctrine that cases
should, as much as possible, be decided on their merits.
Third Issue: Scope of the Appeal Before Respondent Court

Petitioner is correct in asserting that the entire RTC judgment was not appealed to Respondent Court of Appeals. The
errors assigned in the appellants Brief, as quoted earlier, attacked only the trial courts (1) conclusion that defendants-appellants
acted in bad faith and (2) award of damages in favor of herein petitioner. In short, only those parts relating to the second cause
of action could be reviewed by the CA.
Respondent Court could not therefore reverse and set aside the RTC Decision in its entirety and dismiss the original
Complaint without trampling upon the rights that had accrued to the petitioner from the unappealed portion of the Decision. It is
well-settled that only the errors assigned and properly argued in the brief, and those necessarily related thereto, may be
considered by the appellate court in resolving an appeal in a civil case.
[21]
The appellate court has no power to resolve unassigned
errors, except those that affect the courts jurisdiction over the subject matter and those that are plain or clerical errors.
[22]

Having said that, we note, however, that Respondent Court in its Decision effectively recognized the confines of the appeal,
as it stated at the outset that this appeal shall be limited to the damages awarded in the [RTC] decision other than the claims for
race winning prizes.
[23]
The dispositive portion of the Decision must be understood together with the aforequoted statement that
categorically defined the scope of Respondent Courts review. Consequently, what the assailed Decision reversed and set aside
was only that part of the appealed judgment finding bad faith on the part of herein Private Respondent Carrascoso and awarding
damages to herein petitioner. It did not annul the trial courts order for Respondent PCSO to pay Petitioner Cojuangco his
racehorse winnings, because this Order had never been assigned as an error sought to be corrected.
On the contrary, Respondent PCSO had probably never intended to further object to the payment, as it so manifested before
the trial court
[24]
in answer to Petitioner Cojuangcos Motion
[25]
for the partial execution of the judgment. In fact, on May 20,
1992, PCSO willingly and readily paid the petitioner the principal amount of P1,020,700 in accordance with the writ of execution
issued by the trial court on February 14, 1992.
[26]
Obviously and plainly, the RTC judgment, insofar as it related to the first cause
of action, had become final and no longer subject to appeal.
In any event, the Court of Appeals discussion regarding the indispensability of the PCGG as a party-litigant to the instant
case was not pivotal to its reversal of the appealed trial court Decision. It merely mentioned that the non-joinder of the PCGG
made the Complaint vulnerable or susceptible to dismissal. It did not rule that it was the very ground, or at least one of the legal
grounds, it relied upon in setting aside the appealed judgment. It could not have legally done so anyway, because the PCGGs
role in the controversy, if any, had never been an issue before the trial court. Well-settled is the doctrine that no question, issue
or argument will be entertained on appeal unless it has been raised in the court a quo.
[27]

The aforementioned discussion should therefore be construed only in light of the previous paragraphs relating to
Respondent Carrascosos good faith which, the appellate court surmised, was indicated by his reliance on PCGGs statements
that the subject prize winnings of Petitioner Cojuangco were part of the sequestered properties. In other words, Respondent
Courts view that the non-inclusion of PCGG as a party made the Complaint dismissible was a mere aside that did not prejudice
petitioner.
Fourth Issue: Damages

Petitioner insists that the Court of Appeals erred in reversing the trial courts finding that Respondent Carrascoso acted in
bad faith in withholding his winnings. We do not think so.
Bad faith does not simply connote bad judgment or simple negligence. It imports a dishonest purpose or some moral
obliquity and conscious doing of a wrong, a breach of a known duty due to some motive or interest or ill will that partakes of the
nature of fraud.
[28]

We do not believe that the above judicially settled nature of bad faith characterized the questioned acts of Respondent
Carrascoso. On the contrary, we believe that there is sufficient evidence on record to support Respondent Courts conclusion that
he did not act in bad faith. It reasoned, and we quote with approval:
[29]

A close examination of the June 10, 1986 letter of defendant Carrascoso to Jovito Salonga, then Chairman of the Presidential
Commission on Good Government, readily display uncertainties in the mind of Chairman Carrascoso as to the extent of the
sequestration against the properties of the plaintiff. In the said letter (Exhibit 1) the first prize for the March 16, 1986 draw and
the second prize for the June 8, 1986 draw, were, in the meantime, being withheld to avoid any possible violation of your
sequestration order on the matter because while he is aware of the sequestration order issued against the properties of defendant
Eduardo Cojuangco, he is not aware of the extent and coverage thereof. It was for that reason that, in the same letter, defendant
Carrascoso requested for a clarification whether the prizes are covered by the order and if it is in the affirmative, for instructions
on the proper disposal of the two (2) prizes taking into account the shares of the trainer and the groom.
Correspondingly, in a letter dated June 13, 1986 (Exhibit 2) PCGG Commissioner Ramon A. Diaz authorized the payment to the
trainer and the groom but instructed the withholding of the amounts due plaintiff Eduardo Cojuangco. This piece of evidence
should be understood and appreciated in the light of the circumstances prevailing at the time. PCGG was just a newly born legal
creation and sequestration was a novel remedy which even legal luminaries were not sure as to the actual procedure, the correct
approach and the manner how the powers of the said newly created office should be exercised and the remedy of sequestration
properly implemented without violating due process of law. To the mind of their newly installed power, the immediate concern
is to take over and freeze all properties of former President Ferdinand E. Marcos, his immediate families, close associates and
cronies. There is no denying that plaintiff is a very close political and business associate of the former President. Under those
equivocalities, defendant Carrascoso could not be faulted in asking further instructions from the PCGG, the official government
agency on the matter, on what to do with the prize winnings of the plaintiff, and more so, to obey the instructions subsequently
given. The actions taken may be a hard blow on plaintiff but defendant Carrascoso had no alternative. It was the safest he could
do in order to protect public interest, act within the powers of his position and serve the public demands then prevailing. More
importantly, it was the surest way to avoid a possible complaint for neglect of duty or misfeasance of office or an anti-graft case
against him.
xxx xxx xxx
Moreover, the finding of bad faith against defendant Carrascoso is overshadowed by the evidences showing his good faith. He
was just recently appointed chairman of the PCGG when he received the first demand for the collection of the prize for the March
16, 1986 race which he promptly answered saying he was under instructions by the PCGG to withhold such payment. But the
moment he received the go signal from the PCGG that the prize winnings of plaintiff Cojuangco could already be released, he
immediately informed the latter thereof, interposed no objection to the execution pending appeal relative thereto, in fact, actually
paid off all the winnings due the plaintiff. xxx
Carrascosos decision to withhold petitioners winnings could not be characterized as arbitrary or whimsical, or even the
product of ill will or malice. He had particularly sought from PCGG a clarification of the extent and coverage of the
sequestration order issued against the properties of petitioner.
[30]
He had acted upon the PCGGs statement that the subject prizes
were part of those covered by the sequestration order and its instruction to hold in a proper bank deposits [sic] earning interest
the amount due Mr. Cojuangco.
[31]
Besides, EO 2 had just been issued by then President Aquino, freez[ing] all assets and
properties in the Philippines [of] former President Marcos and/or his wife, xxx their close friends, subordinates, business
associates, xxx; and enjoining the transfer, encumbrance, concealment, or dissipation [thereof], under pain of such penalties as
prescribed by law. It cannot, therefore, be said that Respondent Carrascoso, who relied upon these issuances, acted with malice
or bad faith.
The extant rule is that a public officer shall not be liable by way of moral and exemplary damages for acts done in the
performance of official duties, unless there is a clear showing of bad faith, malice or gross negligence.
[32]
Attorneys fees and
expenses of litigation cannot be imposed either, in the absence of a clear showing of any of the grounds provided therefor under
the Civil Code.
[33]
The trial courts award of these kinds of damages must perforce be deleted, as ruled by the Court of Appeals.
Nevertheless, this Court agrees with the petitioner and the trial court that Respondent Carrascoso may still be held liable
under Article 32 of the Civil Code, which provides:
Art. 32. Any public officer or employee, or any private individual, who directly or indirectly obstructs, defeats, violates or in
any manner impedes or impairs any of the following rights and liberties of another person shall be liable to the latter for damages:
xxx xxx xxx
(6) The right against deprivation of property without due process of law;
xxx xxx xxx
In Aberca v. Ver,
[34]
this Court explained the nature and the purpose of this article as follows:
It is obvious that the purpose of the above codal provision is to provide a sanction to the deeply cherished rights and freedoms
enshrined in the Constitution. Its message is clear; no man may seek to violate those sacred rights with impunity. In times of
great upheaval or of social and political stress, when the temptation is strongest to yield -- borrowing the words of Chief Justice
Claudio Teehankee -- to the law of force rather than the force of law, it is necessary to remind ourselves that certain basic rights
and liberties are immutable and cannot be sacrificed to the transient needs or imperious demands of the ruling power. The rule of
law must prevail, or else liberty will perish. Our commitment to democratic principles and to the rule of law compels us to reject
the view which reduces law to nothing but the expression of the will of the predominant power in the community. Democracy
cannot be a reign of progress, of liberty, of justice, unless the law is respected by him who makes it and by him for whom it is
made. Now this respect implies a maximum of faith, a minimum of idealism. On going to the bottom of the matter, we discover
that life demands of us a certain residuum of sentiment which is not derived from reason, but which reason nevertheless
controls.
[35]

Under the aforecited article, it is not necessary that the public officer acted with malice or bad faith.
[36]
To be liable, it is
enough that there was a violation of the constitutional rights of petitioner, even on the pretext of justifiable motives or good faith
in the performance of ones duties.
[37]

We hold that petitioners right to the use of his property was unduly impeded. While Respondent Carrascoso may have
relied upon the PCGGs instructions, he could have further sought the specific legal basis therefor. A little exercise of prudence
would have disclosed that there was no writ issued specifically for the sequestration of the racehorse winnings of
petitioner. There was apparently no record of any such writ covering his racehorses either. The issuance of a sequestration order
requires the showing of a prima facie case and due regard for the requirements of due process.
[38]
The withholding of the prize
winnings of petitioner without a properly issued sequestration order clearly spoke of a violation of his property rights without due
process of law.
Article 2221 of the Civil Code authorizes the award of nominal damages to a plaintiff whose right has been violated or
invaded by the defendant, for the purpose of vindicating or recognizing that right, not for indemnifying the plaintiff for any loss
suffered.
[39]
The court may also award nominal damages in every case where a property right has been invaded.
[40]
The amount of
such damages is addressed to the sound discretion of the court, with the relevant circumstances taken into account.
[41]

WHEREFORE, the petition is hereby partially GRANTED. The assailed Decision, as herein clarified, is AFFIRMED with
the MODIFICATION that Private Respondent Fernando O. Carrascoso Jr. is ORDERED TO PAY petitioner nominal damages in
the amount of fifty thousand pesos (P50,000). No pronouncement as to costs.
SO ORDERED.
Vitug, Purisima, and Gonzaga-Reyes, JJ., concur.
Romero, J., on official business abroad.
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 141309 June 19, 2007
LIWAYWAY VINZONS-CHATO, petitioner,
vs.
FORTUNE TOBACCO CORPORATION, respondent.
D E C I S I O N
YNARES-SANTIAGO, J .:
Petitioner assails the May 7, 1999 Decision
1
of the Court of Appeals in CA-G.R. SP No. 47167, which affirmed the
September 29, 1997 Order
2
of the Regional Trial Court (RTC) of Marikina, Branch 272, in Civil Case No. 97-341-MK,
denying petitioners motion to dismiss. The complaint filed by respondent sought to recover damages for the alleged
violation of its constitutional rights arising from petitioners issuance of Revenue Memorandum Circular No. 37-93
(RMC 37-93), which the Court declared invalid in Commissioner of Internal Revenue v. Court of Appeals.
3

Petitioner Liwayway Vinzons-Chato was then the Commissioner of Internal Revenue while respondent Fortune
Tobacco Corporation is an entity engaged in the manufacture of different brands of cigarettes, among which are
"Champion," "Hope," and "More" cigarettes.
On June 10, 1993, the legislature enacted Republic Act No. 7654 (RA 7654), which took effect on July 3, 1993. Prior
to its effectivity, cigarette brands Champion," "Hope," and "More" were considered local brands subjected to an ad
valorem tax at the rate of 20-45%. However, on July 1, 1993, or two days before RA 7654 took effect, petitioner
issued RMC 37-93 reclassifying "Champion," "Hope," and "More" as locally manufactured cigarettes bearing a foreign
brand subject to the 55% ad valorem tax.
4
RMC 37-93 in effect subjected "Hope," "More," and"Champion"
cigarettes to the provisions of RA 7654, specifically, to Sec. 142,
5
(c)(1) on locally manufactured cigarettes which
are currently classified and taxed at 55%, and which imposes an ad valorem tax of "55% provided that the
minimum tax shall not be less than Five Pesos (P5.00) per pack."
6

On July 2, 1993, at about 5:50 p.m., BIR Deputy Commissioner Victor A. Deoferio, Jr. sent via telefax a copy of RMC
37-93 to Fortune Tobacco but it was addressed to no one in particular. On July 15, 1993, Fortune Tobacco received,
by ordinary mail, a certified xerox copy of RMC 37-93. On July 20, 1993, respondent filed a motion for
reconsideration requesting the recall of RMC 37-93, but was denied in a letter dated July 30, 1993.
7
The same letter
assessed respondent for ad valorem tax deficiency amounting to P9,598,334.00 (computed on the basis of RMC 37-
93) and demanded payment within 10 days from receipt thereof.
8
On August 3, 1993, respondent filed a petition for
review with the Court of Tax Appeals (CTA), which on September 30, 1993, issued an injunction enjoining the
implementation of RMC 37-93.
9
In its decision dated August 10, 1994, the CTA ruled that RMC 37-93 is defective,
invalid, and unenforceable and further enjoined petitioner from collecting the deficiency tax assessment issued
pursuant to RMC No. 37-93. This ruling was affirmed by the Court of Appeals, and finally by this Court
in Commissioner of Internal Revenue v. Court of Appeals.
10
It was held, among others, that RMC 37-93, has fallen
short of the requirements for a valid administrative issuance.
On April 10, 1997, respondent filed before the RTC a complaint
11
for damages against petitioner in her private
capacity. Respondent contended that the latter should be held liable for damages under Article 32 of the Civil Code
considering that the issuance of RMC 37-93 violated its constitutional right against deprivation of property without due
process of law and the right to equal protection of the laws.
Petitioner filed a motion to dismiss
12
contending that: (1) respondent has no cause of action against her because she
issued RMC 37-93 in the performance of her official function and within the scope of her authority. She claimed that
she acted merely as an agent of the Republic and therefore the latter is the one responsible for her acts; (2) the
complaint states no cause of action for lack of allegation of malice or bad faith; and (3) the certification against forum
shopping was signed by respondents counsel in violation of the rule that it is the plaintiff or the principal party who
should sign the same.
On September 29, 1997, the RTC denied petitioners motion to dismiss holding that to rule on the allegations of
petitioner would be to prematurely decide the merits of the case without allowing the parties to present evidence. It
further held that the defect in the certification against forum shopping was cured by respondents submission of the
corporate secretarys certificate authorizing its counsel to execute the certification against forum shopping. The
dispositive portion thereof, states:
WHEREFORE, foregoing premises considered, the motion to dismiss filed by the defendant Liwayway
Vinzons-Chato and the motion to strike out and expunge from the record the said motion to dismiss filed by
plaintiff Fortune Tobacco Corporation are both denied on the grounds aforecited. The defendant is ordered
to file her answer to the complaint within ten (10) days from receipt of this Order.
SO ORDERED.
13

The case was elevated to the Court of Appeals via a petition for certiorari under Rule 65. However, same was
dismissed on the ground that under Article 32 of the Civil Code, liability may arise even if the defendant did not act
with malice or bad faith. The appellate court ratiocinated that Section 38, Book I of the Administrative Code is the
general law on the civil liability of public officers while Article 32 of the Civil Code is the special law that governs the
instant case. Consequently, malice or bad faith need not be alleged in the complaint for damages. It also sustained
the ruling of the RTC that the defect of the certification against forum shopping was cured by the submission of the
corporate secretarys certificate giving authority to its counsel to execute the same.
Undaunted, petitioner filed the instant recourse contending that the suit is grounded on her acts done in the
performance of her functions as a public officer, hence, it is Section 38, Book I of the Administrative Code which
should be applied. Under this provision, liability will attach only when there is a clear showing of bad faith, malice, or
gross negligence. She further averred that the Civil Code, specifically, Article 32 which allows recovery of damages
for violation of constitutional rights, is a general law on the liability of public officers; while Section 38, Book I of the
Administrative Code is a special law on the superior public officers liability, such that, if the complaint, as in the
instant case, does not allege bad faith, malice, or gross negligence, the same is dismissible for failure to state a
cause of action. As to the defect of the certification against forum shopping, she urged the Court to strictly construe
the rules and to dismiss the complaint.
Conversely, respondent argued that Section 38 which treats in general the public officers "acts" from which civil
liability may arise, is a general law; while Article 32 which deals specifically with the public officers violation of
constitutional rights, is a special provision which should determine whether the complaint states a cause of action or
not. Citing the case of Lim v. Ponce de Leon,
14
respondent alleged that under Article 32 of the Civil Code, it is enough
that there was a violation of the constitutional rights of the plaintiff and it is not required that said public officer should
have acted with malice or in bad faith. Hence, it concluded that even granting that the complaint failed to allege bad
faith or malice, the motion to dismiss for failure to state a cause of action should be denied inasmuch as bad faith or
malice are not necessary to hold petitioner liable.
The issues for resolution are as follows:
(1) May a public officer be validly sued in his/her private capacity for acts done in connection with the
discharge of the functions of his/her office?
(2) Which as between Article 32 of the Civil Code and Section 38, Book I of the Administrative Code should
govern in determining whether the instant complaint states a cause of action?
(3) Should the complaint be dismissed for failure to comply with the rule on certification against forum
shopping?
(4) May petitioner be held liable for damages?
On the first issue, the general rule is that a public officer is not liable for damages which a person may suffer arising
from the just performance of his official duties and within the scope of his assigned tasks.
15
An officer who acts within
his authority to administer the affairs of the office which he/she heads is not liable for damages that may have been
caused to another, as it would virtually be a charge against the Republic, which is not amenable to judgment for
monetary claims without its consent.
16
However, a public officer is by law not immune from damages in his/her
personal capacity for acts done in bad faith which, being outside the scope of his authority, are no longer protected by
the mantle of immunity for official actions.
17

Specifically, under Section 38, Book I of the Administrative Code, civil liability may arise where there is bad faith,
malice, or gross negligence on the part of a superior public officer. And, under Section 39 of the same Book, civil
liability may arise where the subordinate public officers act is characterized by willfulness or negligence. Thus
Sec. 38. Liability of Superior Officers. (1) A public officer shall not be civilly liable for acts done in the
performance of his official duties, unless there is a clear showing of bad faith, malice or gross negligence.
x x x x
Section 39. Liability of Subordinate Officers. No subordinate officer or employee shall be civilly liable
for acts done by him in good faith in the performance of his duties. However, he shall be liable for willful or
negligent acts done by him which are contrary to law, morals, public policy and good customs even if he acts
under orders or instructions of his superior.
In addition, the Court held in Cojuangco, Jr. v. Court of Appeals,
18
that a public officer who directly or indirectly
violates the constitutional rights of another, may be validly sued for damages under Article 32 of the Civil Code even if
his acts were not so tainted with malice or bad faith.
Thus, the rule in this jurisdiction is that a public officer may be validly sued in his/her private capacity for acts done in
the course of the performance of the functions of the office, where said public officer: (1) acted with malice, bad faith,
or negligence; or (2) where the public officer violated a constitutional right of the plaintiff.
Anent the second issue, we hold that the complaint filed by respondent stated a cause of action and that the decisive
provision thereon is Article 32 of the Civil Code.
A general statute is one which embraces a class of subjects or places and does not omit any subject or place
naturally belonging to such class. A special statute, as the term is generally understood, is one which relates to
particular persons or things of a class or to a particular portion or section of the state only.
19

A general law and a special law on the same subject are statutes in pari materia and should, accordingly, be read
together and harmonized, if possible, with a view to giving effect to both. The rule is that where there are two acts,
one of which is special and particular and the other general which, if standing alone, would include the same matter
and thus conflict with the special act, the special law must prevail since it evinces the legislative intent more clearly
than that of a general statute and must not be taken as intended to affect the more particular and specific provisions
of the earlier act, unless it is absolutely necessary so to construe it in order to give its words any meaning at all.
20

The circumstance that the special law is passed before or after the general act does not change the principle. Where
the special law is later, it will be regarded as an exception to, or a qualification of, the prior general act; and where the
general act is later, the special statute will be construed as remaining an exception to its terms, unless repealed
expressly or by necessary implication.
21

Thus, in City of Manila v. Teotico,
22
the Court held that Article 2189 of the Civil Code which holds provinces, cities,
and municipalities civilly liable for death or injuries by reason of defective conditions of roads and other public works,
is a special provision and should prevail over Section 4 of Republic Act No. 409, the Charter of Manila, in determining
the liability for defective street conditions. Under said Charter, the city shall not be held for damages or injuries arising
from the failure of the local officials to enforce the provision of the charter, law, or ordinance, or from negligence while
enforcing or attempting to enforce the same. As explained by the Court:
Manila maintains that the former provision should prevail over the latter, because Republic Act 409 is a
special law, intended exclusively for the City of Manila, whereas the Civil Code is a general law, applicable
to the entire Philippines.
The Court of Appeals, however, applied the Civil Code, and, we think, correctly. It is true that, insofar as its
territorial application is concerned, Republic Act No. 409 is a special law and the Civil Code a general
legislation; but, as regards the subject matter of the provisions above quoted, Section 4 of Republic Act 409
establishes a general rule regulating the liability of the City of Manila for "damages or injury to persons or
property arising from the failure of" city officers "to enforce the provisions of" said Act "or any other law or
ordinance, or from negligence" of the city "Mayor, Municipal Board, or other officers while enforcing or
attempting to enforce said provisions." Upon the other hand, Article 2189 of the Civil Code constitutes a
particular prescription making "provinces, cities and municipalities . . . liable for damages for the death of, or
injury suffered by, any person by reason" specifically "of the defective condition of roads, streets,
bridges, public buildings, and other public works under their control or supervision." In other words, said
section 4 refers to liability arising from negligence, in general, regardless of the object thereof,
whereas Article 2189 governs liability due to "defective streets," in particular. Since the present
action is based upon the alleged defective condition of a road, said Article 2189 is decisive
thereon.
23

In the case of Bagatsing v. Ramirez,
24
the issue was which law should govern the publication of a tax ordinance, the
City Charter of Manila, a special act which treats ordinances in general and which requires their publication before
enactment and after approval, or the Tax Code, a general law, which deals in particular with "ordinances levying or
imposing taxes, fees or other charges," and which demands publication only after approval. In holding that it is the
Tax Code which should prevail, the Court elucidated that:
There is no question that the Revised Charter of the City of Manila is a special act since it relates only to the
City of Manila, whereas the Local Tax Code is a general law because it applies universally to all local
governments. Blackstone defines general law as a universal rule affecting the entire community and special
law as one relating to particular persons or things of a class. And the rule commonly said is that a prior
special law is not ordinarily repealed by a subsequent general law. The fact that one is special and the other
general creates a presumption that the special is to be considered as remaining an exception of the general,
one as a general law of the land, the other as the law of a particular case. However, the rule readily yields
to a situation where the special statute refers to a subject in general, which the general statute treats
in particular. Th[is] exactly is the circumstance obtaining in the case at bar. Section 17 of the
Revised Charter of the City of Manila speaks of "ordinance" in general, i.e., irrespective of the nature
and scope thereof, whereas, Section 43 of the Local Tax Code relates to "ordinances levying or
imposing taxes, fees or other charges" in particular. In regard, therefore, to ordinances in general,
the Revised Charter of the City of Manila is doubtless dominant, but, that dominant force loses its
continuity when it approaches the realm of "ordinances levying or imposing taxes, fees or other
charges" in particular. There, the Local Tax Code controls. Here, as always, a general provision must
give way to a particular provision. Special provision governs.
Let us examine the provisions involved in the case at bar. Article 32 of the Civil Code provides:
ART. 32. Any public officer or employee, or any private individual, who directly or indirectly obstructs,
defeats, violates, or in any manner impedes or impairs any of the following rights and liberties of another
person shall be liable to the latter for damages:
x x x x
(6) The right against deprivation of property without due process of law;
x x x x
(8) The right to the equal protection of the laws;
x x x x
The rationale for its enactment was explained by Dean Bocobo of the Code Commission, as follows:
"DEAN BOCOBO. Article 32, regarding individual rights, Attorney Cirilo Paredes proposes that Article 32 be
so amended as to make a public official liable for violation of another persons constitutional rights only if the
public official acted maliciously or in bad faith. The Code Commission opposes this suggestion for these
reasons:
"The very nature of Article 32 is that the wrong may be civil or criminal. It is not necessary therefore that
there should be malice or bad faith. To make such a requisite would defeat the main purpose of Article 32
which is the effective protection of individual rights. Public officials in the past have abused their powers on
the pretext of justifiable motives or good faith in the performance of their duties. Precisely, the object of the
Article is to put an end to official abuse by the plea of good faith. In the United States this remedy is in the
nature of a tort.
"Mr. Chairman, this article is firmly one of the fundamental articles introduced in the New Civil Code to
implement democracy. There is no real democracy if a public official is abusing and we made the article so
strong and so comprehensive that it concludes an abuse of individual rights even if done in good faith, that
official is liable. As a matter of fact, we know that there are very few public officials who openly and definitely
abuse the individual rights of the citizens. In most cases, the abuse is justified on a plea of desire to enforce
the law to comply with ones duty. And so, if we should limit the scope of this article, that would practically
nullify the object of the article. Precisely, the opening object of the article is to put an end to abuses which
are justified by a plea of good faith, which is in most cases the plea of officials abusing individual rights."
25

The Code Commission deemed it necessary to hold not only public officers but also private individuals civilly liable for
violation of the rights enumerated in Article 32 of the Civil Code. It is not necessary that the defendant under this
Article should have acted with malice or bad faith, otherwise, it would defeat its main purpose, which is the effective
protection of individual rights. It suffices that there is a violation of the constitutional right of the plaintiff.
26

Article 32 was patterned after the "tort" in American law.
27
A tort is a wrong, a tortious act which has been defined as
the commission or omission of an act by one, without right, whereby another receives some injury, directly or
indirectly, in person, property, or reputation.
28
There are cases in which it has been stated that civil liability in tort is
determined by the conduct and not by the mental state of the tortfeasor, and there are circumstances under which the
motive of the defendant has been rendered immaterial. The reason sometimes given for the rule is that otherwise, the
mental attitude of the alleged wrongdoer, and not the act itself, would determine whether the act was
wrongful.
29
Presence of good motive, or rather, the absence of an evil motive, does not render lawful an act which is
otherwise an invasion of anothers legal right; that is, liability in tort is not precluded by the fact that defendant acted
without evil intent.
30

The clear intention therefore of the legislature was to create a distinct cause of action in the nature of tort for violation
of constitutional rights, irrespective of the motive or intent of the defendant.
31
This is a fundamental innovation in the
Civil Code, and in enacting the Administrative Code pursuant to the exercise of legislative powers, then President
Corazon C. Aquino, could not have intended to obliterate this constitutional protection on civil liberties.
In Aberca v. Ver,
32
it was held that with the enactment of Article 32, the principle of accountability of public officials
under the Constitution acquires added meaning and assumes a larger dimension. No longer may a superior official
relax his vigilance or abdicate his duty to supervise his subordinates, secure in the thought that he does not have to
answer for the transgressions committed by the latter against the constitutionally protected rights and liberties of the
citizen. Part of the factors that propelled people power in February 1986 was the widely held perception that the
government was callous or indifferent to, if not actually responsible for, the rampant violations of human rights. While
it would certainly be too naive to expect that violators of human rights would easily be deterred by the prospect of
facing damage suits, it should nonetheless be made clear in no uncertain terms that Article 32 of the Civil Code
makes the persons who are directly, as well as indirectly, responsible for the transgression, joint tortfeasors.
On the other hand, Sections 38 and 39, Book I of the Administrative Code, laid down the rule on the civil liability of
superior and subordinate public officers for acts done in the performance of their duties. For both superior and
subordinate public officers, the presence of bad faith, malice, and negligence are vital elements that will make them
liable for damages. Note that while said provisions deal in particular with the liability of government officials, the
subject thereof is general, i.e., "acts" done in the performance of official duties, without specifying the action or
omission that may give rise to a civil suit against the official concerned.
Contrarily, Article 32 of the Civil Code specifies in clear and unequivocal terms a particular specie of an "act" that may
give rise to an action for damages against a public officer, and that is, a tort for impairment of rights and liberties.
Indeed, Article 32 is the special provision that deals specifically with violation of constitutional rights by public officers.
All other actionable acts of public officers are governed by Sections 38 and 39 of the Administrative Code. While the
Civil Code, specifically, the Chapter on Human Relations is a general law, Article 32 of the same Chapter is a special
and specific provision that holds a public officer liable for and allows redress from a particular class of wrongful acts
that may be committed by public officers. Compared thus with Section 38 of the Administrative Code, which broadly
deals with civil liability arising from errors in the performance of duties, Article 32 of the Civil Code is the specific
provision which must be applied in the instant case precisely filed to seek damages for violation of constitutional
rights.
The complaint in the instant case was brought under Article 32 of the Civil Code. Considering that bad faith and
malice are not necessary in an action based on Article 32 of the Civil Code, the failure to specifically allege the same
will not amount to failure to state a cause of action. The courts below therefore correctly denied the motion to dismiss
on the ground of failure to state a cause of action, since it is enough that the complaint avers a violation of a
constitutional right of the plaintiff.
Anent the issue on non-compliance with the rule against forum shopping, the subsequent submission of the
secretarys certificate authorizing the counsel to sign and execute the certification against forum shopping cured the
defect of respondents complaint. Besides, the merits of the instant case justify the liberal application of the rules.
33

WHEREFORE, in view of the foregoing, the petition is DENIED. The Decision of the Court of Appeals dated May 7,
1999 which affirmed the Order of the Regional Trial Court of Marikina, Branch 272, denying petitioners motion to
dismiss, is AFFIRMED. The Presiding Judge, Regional Trial Court of Marikina, Branch 272, is hereby DIRECTEDto
continue with the proceedings in Civil Case No. 97-341-MK with dispatch.
With costs.
SO ORDERED.
Austria-Martinez, Chico-Nazario, Nachura, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. No. 126746 November 29, 2000
ARTHUR TE, petitioner,
vs.
COURT OF APPEALS, and LILIANA CHOA, respondents.
D E C I S I O N
KAPUNAN, J .:
Before us is a petition for review on certiorari which seeks to reverse the Decision of the Court of Appeals Tenth
Division, dated 31 August 1994 in CA-G.R. SP No. 23971
1
and CA-G.R. SP No. 26178
2
and the Resolution dated
October 18, 1996 denying petitioners motion for reconsideration.
The facts of the case are as follows:
Petitioner Arthur Te and private respondent Liliana Choa were married in civil rites on September 14, 1988. They did
not live together after the marriage although they would meet each other regularly. Not long after private respondent
gave birth to a girl on April 21, 1989, petitioner stopped visiting her.
3

On May 20, 1990, while his marriage with private respondent was subsisting, petitioner contracted a second marriage
with a certain Julieta Santella (Santella).
4

On the basis of a complaint-affidavit filed by private respondent sometime in June 1990, when she learned about
petitioners marriage to Santella, an information charging petitioner with bigamy was filed with the Regional Trial
Court (RTC) of Quezon City on August 9, 1990.
5
This case was docketed as Criminal Case No. Q-90-14409.
6

Meanwhile, on July 20, 1990, petitioner filed in the RTC of Quezon City an action for the annulment of his marriage to
private respondent on the ground that he was forced to marry her. He alleged that private respondent concealed her
pregnancy by another man at the time of their marriage and that she was psychologically incapacitated to perform her
essential marital obligations.
7

On November 8, 1990, private respondent also filed with the Professional Regulation Commission (PRC) an
administrative case against petitioner and Santella for the revocation of their respective engineering licenses on the
ground that they committed acts of immorality by living together and subsequently marrying each other despite their
knowledge that at the time of their marriage, petitioner was already married to private respondent. With respect to
petitioner, private respondent added that he committed an act of falsification by stating in his marriage contract with
Santella that he was still single.
8

After the prosecution rested its case in the criminal case for bigamy, petitioner filed a demurrer to evidence with leave
of court and motion to inhibit the trial court judge for showing antagonism and animosity towards petitioners counsel
during the hearings of said case.
The trial court denied petitioners demurrer to evidence in an Order dated November 28, 1990 which stated that the
same could not be granted because the prosecution had sufficiently established a prima facie case against the
accused.
9
The RTC also denied petitioners motion to inhibit for lack of legal basis.
10

Petitioner then filed with the Court of Appeals a petition for certiorari, alleging grave abuse of discretion on the part of
the trial court judge, Judge Cezar C. Peralejo, for (1) exhibiting antagonism and animosity towards petitioners
counsel; (2) violating the requirements of due process by denying petitioners [motion for reconsideration and]
demurrer to evidence even before the filing of the same; (3) disregarding and failing to comply with the appropriate
guidelines for judges promulgated by the Supreme Court; and (4) ruling that in a criminal case only "prima facie
evidence" is sufficient for conviction of an accused. This case was docketed as CA-G.R. SP No. 23971.
11

Petitioner also filed with the Board of Civil Engineering of the PRC (PRC Board), where the administrative case for
the revocation of his engineering license was pending, a motion to suspend the proceedings therein in view of the
pendency of the civil case for annulment of his marriage to private respondent and criminal case for bigamy in
Branches 106 and 98, respectively of the RTC of Quezon City.
12
When the Board denied the said motion in its Order
dated July 16, 1991,
13
petitioner filed with the Court of Appeals another petition for certiorari, contending that the
Board gravely abused its discretion in: (1) failing to hold that the resolution of the annulment case is prejudicial to the
outcome of the administrative case pending before it; (2) not holding that the continuation of proceedings in the
administrative case could render nugatory petitioners right against self-incrimination in this criminal case for bigamy
against him; and (3) making an overly-sweeping interpretation that Section 32 of the Rules and Regulations
Governing the Regulation and Practice of Professionals does not allow the suspension of the administrative
proceeding before the PRC Board despite the pendency of criminal and/or administrative proceedings against the
same respondent involving the same set of facts in other courts or tribunals. This petition was docketed as CA-G.R.
SP No. 26178.
14

The two petitions for certiorari were consolidated since they arose from the same set of facts.
On 31 August 1994, the Court of Appeals, Tenth Division, rendered the assailed decision in the consolidated
petitions. The appellate court upheld the RTCs denial of the motion to inhibit due to petitioners failure to show any
concrete evidence that the trial court judge exhibited partiality and had prejudged the case. It also ruled that the
denial of petitioners motion to suspend the proceedings on the ground of prejudicial question was in accord with
law.
15
The Court of Appeals likewise affirmed the RTCs denial of the demurrer to evidence filed by petitioner for his
failure to set forth persuasive grounds to support the same, considering that the prosecution was able to adduce
evidence showing the existence of the elements of bigamy.
16

Neither did the appellate court find grave abuse of discretion on the part of the Boards Order denying petitioners
motion to suspend proceedings in the administrative case on the ground of prejudicial question. Respondent court
held that no prejudicial question existed since the action sought to be suspended is administrative in nature, and the
other action involved is a civil case.
17

Petitioner thereafter filed a motion for reconsideration of the decision of the Court of Appeals but the same was
denied.
18

Hence, petitioner filed the instant petition raising the following issues:
I
PUBLIC RESPONDENT COMMITTED A SERIOUS ERROR IN REFUSING TO SUSPEND THE LEGAL
[CRIMINAL AND ADMINISTRATIVE] PROCEEDINGS DESPITE THE PENDENCY OF THE CIVIL CASE
FOR DECLARATION OF NULLITY OF MARRIAGE.
II
PUBLIC RESPONDENT GRAVELY ABUSED ITS DISCRETION AND COMMITTED AN ERROR OF LAW
IN NOT HOLDING THAT THE DEMURRER TO EVIDENCE SHOULD HAVE BEEN GIVEN DUE COURSE.
III
PUBLIC RESPONDENT COMMITTED A SERIOUS LEGAL ERROR IN NOT HOLDING THAT THE TRIAL
JUDGE A QUO SHOULD HAVE INHIBITED HIMSELF.
19

The petition has no merit.
While the termination of Civil Case No. Q-90-6205 for annulment of petitioners marriage to private respondent has
rendered the issue of the propriety of suspending both the criminal case for bigamy before the RTC of Quezon City,
Branch 98 and the administrative case for revocation of petitioners engineering license before the PRC Board moot
and academic, the Court shall discuss the issue of prejudicial question to emphasize the guarding and controlling
precepts and rules.
20

A prejudicial question has been defined as one based on a fact distinct and separate from the crime but so intimately
connected with it that it determines the guilt or innocence of the accused, and for it to suspend the criminal action, it
must appear not only that said case involves facts intimately related to those upon which the criminal prosecution
would be based but also that in the resolution of the issue or issues raised in the civil case, the guilt or innocence of
the accused would necessarily be determined.
21
The rationale behind the principle of suspending a criminal case in
view of a prejudicial question is to avoid two conflicting decisions.
22

The Court of Appeals did not err when it ruled that the pendency of the civil case for annulment of marriage filed by
petitioner against private respondent did not pose a prejudicial question which would necessitate that the criminal
case for bigamy be suspended until said civil case is terminated.
The outcome of the civil case for annulment of petitioners marriage to private respondent had no bearing upon the
determination of petitioners innocence or guilt in the criminal case for bigamy, because all that is required for the
charge of bigamy to prosper is that the first marriage be subsisting at the time the second marriage is
contracted.
23
Petitioners argument that the nullity of his marriage to private respondent had to be resolved first in the
civil case before the criminal proceedings could continue, because a declaration that their marriage was voidab
initio would necessarily absolve him from criminal liability, is untenable. The ruling in People vs.
Mendoza
24
andPeople vs. Aragon
25
cited by petitioner that no judicial decree is necessary to establish the invalidity of
a marriage which is void ab initio has been overturned. The prevailing rule is found in Article 40 of the Family Code,
which was already in effect at the time of petitioners marriage to private respondent in September 1988. Said article
states that the absolute nullity of a previous marriage may not be invoked for purposes of remarriage unless there is a
final judgment declaring such previous marriage void. Thus, under the law, a marriage, even one which is void or
voidable, shall be deemed valid until declared otherwise in a judicial proceeding.
26
In Landicho vs. Relova,
27
we held
that:
Parties to a marriage should not be permitted to judge for themselves its nullity, for this must be submitted to the
judgment of competent courts and only when the nullity of a marriage is so declared can it be held as void, and so
long as there is no such declaration the presumption of marriage exists.
28

It is clear from the foregoing that the pendency of the civil case for annulment of petitioners marriage to private
respondent did not give rise to a prejudicial question which warranted the suspension of the proceedings in the
criminal case for bigamy since at the time of the alleged commission of the crime, their marriage was, under the law,
still valid and subsisting.
Neither did the filing of said civil case for annulment necessitate the suspension of the administrative proceedings
before the PRC Board. As discussed above, the concept of prejudicial question involves a civil and a criminal case.
We have previously ruled that there is no prejudicial question where one case is administrative and the other is civil.
29

Furthermore, Section 32 of the Rules and Regulations Governing the Regulation and Practice of Professionals of the
PRC Board expressly provides that the administrative proceedings before it shall not be suspended notwithstanding
the existence of a criminal and/or civil case against the respondent involving the same facts as the administrative
case:
The filing or pendency of a criminal and/or civil cases in the courts or an administrative case in another judicial body
against an examinee or registered professional involving the same facts as in the administrative case filed or to be
filed before the Board shall neither suspend nor bar the proceeding of the latter case. The Board shall proceed
independently with the investigation of the case and shall render therein its decision without awaiting for the final
decision of the courts or quasi-judicial body.
It must also be noted that the allegations in the administrative complaint before the PRC Board are not confined to
the issue of the alleged bigamous marriage contracted by petitioner and Santella. Petitioner is also charged with
immoral conduct for continued failure to perform his obligations as husband to private respondent and as father to
their child, and for cohabiting with Santella without the benefit of marriage.
30
The existence of these other charges
justified the continuation of the proceedings before the PRC Board.
Petitioner also contends that the Court of Appeals erred in upholding the trial courts denial of his demurrer to
evidence in the criminal case for bigamy, arguing that the prosecution failed to establish the existence of both the first
and second marriages beyond reasonable doubt. Petitioner claims that the original copy of marriage contract
between him and private respondent was not presented, the signatures therein were not properly identified and there
was no showing that the requisites of a valid marriage were complied with. He alleges further that the original copy of
the marriage contract between him and Santella was not presented, that no proof that he signed said contract was
adduced, and that there was no witness presented to show that a second marriage ceremony participated in by him
ever took place.
31

We are not persuaded. The grant or denial of a demurrer to evidence is left to the sound discretion of the trial court,
and its ruling on the matter shall not be disturbed in the absence of a grave abuse of such discretion.
32
In this case,
the Court of Appeals did not find any grave abuse of discretion on the part of the trial court, which based its denial of
the demurrer on two grounds: first, the prosecution established a prima facie case for bigamy against the petitioner;
and second, petitioners allegations in the demurrer were insufficient to justify the grant of the same. It has been held
that the appellate court will not review in a special civil action for certiorari the prosecutions evidence and decide in
advance that such evidence has or has not yet established the guilt of the accused beyond reasonable doubt.
33
In
view of the trial courts finding that a prima facie case against petitioner exists, his proper recourse is to adduce
evidence in his defense.
34

The Court also finds it necessary to correct petitioners misimpression that by denying his demurrer to evidence in
view of the existence of a prima facie case against him, the trial court was already making a pronouncement that he
is liable for the offense charged. As correctly held by the Court of Appeals, the order of the RTC denying the
demurrer was not an adjudication on the merits but merely an evaluation of the sufficiency of the prosecutions
evidence to determine whether or not a full-blown trial would be necessary to resolve the case.
35
The RTCs
observation that there was a prima facie case against petitioner only meant that the prosecution had presented
sufficient evidence to sustain its proposition that petitioner had committed the offense of bigamy, and unless
petitioner presents evidence to rebut the same, such would be the conclusion.
36
Said declaration by the RTC should
not be construed as a pronouncement of petitioners guilt. It was precisely because of such finding that the trial court
denied the demurrer, in order that petitioner may present evidence in his defense and allow said court to resolve the
case based on the evidence adduced by both parties.
Lastly, petitioner contends that his motion to inhibit Judge Peralejo in Criminal Case No. Q-90-14409 should have
been granted since said judge exhibited partiality and bias against him in several instances. First, when petitioner
manifested that he would file a motion for reconsideration of the denial of his motion to suspend the proceedings in
said case, the judge said such motion was dilatory and would be denied even though the motion for reconsideration
had not yet been filed. Second, when petitioners counsel manifested that he had just recovered from an accident and
was not physically fit for trial, the judge commented that counsel was merely trying to delay the case and required
said counsel to produce a medical certificate to support his statement. Third, when petitioner manifested that he was
going to file a demurrer to evidence, the judge characterized the same as dilatory and declared that he would deny
the same. According to petitioner, the judges hostile attitude towards petitioners counsel as shown in the foregoing
instances justified the grant of his motion to inhibit.
We agree with the appellate court that the grounds raised by petitioner against Judge Peralejo did not conclusively
show that the latter was biased and had prejudged the case.
37
In People of the Philippines vs. Court of Appeals,
38
this
Court held that while bias and prejudice have been recognized as valid reasons for the voluntary inhibition of a judge
under Section 1, Rule 137, the rudimentary rule is that the mere suspicion that a judge is partial is not enough. There
should be clear and convincing evidence to prove the charge of bias and partiality.
39

Furthermore, since the grounds raised by petitioner in his motion to inhibit are not among those expressly mentioned
in Section 1, Rule 137 of the Revised Rules of Court, the decision to inhibit himself lay within the sound discretion of
Judge Peralejo. Said provision of law states:
Section 1. Disqualification of judges. No judge or judicial officer shall sit in any case in which he, or his wife or child,
is pecuniarily interested as heir, legatee, creditor or otherwise, or in which he is related to either party within the sixth
degree of consanguinity or affinity, or to counsel within the fourth degree, computed according to the rules of the civil
law, or in which he has been executor, administrator, guardian, trustee or counsel, or in which he has presided in any
inferior court when his ruling or decision is the subject of review, without the written consent of all parties in interest,
signed by them and entered upon the record.
A judge may, in the exercise of his sound discretion, disqualify himself from sitting in the case, for just and valid
reasons other than those mentioned above.
Thus, it was not mandatory that the judge inhibit himself from hearing and deciding the case.
This Court does not find any abuse of discretion by respondent judge in denying petitioners motion to inhibit. The test
for determining the propriety of the denial of said motion is whether petitioner was deprived a fair and impartial
trial.
40
The instances when Judge Peralejo allegedly exhibited antagonism and partiality against petitioner and/or his
counsel did not deprive him of a fair and impartial trial. As discussed earlier, the denial by the judge of petitioners
motion to suspend the criminal proceeding and the demurrer to evidence are in accord with law and jurisprudence.
Neither was there anything unreasonable in the requirement that petitioners counsel submit a medical certificate to
support his claim that he suffered an accident which rendered him unprepared for trial. Such requirement was
evidently imposed upon petitioners counsel to ensure that the resolution of the case was not hampered by
unnecessary and unjustified delays, in keeping with the judges duty to disposing of the courts business promptly.
41

WHEREFORE, the petition is hereby DENIED for lack of merit.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Puno, Pardo, and Ynares-Santiago, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION
G.R. Nos. 160054-55 July 21, 2004
MANOLO P. SAMSON, petitioner,
vs.
HON. REYNALDO B. DAWAY, in his capacity as Presiding Judge, Regional Trial Court of Quezon City,
Branch 90, PEOPLE OF THE PHILIPPINES and CATERPILLAR, INC., respondents.


D E C I S I O N


YNARES-SANTIAGO, J .:
Assailed in this petition for certiorari is the March 26, 2003 Order
1
of the Regional Trial Court of Quezon City, Branch
90, which denied petitioners (1) motion to quash the information; and (2) motion for reconsideration of the August
9, 2002 Order denying his motion to suspend the arraignment and other proceedings in Criminal Case Nos. Q-02-
108043-44. Petitioner also questioned its August 5, 2003 Order
2
which denied his motion for reconsideration.
The undisputed facts show that on March 7, 2002, two informations for unfair competition under Section 168.3 (a), in
relation to Section 170, of the Intellectual Property Code (Republic Act No. 8293), similarly worded save for the dates
and places of commission, were filed against petitioner Manolo P. Samson, the registered owner of ITTI Shoes. The
accusatory portion of said informations read:
That on or about the first week of November 1999 and sometime prior or subsequent thereto, in Quezon
City, Philippines, and within the jurisdiction of this Honorable Court, above-named accused, owner/proprietor
of ITTI Shoes/Mano Shoes Manufactuirng Corporation located at Robinsons Galleria, EDSA corner Ortigas
Avenue, Quezon City, did then and there willfully, unlawfully and feloniously distribute, sell and/or offer for
sale CATERPILLAR products such as footwear, garments, clothing, bags, accessories and paraphernalia
which are closely identical to and/or colorable imitations of the authentic Caterpillar products and likewise
using trademarks, symbols and/or designs as would cause confusion, mistake or deception on the part of
the buying public to the damage and prejudice of CATERPILLAR, INC., the prior adopter, user and owner of
the following internationally: "CATERPILLAR", "CAT", "CATERPILLAR & DESIGN", "CAT AND DESIGN",
"WALKING MACHINES" and "TRACK-TYPE TRACTOR & DESIGN."
CONTRARY TO LAW.
3

On April 19, 2002, petitioner filed a motion to suspend arraignment and other proceedings in view of the existence of
an alleged prejudicial question involved in Civil Case No. Q-00-41446 for unfair competition pending with the same
branch; and also in view of the pendency of a petition for review filed with the Secretary of Justice assailing the Chief
State Prosecutors resolution finding probable cause to charge petitioner with unfair competition. In an Order dated
August 9, 2002, the trial court denied the motion to suspend arraignment and other proceedings.
On August 20, 2002, petitioner filed a twin motion to quash the informations and motion for reconsideration of the
order denying motion to suspend, this time challenging the jurisdiction of the trial court over the offense charged. He
contended that since under Section 170 of R.A. No. 8293, the penalty4 of imprisonment for unfair competition does
not exceed six years, the offense is cognizable by the Municipal Trial Courts and not by the Regional Trial Court, per
R.A. No. 7691.
In its assailed March 26, 2003 Order, the trial court denied petitioners twin motions.6 A motion for reconsideration
thereof was likewise denied on August 5, 2003.
Hence, the instant petition alleging that respondent Judge gravely abused its discretion in issuing the assailed orders.
The issues posed for resolution are (1) Which court has jurisdiction over criminal and civil cases for violation of
intellectual property rights? (2) Did the respondent Judge gravely abuse his discretion in refusing to suspend the
arraignment and other proceedings in Criminal Case Nos. Q-02-108043-44 on the ground of (a) the existence of a
prejudicial question; and (b) the pendency of a petition for review with the Secretary of Justice on the finding of
probable cause for unfair competition?
Under Section 170 of R.A. No. 8293, which took effect on January 1, 1998, the criminal penalty for infringement of
registered marks, unfair competition, false designation of origin and false description or representation, is
imprisonment from 2 to 5 years and a fine ranging from Fifty Thousand Pesos to Two Hundred Thousand Pesos, to
wit:
SEC. 170. Penalties. Independent of the civil and administrative sanctions imposed by law, a criminal
penalty of imprisonment from two (2) years to five (5) years and a fine ranging from Fifty thousand pesos
(P50,000.00) to Two hundred thousand pesos (P200,000.00), shall be imposed on any person who is found
guilty of committing any of the acts mentioned in Section 155 [Infringement], Section 168 [Unfair
Competition] and Section 169.1 [False Designation of Origin and False Description or Representation].
Corollarily, Section 163 of the same Code states that actions (including criminal and civil) under Sections 150, 155,
164, 166, 167, 168 and 169 shall be brought before the proper courts with appropriate jurisdiction under existing
laws, thus
SEC. 163. Jurisdiction of Court. All actions under Sections 150, 155, 164 and 166 to 169 shall be brought
before the proper courts with appropriate jurisdiction under existing laws. (Emphasis supplied)
The existing law referred to in the foregoing provision is Section 27 of R.A. No. 166 (The Trademark Law) which
provides that jurisdiction over cases for infringement of registered marks, unfair competition, false designation of
origin and false description or representation, is lodged with the Court of First Instance (now Regional Trial Court)
SEC. 27. Jurisdiction of Court of First Instance. All actions under this Chapter [V Infringement] and
Chapters VI [Unfair Competition] and VII [False Designation of Origin and False Description or
Representation], hereof shall be brought before the Court of First Instance.
We find no merit in the claim of petitioner that R.A. No. 166 was expressly repealed by R.A. No. 8293. The repealing
clause of R.A. No. 8293, reads
SEC. 239. Repeals. 239.1. All Acts and parts of Acts inconsistent herewith, more particularly Republic
Act No. 165, as amended; Republic Act No. 166, as amended; and Articles 188 and 189 of the Revised
Penal Code; Presidential Decree No. 49, including Presidential Decree No. 285, as amended, are hereby
repealed. (Emphasis added)
Notably, the aforequoted clause did not expressly repeal R.A. No. 166 in its entirety, otherwise, it would not have
used the phrases "parts of Acts" and "inconsistent herewith;" and it would have simply stated "Republic Act No. 165,
as amended; Republic Act No. 166, as amended; and Articles 188 and 189 of the Revised Penal Code; Presidential
Decree No. 49, including Presidential Decree No. 285, as amended are hereby repealed." It would have removed all
doubts that said specific laws had been rendered without force and effect. The use of the phrases "parts of Acts" and
"inconsistent herewith" only means that the repeal pertains only to provisions which are repugnant or not susceptible
of harmonization with R.A. No. 8293.6 Section 27 of R.A. No. 166, however, is consistent and in harmony with
Section 163 of R.A. No. 8293. Had R.A. No. 8293 intended to vest jurisdiction over violations of intellectual property
rights with the Metropolitan Trial Courts, it would have expressly stated so under Section 163 thereof.
Moreover, the settled rule in statutory construction is that in case of conflict between a general law and a special law,
the latter must prevail. Jurisdiction conferred by a special law to Regional Trial Courts must prevail over that granted
by a general law to Municipal Trial Courts.7
In the case at bar, R.A. No. 8293 and R.A. No. 166 are special laws8 conferring jurisdiction over violations of
intellectual property rights to the Regional Trial Court. They should therefore prevail over R.A. No. 7691, which is a
general law.9 Hence, jurisdiction over the instant criminal case for unfair competition is properly lodged with the
Regional Trial Court even if the penalty therefor is imprisonment of less than 6 years, or from 2 to 5 years and a fine
ranging from P50,000.00 to P200,000.00.
In fact, to implement and ensure the speedy disposition of cases involving violations of intellectual property rights
under R.A. No. 8293, the Court issued A.M. No. 02-1-11-SC dated February 19, 2002 designating certain Regional
Trial Courts as Intellectual Property Courts. On June 17, 2003, the Court further issued a Resolution consolidating
jurisdiction to hear and decide Intellectual Property Code and Securities and Exchange Commission cases in specific
Regional Trial Courts designated as Special Commercial Courts.
The case of Mirpuri v. Court of Appeals,10 invoked by petitioner finds no application in the present case. Nowhere
in Mirpuri did we state that Section 27 of R.A. No. 166 was repealed by R.A. No. 8293. Neither did we make a
categorical ruling therein that jurisdiction over cases for violation of intellectual property rights is lodged with the
Municipal Trial Courts. The passing remark in Mirpuri on the repeal of R.A. No. 166 by R.A. No. 8293 was merely a
backgrounder to the enactment of the present Intellectual Property Code and cannot thus be construed as a
jurisdictional pronouncement in cases for violation of intellectual property rights.
Anent the second issue, petitioner failed to substantiate his claim that there was a prejudicial question. In his petition,
he prayed for the reversal of the March 26, 2003 order which sustained the denial of his motion to suspend
arraignment and other proceedings in Criminal Case Nos. Q-02-108043-44. For unknown reasons, however, he
made no discussion in support of said prayer in his petition and reply to comment. Neither did he attach a copy of the
complaint in Civil Case No. Q-00-41446 nor quote the pertinent portion thereof to prove the existence of a prejudicial
question.
At any rate, there is no prejudicial question if the civil and the criminal action can, according to law, proceed
independently of each other.11 Under Rule 111, Section 3 of the Revised Rules on Criminal Procedure, in the cases
provided in Articles 32, 33, 34 and 2176 of the Civil Code, the independent civil action may be brought by the
offended party. It shall proceed independently of the criminal action and shall require only a preponderance of
evidence.
In the case at bar, the common element in the acts constituting unfair competition under Section 168 of R.A. No.
8293 is fraud.12 Pursuant to Article 33 of the Civil Code, in cases of defamation, fraud, and physical injuries, a civil
action for damages, entirely separate and distinct from the criminal action, may be brought by the injured party.
Hence, Civil Case No. Q-00-41446, which as admitted13 by private respondent also relate to unfair competition, is an
independent civil action under Article 33 of the Civil Code. As such, it will not operate as a prejudicial question that
will justify the suspension of the criminal cases at bar.
Section 11 (c), Rule 116 of the Revised Rules on Criminal Procedure provides
SEC. 11. Suspension of arraignment. Upon motion by the proper party, the arraignment shall be
suspended in the following cases
x x x x x x x x x
(c) A petition for review of the resolution of the prosecutor is pending at either the Department of Justice, or
the Office of the President; Provided, that the period of suspension shall not exceed sixty (60) days counted
from the filing of the petition with the reviewing office.
While the pendency of a petition for review is a ground for suspension of the arraignment, the aforecited provision
limits the deferment of the arraignment to a period of 60 days reckoned from the filing of the petition with the
reviewing office. It follows, therefore, that after the expiration of said period, the trial court is bound to arraign the
accused or to deny the motion to defer arraignment.
In the instant case, petitioner failed to establish that respondent Judge abused his discretion in denying his motion to
suspend. His pleadings and annexes submitted before the Court do not show the date of filing of the petition for
review with the Secretary of Justice.14 Moreover, the Order dated August 9, 2002 denying his motion to suspend was
not appended to the petition. He thus failed to discharge the burden of proving that he was entitled to a suspension of
his arraignment and that the questioned orders are contrary to Section 11 (c), Rule 116 of the Revised Rules on
Criminal Procedure. Indeed, the age-old but familiar rule is that he who alleges must prove his allegations.
In sum, the dismissal of the petition is proper considering that petitioner has not established that the trial court
committed grave abuse of discretion. So also, his failure to attach documents relevant to his allegations warrants the
dismissal of the petition, pursuant to Section 3, Rule 46 of the Rules of Civil Procedure, which states:
SEC. 3. Contents and filing of petition; effect of non-compliance with requirements. The petition
shall contain the full names and actual addresses of all the petitioners and respondents, a concise statement
of the matters involved, the factual background of the case, and the grounds relied upon for the relief prayed
for.
It shall be filed in seven (7) clearly legible copies together with proof of service thereof on the respondent
with the original copy intended for the court indicated as such by the petitioner, and shall be accompanied
by a clearly legible duplicate original or certified true copy of the judgment, order, resolution, or
ruling subject thereof, such material portions of the record as are referred to therein, and other
documents relevant or pertinent thereto.
x x x x x x x x x
The failure of the petitioner to comply with any of the foregoing requirements shall be sufficient
ground for the dismissal of the petition. (Emphasis added)
WHEREFORE, in view of all the foregoing, the petition is dismissed.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Quisumbing, Carpio, and Azcuna, JJ., concur.
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 159323 July 31, 2008
COCA-COLA BOTTLERS (PHILS.), INC. and ERIC MONTINOLA, Petitioners,
vs.
SOCIAL SECURITY COMMISSION and DR. DEAN CLIMACO, Respondents.
D E C I S I O N
REYES, R.T., J .:
WE are confronted with triple remedial issues on prejudicial question, forum shopping, and litis pendentia.
We review on certiorari the Decision
1
of the Court of Appeals (CA) upholding the order of the Social Security
Commission (SSC),
2
denying petitioners motion to dismiss respondent Climacos petition for compulsory coverage
with the Social Security System (SSS).
The Facts
Petitioner Coca-Cola Bottlers (Phils.), Inc. is a corporation engaged in the manufacture and sale of softdrink
beverages.
3
Co-petitioner Eric Montinola was the general manager of its plant in Bacolod City.
4
Respondent Dr. Dean
Climaco was a former retainer physician at the companys plant in Bacolod City.
5

In 1988, petitioner company and Dr. Climaco entered into a Retainer Agreement
6
for one year, with a monthly
compensation of P3,800.00,
7
where he "may charge professional fees for hospital services rendered in line with his
specialization."
8
The agreement further provided that "either party may terminate the contract upon giving thirty (30)-
day written notice to the other."
9
In consideration of the retainers fee, Dr. Climaco "agrees to perform the duties and
obligations"
10
enumerated in the Comprehensive Medical Plan,
11
which was attached and made an integral part of the
agreement.
Explicit in the contract, however, is the provision that no employee-employer relationship shall exist between the
company and Dr. Climaco while the contract is in effect.
12
In case of its termination, Dr. Climaco "shall be entitled only
to such retainer fee as may be due him at the time of termination."
13

Dr. Climaco continuously served as the company physician, performing all the duties stipulated in the Retainer
Agreement and the Comprehensive Medical Plan. By 1992, his salary was increased to P7,500.00 per month.
14

Meantime, Dr. Climaco inquired with the Department of Labor and Employment and the SSS whether he was an
employee of the company. Both agencies replied in the affirmative.
15
As a result, Dr. Climaco filed a
complaint
16
before the National Labor Relations Commission (NLRC), Bacolod City. In his complaint, he sought
recognition as a regular employee of the company and demanded payment of his 13th month pay, cost of living
allowance, holiday pay, service incentive leave pay, Christmas bonus and all other benefits.
17

During the pendency of the complaint, the company terminated its Retainer Agreement with Dr. Climaco. Thus, Dr.
Climaco filed another complaint
18
for illegal dismissal against the company before the NLRC Bacolod City. He asked
that he be reinstated to his former position as company physician of its Bacolod Plant, without loss of seniority rights,
with full payment of backwages, other unpaid benefits, and for payment of damages.
19

The Labor Arbiter, in each of the complaints, ruled in favor of petitioner company.
20
The first complaint was dismissed
after Labor Arbiter Jesus N. Rodriguez, Jr. found that the company did not have the power of control over Dr.
Climacos performance of his duties and responsibilities. The validity of the Retainer Agreement was also recognized.
Labor Arbiter Benjamin Pelaez likewise dismissed the second complaint in view of the dismissal of the first
complaint.1avvphi1
On appeal, the NLRC, Fourth Division, Cebu City, affirmed the Arbiter disposition.
21
On petition for review before the
CA, the NLRC ruling was reversed.
22
The appellate court ruled that using the four-fold test, an employer-employee
relationship existed between the company and Dr. Climaco. Petitioners elevated the case through a petition for
review on certiorari
23
before this Court.
Meantime, on November 9, 1994, while the NLRC cases were pending, Dr. Climaco filed with the SSC in Bacolod
City, a petition
24
praying, among others, that petitioner Coca-Cola Bottlers (Phils.), Inc. be ordered to report him for
compulsory social security coverage.
On April 12, 1995, petitioners moved for the dismissal of the petition on the ground of lack of jurisdiction. They argued
that there is no employer-employee relationship between the company and Dr. Climaco; and that his services were
engaged by virtue of a Retainer Agreement.
25

Dr. Climaco opposed the motion.
26
According to Dr. Climaco, "[t]he fact that the petitioner [i.e., respondent Dr.
Climaco] does not enjoy the other benefits of the company is a question that is being raised by the petitioner in his
cases filed with the National Labor Relations Commission (NLRC), Bacolod City, against the respondent [i.e.,
petitioner company]."
27

On July 24, 1995, the SSC issued an order stating among others, that the resolution of petitioner companys motion
to dismiss is held in abeyance "pending reception of evidence of the parties."
28

In view of the statements of Dr. Climaco in his opposition to the companys motion to dismiss, petitioners again, on
March 1, 1996, moved for the dismissal of Dr. Climacos complaint, this time on the grounds of forum shopping
andlitis pendentia.
29

SSC and CA Dispositions
On January 17, 1997, the SSC denied petitioners motion to dismiss, disposing as follows:
WHEREFORE, PREMISES CONSIDERED, the respondents Motion to Dismiss is hereby denied for lack of merit.
Accordingly, let this case be remanded to SSS Bacolod Branch Office for reception of evidence of the parties
pursuant to the Order dated July 24, 1995.
SO ORDERED.
30

Petitioners motion for reconsideration
31
received the same fate.
32

On April 29, 1997, the company filed a petition for certiorari before the CA. On March 15, 2002, the CA dismissed the
petition, with a fallo reading:
WHEREFORE, under the premises, the Court holds that public respondent Social Security Commission did not act
with grave abuse of discretion in issuing the disputed orders, and the herein petition is therefore DISMISSED for want
of merit.
SO ORDERED.
33

Hence, the present recourse.
Issues
Petitioners raise the following issues for Our consideration:
WITH ALL DUE RESPECT, THE HONORABLE COURT OF APPEALS ERRED IN RENDERING THE ASSAILED
RESOLUTIONS, HAVING DECIDED A QUESTION OF SUBSTANCE IN A WAY NOT IN ACCORD WITH LAW AND
THE APPLICABLE DECISIONS OF THIS HONORABLE COURT, CONSIDERING THAT:
I.
THE PREVIOUS COMPLAINT FOR REGULARIZATION AND/OR ILLEGAL DISMISSAL, WHICH IS NOW
PENDING RESOLUTION BEFORE THE SUPREME COURT, POSES A PREJUDICIAL QUESTION TO
THE SUBJECT OF THE PRESENT CASE.
II.
GIVEN THE ATTENDANT CIRCUMSTANCES, RESPONDENT CLIMACO IS GUILTY OF FORUM
SHOPPING, WHICH THEREBY CALLED FOR THE OUTRIGHT DISMISSAL OF HIS PETITION BEFORE
THE SOCIAL SECURITY COMMISSION.
III.
THE PETITION SHOULD HAVE ALSO BEEN DISMISSED OUTRIGHT ON THE GROUND OF LITIS
PENDENTIA, AS THERE ARE OTHER ACTIONS PENDING BETWEEN THE SAME PARTIES FOR THE
SAME CAUSE OF ACTION.
34
(Underscoring supplied)
Our Ruling
The petition fails.
The Court notes that petitioners, in their petition, averred that the appeal from the NLRC and CA dispositions on the
illegal dismissal of respondent Climaco is still pending with this Court. Upon verification, however, it was unveiled that
the said case had already been decided by this Courts First Division on February 5, 2007.
While we deplore the failure of petitioners and counsel in updating the Court on the resolution of the said related
case, We hasten to state that it did not operate to moot the issues pending before Us. We take this opportunity to
address the questions on prejudicial question, forum shopping, and litis pendentia.
No prejudicial question exists.
Petitioners allege that Dr. Climaco previously filed separate complaints before the NLRC seeking recognition as a
regular employee. Necessarily then, a just resolution of these cases hinge on a determination of whether or not Dr.
Climaco is an employee of the company.
35
The issue of whether Dr. Climaco is entitled to employee benefits, as
prayed for in the NLRC cases, is closely intertwined with the issue of whether Dr. Climaco is an employee of the
company who is subject to compulsory coverage under the SSS Law. Hence, they argue, said regularization/illegal
dismissal case is a prejudicial question.
The argument is untenable.
Our concept of prejudicial question was lifted from Spain, where civil cases are tried exclusively by civil courts, while
criminal cases are tried exclusively in criminal courts. Each kind of court is jurisdictionally distinct from and
independent of the other. In the Philippines, however, courts are invariably tribunals of general jurisdiction. This
means that courts here exercise jurisdiction over both civil and criminal cases. Thus, it is not impossible that the
criminal case, as well as the civil case in which a prejudicial question may rise, may be both pending in the same
court. For this reason, the elements of prejudicial question have been modified in such a way that the phrase
"pendency of the civil case in a different tribunal" has been eliminated.
36

The rule is that there is prejudicial question when (a) the previously instituted civil action involves an issue similar or
intimately related to the issue raised in the subsequent criminal action, and (b) the resolution of such issue
determines whether or not the criminal action may proceed.
37
It comes into play generally in a situation where a civil
action and a criminal action both pend and there exists in the former an issue which must be preemptively resolved
before the criminal action may proceed. This is so because howsoever the issue raised in the civil action is resolved
would be determinative juris et de jure of the guilt or innocence of the accused in the criminal case.
38

Here, no prejudicial question exists because there is no pending criminal case.
39
The consolidated NLRC cases
cannot be considered as "previously instituted civil action." In Berbari v. Concepcion,
40
it was held that a prejudicial
question is understood in law to be that which must precede the criminal action, that which requires a decision with
which said question is closely related.
Neither can the doctrine of prejudicial question be applied by analogy. The issue in the case filed by Dr.
Climaco with the SSC involves the question of whether or not he is an employee of Coca-Cola Bottlers (Phils.), Inc.
and subject to the compulsory coverage of the Social Security System. On the contrary, the cases filed by Dr.
Climaco before the NLRC involved different issues. In his first complaint,
41
Dr. Climaco sought recognition as a
regular employee of the company and demanded payment of his 13th month pay, cost of living allowance, holiday
pay, service incentive leave pay, Christmas bonus and all other benefits.
42
The second complaint
43
was for illegal
dismissal, with prayer for reinstatement to his former position as company physician of the companys Bacolod Plant,
without loss of seniority rights, with full payment of backwages, other unpaid benefits, and for payment of
damages.
44
Thus, the issues in the NLRC cases are not determinative of whether or not the SSC should proceed. It is
settled that the question claimed to be prejudicial in nature must be determinative of the case before the court.
45

There is no forum shopping.
Anent the second issue, petitioners posit that since the issues before the NLRC and the SSC are the same, the SSC
cannot make a ruling on the issue presented before it without necessarily having a direct effect on the issue before
the NLRC. It was patently erroneous, if not malicious, for Dr. Climaco to invoke the jurisdiction of the SSC through a
separate petition.
46
Thus, petitioners contend, Dr. Climaco was guilty of forum shopping.
Again, We turn down the contention.
Forum shopping is a prohibited malpractice and condemned as trifling with the courts and their processes.
47
It is
proscribed because it unnecessarily burdens the courts with heavy caseloads. It also unduly taxes the manpower and
financial resources of the judiciary. It mocks the judicial processes, thus, affecting the efficient administration of
justice.
48

The grave evil sought to be avoided by the rule against forum shopping is the rendition by two (2) competent tribunals
of two (2) separate and contradictory decisions. Unscrupulous litigants, taking advantage of a variety of competent
tribunals, may repeatedly try their luck in several different fora until a favorable result is reached.
49

It is well to note that forum shopping traces its origin in private international law on choice of venues, which later
developed to a choice of remedies. In First Philippine International Bank v. Court of Appeals,
50
the Court had
occasion to outline the origin of the rule on forum shopping. Said the Court:
x x x forum shopping originated as a concept in private international law, where non-resident litigants are given the
option to choose the forum or place wherein to bring their suit for various reasons or excuses, including to secure
procedural advantages, to annoy and harass the defendant, to avoid overcrowded dockets, or to select a more
friendly venue. To combat these less than honorable excuses, the principle of forum non conveniens was developed
whereby a court, in conflicts of law cases, may refuse impositions on its jurisdiction where it is not the most
"convenient" or available forum and the parties are not precluded from seeking remedies elsewhere.
x x x x
In the Philippines, forum shopping has acquired a connotation encompassing not only a choice of venues, as it was
originally understood in conflicts of laws, but also to a choice of remedies. As to the first (choice of venues), the Rules
of Court, for example, allow a plaintiff to commence personal actions "where the defendant or any of the defendants
resides or may be found, or where the plaintiff or any of the plaintiffs resides, at the election of the plaintiff" (Rule 4,
Sec. 2[b]). As to remedies, aggrieved parties, for example, are given a choice of pursuing civil liabilities independently
of the criminal, arising from the same set of facts. A passenger of a public utility vehicle involved in a vehicular
accident may sue on culpa contractual, culpa aquiliana or culpa criminal each remedy being available
independently of the others although he cannot recover more than once.
"In either of these situations (choice of venue or choice of remedy), the litigant actually shops for a forum of his
action. This was the original concept of the term forum shopping.
"Eventually, however, instead of actually making a choice of the forum of their actions, litigants, through the
encouragement of their lawyers, file their actions in all available courts, or invoke all relevant remedies
simultaneously. This practice had not only resulted to (sic) conflicting adjudications among different courts and
consequent confusion enimical (sic) to an orderly administration of justice. It had created extreme inconvenience to
some of the parties to the action.
"Thus, forum-shopping had acquired a different concept which is unethical professional legal practice. And this
necessitated or had given rise to the formulation of rules and canons discouraging or altogether prohibiting the
practice."
What therefore started both in conflicts of laws and in our domestic law as a legitimate device for solving problems
has been abused and misused to assure scheming litigants of dubious reliefs.
51

Thus, in order to prevent forum shopping, the 1997 Rules of Civil Procedure now provide:
SEC. 5. Certification against forum shopping. The plaintiff or principal party shall certify under oath in the complaint
or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed thereto and simultaneously
filed therewith: (a) that he has not theretofore commenced any action or filed any claim involving the same issues in
any court, tribunal or quasi-judicial agency and, to the best of his knowledge, no such other action or claim is pending
therein; (b) if there is such other pending action or claim, a complete statement of the present status thereof; and (c) if
he should thereafter learn that the same or similar action or claim has been filed or is pending, he shall report that
fact within five (5) days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed.
52

Forum shopping is not only strictly prohibited but also condemned. So much so that "[f]ailure to comply with the
foregoing requirements shall not be curable by mere amendment of the initiatory pleading but shall be cause for the
dismissal of the case without prejudice. The submission of a false certification or non-compliance with any of the
undertakings therein shall constitute indirect contempt of court, without prejudice to the corresponding administrative
and criminal actions. If the acts of the party or his counsel clearly constitute willful and deliberate forum shopping, the
same shall be ground for summary dismissal with prejudice and shall constitute direct contempt as well as a cause
for administrative sanctions."
53

There is forum shopping when one party repetitively avails of several judicial remedies in different courts,
simultaneously or successively, all substantially founded on the same transactions and the same essential facts and
circumstances, and all raising substantially the same issues either pending in, or already resolved adversely, by
some other court.
54
In short, forum shopping exists where the elements of litis pendentia are present or where a final
judgment in one case will amount to res judicata in the other.
55

There is res judicata when (1) there is a final judgment or order; (2) the court rendering it has jurisdiction over the
subject matter and the parties; (3) the judgment or order is on the merits; and (4) there is between the two cases
identity of parties, subject matter and causes of action.
56

Measured by the foregoing yardstick, Dr. Climaco is not guilty of forum shopping. While it is true that the parties are
identical in the NLRC and in the SSC, the reliefs sought and the causes of action are different.
Admittedly, Dr. Climacos basis in filing the cases before the NLRC and the SSC is his Retainer Agreement with the
company. This does not mean, however, that his causes of action are the same:
x x x Some authorities declare the distinction between demands or rights of action which are single and entire and
those which are several and distinct to be that the former arise out of one and the same act or contract and the latter
out of different acts or contracts. This rule has been declared to be unsound, however, and as evidence of its
unsoundness, reference has been made to the fact that several promissory notes may, and often do, grow out of one
and the same transaction, and yet they do not constitute an entire demand. The better rule is that the bare fact that
different demands spring out of the same or contract does not ipso facto render a judgment on one a bar to a suit on
another, however distinct. It is clear that the right of a plaintiff to maintain separate actions cannot be determined by
the fact that the claims might have been prosecuted in a single action. A plaintiff having separate demands against a
defendant may, at his election, join them in the same action, or he may prosecute them separately, subject of the
power of the court to order their consolidation. There may be only one cause of action although the plaintiff is entitled
to several forms and kinds of relief, provided there is not more than one primary right sought to be enforced or one
subject of controversy presented for adjudication.
57
(Underscoring supplied)
As the SSC and the CA correctly observed, different laws are applicable to the cases before the two tribunals. The
Labor Code and pertinent social legislations would govern the cases before the NLRC, while the Social Security Law
would govern the case before the SSC. Clearly, as the issues pending before the NLRC and the SSC are diverse, a
ruling on the NLRC cases would not amount to res judicata in the case before the SSC.
The elements of litis pendentia are absent.
Lastly, petitioners contend that the petition of Dr. Climaco before the SSC is defective because there were pending
actions between the same parties and involving the same issues in different fora.
58

For litis pendentia to exist, there must be (1) identity of the parties or at least such as representing the same interests
in both actions; (2) identity of the rights asserted and relief prayed for, the relief founded on the same facts; and (3)
identity of the two cases such that judgment in one, regardless of which party is successful, would amount to res
judicata in the other.
59

In the case under review, there is no litis pendentia to speak of. As previously explained, although the parties in the
cases before the NLRC and the SSC are similar, the nature of the cases filed, the rights asserted, and reliefs prayed
for in each tribunal, are different.lawp++il
As a last attempt, however, petitioners invoke Rule 16, Section 1(e) of the 1997 Rules of Civil Procedure. Petitioners
contend that the petition Dr. Climaco lodged with the SSC is "another action" prohibited by the Rule.
60

In Solancio v. Ramos,
61
the issue centered on whether the pending administrative case before the Bureau of Lands is
"another action," which would justify the dismissal of the complaint of plaintiff against defendants before the then
Court of First Instance (now RTC) of Cagayan. Ruling in the negative, the Court noted that "both parties as well as
the trial court have missed the extent or meaning of the ground of the motion to dismiss as contemplated under the
Rules of Court."
62
Mr. Justice Regala, who wrote the opinion of the Court, explained the phrase "another action" in
this wise:
This is not what is contemplated under the law because under Section 1(d), Rule 16 (formerly Rule 8) of the Rules of
Court, [now Rule 1, Section 16(e) of the Rules of Court, supra] one of the grounds for the dismissal of an action is
that "there is another action pending between the same parties for the same cause." Note that the Rule uses the
phrase "another action." This phrase should be construed in line with Section 1 of Rule 2, which defines the word
action, thus
"Action means an ordinary suit in a court of justice, by which one party prosecutes another for the enforcement or
protection of a right, or the prevention or redress of a wrong. Every other remedy is a special proceeding."
63

Evidently, there is no "another action" pending between petitioners and Dr. Climaco at the time when the latter filed a
petition before the SSC.
WHEREFORE, the petition is DENIED and the appealed decision AFFIRMED.
Costs against petitioners.
SO ORDERED.
RUBEN T. REYES
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice
MINITA V. CHICO-NAZARIO
Associate Justice
A T T E S T A T I O N
I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to
the writer of the opinion of the Courts Division.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution and the Division Chairpersons Attestation, I certify that the
conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the
opinion of the Courts Division.
REYNATO S. PUNO
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 184861 June 30, 2009
DREAMWORK CONSTRUCTION, INC., Petitioner,
vs.
CLEOFE S. JANIOLA and HON. ARTHUR A. FAMINI, Respondents.
D E C I S I O N
VELASCO, JR., J .:
The Case
Petitioner Dreamwork Construction, Inc. seeks the reversal of the August 26, 2008 Decision
1
in SCA No. 08-0005 of
the Regional Trial Court (RTC), Branch 253 in Las Pias City. The Decision affirmed the Orders dated October 16,
2007
2
and March 12, 2008
3
in Criminal Case Nos. 55554-61 issued by the Metropolitan Trial Court (MTC), Branch 79
in Las Pias City.
The Facts
On October 18, 2004, petitioner, through its President, Roberto S. Concepcion, and Vice-President for Finance and
Marketing, Normandy P. Amora, filed a Complaint Affidavit dated October 5, 2004
4
for violation of Batas Pambansa
Bilang 22 (BP 22) against private respondent Cleofe S. Janiola with the Office of the City Prosecutor of Las Pias
City. The case was docketed as I.S. No. 04-2526-33. Correspondingly, petitioner filed a criminal information for
violation of BP 22 against private respondent with the MTC on February 2, 2005 docketed as Criminal Case Nos.
55554-61, entitled People of the Philippines v. Cleofe S. Janiola.
On September 20, 2006, private respondent, joined by her husband, instituted a civil complaint against petitioner by
filing a Complaint dated August 2006
5
for the rescission of an alleged construction agreement between the parties, as
well as for damages. The case was filed with the RTC, Branch 197 in Las Pias City and docketed as Civil Case No.
LP-06-0197. Notably, the checks, subject of the criminal cases before the MTC, were issued in consideration of the
construction agreement.
Thereafter, on July 25, 2007, private respondent filed a Motion to Suspend Proceedings dated July 24, 2007
6
in
Criminal Case Nos. 55554-61, alleging that the civil and criminal cases involved facts and issues similar or intimately
related such that in the resolution of the issues in the civil case, the guilt or innocence of the accused would
necessarily be determined. In other words, private respondent claimed that the civil case posed a prejudicial question
as against the criminal cases.
Petitioner opposed the suspension of the proceedings in the criminal cases in an undated Comment/Opposition to
Accuseds Motion to Suspend Proceedings based on Prejudicial Question
7
on the grounds that: (1) there is no
prejudicial question in this case as the rescission of the contract upon which the bouncing checks were issued is a
separate and distinct issue from the issue of whether private respondent violated BP 22; and (2) Section 7, Rule 111
of the Rules of Court states that one of the elements of a prejudicial question is that "the previously instituted civil
action involves an issue similar or intimately related to the issue raised in the subsequent criminal action"; thus, this
element is missing in this case, the criminal case having preceded the civil case.
Later, the MTC issued its Order dated October 16, 2007, granting the Motion to Suspend Proceedings, and reasoned
that:
Should the trial court declare the rescission of contract and the nullification of the checks issued as the same are
without consideration, then the instant criminal cases for alleged violation of BP 22 must be dismissed. The belated
filing of the civil case by the herein accused did not detract from the correctness of her cause, since a motion for
suspension of a criminal action may be filed at any time before the prosecution rests (Section 6, Rule 111, Revised
Rules of Court).
8

In an Order dated March 12, 2008,
9
the MTC denied petitioners Motion for Reconsideration dated November 29,
2007.
Petitioner appealed the Orders to the RTC with a Petition dated May 13, 2008. Thereafter, the RTC issued the
assailed decision dated August 26, 2008, denying the petition. On the issue of the existence of a prejudicial question,
the RTC ruled:
Additionally, it must be stressed that the requirement of a "previously" filed civil case is intended merely to obviate
delays in the conduct of the criminal proceedings. Incidentally, no clear evidence of any intent to delay by private
respondent was shown. The criminal proceedings are still in their initial stages when the civil action was instituted.
And, the fact that the civil action was filed after the criminal action was instituted does not render the issues in the civil
action any less prejudicial in character.
10

Hence, we have this petition under Rule 45.
The Issue
WHETHER OR NOT THE COURT A QUO SERIOUSLY ERRED IN NOT PERCEIVING GRAVE ABUSE OF
DISCRETION ON THE PART OF THE INFERIOR COURT, WHEN THE LATTER RULED TO SUSPEND
PROCEEDINGS IN CRIM. CASE NOS. 55554-61 ON THE BASIS OF "PREJUDICIAL QUESTION" IN CIVIL CASE
NO. LP-06-0197.
11

The Courts Ruling
This petition must be granted.
The Civil Action Must Precede the Filing of the
Criminal Action for a Prejudicial Question to Exist
Under the 1985 Rules on Criminal Procedure, as amended by Supreme Court Resolutions dated June 17, 1988 and
July 7, 1988, the elements of a prejudicial question are contained in Rule 111, Sec. 5, which states:
SEC. 5. Elements of prejudicial question. The two (2) essential elements of a prejudicial question are: (a) the civil
action involves an issue similar or intimately related to the issue raised in the criminal action; and (b) the resolution of
such issue determines whether or not the criminal action may proceed.
Thus, the Court has held in numerous cases
12
that the elements of a prejudicial question, as stated in the above-
quoted provision and in Beltran v. People,
13
are:
The rationale behind the principle of prejudicial question is to avoid two conflicting decisions. It has two essential
elements: (a) the civil action involves an issue similar or intimately related to the issue raised in the criminal action;
and (b) the resolution of such issue determines whether or not the criminal action may proceed.
On December 1, 2000, the 2000 Rules on Criminal Procedure, however, became effective and the above provision
was amended by Sec. 7 of Rule 111, which applies here and now provides:
SEC. 7. Elements of prejudicial question.The elements of a prejudicial question are: (a) the previously instituted
civil action involves an issue similar or intimately related to the issue raised in the subsequent criminal action, and (b)
the resolution of such issue determines whether or not the criminal action may proceed. (Emphasis supplied.)
Petitioner interprets Sec. 7(a) to mean that in order for a civil case to create a prejudicial question and, thus, suspend
a criminal case, it must first be established that the civil case was filed previous to the filing of the criminal case. This,
petitioner argues, is specifically to guard against the situation wherein a party would belatedly file a civil action that is
related to a pending criminal action in order to delay the proceedings in the latter.
On the other hand, private respondent cites Article 36 of the Civil Code which provides:
Art. 36. Pre-judicial questions which must be decided before any criminal prosecution may be instituted or may
proceed, shall be governed by rules of court which the Supreme Court shall promulgate and which shall not be in
conflict with the provisions of this Code. (Emphasis supplied.)
Private respondent argues that the phrase "before any criminal prosecution may be instituted or may proceed" must
be interpreted to mean that a prejudicial question exists when the civil action is filed either before the institution of the
criminal action or during the pendency of the criminal action. Private respondent concludes that there is an apparent
conflict in the provisions of the Rules of Court and the Civil Code in that the latter considers a civil case to have
presented a prejudicial question even if the criminal case preceded the filing of the civil case.
We cannot agree with private respondent.
First off, it is a basic precept in statutory construction that a "change in phraseology by amendment of a provision of
law indicates a legislative intent to change the meaning of the provision from that it originally had."
14
In the instant
case, the phrase, "previously instituted," was inserted to qualify the nature of the civil action involved in a prejudicial
question in relation to the criminal action. This interpretation is further buttressed by the insertion of "subsequent"
directly before the term criminal action. There is no other logical explanation for the amendments except to qualify the
relationship of the civil and criminal actions, that the civil action must precede the criminal action.
Thus, this Court ruled in Torres v. Garchitorena
15
that:
Even if we ignored petitioners procedural lapse and resolved their petition on the merits, we hold that Sandiganbayan
did not abuse its discretion amounting to excess or lack of jurisdiction in denying their omnibus motion for the
suspension of the proceedings pending final judgment in Civil Case No. 7160. Section 6, Rule lll of the Rules of
Criminal Procedure, as amended, reads:
Sec. 6. Suspension by reason of prejudicial question. - A petition for suspension of the criminal action based upon the
pendency of a prejudicial question in a civil action may be filed in the office of the prosecutor or the court conducting
the preliminary investigation. When the criminal action has been filed in court for trial, the petition to suspend shall be
filed in the same criminal action at any time before the prosecution rests.
Sec. 7. Elements of prejudicial question. - The elements of a prejudicial question are: (a) the previously instituted civil
action involves an issue similar or intimately related to the issue raised in the subsequent criminal action, and (b) the
resolution of such issue determines whether or not the criminal action may proceed.
Under the amendment, a prejudicial question is understood in law as that which must precede the criminal action and
which requires a decision before a final judgment can be rendered in the criminal action with which said question is
closely connected. The civil action must be instituted prior to the institution of the criminal action. In this case, the
Information was filed with the Sandiganbayan ahead of the complaint in Civil Case No. 7160 filed by the State with
the RTC in Civil Case No. 7160. Thus, no prejudicial question exists. (Emphasis supplied.)
Additionally, it is a principle in statutory construction that "a statute should be construed not only to be consistent with
itself but also to harmonize with other laws on the same subject matter, as to form a complete, coherent and
intelligible system."
16
This principle is consistent with the maxim, interpretare et concordare leges legibus est optimus
interpretandi modus or every statute must be so construed and harmonized with other statutes as to form a uniform
system of jurisprudence.
17
1 a vv p h i l
In other words, every effort must be made to harmonize seemingly conflicting laws. It is only when harmonization is
impossible that resort must be made to choosing which law to apply.
In the instant case, Art. 36 of the Civil Code and Sec. 7 of Rule 111 of the Rules of Court are susceptible of an
interpretation that would harmonize both provisions of law. The phrase "previously instituted civil action" in Sec. 7 of
Rule 111 is plainly worded and is not susceptible of alternative interpretations. The clause "before any criminal
prosecution may be instituted or may proceed" in Art. 36 of the Civil Code may, however, be interpreted to mean that
the motion to suspend the criminal action may be filed during the preliminary investigation with the public prosecutor
or court conducting the investigation, or during the trial with the court hearing the case.
This interpretation would harmonize Art. 36 of the Civil Code with Sec. 7 of Rule 111 of the Rules of Court but also
with Sec. 6 of Rule 111 of the Civil Code, which provides for the situations when the motion to suspend the criminal
action during the preliminary investigation or during the trial may be filed. Sec. 6 provides:
SEC. 6. Suspension by reason of prejudicial question.A petition for suspension of the criminal action based upon
the pendency of a prejudicial question in a civil action may be filed in the office of the prosecutor or the court
conducting the preliminary investigation. When the criminal action has been filed in court for trial, the petition to
suspend shall be filed in the same criminal action at any time before the prosecution rests.
Thus, under the principles of statutory construction, it is this interpretation of Art. 36 of the Civil Code that should
govern in order to give effect to all the relevant provisions of law.
It bears pointing out that the circumstances present in the instant case indicate that the filing of the civil action and the
subsequent move to suspend the criminal proceedings by reason of the presence of a prejudicial question were a
mere afterthought and instituted to delay the criminal proceedings.
In Sabandal v. Tongco,
18
we found no prejudicial question existed involving a civil action for specific performance,
overpayment, and damages, and a criminal complaint for BP 22, as the resolution of the civil action would not
determine the guilt or innocence of the accused in the criminal case. In resolving the case, we said:
Furthermore, the peculiar circumstances of the case clearly indicate that the filing of the civil case was a ploy to delay
the resolution of the criminal cases. Petitioner filed the civil case three years after the institution of the criminal
charges against him. Apparently, the civil action was instituted as an afterthought to delay the proceedings in the
criminal cases.
19

Here, the civil case was filed two (2) years after the institution of the criminal complaint and from the time that private
respondent allegedly withdrew its equipment from the job site. Also, it is worth noting that the civil case was instituted
more than two and a half (2 ) years from the time that private respondent allegedly stopped construction of the
proposed building for no valid reason. More importantly, the civil case praying for the rescission of the construction
agreement for lack of consideration was filed more than three (3) years from the execution of the construction
agreement.
Evidently, as in Sabandal, the circumstances surrounding the filing of the cases involved here show that the filing of
the civil action was a mere afterthought on the part of private respondent and interposed for delay. And as correctly
argued by petitioner, it is this scenario that Sec. 7 of Rule 111 of the Rules of Court seeks to prevent. Thus, private
respondents positions cannot be left to stand.
The Resolution of the Civil Case Is Not
Determinative of the Prosecution of the Criminal Action
In any event, even if the civil case here was instituted prior to the criminal action, there is, still, no prejudicial question
to speak of that would justify the suspension of the proceedings in the criminal case.
To reiterate, the elements of a prejudicial question under Sec. 7 of Rule 111 of the Rules of Court are: (1) the
previously instituted civil action involves an issue similar or intimately related to the issue raised in the subsequent
criminal action; and (2) the resolution of such issue determines whether or not the criminal action may proceed.
Petitioner argues that the second element of a prejudicial question, as provided in Sec. 7 of Rule 111 of the Rules, is
absent in this case. Thus, such rule cannot apply to the present controversy.
Private respondent, on the other hand, claims that if the construction agreement between the parties is declared null
and void for want of consideration, the checks issued in consideration of such contract would become mere scraps of
paper and cannot be the basis of a criminal prosecution.
We find for petitioner.
It must be remembered that the elements of the crime punishable under BP 22 are as follows:
(1) the making, drawing, and issuance of any check to apply for account or for value;
(2) the knowledge of the maker, drawer, or issuer that at the time of issue there are no sufficient funds in or
credit with the drawee bank for the payment of such check in full upon its presentment; and
(3) the subsequent dishonor of the check by the drawee bank for insufficiency of funds or credit, or dishonor
for the same reason had not the drawer, without any valid cause, ordered the bank to stop payment.
20

Undeniably, the fact that there exists a valid contract or agreement to support the issuance of the check/s or that the
checks were issued for valuable consideration does not make up the elements of the crime. Thus, this Court has held
in a long line of cases
21
that the agreement surrounding the issuance of dishonored checks is irrelevant to the
prosecution for violation of BP 22. In Mejia v. People,
22
we ruled:
It must be emphasized that the gravamen of the offense charge is the issuance of a bad check. The purpose for
which the check was issued, the terms and conditions relating to its issuance, or any agreement surrounding such
issuance are irrelevant to the prosecution and conviction of petitioner. To determine the reason for which checks are
issued, or the terms and conditions for their issuance, will greatly erode the faith the public reposes in the stability and
commercial value of checks as currency substitutes, and bring havoc in trade and in banking communities. The clear
intention of the framers of B.P. 22 is to make the mere act of issuing a worthless check malum prohibitum.
Lee v. Court of Appeals
23
is even more poignant. In that case, we ruled that the issue of lack of valuable
consideration for the issuance of checks which were later on dishonored for insufficient funds is immaterial to the
success of a prosecution for violation of BP 22, to wit:
Third issue. Whether or not the check was issued on account or for value.
Petitioners claim is not feasible. We have held that upon issuance of a check, in the absence of evidence to the
contrary, it is presumed that the same was issued for valuable consideration. Valuable consideration, in turn, may
consist either in some right, interest, profit or benefit accruing to the party who makes the contract, or some
forbearance, detriment, loss or some responsibility, to act, or labor, or service given, suffered or undertaken by the
other side. It is an obligation to do, or not to do in favor of the party who makes the contract, such as the maker or
indorser.
In this case, petitioner himself testified that he signed several checks in blank, the subject check included, in
exchange for 2.5% interest from the proceeds of loans that will be made from said account. This is a valuable
consideration for which the check was issued. That there was neither a pre-existing obligation nor an obligation
incurred on the part of petitioner when the subject check was given by Bautista to private complainant on July 24,
1993 because petitioner was no longer connected with Unlad or Bautista starting July 1989, cannot be given merit
since, as earlier discussed, petitioner failed to adequately prove that he has severed his relationship with Bautista or
Unlad.
At any rate, we have held that what the law punishes is the mere act of issuing a bouncing check, not the purpose for
which it was issued nor the terms and conditions relating to its issuance. This is because the thrust of the law is to
prohibit the making of worthless checks and putting them into circulation.
24
(Emphasis supplied.)
Verily, even if the trial court in the civil case declares that the construction agreement between the parties is void for
lack of consideration, this would not affect the prosecution of private respondent in the criminal case. The fact of the
matter is that private respondent indeed issued checks which were subsequently dishonored for insufficient funds. It
is this fact that is subject of prosecution under BP 22.lawphil.net
Therefore, it is clear that the second element required for the existence of a prejudicial question, that the resolution of
the issue in the civil action would determine whether the criminal action may proceed, is absent in the instant case.
Thus, no prejudicial question exists and the rules on it are inapplicable to the case before us.
WHEREFORE, we GRANT this petition. We hereby REVERSE and SET ASIDE the August 26, 2008 Decision in
SCA No. 08-0005 of the RTC, Branch 253 in Las Pias City and the Orders dated October 16, 2007 and March 12,
2008 in Criminal Case Nos. 55554-61 of the MTC, Branch 79 in Las Pias City. We order the MTC to continue with
the proceedings in Criminal Case Nos. 55554-61 with dispatch.
No costs.
SO ORDERED.
PRESBITERO J. VELASCO, JR.
Associate Justice
WE CONCUR:
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
MINITA V. CHICO-NAZARIO
Associate Justice
ANTONIO EDUARDO B. NACHURA
Associate Justice
DIOSDADO M. PERALTA
Associate Justice
A T T E S T A T I O N
I attest that the conclusions in the above Decision had been reached in consultation before the case was assigned to
the writer of the opinion of the Courts Division.
CONSUELO YNARES-SANTIAGO
Associate Justice
Chairperson
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairpersons Attestation, I certify that the
conclusions in the above Decision had been reached in consultation before the case was assigned to the writer of the
opinion of the Courts Division.
REYNATO S. PUNO
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
FIRST DIVISION

G.R. No. 120600 September 22, 1998
ERNESTO C. DAWSON, LOUIS P. DAWSON, JR., BENJAMIN C. DAWSON, JOSEPHINE DAWSON SOLIVEN,
RALPH D. CUDILLA, ELIZA C. ISIP and LARRY D. ISIP, petitioners,
vs.
REGISTER OF DEEDS OF QUEZON CITY and JUDGE OF REGIONAL TRIAL COURT OF QUEZON CITY,
BRANCH 85, respondents.

PANGANIBAN, J .:
In a contract to sell, the title over the subject property vests in the vendee only upon full payment of the consideration.
Where the installments agreed on have not been completely paid upon the death of the original vendee and the
certificate of title was erroneously issued in his name, his heirs, who assumed his obligations and completed the
payment, can resort to the summary proceedings under Section 108 of Presidential Decree (PD) 1529 to correct the
manifest mistake.
The Case
Before us is; a petition for review assailing the February 9, 1995 Decision and the May 29, 1995 Resolution of the
Court of Appeals
1
in CA-GR SP No. 34515 entitled "Dr. Ernesto Dawson, et. al., v. Register of Deeds of Quezon
City, Judge of RTC, QC, Branch 85." The assailed Decision affirmed the Resolution
2
of the trial court
3
dated
December 29, 1993 in LRC Case No. Q-6403 (93), dismissing the petition for cancellation of Transfer Certificate of
Title (TCT) No. RT-58706 (248057). The May 29, 1995 Resolution denied petitioners' Motion for Reconsideration.
The Facts
The undisputed facts, as summarized by Respondent Court of Appeals, are reproduced hereunder:
4

On October 7, 1993, the petitioners herein filed a petition with the Regional Trial Court in Quezon City alleging, inter
alia, the following:
On May 2, 1967, during his lifetime. Louis P. Dawson offered to buy on installment from the
SISKA DEVELOPMENT CORPORATION, per contract to sell, a parcel of land in Quezon City,
consisting of 638 square meters for P27,632.00, now covered by Transfer Certificate of Title No.
RT-58706 (248057);
On June 3, 1971, Louis P. Dawson died intestate;
Upon his death, the petitioners assumed the rights and obligations of deceased Louis P.
Dawson in the aforementioned contract to sell, paying in full the selling price of the lot from their
own funds, which payment was completed in 1978;
With said full payment, vendor SISKA DEVELOPMENT CORPORATION executed on March 16,
1978 a deed of absolute sale in favor of deceased Louis P. Dawson who had died seven (7) years
earlier, instead of in favor of the petitioners who assumed and to whom [were] transferred the rights
and obligations of deceased Louis P. Dawson upon the latter's death;
Because of the obvious error, Transfer Certificate of Title No. RT-58706 (248057) was issued in
the name of deceased Louis P. Dawson instead of those of petitioners hence, the petition for the
cancellation and correction of TCT No. RT - 58706 (248057) in the name of Louis P. Dawson and
the issuance of a new title in the names of herein petitioners, to wit: Dr. Ernesto C. Dawson (1/5),
Louis P. Dawson, Jr. (1/5), Benjamin C. Dawson (1/5), Josephine Dawson Soliven (1/5), Ralph D.
Cudilla (1/15), Eliza C. Isip (1/15) and Larry D. Cudilla (1/15);
this petition is filed pursuant to Section 108 of P.D. 1529 (formerly Section 112 of Act No. 496);
the herein petition is not without legal precedent;
the petition is not controversial, considering the unanimity among all the interested parties, who
are all petitioners herein, being the only surviving heirs of deceased Louis P. Dawson. (pages 1-6
of the Record).
On December 1, 1993, the respondent court issued an Order allowing the petitioners to present ex-
parte their evidence before the Branch Clerk of Court. (page 16 of the Record).
On December 20, 1993, the respondent court rendered its first assailed Resolution (pages 36-38 thereof), the
dispositive portion of which was earlier quoted.
On February 2, 1993, the petitioner herein filed a motion for reconsideration (pages 39-48 of the
Record) from the afore-quoted Resolution of the respondent court.
Said motion was denied by the respondent court in its second assailed Order (dated March 21,
1994) which was earlier quoted.
Hence, this petition for review.
5

Ruling of the Court of Appeals
In affirming the dismissal of the petition for cancellation of TCT No. RT-58706 (248057), the Court of Appeals held
that the summary proceedings under Section 108, PD 1529, do not apply to the present case, viz.:
Petitioners' contention that the respondent court erred in holding that Section 108 of Presidential
Decree No. 1529 "does not apply" was torpedoed by the following:
Wrong Action. Petitioners' evidence showed that their father, Louis P. Dawson, died on June 3,
1971 (Exhibit 'D'), while the deed of absolute sale for the subject parcel was executed on March 16,
1978 by the Siska Development. Corporation in favor of Louis P. Dawson, (Exhibit 'E'). It was on
this basis that a certificate of title (TCT No. RT-58706) was issued in the name of Louis P. Dawson,
which title was entered at the Office of the Register of Deeds in Quezon City on August 17, 1978.
As per the tax declaration and real property tax bill, the subject parcel is still in the name of Louis P.
Dawson (pages 23-24, tsn of December 8, 1993), although his wife (Soledad Dawson) died in 1988
(Exhibit 'I'). We are intrigued why the petitioners only took action by filing the petition for
cancellation of the certificate of title in their father's name only on October 7, 1993. Was it designed
to evade the payment of the necessary taxes to the government?
Legal shortcut. As aptly observed by the respondent court in its assailed resolution, "the case at
bar pertains more to the partition of the estate which will in effect transfer ownership of title of the
property to the petitioners as compulsory heirs of the decedent." Hence, Section 108 of Presidential
Decree No. 1529 (which calls for summary proceedings) does not apply. Certainly, to allow
petitioners' move will open the floodgate [of] tax evasion[s]. Petitioners' posture can be likened to a
petition seeking to change/alter one's paternity or citizenship by merely seeking the
correction/revision of birth certificate. Such is not allowable there must be a petition for
naturalization. In the case at bench, [w]e further took note of the fact that the wife of the property
owner (Soledad Dawson) died in 1988, almost ten years after a certificate of title was issued by the
respondent Register of Deeds in the name of Louis P. Dawson.
With the foregoing, [w]e find no error committed by the respondent court in handing down its
assailed resolution (dated December 20, 1993) and Order (dated March 21, 1994). The law abhors
shortcuts.
6

The Issue
Petitioners submit, for the consideration of the Court, a single issue:
The Court of Appeals erred in affirming that Section 108 of P.D. 1529 does not apply herein.
The Court's Ruling
The petition is meritorious.
Sole Issue: Applicability of Section 108, PD 1529
Sec. 108 of PD 1529 reads:
Sec. 108. Amendment and alteration of certificates. No erasure, alteration, or amendment shall
be made upon the registration book after the entry of a certificate of title or of a memorandum
thereon and the attestation of the same by the Register of Deeds, except by order of the proper
Court of First Instance. A registered owner or other person having an interest in registered
property, or, in proper cases, the Register of Deeds with the approval of the Commissioner of Land
Registration, may apply by petition to the court upon the ground that the registered interests of any
description, whether vested, contingent, expectant or inchoate appearing on the certificate, have
terminated and ceased; or that [a] new interest not appearing upon the certificate have arisen or
been created; or that an omission or error was made in entering a certificate or any memorandum
thereon, or on any duplicate certificate; or that the name of any person on the certificate has been
changed; or that the registered owner has married, or, if registered as married, that the marriage
has been terminated and no right or interest of heirs or creditors will thereby be affected; or that a
corporation which owned registered land and has been dissolved has not conveyed the same
within three years after its dissolution; or upon any other reasonable ground; and the court may
hear and determine the petition after notice to all parties in interest, and may order the entry or
cancellation of a new certificate, the entry or cancellation of a memorandum upon a certificate, or
grant any other relief upon such terms and conditions, requiring security or bond if necessary, as it
may consider proper; Provided, however, that this section shall not be construed to give the court
authority to reopen the judgment or decree of registration, and that nothing shall be done or
ordered by the court which shall impair the title or other interest of a purchaser holding a certificate
for value in good faith, or his heirs and assigns, without his or their written consent. Where the
owner's duplicate certificate is not presented, a similar petition may be filed as provided in the
preceding section.
All petitions or motions filed under this section as well as under any other provision of this Decree
after original registration shall be filed and entitled in the original case in which the decree or
registration was
entered.
7

Petitioners contend that, as the sole heirs of Louis P. Dawson, they assumed upon his death in 1971 the obligations
under the contract to sell that he had entered into in 1967. Thus, when the contract price was fully paid by them in
1978, ownership over the property in question should have been transferred to them, and not to the deceased, Louis
P. Dawson. Since the issuance of the aforesaid TCT in the name of the deceased was manifestly an error, petitioners
posit that they can avail of the remedy provided under the aforecited statutory provision.
On the other hand, the Court of Appeals and the trial court ruled that petitioners could not avail themselves of the
summary proceedings under the said provision, because the present controversy involved not the cancellation of a
certificate of title but the partition of the estate of the deceased.
In his Comment
8
dated May 8, 1996 and Memorandum
9
dated May 5, 1998, the Office of the Solitor General sides
with petitioners and argues that, under the given factual circumstances, a resort to Section 108 of PD 1529 is proper.
We agree with both the petitioners and the solicitor general.
On May 2, 1967, Louis P. Dawson and Siska Development Corporation executed a contract to sell, the subject of
which was the parcel of land in question. By the nature of a contract to sell, the title over the subject property is
transferred to the vendee only upon the full payment of the stipulated consideration. Unlike in a contract of sale, the
title does not pass to the vendee upon the execution of the agreement or the delivety of the thing sold. InSalazar v.
Court of Appeals,
10
this Court explained the distinction between a contract to sell and a contract of sale:
In a contract of sale, the title to the property passes to the vendee upon the delivery of the thing
sold; in a contract to sell, ownership is, by agreement, reserved in the vendor and is not to pass to
the vendee until full payment of the purchase price. Otherwise stated, in a contract of sale, the
vendor loses ownership over the property and cannot recover it until and unless the contract is
resolved or rescinded; whereas in a contract to sell, title is retained by the vendor until full payment
of the price. In the latter contract, payment of the price is a positive suspensive condition, failure of
which is not a breach but an event that prevents the obligation of the vendor to convey title from
becoming effective.
It is undisputed that Louis P. Dawson died in June 1971, without having completed the installments on the property.
His heirs, herein petitioners, then took over the contrac to sell, assumed his obligations by paying the selling price of
the lot from their own funds, and completed the payment in 1978. Accordingly, the ownership of the lot had not been
vested in Louis P. Dawson during his lifetime.
Indeed, on March 16, 1978, Siska Development Corporation could not have transferred the title over the lot, through
a Deed of Absolute Sale, to Louis P. Dawson who had died seven years earlier in 1971. In 1978, the deceased had
no more civil personality or juridical capacity.
11
"His juridical capacity, which is the fitness to be the subject of legal
relations, was lost through death."
12

In other words, the said property did not become part of the estate of Louis P Dawson. Necessarily, partition is not
the remedy to determine ownership thereof and to consolidate title in herein petitioners.
Hence, we agree with the following assertion of the solicitor general: "Having stepped into the shoes of the deceased
Louis P. Dawson upon his death in June, 1971 with respect to the said contract, and being the ones who continued
the installment payments of the selling price from their own funds until its full payment in 1978, petitioners necessarily
became the lawful owners of the said lot in whose favor the deed of absolute sale should have been executed by
vendor Siska Development Corporation."
13

In view of the circumstances of this case, Section 108 of PD is clearly available as a remedy to correct the erroneous
issuance of the subject TCT in the name of Louis P. Dawson. The issue is not really novel. Faced with substantially
similar facts in Cruz v. Tan,
14
this Court also allowed the application of Section 112 of the Public Land Act, which is
identical to Section 108 of PD 1529. A translation of the said case from Spanish reads:
15

Simeon de la Cruz purchased a parcel of land on a ten-year installment basis. He died in 1939 and
his wife died in 1942, leaving three children. The vendor of the land executed the corresponding
deed of sale over the land in 1950 upon completion of the payment. The transfer certificate of title
was then issued in the name of the deceased buyer, Simeon de la Cruz. Petitioner filed this petition
under the original land registration case praying that the court order the Register of Deeds to
substitute the name of Regino de la Cruz, petitioner herein, for that of Simeon de la Cruz in the
transfer certificate of title. Petitioner claimed that Simeon during his lifetime transferred all rights
over, the land to him. The petition carried the conformity of the heirs of the deceased Simeon de la
Cruz. Respondent court denied the petition on the ground that the substitution of owners cannot be
ordered by the court acting on its jurisdiction granted by the Land Registration Law, because
Simeon de la Cruz and Regino de la Cruz are two different persons. The court also said that the
petition should be brought before an ordinary court for the protection of the interested parties.
Held: The danger that respondent judge feared that other interested parties might be prejudiced of
their rights is remote, considering that the heirs of Simeon de la Cruz signified their conformity to
the petition. Intestate proceedings are not necessary when the heirs have amicably settled the
estate among themselves and when the deceased left no debts. Section 112 of the Land
Registration Law (now Section 108 of Presidential Decree No. 1529) authorizes the court upon
proper petition and notification to order the cancellation of a certificate of title and substitute the
name of the person who appears to be entitled to the property. The order of respondent judge is
revoked and the Register of Deeds is ordered to make the necessary substitution.
Accordingly, petitioners may avail of the remedy provided under Section 108 of PD 1529. This, however, does not
necessarily mean that they are automatically entitled to the relief prayed for the cancellation of the title issued in
the name of Louis P. Dawson and the issuance of new titles. It is incumbent upon them to satisfy the requirements
and conditions prescribed under the statutory provision.
Respondent Court questioned the filing of the petition for cancellation only in 1993, hinting that the remedy was
"designed to evade the payment of the necessary taxes to the government." Respondent Court, however, failed to
state which taxes petitioners sought to avoid. Although they are required to pay capital gains tax and, thereafter, real
estate tax, there is no showing that said taxes have not been paid. Thus, we cannot withhold the relief prayed for by
petitioners, merely on the basis of some speculation of improper motivation.
WHEREFORE, the petition is GRANTED and the assailed Decision is REVERSED and SET ASIDE. The Regional
Trial Court of Quezon City is ORDERED to cause the cancellation of TCT No. RT-58706 (248057) issued in the name
of Louis P. Dawson and to cause the issuance, in lieu thereof, of a new certificate of title in the names of the
petitioners as co-owners of the subject property, after said petitioners have fulfilled the requirements stated in Section
108 of PD 1529. No cost.
SO ORDERED.
Davide, Jr., and Quisumbing, JJ., concur.
Bellosillo and Vitug, JJ., in the result.
Republic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 182836 October 13, 2009
CONTINENTAL STEEL MANUFACTURING CORPORATION, Petitioner,
vs.
HON. ACCREDITED VOLUNTARY ARBITRATOR ALLAN S. MONTAO and NAGKAKAISANG MANGGAGAWA
NG CENTRO STEEL CORPORATION-SOLIDARITY OF UNIONS IN THE PHILIPPINES FOR EMPOWERMENT
AND REFORMS (NMCSC-SUPER), Respondents.
D E C I S I O N
CHICO-NAZARIO, J .:
Before Us is a Petition for Review on Certiorari, under Rule 45 of the Rules of Court, assailing the Decision
1
dated 27
February 2008 and the Resolution
2
dated 9 May 2008 of the Court of Appeals in CA-G.R. SP No. 101697, affirming
the Resolution
3
dated 20 November 2007 of respondent Accredited Voluntary Arbitrator Atty. Allan S. Montao
(Montao) granting bereavement leave and other death benefits to Rolando P. Hortillano (Hortillano), grounded on
the death of his unborn child.
The antecedent facts of the case are as follows:
Hortillano, an employee of petitioner Continental Steel Manufacturing Corporation (Continental Steel) and a member
of respondent Nagkakaisang Manggagawa ng Centro Steel Corporation-Solidarity of Trade Unions in the Philippines
for Empowerment and Reforms (Union) filed on 9 January 2006, a claim for Paternity Leave, Bereavement Leave and
Death and Accident Insurance for dependent, pursuant to the Collective Bargaining Agreement (CBA) concluded
between Continental and the Union, which reads:
ARTICLE X: LEAVE OF ABSENCE
x x x x
Section 2. BEREAVEMENT LEAVEThe Company agrees to grant a bereavement leave with pay to any employee
in case of death of the employees legitimate dependent (parents, spouse, children, brothers and sisters) based on
the following:
2.1 Within Metro Manila up to Marilao, Bulacan - 7 days
2.2 Provincial/Outside Metro Manila - 11 days
x x x x
ARTICLE XVIII: OTHER BENEFITS
x x x x
Section 4. DEATH AND ACCIDENT INSURANCEThe Company shall grant death and accidental insurance to the
employee or his family in the following manner:
x x x x
4.3 DEPENDENTSEleven Thousand Five Hundred Fifty Pesos (Php11,550.00) in case of death of the employees
legitimate dependents (parents, spouse, and children). In case the employee is single, this benefit covers the
legitimate parents, brothers and sisters only with proper legal document to be presented (e.g. death certificate).
4

The claim was based on the death of Hortillanos unborn child. Hortillanos wife, Marife V. Hortillano, had a premature
delivery on 5 January 2006 while she was in the 38th week of pregnancy.
5
According to the Certificate of Fetal Death
dated 7 January 2006, the female fetus died during labor due to fetal Anoxia secondary to uteroplacental
insufficiency.
6

Continental Steel immediately granted Hortillanos claim for paternity leave but denied his claims for bereavement
leave and other death benefits, consisting of the death and accident insurance.
7

Seeking the reversal of the denial by Continental Steel of Hortillanos claims for bereavement and other death
benefits, the Union resorted to the grievance machinery provided in the CBA. Despite the series of conferences held,
the parties still failed to settle their dispute,
8
prompting the Union to file a Notice to Arbitrate before the National
Conciliation and Mediation Board (NCMB) of the Department of Labor and Employment (DOLE), National Capital
Region (NCR).
9
In a Submission Agreement dated 9 October 2006, the Union and Continental Steel submitted for
voluntary arbitration the sole issue of whether Hortillano was entitled to bereavement leave and other death benefits
pursuant to Article X, Section 2
and Article XVIII, Section 4.3 of the CBA.
10
The parties mutually chose Atty. Montao, an Accredited Voluntary
Arbitrator, to resolve said issue.
11

When the preliminary conferences again proved futile in amicably settling the dispute, the parties proceeded to
submit their respective Position Papers,
12
Replies,
13
and Rejoinders
14
to Atty. Montao.
The Union argued that Hortillano was entitled to bereavement leave and other death benefits pursuant to the CBA.
The Union maintained that Article X, Section 2 and Article XVIII, Section 4.3 of the CBA did not specifically state that
the dependent should have first been born alive or must have acquired juridical personality so that his/her
subsequent death could be covered by the CBA death benefits. The Union cited cases wherein employees of MKK
Steel Corporation (MKK Steel) and Mayer Steel Pipe Corporation (Mayer Steel), sister companies of Continental
Steel, in similar situations as Hortillano were able to receive death benefits under similar provisions of their CBAs.
The Union mentioned in particular the case of Steve L. Dugan (Dugan), an employee of Mayer Steel, whose wife also
prematurely delivered a fetus, which had already died prior to the delivery. Dugan was able to receive paternity leave,
bereavement leave, and voluntary contribution under the CBA between his union and Mayer Steel.
15
Dugans child
was only 24 weeks in the womb and died before labor, as opposed to Hortillanos child who was already 37-38 weeks
in the womb and only died during labor.
The Union called attention to the fact that MKK Steel and Mayer Steel are located in the same compound as
Continental Steel; and the representatives of MKK Steel and Mayer Steel who signed the CBA with their respective
employees unions were the same as the representatives of Continental Steel who signed the existing CBA with the
Union.
Finally, the Union invoked Article 1702 of the Civil Code, which provides that all doubts in labor legislations and labor
contracts shall be construed in favor of the safety of and decent living for the laborer.
On the other hand, Continental Steel posited that the express provision of the CBA did not contemplate the death of
an unborn child, a fetus, without legal personality. It claimed that there are two elements for the entitlement to the
benefits, namely: (1) death and (2) status as legitimate dependent, none of which existed in Hortillanos case.
Continental Steel, relying on Articles 40, 41 and 42
16
of the Civil Code, contended that only one with civil personality
could die. Hence, the unborn child never died because it never acquired juridical personality. Proceeding from the
same line of thought, Continental Steel reasoned that a fetus that was dead from the moment of delivery was not a
person at all. Hence, the term dependent could not be applied to a fetus that never acquired juridical personality. A
fetus that was delivered dead could not be considered a dependent, since it never needed any support, nor did it ever
acquire the right to be supported.
Continental Steel maintained that the wording of the CBA was clear and unambiguous. Since neither of the parties
qualified the terms used in the CBA, the legally accepted definitions thereof were deemed automatically accepted by
both parties. The failure of the Union to have unborn child included in the definition of dependent, as used in the CBA
the death of whom would have qualified the parent-employee for bereavement leave and other death benefits
bound the Union to the legally accepted definition of the latter term.
Continental Steel, lastly, averred that similar cases involving the employees of its sister companies, MKK Steel and
Mayer Steel, referred to by the Union, were irrelevant and incompetent evidence, given the separate and distinct
personalities of the companies. Neither could the Union sustain its claim that the grant of bereavement leave and
other death benefits to the parent-employee for the loss of an unborn child constituted "company practice."
On 20 November 2007, Atty. Montao, the appointed Accredited Voluntary Arbitrator, issued a Resolution
17
ruling
that Hortillano was entitled to bereavement leave with pay and death benefits.
Atty. Montao identified the elements for entitlement to said benefits, thus:
This Office declares that for the entitlement of the benefit of bereavement leave with pay by the covered employees
as provided under Article X, Section 2 of the parties CBA, three (3) indispensable elements must be present: (1)
there is "death"; (2) such death must be of employees "dependent"; and (3) such dependent must be "legitimate".
On the otherhand, for the entitlement to benefit for death and accident insurance as provided under Article XVIII,
Section 4, paragraph (4.3) of the parties CBA, four (4) indispensable elements must be present: (a) there is "death";
(b) such death must be of employees "dependent"; (c) such dependent must be "legitimate"; and (d) proper legal
document to be presented.
18

Atty. Montao found that there was no dispute that the death of an employees legitimate dependent occurred. The
fetus had the right to be supported by the parents from the very moment he/she was conceived. The fetus had to rely
on another for support; he/she could not have existed or sustained himself/herself without the power or aid of
someone else, specifically, his/her mother. Therefore, the fetus was already a dependent, although he/she died
during the labor or delivery. There was also no question that Hortillano and his wife were lawfully married, making
their dependent, unborn child, legitimate.
In the end, Atty. Montao decreed:
WHEREFORE, premises considered, a resolution is hereby rendered ORDERING [herein petitioner Continental
Steel] to pay Rolando P. Hortillano the amount of Four Thousand Nine Hundred Thirty-Nine Pesos (P4,939.00),
representing his bereavement leave pay and the amount of Eleven Thousand Five Hundred Fifty Pesos (P11,550.00)
representing death benefits, or a total amount of P16,489.00
The complaint against Manuel Sy, however, is ORDERED DISMISSED for lack of merit.
All other claims are DISMISSED for lack of merit.
Further, parties are hereby ORDERED to faithfully abide with the herein dispositions.
Aggrieved, Continental Steel filed with the Court of Appeals a Petition for Review on Certiorari,
19
under Section 1,
Rule 43 of the Rules of Court, docketed as CA-G.R. SP No. 101697.
Continental Steel claimed that Atty. Montao erred in granting Hortillanos claims for bereavement leave with pay and
other death benefits because no death of an employees dependent had occurred. The death of a fetus, at whatever
stage of pregnancy, was excluded from the coverage of the CBA since what was contemplated by the CBA was the
death of a legal person, and not that of a fetus, which did not acquire any juridical personality. Continental Steel
pointed out that its contention was bolstered by the fact that the term death was qualified by the phrase legitimate
dependent. It asserted that the status of a child could only be determined upon said childs birth, otherwise, no such
appellation can be had. Hence, the conditions sine qua non for Hortillanos entitlement to bereavement leave and
other death benefits under the CBA were lacking.
The Court of Appeals, in its Decision dated 27 February 2008, affirmed Atty. Montaos Resolution dated 20
November 2007. The appellate court interpreted death to mean as follows:
[Herein petitioner Continental Steels] exposition on the legal sense in which the term "death" is used in the CBA fails
to impress the Court, and the same is irrelevant for ascertaining the purpose, which the grant of bereavement leave
and death benefits thereunder, is intended to serve. While there is no arguing with [Continental Steel] that the
acquisition of civil personality of a child or fetus is conditioned on being born alive upon delivery, it does not follow
that such event of premature delivery of a fetus could never be contemplated as a "death" as to be covered by the
CBA provision, undoubtedly an event causing loss and grief to the affected employee, with whom the dead fetus
stands in a legitimate relation. [Continental Steel] has proposed a narrow and technical significance to the term
"death of a legitimate dependent" as condition for granting bereavement leave and death benefits under the CBA.
Following [Continental Steels] theory, there can be no experience of "death" to speak of. The Court, however, does
not share this view. A dead fetus simply cannot be equated with anything less than "loss of human life", especially for
the expectant parents. In this light, bereavement leave and death benefits are meant to assuage the employee and
the latters immediate family, extend to them solace and support, rather than an act conferring legal status or
personality upon the unborn child. [Continental Steels] insistence that the certificate of fetal death is for statistical
purposes only sadly misses this crucial point.
20

Accordingly, the fallo of the 27 February 2008 Decision of the Court of Appeals reads:
WHEREFORE, premises considered, the present petition is hereby DENIED for lack of merit. The assailed
Resolution dated November 20, 2007 of Accredited Voluntary Arbitrator Atty. Allan S. Montao is hereby AFFIRMED
and UPHELD.
With costs against [herein petitioner Continental Steel].
21

In a Resolution
22
dated 9 May 2008, the Court of Appeals denied the Motion for Reconsideration
23
of Continental
Steel.
Hence, this Petition, in which Continental Steel persistently argues that the CBA is clear and unambiguous, so that
the literal and legal meaning of death should be applied. Only one with juridical personality can die and a dead fetus
never acquired a juridical personality.
We are not persuaded.
As Atty. Montao identified, the elements for bereavement leave under Article X, Section 2 of the CBA are: (1) death;
(2) the death must be of a dependent, i.e., parent, spouse, child, brother, or sister, of an employee; and (3) legitimate
relations of the dependent to the employee. The requisites for death and accident insurance under Article XVIII,
Section 4(3) of the CBA are: (1) death; (2) the death must be of a dependent, who could be a parent, spouse, or child
of a married employee; or a parent, brother, or sister of a single employee; and (4) presentation of the proper legal
document to prove such death, e.g., death certificate.
It is worthy to note that despite the repeated assertion of Continental Steel that the provisions of the CBA are clear
and unambiguous, its fundamental argument for denying Hortillanos claim for bereavement leave and other death
benefits rests on the purportedly proper interpretation of the terms "death" and "dependent" as used in the CBA. If the
provisions of the CBA are indeed clear and unambiguous, then there is no need to resort to the interpretation or
construction of the same. Moreover, Continental Steel itself admitted that neither management nor the Union sought
to define the pertinent terms for bereavement leave and other death benefits during the negotiation of the CBA.
The reliance of Continental Steel on Articles 40, 41 and 42 of the Civil Code for the legal definition of death is
misplaced. Article 40 provides that a conceived child acquires personality only when it is born, and Article 41 defines
when a child is considered born. Article 42 plainly states that civil personality is extinguished by death.
First, the issue of civil personality is not relevant herein. Articles 40, 41 and 42 of the Civil Code on natural persons,
must be applied in relation to Article 37 of the same Code, the very first of the general provisions on civil personality,
which reads:
Art. 37. Juridical capacity, which is the fitness to be the subject of legal relations, is inherent in every natural person
and is lost only through death. Capacity to act, which is the power to do acts with legal effect, is acquired and may be
lost.
We need not establish civil personality of the unborn child herein since his/her juridical capacity and capacity to act as
a person are not in issue. It is not a question before us whether the unborn child acquired any rights or incurred any
obligations prior to his/her death that were passed on to or assumed by the childs parents. The rights to
bereavement leave and other death benefits in the instant case pertain directly to the parents of the unborn child
upon the latters death.
Second, Sections 40, 41 and 42 of the Civil Code do not provide at all a definition of death. Moreover, while the Civil
Code expressly provides that civil personality may be extinguished by death, it does not explicitly state that only those
who have acquired juridical personality could die.
And third, death has been defined as the cessation of life.
24
Life is not synonymous with civil personality. One need
not acquire civil personality first before he/she could die. Even a child inside the womb already has life. No less than
the Constitution recognizes the life of the unborn from conception,
25
that the State must protect equally with the life of
the mother. If the unborn already has life, then the cessation thereof even prior to the child being delivered, qualifies
as death.
Likewise, the unborn child can be considered a dependent under the CBA. As Continental Steel itself defines, a
dependent is "one who relies on another for support; one not able to exist or sustain oneself without the power or aid
of someone else." Under said general definition,
26
even an unborn child is a dependent of its parents. Hortillanos
child could not have reached 38-39 weeks of its gestational life without depending upon its mother, Hortillanos wife,
for sustenance. Additionally, it is explicit in the CBA provisions in question that the dependent may be the parent,
spouse, or child of a married employee; or the parent, brother, or sister of a single employee. The CBA did not
provide a qualification for the child dependent, such that the child must have been born or must have acquired civil
personality, as Continental Steel avers. Without such qualification, then child shall be understood in its more general
sense, which includes the unborn fetus in the mothers womb.
The term legitimate merely addresses the dependent childs status in relation to his/her parents. In Angeles v.
Maglaya,
27
we have expounded on who is a legitimate child, viz:
A legitimate child is a product of, and, therefore, implies a valid and lawful marriage. Remove the element of lawful
union and there is strictly no legitimate filiation between parents and child. Article 164 of the Family Code cannot be
more emphatic on the matter: "Children conceived or born during the marriage of the parents are legitimate."
(Emphasis ours.)
Conversely, in Briones v. Miguel,
28
we identified an illegitimate child to be as follows:
The fine distinctions among the various types of illegitimate children have been eliminated in the Family Code. Now,
there are only two classes of children -- legitimate (and those who, like the legally adopted, have the rights of
legitimate children) and illegitimate. All children conceived and born outside a valid marriage are illegitimate, unless
the law itself gives them legitimate status. (Emphasis ours.)
It is apparent that according to the Family Code and the afore-cited jurisprudence, the legitimacy or illegitimacy of a
child attaches upon his/her conception. In the present case, it was not disputed that Hortillano and his wife were
validly married and that their child was conceived during said marriage, hence, making said child legitimate upon her
conception.1avvphi1
Also incontestable is the fact that Hortillano was able to comply with the fourth element entitling him to death and
accident insurance under the CBA, i.e., presentation of the death certificate of his unborn child.
Given the existence of all the requisites for bereavement leave and other death benefits under the CBA, Hortillanos
claims for the same should have been granted by Continental Steel.
We emphasize that bereavement leave and other death benefits are granted to an employee to give aid to, and if
possible, lessen the grief of, the said employee and his family who suffered the loss of a loved one. It cannot be said
that the parents grief and sense of loss arising from the death of their unborn child, who, in this case, had a
gestational life of 38-39 weeks but died during delivery, is any less than that of parents whose child was born alive
but died subsequently.
Being for the benefit of the employee, CBA provisions on bereavement leave and other death benefits should be
interpreted liberally to give life to the intentions thereof. Time and again, the Labor Code is specific in enunciating that
in case of doubt in the interpretation of any law or provision affecting labor, such should be interpreted in favor of
labor.
29
In the same way, the CBA and CBA provisions should be interpreted in favor of labor. InMarcopper Mining v.
National Labor Relations Commission,
30
we pronounced:
Finally, petitioner misinterprets the declaration of the Labor Arbiter in the assailed decision that "when the pendulum
of judgment swings to and fro and the forces are equal on both sides, the same must be stilled in favor of labor."
While petitioner acknowledges that all doubts in the interpretation of the Labor Code shall be resolved in favor of
labor, it insists that what is involved-here is the amended CBA which is essentially a contract between private
persons. What petitioner has lost sight of is the avowed policy of the State, enshrined in our Constitution, to accord
utmost protection and justice to labor, a policy, we are, likewise, sworn to uphold.
In Philippine Telegraph & Telephone Corporation v. NLRC [183 SCRA 451 (1990)], we categorically stated that:
When conflicting interests of labor and capital are to be weighed on the scales of social justice, the heavier influence
of the latter should be counter-balanced by sympathy and compassion the law must accord the underprivileged
worker.
Likewise, in Terminal Facilities and Services Corporation v. NLRC [199 SCRA 265 (1991)], we declared:
Any doubt concerning the rights of labor should be resolved in its favor pursuant to the social justice policy.
IN VIEW WHEREOF, the Petition is DENIED. The Decision dated 27 February 2008 and Resolution dated 9 May
2008 of the Court of Appeals in CA-G.R. SP No. 101697, affirming the Resolution dated 20 November 2007 of
Accredited Voluntary Arbitrator Atty. Allan S. Montao, which granted to Rolando P. Hortillano bereavement leave
pay and other death benefits in the amounts of Four Thousand Nine Hundred Thirty-Nine Pesos (P4,939.00) and
Eleven Thousand Five Hundred Fifty Pesos (P11,550.00), respectively, grounded on the death of his unborn child,
are AFFIRMED. Costs against Continental Steel Manufacturing Corporation.
SO ORDERED.
MINITA V. CHICO-NAZARIO
Associate Justice
WE CONCUR:
ANTONIO T. CARPIO
Associate Justice
Chairperson
PRESBITERO J. VELASCO, JR.
Associate Justice
ANTONIO EDUARDO B. NACHURA
Associate Justice
DIOSDADO M. PERALTA
Associate Justice
A T T E S T A T I O N
I attest that the conclusions in the above Decision were reached in consultation before the case was assigned to the
writer of the opinion of the Courts Division.
ANTONIO T. CARPIO
Associate Justice
Chairperson, Third Division
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, and the Division Chairpersons Attestation, it is hereby certified
that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of
the opinion of the Courts Division.
LEONARDO A. QUISUMBING
Acting Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
EN BANC

G.R. No. 120295 June 28, 1996
JUAN G. FRIVALDO, petitioner,
vs.
COMMISSION ON ELECTIONS, and RAUL R. LEE, respondents.
G.R. No. 123755 June 28, 1996
RAUL R. LEE, petitioner,
vs.
COMMISSION ON ELECTIONS and JUAN G. FRIVALDO, respondents.

PANGANIBAN, J .:p
The ultimate question posed before this Court in these twin cases is: Who should be declared the rightful governor of
Sorsogon -
(i) Juan G. Frivaldo, who unquestionably obtained the highest number of votes in three successive elections but who
was twice declared by this Court to be disqualified to hold such office due to his alien citizenship, and who now claims
to have re-assumed his lost Philippine citizenship thru repatriation;
(ii) Raul R. Lee, who was the second placer in the canvass, but who claims that the votes cast in favor of Frivaldo
should be considered void; that the electorate should be deemed to have intentionally thrown away their ballots; and
that legally, he secured the most number of valid votes; or
(iii) The incumbent Vice-Governor, Oscar G. Deri, who obviously was not voted directly to the position of governor,
but who according to prevailing jurisprudence should take over the said post inasmuch as, by the ineligibility of
Frivaldo, a "permanent vacancy in the contested office has occurred"?
In ruling for Frivaldo, the Court lays down new doctrines on repatriation, clarifies/reiterates/amplifies existing
jurisprudence on citizenship and elections, and upholds the superiority of substantial justice over pure legalisms.
G.R. No. 123755
This is a special civil action under Rules 65 and 58 of the Rules of Court for certiorari and preliminary injunction to
review and annul a Resolution of the respondent Commission on Elections (Comelec), First Division,
1
promulgated
on December 19, 1995
2
and another Resolution of the Comelec en banc promulgated February 23, 1996
3
denying
petitioner's motion for reconsideration.
The Facts
On March 20, 1995, private respondent Juan G. Frivaldo filed his Certificate of Candidacy for the office of Governor
of Sorsogon in the May 8, 1995 elections. On March 23, 1995, petitioner Raul R. Lee, another candidate, filed a
petition
4
with the Comelec docketed as SPA No. 95-028 praying that Frivaldo "be disqualified from seeking or holding
any public office or position by reason of not yet being a citizen of the Philippines", and that his Certificate of
Candidacy be canceled. On May 1, 1995, the Second Division of the Comelec promulgated a Resolution
5
granting
the petition with the following disposition
6
:
WHEREFORE, this Division resolves to GRANT the petition and declares that respondent is
DISQUALIFIED to run for the Office of Governor of Sorsogon on the ground that he is NOT a
citizen of the Philippines. Accordingly, respondent's certificate of candidacy is canceled.
The Motion for Reconsideration filed by Frivaldo remained unacted upon until after the May 8, 1995 elections. So, his
candidacy continued and he was voted for during the elections held on said date. On May 11, 1995, the Comelec en
banc
7
affirmed the aforementioned Resolution of the Second Division.
The Provincial Board of Canvassers completed the canvass of the election returns and a Certificate of Votes
8
dated
May 27, 1995 was issued showing the following votes obtained by the candidates for the position of Governor of
Sorsogon:
Antonio H. Escudero, Jr. 51,060
Juan G. Frivaldo 73,440
Raul R. Lee 53,304
Isagani P. Ocampo 1,925
On June 9, 1995, Lee filed in said SPA No. 95-028, a (supplemental) petition
9
praying for his proclamation as the
duly-elected Governor of Sorsogon.
In an order
10
dated June 21, 1995, but promulgated according to the petition "only on June 29, 1995," the
Comelec en banc directed "the Provincial Board of Canvassers of Sorsogon to reconvene for the purpose of
proclaiming candidate Raul Lee as the winning gubernatorial candidate in the province of Sorsogon on June 29, 1995
. . ." Accordingly, at 8:30 in the evening of June 30, 1995, Lee was proclaimed governor of Sorsogon.
On July 6, 1995, Frivaldo filed with the Comelec a new petition,
11
docketed as SPC No. 95-317, praying for the
annulment of the June 30, 1995 proclamation of Lee and for his own proclamation. He alleged that on June 30, 1995,
at 2:00 in the afternoon, he took his oath of allegiance as a citizen of the Philippines after "his petition for repatriation
under P.D. 725 which he filed with the Special Committee on Naturalization in September 1994 had been granted".
As such, when "the said order (dated June 21, 1995) (of the Comelec) . . . was released and received by Frivaldo on
June 30, 1995 at 5:30 o'clock in the evening, there was no more legal impediment to the proclamation (of Frivaldo) as
governor . . ." In the alternative, he averred that pursuant to the two cases of Labo vs. Comelec,
12
the Vice-Governor
- not Lee - should occupy said position of governor.
On December 19, 1995, the Comelec First Division promulgated the herein assailed Resolution
13
holding that Lee,
"not having garnered the highest number of votes," was not legally entitled to be proclaimed as duly-elected
governor; and that Frivaldo, "having garnered the highest number of votes,
and . . . having reacquired his Filipino citizenship by repatriation on June 30, 1995 under the provisions of
Presidential Decree No. 725 . . . (is) qualified to hold the office of governor of Sorsogon"; thus:
PREMISES CONSIDERED, the Commission (First Division), therefore RESOLVES to GRANT the
Petition.
Consistent with the decisions of the Supreme Court, the proclamation of Raul R. Lee as Governor
of Sorsogon is hereby ordered annulled, being contrary to law, he not having garnered the highest
number of votes to warrant his proclamation.
Upon the finality of the annulment of the proclamation of Raul R. Lee, the Provincial Board of
Canvassers is directed to immediately reconvene and, on the basis of the completed canvass,
proclaim petitioner Juan G. Frivaldo as the duly elected Governor of Sorsogon having garnered the
highest number of votes, and he having reacquired his Filipino citizenship by repatriation on June
30, 1995 under the provisions of Presidential Decree No. 725 and, thus, qualified to hold the office
of Governor of Sorsogon.
Conformably with Section 260 of the Omnibus Election Code (B.P. Blg. 881), the Clerk of the
Commission is directed to notify His Excellency the President of the Philippines, and the Secretary
of the Sangguniang Panlalawigan of the Province of Sorsogon of this resolution immediately upon
the due implementation thereof.
On December 26, 1995, Lee filed a motion for reconsideration which was denied by the Comelec en banc in its
Resolution
14
promulgated on February 23, 1996. On February 26, 1996, the present petition was filed. Acting on the
prayer for a temporary restraining order, this Court issued on February 27, 1996 a Resolution which inter alia directed
the parties "to maintain the status quo prevailing prior to the filing of this petition."
The Issues in G.R. No. 123755
Petitioner Lee's "position on the matter at hand may briefly be capsulized in the following propositions"
15
:
First -- The initiatory petition below was so far insufficient in form and substance to warrant the
exercise by the COMELEC of its jurisdiction with the result that, in effect, the COMELEC acted
without jurisdiction in taking cognizance of and deciding said petition;
Second -- The judicially declared disqualification of respondent was a continuing condition and
rendered him ineligible to run for, to be elected to and to hold the Office of Governor;
Third -- The alleged repatriation of respondent was neither valid nor is the effect thereof retroactive
as to cure his ineligibility and qualify him to hold the Office of Governor; and
Fourth -- Correctly read and applied, the Labo Doctrine fully supports the validity of petitioner's
proclamation as duly elected Governor of Sorsogon.
G.R. No. 120295
This is a petition to annul three Resolutions of the respondent Comelec, the first two of which are also at issue in G.R.
No. 123755, as follows:
1. Resolution
16
of the Second Division, promulgated on May 1, 1995, disqualifying Frivaldo from
running for governor of Sorsogon in the May 8, 1995 elections "on the ground that he is not a
citizen of the Philippines";
2. Resolution
1
7 of the Comelec en banc, promulgated on May 11, 1995; and
3. Resolution
18
of the Comelec en banc, promulgated also on May 11, 1995 suspending the
proclamation of, among others, Frivaldo.
The Facts and the Issue
The facts of this case are essentially the same as those in G.R. No. 123755. However, Frivaldo assails the above-
mentioned resolutions on a different ground: that under Section 78 of the Omnibus Election Code, which is
reproduced hereinunder:
Sec. 78. Petition to deny due course or to cancel a certificate of candidacy. -- A verified petition
seeking to deny due course or to cancel a certificate of candidacy may be filed by any person
exclusively on the ground that any material representation contained therein as required under
Section 74 hereof is false. The petition may be filed at any time not later than twenty-five days from
the time of the filing of the certificate of candidacy and shall be decided, after notice and
hearing, not later than fifteen days before the election. (Emphasis supplied.)
the Comelec had no jurisdiction to issue said Resolutions because they were not rendered "within the period
allowed by law" i.e., "not later than fifteen days before the election."
Otherwise stated, Frivaldo contends that the failure of the Comelec to act on the petition for disqualification within the
period of fifteen days prior to the election as provided by law is a jurisdictional defect which renders the said
Resolutions null and void.
By Resolution on March 12, 1996, the Court consolidated G.R. Nos. 120295 and 123755 since they are intimately
related in their factual environment and are identical in the ultimate question raised, viz., who should occupy the
position of governor of the province of Sorsogon.
On March 19, 1995, the Court heard oral argument from the parties and required them thereafter to file
simultaneously their respective memoranda.
The Consolidated Issues
From the foregoing submissions, the consolidated issues may be restated as follows:
1. Was the repatriation of Frivaldo valid and legal? If so, did it seasonably cure his lack of citizenship as to qualify him
to be proclaimed and to hold the Office of Governor? If not, may it be given retroactive effect? If so, from when?
2. Is Frivaldo's "judicially declared" disqualification for lack of Filipino citizenship a continuing bar to his eligibility to
run for, be elected to or hold the governorship of Sorsogon?
3. Did the respondent Comelec have jurisdiction over the initiatory petition in SPC No. 95-317 considering that said
petition is not "a pre-proclamation case, an election protest or a quo warranto case"?
4. Was the proclamation of Lee, a runner-up in the election, valid and legal in light of existing jurisprudence?
5. Did the respondent Commission on Elections exceed its jurisdiction in promulgating the assailed Resolutions, all of
which prevented Frivaldo from assuming the governorship of Sorsogon, considering that they were not rendered
within the period referred to in Section 78 of the Omnibus Election Code, viz., "not later than fifteen days before the
elections"?
The First Issue: Frivaldo's Repatriation
The validity and effectivity of Frivaldo's repatriation is the lis mota, the threshold legal issue in this case. All the other
matters raised are secondary to this.
The Local Government Code of 1991
19
expressly requires Philippine citizenship as a qualification for elective local
officials, including that of provincial governor, thus:
Sec. 39. Qualifications. -- (a) An elective local official must be a citizen of the Philippines; a
registered voter in the barangay, municipality, city, or province or, in the case of a member of the
sangguniang panlalawigan, sangguniang panlungsod, or sangguniang bayan, the district where he
intends to be elected; a resident therein for at least one (1) year immediately preceding the day of
the election; and able to read and write Filipino or any other local language or dialect.
(b) Candidates for the position of governor, vice governor or member of the
sangguniang panlalawigan, or mayor, vice mayor or member of the sangguniang
panlungsod of highly urbanized cities must be at least twenty-three (23) years of
age on election day.
xxx xxx xxx
Inasmuch as Frivaldo had been declared by this Court
20
as a non-citizen, it is therefore incumbent upon him to show
that he has reacquired citizenship; in fine, that he possesses the qualifications prescribed under the said statute (R.A.
7160).
Under Philippine law,
21
citizenship may be reacquired by direct act of Congress, by naturalization or by repatriation.
Frivaldo told this Court in G.R. No. 104654
22
and during the oral argument in this case that he tried to resume his
citizenship by direct act of Congress, but that the bill allowing him to do so "failed to materialize, notwithstanding the
endorsement of several members of the House of Representatives" due, according to him, to the "maneuvers of his
political rivals." In the same case, his attempt at naturalization was rejected by this Court because of jurisdictional,
substantial and procedural defects.
Despite his lack of Philippine citizenship, Frivaldo was overwhelmingly elected governor by the electorate of
Sorsogon, with a margin of 27,000 votes in the 1988 elections, 57,000 in 1992, and 20,000 in 1995 over the same
opponent Raul Lee. Twice, he was judicially declared a non-Filipino and thus twice disqualified from holding and
discharging his popular mandate. Now, he comes to us a third time, with a fresh vote from the people of Sorsogon
and a favorable decision from the Commission on Elections to boot. Moreover, he now boasts of having successfully
passed through the third and last mode of reacquiring citizenship: by repatriation under P.D. No. 725, with no less
than the Solicitor General himself, who was the prime opposing counsel in the previous cases he lost, this time, as
counsel for co-respondent Comelec, arguing the validity of his cause (in addition to his able private counsel Sixto S.
Brillantes, Jr.). That he took his oath of allegiance under the provisions of said Decree at 2:00 p.m. on June 30, 1995
is not disputed. Hence, he insists that he -- not Lee -- should have been proclaimed as the duly-elected governor of
Sorsogon when the Provincial Board of Canvassers met at 8:30 p.m. on the said date since, clearly and
unquestionably, he garnered the highest number of votes in the elections and since at that time, he already
reacquired his citizenship.
En contrario, Lee argues that Frivaldo's repatriation is tainted with serious defects, which we shall now discuss in
seriatim.
First, Lee tells us that P.D. No. 725 had "been effectively repealed", asserting that "then President Corazon Aquino
exercising legislative powers under the Transitory Provisions of the 1987 Constitution, forbade the grant of citizenship
by Presidential Decree or Executive Issuances as the same poses a serious and contentious issue of policy which
the present government, in the exercise of prudence and sound discretion, should best leave to the judgment of the
first Congress under the 1987 Constitution", adding that in her memorandum dated March 27, 1987 to the members
of the Special Committee on Naturalization constituted for purposes of Presidential Decree No. 725, President Aquino
directed them "to cease and desist from undertaking any and all proceedings within your functional area of
responsibility as defined under Letter of Instructions (LOI) No. 270 dated April 11, 1975, as amended."
23

This memorandum dated March 27, 1987
24
cannot by any stretch of legal hermeneutics be construed as a law
sanctioning or authorizing a repeal of P.D. No. 725. Laws are repealed only by subsequent ones
25
and a repeal may
be express or implied. It is obvious that no express repeal was made because then President Aquino in her
memorandum -- based on the copy furnished us by Lee -- did not categorically and/or impliedly state that P.D. 725
was being repealed or was being rendered without any legal effect. In fact, she did not even mention it specifically by
its number or text. On the other hand, it is a basic rule of statutory construction that repeals by implication are not
favored. An implied repeal will not be allowed "unless it is convincingly and unambiguously demonstrated that the two
laws are clearly repugnant and patently inconsistent that they cannot co-exist".
26

The memorandum of then President Aquino cannot even be regarded as a legislative enactment, for not every
pronouncement of the Chief Executive even under the Transitory Provisions of the 1987 Constitution can nor should
be regarded as an exercise of her law-making powers. At best, it could be treated as an executive policy addressed
to the Special Committee to halt the acceptance and processing of applications for repatriation pending whatever
"judgment the first Congress under the 1987 Constitution" might make. In other words, the former President did not
repeal P.D. 725 but left it to the first Congress -- once created -- to deal with the matter. If she had intended to repeal
such law, she should have unequivocally said so instead of referring the matter to Congress. The fact is she carefully
couched her presidential issuance in terms that clearly indicated the intention of "the present government, in the
exercise of prudence and sound discretion" to leave the matter of repeal to the new Congress. Any other
interpretation of the said Presidential Memorandum, such as is now being proffered to the Court by Lee, would visit
unmitigated violence not only upon statutory construction but on common sense as well.
Second, Lee also argues that "serious congenital irregularities flawed the repatriation proceedings," asserting that
Frivaldo's application therefor was "filed on June 29, 1995 . . . (and) was approved in just one day or on June 30,
1995 . . .", which "prevented a judicious review and evaluation of the merits thereof." Frivaldo counters that he filed
his application for repatriation with the Office of the President in Malacaang Palace on August 17, 1994. This is
confirmed by the Solicitor General. However, the Special Committee was reactivated only on June 8, 1995, when
presumably the said Committee started processing his application. On June 29, 1995, he filled up and re-submitted
the FORM that the Committee required. Under these circumstances, it could not be said that there was "indecent
haste" in the processing of his application.
Anent Lee's charge that the "sudden reconstitution of the Special Committee on Naturalization was intended solely
for the personal interest of respondent,"
2
7 the Solicitor General explained during the oral argument on March 19,
1996 that such allegation is simply baseless as there were many others who applied and were considered for
repatriation, a list of whom was submitted by him to this Court, through a Manifestation
28
filed on April 3, 1996.
On the basis of the parties' submissions, we are convinced that the presumption of regularity in the performance of
official duty and the presumption of legality in the repatriation of Frivaldo have not been successfully rebutted by Lee.
The mere fact that the proceedings were speeded up is by itself not a ground to conclude that such proceedings were
necessarily tainted. After all, the requirements of repatriation under P.D. No. 725 are not difficult to comply with, nor
are they tedious and cumbersome. In fact, P.D.
725
29
itself requires very little of an applicant, and even the rules and regulations to implement the said decree were
left to the Special Committee to promulgate. This is not unusual since, unlike in naturalization where an alien covets
a first-timeentry into Philippine political life, in repatriation the applicant is a former natural-born Filipino who is merely
seeking to reacquire his previous citizenship. In the case of Frivaldo, he was undoubtedly a natural-born citizen who
openly and faithfully served his country and his province prior to his naturalization in the United States -- a
naturalization he insists was made necessary only to escape the iron clutches of a dictatorship he abhorred and could
not in conscience embrace -- and who, after the fall of the dictator and the re-establishment of democratic space,
wasted no time in returning to his country of birth to offer once more his talent and services to his people.
So too, the fact that ten other persons, as certified to by the Solicitor General, were granted repatriation argues
convincingly and conclusively against the existence of favoritism vehemently posited by Raul Lee. At any rate, any
contest on the legality of Frivaldo's repatriation should have been pursued before the Committee itself, and, failing
there, in the Office of the President, pursuant to the doctrine of exhaustion of administrative remedies.
Third, Lee further contends that assuming the assailed repatriation to be valid, nevertheless it could only be effective
as at 2:00 p.m. of June 30, 1995 whereas the citizenship qualification prescribed by the Local Government Code
"must exist on the date of his election, if not when the certificate of candidacy is filed," citing our decision in G.R.
104654
30
which held that "both the Local Government Code and the Constitution require that only Philippine
citizens can run and be elected to public office." Obviously, however, this was a mere obiter as the only issue in said
case was whether Frivaldo's naturalization was valid or not -- and NOT the effective date thereof. Since the Court
held his naturalization to be invalid, then the issue of when an aspirant for public office should be a citizen was NOT
resolved at all by the Court. Which question we shall now directly rule on.
Under Sec. 39 of the Local Government Code, "(a)n elective local official must be:
* a citizen of the Philippines;
* a registered voter in the barangay, municipality, city, or province . . . where he intends to be
elected;
* a resident therein for at least one (1) year immediately preceding the day of the election;
* able to read and write Filipino or any other local language or dialect.
* In addition, "candidates for the position of governor . . . must be at least twenty-three (23) years of
age on election day.
From the above, it will be noted that the law does not specify any particular date or time when the candidate must
possess citizenship, unlike that for residence (which must consist of at least one year's residency immediately
preceding the day of election) and age (at least twenty three years of age on election day).
Philippine citizenship is an indispensable requirement for holding an elective public office,
31
and the purpose of the
citizenship qualification is none other than to ensure that no alien, i.e., no person owing allegiance to another nation,
shall govern our people and our country or a unit of territory thereof. Now, an official begins to govern or to discharge
his functions only upon his proclamation and on the day the law mandates his term of office to begin. Since Frivaldo
re-assumed his citizenship on June 30, 1995 -- the very day
32
the term of office of governor (and other elective
officials) began -- he was therefore already qualified to be proclaimed, to hold such office and to discharge the
functions and responsibilities thereof as of said date. In short, at that time, he was already qualified to govern his
native Sorsogon. This is the liberal interpretation that should give spirit, life and meaning to our law on qualifications
consistent with the purpose for which such law was enacted. So too, even from a literal (as distinguished from liberal)
construction, it should be noted that Section 39 of the Local Government Code speaks of "Qualifications" of
"ELECTIVE OFFICIALS", not of candidates. Why then should such qualification be required at the time of election or
at the time of the filing of the certificates of candidacies, as Lee insists? Literally, such qualifications -- unless
otherwise expressly conditioned, as in the case of age and residence -- should thus be possessed when the "elective
[or elected] official" begins to govern, i.e., at the time he is proclaimed and at the start of his term -- in this case, on
June 30, 1995. Paraphrasing this Court's ruling in Vasquez vs. Giap and Li Seng Giap & Sons,
33
if the purpose of the
citizenship requirement is to ensure that our people and country do not end up being governed by aliens,i.e., persons
owing allegiance to another nation, that aim or purpose would not be thwarted but instead achieved by construing the
citizenship qualification as applying to the time of proclamation of the elected official and at the start of his term.
But perhaps the more difficult objection was the one raised during the oral argument
34
to the effect that the
citizenship qualification should be possessed at the time the candidate (or for that matter the elected official)
registered as a voter. After all, Section 39, apart from requiring the official to be a citizen, also specifies as another
item of qualification, that he be a "registered voter". And, under the law
35
a "voter" must be a citizen of the
Philippines. So therefore, Frivaldo could not have been a voter -- much less a validly registered one -- if he was not a
citizen at the time of such registration.
The answer to this problem again lies in discerning the purpose of the requirement. If the law intended
thecitizenship qualification to be possessed prior to election consistent with the requirement of being a registered
voter, then it would not have made citizenship a SEPARATE qualification. The law abhors a redundancy. It therefore
stands to reason that the law intended CITIZENSHIP to be a qualification distinct from being a VOTER, even if being
a voter presumes being a citizen first. It also stands to reason that the voter requirement was included as another
qualification (aside from "citizenship"), not to reiterate the need for nationality but to require that the official be
registered as a voter IN THE AREA OR TERRITORY he seeks to govern, i.e., the law states: "a registered voter in
the barangay, municipality, city, or province . . . where he intends to be elected." It should be emphasized that the
Local Government Code requires an elective official to be a registered voter. It does not require him to vote actually.
Hence, registration -- not the actual voting -- is the core of this "qualification". In other words, the law's purpose in this
second requirement is to ensure that the prospective official is actually registered in the area he seeks to govern --
and not anywhere else.
Before this Court, Frivaldo has repeatedly emphasized -- and Lee has not disputed -- that he "was and is a registered
voter of Sorsogon, and his registration as a voter has been sustained as valid by judicial declaration . . . In fact, he
cast his vote in his precinct on May 8, 1995."
36

So too, during the oral argument, his counsel steadfastly maintained that "Mr. Frivaldo has always been a registered
voter of Sorsogon. He has voted in 1987, 1988, 1992, then he voted again in 1995. In fact, his eligibility as a voter
was questioned, but the court dismissed (sic) his eligibility as a voter and he was allowed to vote as in fact, he voted
in all the previous elections including on May 8, 1995."
3
7
It is thus clear that Frivaldo is a registered voter in the province where he intended to be elected.
There is yet another reason why the prime issue of citizenship should be reckoned from the date of proclamation, not
necessarily the date of election or date of filing of the certificate of candidacy. Section 253 of the Omnibus Election
Code
38
gives any voter, presumably including the defeated candidate, the opportunity to question the ELIGIBILITY
(or the disloyalty) of a candidate. This is the only provision of the Code that authorizes a remedy on how to contest
before the Comelec an incumbent's ineligibility arising from failure to meet the qualifications enumerated under Sec.
39 of the Local Government Code. Such remedy of Quo Warranto can be availed of "within ten days after
proclamation" of the winning candidate. Hence, it is only at such time that the issue of ineligibility may be taken
cognizance of by the Commission. And since, at the very moment of Lee's proclamation (8:30 p.m., June 30, 1995),
Juan G. Frivaldo was already and indubitably a citizen, having taken his oath of allegiance earlier in the afternoon of
the same day, then he should have been the candidate proclaimed as he unquestionably garnered the highest
number of votes in the immediately preceding elections and such oath had already cured his previous "judicially-
declared" alienage. Hence, at such time, he was no longer ineligible.
But to remove all doubts on this important issue, we also hold that the repatriation of Frivaldo RETROACTED to the
date of the filing of his application on August 17, 1994.
It is true that under the Civil Code of the Philippines,
39
"(l)aws shall have no retroactive effect, unless the contrary is
provided." But there are settled exceptions
40
to this general rule, such as when the statute is CURATIVE or
REMEDIAL in nature or when it CREATES NEW RIGHTS.
According to Tolentino,
41
curative statutes are those which undertake to cure errors and irregularities, thereby
validating judicial or administrative proceedings, acts of public officers, or private deeds and contracts which
otherwise would not produce their intended consequences by reason of some statutory disability or failure to comply
with some technical requirement. They operate on conditions already existing, and are necessarily retroactive in
operation. Agpalo,
42
on the other hand, says that curative statutes are
"healing acts . . . curing defects and adding to the means of enforcing existing obligations . . . (and) are intended to
supply defects, abridge superfluities in existing laws, and curb certain evils. . . . By their very nature, curative statutes
are retroactive . . . (and) reach back to past events to correct errors or irregularities and to render valid and effective
attempted acts which would be otherwise ineffective for the purpose the parties intended."
On the other hand, remedial or procedural laws, i.e., those statutes relating to remedies or modes of procedure,
which do not create new or take away vested rights, but only operate in furtherance of the remedy or confirmation of
such rights, ordinarily do not come within the legal meaning of a retrospective law, nor within the general rule against
the retrospective operation of statutes.
43

A reading of P.D. 725 immediately shows that it creates a new right, and also provides for a new remedy, thereby
filling certain voids in our laws. Thus, in its preamble, P.D. 725 expressly recognizes the plight of "many Filipino
women (who) had lost their Philippine citizenship by marriage to aliens" and who could not, under the existing law
(C.A. No. 63, as amended) avail of repatriation until "after the death of their husbands or the termination of their
marital status" and who could neither be benefitted by the 1973 Constitution's new provision allowing "a Filipino
woman who marries an alien to retain her Philippine citizenship . . ." because "such provision of the new Constitution
does not apply to Filipino women who had married aliens before said constitution took effect." Thus, P.D. 725 granted
a new right to these women -- the right to re-acquire Filipino citizenship even during their marital coverture, which
right did not exist prior to P.D. 725. On the other hand, said statute also provided a new remedyand a new right in
favor of other "natural born Filipinos who (had) lost their Philippine citizenship but now desire to re-acquire Philippine
citizenship", because prior to the promulgation of P.D. 725 such former Filipinos would have had to undergo the
tedious and cumbersome process of naturalization, but with the advent of P.D. 725 they could now re-acquire their
Philippine citizenship under the simplified procedure of repatriation.
The Solicitor General
44
argues:
By their very nature, curative statutes are retroactive, (DBP vs. CA, 96 SCRA 342), since they are
intended to supply defects, abridge superfluities in existing laws (Del Castillo vs. Securities and
Exchange Commission, 96 Phil. 119) and curb certain evils (Santos vs. Duata, 14 SCRA 1041).
In this case, P.D. No. 725 was enacted to cure the defect in the existing naturalization law,
specifically C.A. No. 63 wherein married Filipino women are allowed to repatriate only upon the
death of their husbands, and natural-born Filipinos who lost their citizenship by naturalization and
other causes faced the difficulty of undergoing the rigid procedures of C.A. 63 for reacquisition of
Filipino citizenship by naturalization.
Presidential Decree No. 725 provided a remedy for the aforementioned legal aberrations and thus
its provisions are considered essentially remedial and curative.
In light of the foregoing, and prescinding from the wording of the preamble, it is unarguable that the legislative intent
was precisely to give the statute retroactive operation. "(A) retrospective operation is given to a statute or amendment
where the intent that it should so operate clearly appears from a consideration of the act as a whole, or from the
terms thereof."
45
It is obvious to the Court that the statute was meant to "reach back" to those persons, events and
transactions not otherwise covered by prevailing law and jurisprudence. And inasmuch as it has been held that
citizenship is a political and civil right equally as important as the freedom of speech, liberty of abode, the right
against unreasonable searches and seizures and other guarantees enshrined in the Bill of Rights, therefore the
legislative intent to give retrospective operation to P.D. 725 must be given the fullest effect possible. "(I)t has been
said that a remedial statute must be so construed as to make it effect the evident purpose for which it was enacted,
so that if the reason of the statute extends to past transactions, as well as to those in the future, then it will be so
applied although the statute does not in terms so direct, unless to do so would impair some vested right or violate
some constitutional guaranty."
46
This is all the more true of P.D. 725, which did not specify any restrictions on or
delimit or qualify the right of repatriation granted therein.
At this point, a valid question may be raised: How can the retroactivity of P.D. 725 benefit Frivaldo considering that
said law was enacted on June 5, 1975, while Frivaldo lost his Filipino citizenship much later, on January 20, 1983,
and applied for repatriation even later, on August 17, 1994?
While it is true that the law was already in effect at the time that Frivaldo became an American citizen, nevertheless, it
is not only the law itself (P.D. 725) which is to be given retroactive effect, but even the repatriation granted under said
law to Frivaldo on June 30, 1995 is to be deemed to have retroacted to the date of his application therefor, August 17,
1994. The reason for this is simply that if, as in this case, it was the intent of the legislative authority that the law
should apply to past events -- i.e., situations and transactions existing even before the law came into being -- in order
to benefit the greatest number of former Filipinos possible thereby enabling them to enjoy and exercise the
constitutionally guaranteed right of citizenship, and such legislative intention is to be given the fullest effect and
expression, then there is all the more reason to have the law apply in a retroactive or retrospective manner to
situations, events and transactions subsequent to the passage of such law. That is, the repatriation granted to
Frivaldo on June 30, 1995 can and should be made to take effect as of date of his application. As earlier mentioned,
there is nothing in the law that would bar this or would show a contrary intention on the part of the legislative
authority; and there is no showing that damage or prejudice to anyone, or anything unjust or injurious would result
from giving retroactivity to his repatriation. Neither has Lee shown that there will result the impairment of any
contractual obligation, disturbance of any vested right or breach of some constitutional guaranty.
Being a former Filipino who has served the people repeatedly, Frivaldo deserves a liberal interpretation of Philippine
laws and whatever defects there were in his nationality should now be deemed mooted by his repatriation.
Another argument for retroactivity to the date of filing is that it would prevent prejudice to applicants. If P.D. 725 were
not to be given retroactive effect, and the Special Committee decides not to act, i.e., to delay the processing of
applications for any substantial length of time, then the former Filipinos who may be stateless, as Frivaldo -- having
already renounced his American citizenship -- was, may be prejudiced for causes outside their control. This should
not be. In case of doubt in the interpretation or application of laws, it is to be presumed that the law-making body
intended right and justice to prevail.
4
7
And as experience will show, the Special Committee was able to process, act upon and grant applications for
repatriation within relatively short spans of time after the same were filed.
48
The fact that such interregna were
relatively insignificant minimizes the likelihood of prejudice to the government as a result of giving retroactivity to
repatriation. Besides, to the mind of the Court, direct prejudice to the government is possible only where a person's
repatriation has the effect of wiping out a liability of his to the government arising in connection with or as a result of
his being an alien, and accruing only during the interregnum between application and approval, a situation that is not
present in the instant case.
And it is but right and just that the mandate of the people, already twice frustrated, should now prevail. Under the
circumstances, there is nothing unjust or iniquitous in treating Frivaldo's repatriation as having become effective as of
the date of his application, i.e., on August 17, 1994. This being so, all questions about his possession of the
nationality qualification -- whether at the date of proclamation (June 30, 1995) or the date of election (May 8, 1995) or
date of filing his certificate of candidacy (March 20, 1995) would become moot.
Based on the foregoing, any question regarding Frivaldo's status as a registered voter would also be deemed settled.
Inasmuch as he is considered as having been repatriated -- i.e., his Filipino citizenship restored -- as of August 17,
1994, his previous registration as a voter is likewise deemed validated as of said date.
It is not disputed that on January 20, 1983 Frivaldo became an American. Would the retroactivity of his repatriation
not effectively give him dual citizenship, which under Sec. 40 of the Local Government Code would disqualify him
"from running for any elective local position?"
49
We answer this question in the negative, as there is cogent reason to
hold that Frivaldo was really STATELESS at the time he took said oath of allegiance and even before that, when he
ran for governor in 1988. In his Comment, Frivaldo wrote that he "had long renounced and had long abandoned his
American citizenship -- long before May 8, 1995. At best, Frivaldo was stateless in the interim -- when he abandoned
and renounced his US citizenship but before he was repatriated to his Filipino citizenship."
50

On this point, we quote from the assailed Resolution dated December 19, 1995:
51

By the laws of the United States, petitioner Frivaldo lost his American citizenship when he took his
oath of allegiance to the Philippine Government when he ran for Governor in 1988, in 1992, and in
1995. Every certificate of candidacy contains an oath of allegiance to the Philippine Government."
These factual findings that Frivaldo has lost his foreign nationality long before the elections of 1995 have not been
effectively rebutted by Lee. Furthermore, it is basic that such findings of the Commission are conclusive upon this
Court, absent any showing of capriciousness or arbitrariness or
abuse.
52

The Second Issue: Is Lack of Citizenship
a Continuing Disqualification?
Lee contends that the May 1, 1995 Resolution
53
of the Comelec Second Division in SPA No. 95-028 as affirmed in
totoby Comelec En Banc in its Resolution of May 11, 1995 "became final and executory after five (5) days or on May
17, 1995, no restraining order having been issued by this Honorable Court.
54
Hence, before Lee "was proclaimed as
the elected governor on June 30, 1995, there was already a final and executory judgment disqualifying" Frivaldo. Lee
adds that this Court's two rulings (which Frivaldo now concedes were legally "correct") declaring Frivaldo an alien
have also become final and executory way before the 1995 elections, and these "judicial pronouncements of his
political status as an American citizen absolutely and for all time disqualified (him) from running for, and holding any
public office in the Philippines."
We do not agree.
It should be noted that our first ruling in G.R. No. 87193 disqualifying Frivaldo was rendered in connection with the
1988 elections while that in G.R. No. 104654 was in connection with the 1992 elections. That he was disqualified for
such elections is final and can no longer be changed. In the words of the respondent Commission (Second Division)
in its assailed Resolution:
55

The records show that the Honorable Supreme Court had decided that Frivaldo was not a Filipino
citizen and thus disqualified for the purpose of the 1988 and 1992 elections. However, there is no
record of any "final judgment" of the disqualification of Frivaldo as a candidate for the May 8, 1995
elections. What the Commission said in its Order of June 21, 1995 (implemented on June 30,
1995), directing the proclamation of Raul R. Lee, was that Frivaldo was not a Filipino citizen
"having been declared by the Supreme Court in its Order dated March 25, 1995, not a citizen of the
Philippines." This declaration of the Supreme Court, however, was in connection with the 1992
elections.
Indeed, decisions declaring the acquisition or denial of citizenship cannot govern a person's future status with finality.
This is because a person may subsequently reacquire, or for that matter lose, his citizenship under any of the modes
recognized by law for the purpose. Hence, in Lee vs. Commissioner of Immigration,
56
we held:
Everytime the citizenship of a person is material or indispensable in a judicial or administrative
case, whatever the corresponding court or administrative authority decides therein as to such
citizenship is generally not considered res judicata, hence it has to be threshed out again and
again, as the occasion demands.
The Third Issue: Comelec's Jurisdiction
Over The Petition in SPC No. 95-317
Lee also avers that respondent Comelec had no jurisdiction to entertain the petition in SPC No. 95-317 because the
only "possible types of proceedings that may be entertained by the Comelec are a pre-proclamation case, an election
protest or a quo warranto case". Again, Lee reminds us that he was proclaimed on June 30, 1995 but that Frivaldo
filed SPC No. 95-317 questioning his (Lee's) proclamation only on July 6, 1995 -- "beyond the 5-day reglementary
period." Hence, according to him, Frivaldo's "recourse was to file either an election protest or a quo warranto action."
This argument is not meritorious. The Constitution
5
7 has given the Comelec ample power to "exercise exclusive
original jurisdiction over all contests relating to the elections, returns and qualifications of all elective . . . provincial . . .
officials." Instead of dwelling at length on the various petitions that Comelec, in the exercise of its constitutional
prerogatives, may entertain, suffice it to say that this Court has invariably recognized the Commission's authority to
hear and decide petitions for annulment of proclamations -- of which SPC No. 95-317 obviously is one.
58
Thus,
in Mentang vs. COMELEC,
59
we ruled:
The petitioner argues that after proclamation and assumption of office, a pre-proclamation
controversy is no longer viable. Indeed, we are aware of cases holding that pre-proclamation
controversies may no longer be entertained by the COMELEC after the winning candidate has
been proclaimed. (citing Gallardo vs. Rimando, 187 SCRA 463; Salvacion vs. COMELEC, 170
SCRA 513; Casimiro vs. COMELEC, 171 SCRA 468.) This rule, however, is premised on an
assumption that the proclamation is no proclamation at all and the proclaimed candidate's
assumption of office cannot deprive the COMELEC of the power to make such declaration of
nullity. (citing Aguam vs. COMELEC, 23 SCRA 883; Agbayani vs. COMELEC, 186 SCRA 484.)
The Court however cautioned that such power to annul a proclamation must "be done within ten (10) days following
the proclamation." Inasmuch as Frivaldo's petition was filed only six (6) days after Lee's proclamation, there is no
question that the Comelec correctly acquired jurisdiction over the same.
The Fourth Issue: Was Lee's Proclamation Valid?
Frivaldo assails the validity of the Lee proclamation. We uphold him for the following reasons:
First. To paraphrase this Court in Labo vs. COMELEC,
60
"the fact remains that he (Lee) was not the choice of the
sovereign will," and in Aquino vs. COMELEC,
61
Lee is "a second placer, . . . just that, a second placer."
In spite of this, Lee anchors his claim to the governorship on the pronouncement of this Court in the aforesaid
Labo
62
case, as follows:
The rule would have been different if the electorate fully aware in fact and in law of a candidate's
disqualification so as to bring such awareness within the realm of notoriety, would nonetheless cast
their votes in favor of the ineligible candidate. In such case, the electorate may be said to have
waived the validity and efficacy of their votes by notoriously misapplying their franchise or throwing
away their votes, in which case, the eligible candidate obtaining the next higher number of votes
may be deemed elected.
But such holding is qualified by the next paragraph, thus:
But this is not the situation obtaining in the instant dispute. It has not been shown, and none was
alleged, that petitioner Labo was notoriously known as an ineligible candidate, much less the
electorate as having known of such fact. On the contrary, petitioner Labo was even allowed by no
less than the Comelec itself in its resolution dated May 10, 1992 to be voted for the office of the city
Payor as its resolution dated May 9, 1992 denying due course to petitioner Labo's certificate of
candidacy had not yet become final and subject to the final outcome of this case.
The last-quoted paragraph in Labo, unfortunately for Lee, is the ruling appropriate in this case because Frivaldo was
in 1995 in an identical situation as Labo was in 1992 when the Comelec's cancellation of his certificate of candidacy
was not yet final on election day as there was in both cases a pending motion for reconsideration, for which reason
Comelec issued an (omnibus) resolution declaring that Frivaldo (like Labo in 1992) and several others can still be
voted for in the May 8, 1995 election, as in fact, he was.
Furthermore, there has been no sufficient evidence presented to show that the electorate of Sorsogon was "fully
aware in fact and in law" of Frivaldo's alleged disqualification as to "bring such awareness within the realm of
notoriety;" in other words, that the voters intentionally wasted their ballots knowing that, in spite of their voting for him,
he was ineligible. If Labo has any relevance at all, it is that the vice-governor -- and not Lee -- should be pro- claimed,
since in losing the election, Lee was, to paraphrase Labo again, "obviously not the choice of the people" of Sorsogon.
This is the emphatic teaching of Labo:
The rule, therefore, is: the ineligibility of a candidate receiving majority votes does not entitle the
eligible candidate receiving the next highest number of votes to be declared elected. A minority or
defeated candidate cannot be deemed elected to the office.
Second. As we have earlier declared Frivaldo to have seasonably reacquired his citizenship and inasmuch as he
obtained the highest number of votes in the 1995 elections, he -- not Lee -- should be proclaimed. Hence, Lee's
proclamation was patently erroneous and should now be corrected.
The Fifth Issue: Is Section 78 of the
Election Code Mandatory?
In G.R. No. 120295, Frivaldo claims that the assailed Resolution of the Comelec (Second Division) dated May 1,
1995 and the confirmatory en banc Resolution of May 11, 1995 disqualifying him for want of citizenship should be
annulled because they were rendered beyond the fifteen (15) day period prescribed by Section 78, of the Omnibus
Election Code which reads as follows:
Sec. 78. Petition to deny due course or to cancel a certificate of candidacy. -- A verified petition
seeking to deny due course or to cancel a certificate of candidacy may be filed by any person
exclusively on the ground that any material representation contained therein as required under
Section 74 hereof is false. The petition may be filed at any time not later than twenty-five days from
the time of the filing of the certificate of candidacy and shall be decided after notice and
hearing, not later than fifteen days before the election. (Emphasis supplied.)
This claim is now moot and academic inasmuch as these resolutions are deemed superseded by the subsequent
ones issued by the Commission (First Division) on December 19, 1995, affirmed en banc
63
on February 23, 1996;
which both upheld his election. At any rate, it is obvious that Section 78 is merely directory as Section 6 of R.A. No.
6646 authorizes the Commission to try and decide petitions for disqualifications even after the elections, thus:
Sec. 6. Effect of Disqualification Case. -- Any candidate who has been declared by final judgment
to be disqualified shall not be voted for, and the votes cast for him shall not be counted. If for any
reason a candidate is not declared by final judgment before an election to be disqualified and he is
voted for and receives the winning number of votes in such election, the Court or Commission shall
continue with the trial and hearing of the action, inquiry or protest and upon motion of the
complainant or any intervenor, may during the pendency thereof order the suspension of the
proclamation of such candidate whenever the evidence of his guilt is strong. (emphasis supplied)
Refutation of
Mr. Justice Davide's Dissent
In his dissenting opinion, the esteemed Mr. Justice Hilario G. Davide, Jr. argues that President Aquino's
memorandum dated March 27, 1987 should be viewed as a suspension (not a repeal, as urged by Lee) of P.D. 725.
But whether it decrees a suspension or a repeal is a purely academic distinction because the said issuance is not a
statute that can amend or abrogate an existing law.
The existence and subsistence of P.D. 725 were recognized in the first Frivaldo case;
64
viz., "(u)nder CA No. 63 as
amended by CA No. 473 and P.D. No. 725, Philippine citizenship maybe reacquired by . . . repatriation". He also
contends that by allowing Frivaldo to register and to remain as a registered voter, the Comelec and in effect this
Court abetted a "mockery" of our two previous judgments declaring him a non-citizen. We do not see such abetting or
mockery. The retroactivity of his repatriation, as discussed earlier, legally cured whatever defects there may have
been in his registration as a voter for the purpose of the 1995 elections. Such retroactivity did not change his
disqualifications in 1988 and 1992, which were the subjects of such previous rulings.
Mr. Justice Davide also believes that Quo Warranto is not the sole remedy to question the ineligibility of a candidate,
citing the Comelec's authority under Section 78 of the Omnibus Election Code allowing the denial of a certificate of
candidacy on the ground of a false material representation therein as required by Section 74. Citing Loong, he then
states his disagreement with our holding that Section 78 is merely directory. We really have no quarrel. Our point is
that Frivaldo was in error in his claim in G.R. No. 120295 that the Comelec Resolutions promulgated on May 1, 1995
and May 11, 1995 were invalid because they were issued "not later than fifteen days before the election" as
prescribed by Section 78. In dismissing the petition in G.R. No. 120295, we hold that the Comelec did not commit
grave abuse of discretion because "Section 6 of R.A. 6646 authorizes the Comelec to try and decide disqualifications
even after the elections." In spite of his disagreement with us on this point, i.e., that Section 78 "is merely directory",
we note that just like us, Mr. Justice Davide nonetheless votes to "DISMISS G.R. No. 120295". One other
point. Loong, as quoted in the dissent, teaches that a petition to deny due course under Section 78 must
be filed within the 25-day period prescribed therein. The present case however deals with the period during which the
Comelec may decide such petition. And we hold that it may be decided even after thefifteen day period mentioned in
Section 78. Here, we rule that a decision promulgated by the Comelec even after the elections is valid but Loong held
that a petition filed beyond the 25-day period is out of time. There is no inconsistency nor conflict.
Mr. Justice Davide also disagrees with the Court's holding that, given the unique factual circumstances of Frivaldo,
repatriation may be given retroactive effect. He argues that such retroactivity "dilutes" our holding in the first Frivaldo
case. But the first (and even the second Frivaldo) decision did not directly involve repatriation as a mode of acquiring
citizenship. If we may repeat, there is no question that Frivaldo was not a Filipino for purposes of determining his
qualifications in the 1988 and 1992 elections. That is settled. But his supervening repatriation has changed his
political status -- not in 1988 or 1992, but only in the 1995 elections.
Our learned colleague also disputes our holding that Frivaldo was stateless prior to his repatriation, saying that
"informal renunciation or abandonment is not a ground to lose American citizenship". Since our courts are charged
only with the duty of determining who are Philippine nationals, we cannot rule on the legal question of who are or who
are not Americans. It is basic in international law that a State determines ONLY those who are its own citizens -- not
who are the citizens of other countries.
65
The issue here is: the Comelec made a finding of fact that Frivaldo was
stateless and such finding has not been shown by Lee to be arbitrary or whimsical. Thus, following settled case law,
such finding is binding and final.
The dissenting opinion also submits that Lee who lost by chasmic margins to Frivaldo in all three previous elections,
should be declared winner because "Frivaldo's ineligibility for being an American was publicly known". First, there is
absolutely no empirical evidence for such "public" knowledge. Second, even if there is, such knowledge can be
true post facto only of the last two previous elections. Third, even the Comelec and now this Court were/are still
deliberating on his nationality before, during and after the 1995 elections. How then can there be such "public"
knowledge?
Mr. Justice Davide submits that Section 39 of the Local Government Code refers to the qualifications of electivelocal
officials, i.e., candidates, and not elected officials, and that the citizenship qualification [under par. (a) of that section]
must be possessed by candidates, not merely at the commencement of the term, but by election day at the latest. We
see it differently. Section 39, par. (a) thereof speaks of "elective local official" while par. (b) to (f) refer to "candidates".
If the qualifications under par. (a) were intended to apply to "candidates" and not elected officials, the legislature
would have said so, instead of differentiating par. (a) from the rest of the paragraphs. Secondly, if Congress had
meant that the citizenship qualification should be possessed at election day or prior thereto, it would have specifically
stated such detail, the same way it did in pars. (b) to (f) far other qualifications of candidates for governor, mayor, etc.
Mr. Justice Davide also questions the giving of retroactive effect to Frivaldo's repatriation on the ground, among
others, that the law specifically provides that it is only after taking the oath of allegiance that applicants shall be
deemed to have reacquired Philippine citizenship. We do not question what the provision states. We hold however
that the provision should be understood thus: that after taking the oath of allegiance the applicant is deemed to have
reacquired Philippine citizenship, which reacquisition (or repatriation) is deemed for all purposes and intents to have
retroacted to the date of his application therefor.
In any event, our "so too" argument regarding the literal meaning of the word "elective" in reference to Section 39 of
the Local Authority Code, as well as regarding Mr. Justice Davide's thesis that the very wordings of P.D. 725 suggest
non-retroactivity, were already taken up rather extensively earlier in this Decision.
Mr. Justice Davide caps his paper with a clarion call: "This Court must be the first to uphold the Rule of Law." We
agree -- we must all follow the rule of law. But that is NOT the issue here. The issue is how should the law be
interpreted and applied in this case so it can be followed, so it can rule!
At balance, the question really boils down to a choice of philosophy and perception of how to interpret and apply laws
relating to elections: literal or liberal; the letter or the spirit, the naked provision or its ultimate purpose; legal syllogism
or substantial justice; in isolation or in the context of social conditions; harshly against or gently in favor of the voters'
obvious choice. In applying election laws, it would be far better to err in favor of popular sovereignty than to be right in
complex but little understood legalisms. Indeed, to inflict a thrice rejected candidate upon the electorate of Sorsogon
would constitute unmitigated judicial tyranny and an unacceptable assault upon this Court's conscience.
E P I L O G U E
In sum, we rule that the citizenship requirement in the Local Government Code is to be possessed by an elective
official at the latest as of the time he is proclaimed and at the start of the term of office to which he has been elected.
We further hold P.D. No. 725 to be in full force and effect up to the present, not having been suspended or repealed
expressly nor impliedly at any time, and Frivaldo's repatriation by virtue thereof to have been properly granted and
thus valid and effective. Moreover, by reason of the remedial or curative nature of the law granting him a new right to
resume his political status and the legislative intent behind it, as well as his unique situation of having been forced to
give up his citizenship and political aspiration as his means of escaping a regime he abhorred, his repatriation is to be
given retroactive effect as of the date of his application therefor, during the pendency of which he was stateless, he
having given up his U.S. nationality. Thus, in contemplation of law, he possessed the vital requirement of Filipino
citizenship as of the start of the term of office of governor, and should have been proclaimed instead of Lee.
Furthermore, since his reacquisition of citizenship retroacted to August 17, 1994, his registration as a voter of
Sorsogon is deemed to have been validated as of said date as well. The foregoing, of course, are precisely
consistent with our holding that lack of the citizenship requirement is not a continuing disability or disqualification to
run for and hold public office. And once again, we emphasize herein our previous rulings recognizing the Comelec's
authority and jurisdiction to hear and decide petitions for annulment of proclamations.
This Court has time and again liberally and equitably construed the electoral laws of our country to give fullest effect
to the manifest will of our people,
66
for in case of doubt, political laws must be interpreted to give life and spirit to the
popular mandate freely expressed through the ballot. Otherwise stated, legal niceties and technicalities cannot stand
in the way of the sovereign will. Consistently, we have held:
. . . (L)aws governing election contests must be liberally construed to the end that the will of the
people in the choice of public officials may not be defeated by mere technical objections (citations
omitted).
6
7
The law and the courts must accord Frivaldo every possible protection, defense and refuge, in deference to the
popular will. Indeed, this Court has repeatedly stressed the importance of giving effect to the sovereign will in order to
ensure the survival of our democracy. In any action involving the possibility of a reversal of the popular electoral
choice, this Court must exert utmost effort to resolve the issues in a manner that would give effect to the will of the
majority, for it is merely sound public policy to cause elective offices to be filled by those who are the choice of the
majority. To successfully challenge a winning candidate's qualifications, the petitioner must clearly demonstrate that
the ineligibility is so patently antagonistic
68
to constitutional and legal principles that overriding such ineligibility and
thereby giving effect to the apparent will of the people, would ultimately create greater prejudice to the very
democratic institutions and juristic traditions that our Constitution and laws so zealously protect and promote. In this
undertaking, Lee has miserably failed.
In Frivaldo's case. it would have been technically easy to find fault with his cause. The Court could have refused to
grant retroactivity to the effects of his repatriation and hold him still ineligible due to his failure to show his citizenship
at the time he registered as a voter before the 1995 elections. Or, it could have disputed the factual findings of the
Comelec that he was stateless at the time of repatriation and thus hold his consequent dual citizenship as a
disqualification "from running for any elective local position." But the real essence of justice does not emanate from
quibblings over patchwork legal technicality. It proceeds from the spirit's gut consciousness of the dynamic role of law
as a brick in the ultimate development of the social edifice. Thus, the Court struggled against and eschewed the easy,
legalistic, technical and sometimes harsh anachronisms of the law in order to evoke substantial justice in the larger
social context consistent with Frivaldo's unique situation approximating venerability in Philippine political life.
Concededly, he sought American citizenship only to escape the clutches of the dictatorship. At this stage, we cannot
seriously entertain any doubt about his loyalty and dedication to this country. At the first opportunity, he returned to
this land, and sought to serve his people once more. The people of Sorsogon overwhelmingly voted for him three
times. He took an oath of allegiance to this Republic every time he filed his certificate of candidacy and during his
failed naturalization bid. And let it not be overlooked, his demonstrated tenacity and sheer determination to re-
assume his nationality of birth despite several legal set-backs speak more loudly, in spirit, in fact and in truth than any
legal technicality, of his consuming intention and burning desire to re-embrace his native Philippines even now at the
ripe old age of 81 years. Such loyalty to and love of country as well as nobility of purpose cannot be lost on this Court
of justice and equity. Mortals of lesser mettle would have given up. After all, Frivaldo was assured of a life of ease
and plenty as a citizen of the most powerful country in the world. But he opted, nay, single-mindedly insisted on
returning to and serving once more his struggling but beloved land of birth. He therefore deserves every liberal
interpretation of the law which can be applied in his favor. And in the final analysis, over and above Frivaldo himself,
the indomitable people of Sorsogon most certainly deserve to be governed by a leader of their overwhelming choice.
WHEREFORE, in consideration of the foregoing:
(1) The petition in G.R. No. 123755 is hereby DISMISSED. The assailed Resolutions of the respondent Commission
are AFFIRMED.
(2) The petition in G.R. No. 120295 is also DISMISSED for being moot and academic. In any event, it has no merit.
No costs.
SO ORDERED.
Padilla, Regalado, Romero, Bellosillo, Francisco, Hermosisima, Jr. and Torres, Jr., JJ., concur.
Melo, Vitug and Kapunan, JJ., concurs in the result.
Narvasa, C.J. and Mendoza, J., took no part.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 162224 June 7, 2007
2nd LT. SALVADOR PARREO represented by his daughter Myrna P. Caintic, petitioner,
vs.
COMMISSION ON AUDIT and CHIEF OF STAFF, ARMED FORCES OF THE PHILIPPINES, respondents.
D E C I S I O N
CARPIO, J .:
The Case
Before the Court is a petition for certiorari
1
assailing the 9 January 2003 Decision
2
and 13 January 2004
Resolution
3
of the Commission on Audit (COA).
The Antecedent Facts
Salvador Parreo (petitioner) served in the Armed Forces of the Philippines (AFP) for 32 years. On 5 January 1982,
petitioner retired from the Philippine Constabulary with the rank of 2nd Lieutenant. Petitioner availed, and received
payment, of a lump sum pension equivalent to three years pay. In 1985, petitioner started receiving his monthly
pension amounting to P13,680.
Petitioner migrated to Hawaii and became a naturalized American citizen. In January 2001, the AFP stopped
petitioners monthly pension in accordance with Section 27 of Presidential Decree No. 1638
4
(PD 1638), as amended
by Presidential Decree No. 1650.
5
Section 27 of PD 1638, as amended, provides that a retiree who loses his Filipino
citizenship shall be removed from the retired list and his retirement benefits terminated upon loss of Filipino
citizenship. Petitioner requested for reconsideration but the Judge Advocate General of the AFP denied the request.
Petitioner filed a claim before the COA for the continuance of his monthly pension.
The Ruling of the Commission on Audit
In its 9 January 2003 Decision, the COA denied petitioners claim for lack of jurisdiction. The COA ruled:
It becomes immediately noticeable that the resolution of the issue at hand hinges upon the validity of Section 27 of
P.D. No. 1638, as amended. Pursuant to the mandate of the Constitution, whenever a dispute involves the validity of
laws, "the courts, as guardians of the Constitution, have the inherent authority to determine whether a statute enacted
by the legislature transcends the limit imposed by the fundamental law. Where the statute violates the Constitution, it
is not only the right but the duty of the judiciary to declare such act as unconstitutional and void." (Tatad vs. Secretary
of Department of Energy, 281 SCRA 330) That being so, prudence dictates that this Commission defer to the
authority and jurisdiction of the judiciary to rule in the first instance upon the constitutionality of the provision in
question.
Premises considered, the request is denied for lack of jurisdiction to adjudicate the same. Claimant is advised to file
his claim with the proper court of original jurisdiction.
6

Petitioner filed a motion for reconsideration. Petitioner alleged that the COA has the power and authority to
incidentally rule on the constitutionality of Section 27 of PD 1638, as amended. Petitioner alleged that a direct
recourse to the court would be dismissed for failure to exhaust administrative remedies. Petitioner further alleged that
since his monthly pension involves government funds, the reason for the termination of the pension is subject to
COAs authority and jurisdiction.
In its 13 January 2004 Resolution, the COA denied the motion. The COA ruled that the doctrine of exhaustion of
administrative remedies does not apply if the administrative body has, in the first place, no jurisdiction over the case.
The COA further ruled that even if it assumed jurisdiction over the claim, petitioners entitlement to the retirement
benefits he was previously receiving must necessarily cease upon the loss of his Filipino citizenship in accordance
with Section 27 of PD 1638, as amended.
Hence, the petition before this Court.
The Issues
Petitioner raises the following issues:
1. Whether Section 27 of PD 1638, as amended, is constitutional;
2. Whether the COA has jurisdiction to rule on the constitutionality of Section 27 of PD 1638, as amended; and
3. Whether PD 1638, as amended, has retroactive or prospective effect.
7

The Ruling of this Court
The petition has no merit.
J urisdiction of the COA
Petitioner filed his money claim before the COA. A money claim is "a demand for payment of a sum of money,
reimbursement or compensation arising from law or contract due from or owing to a government agency."
8
Under
Commonwealth Act No. 327,
9
as amended by Presidential Decree No. 1445,
10
money claims against the government
shall be filed before the COA.
11


Section 2(1), Article IX(D) of the 1987 Constitution prescribes the powers of the COA, as follows:
Sec. 2. (1) The Commission on Audit shall have the power, authority, and duty to examine, audit, and settle all
accounts pertaining to the revenue and receipts of, and expenditures or uses of funds and property, owned or held in
trust by, or pertaining to, the Government, or any of its subdivisions, agencies, or instrumentalities, including
government-owned or controlled corporations with original charters, and on a post-audit basis; (a) constitutional
bodies, commissions and offices that have been granted fiscal autonomy under this Constitution; (b) autonomous
state colleges and universities; (c) other government-owned or controlled corporations and their subsidiaries; and (d)
such non-governmental entities receiving subsidy or equity, directly or indirectly, from or through the Government,
which are required by law or the granting institution to submit such audit as a condition of subsidy or equity. However,
where the internal control system of the audited agencies is inadequate, the Commission may adopt such measures,
including temporary or special pre-audit, as are necessary and appropriate to correct the deficiencies. It shall keep
the general accounts of the Government and, for such period as may be provided by law, preserve the vouchers and
other supporting papers pertaining thereto.
The jurisdiction of the COA over money claims against the government does not include the power to rule on the
constitutionality or validity of laws. The 1987 Constitution vests the power of judicial review or the power to declare
unconstitutional a law, treaty, international or executive agreement, presidential decree, order, instruction, ordinance,
or regulation in this Court and in all Regional Trial Courts.
12
Petitioners money claim essentially involved the
constitutionality of Section 27 of PD 1638, as amended. Hence, the COA did not commit grave abuse of discretion in
dismissing petitioners money claim.
Petitioner submits that the COA has the authority to order the restoration of his pension even without ruling on the
constitutionality of Section 27 of PD 1638, as amended. The COA actually ruled on the matter in its 13 January 2004
Resolution, thus:
Furthermore, assuming arguendo that this Commission assumed jurisdiction over the instant case, claimants
entitlement to the retirement benefits he was previously receiving must necessarily be severed or stopped upon the
loss of his Filipino citizenship as prescribed in Section 27, P.D. No. 1638, as amended by P.D. No. 1650.
13

The COA effectively denied petitioners claim because of the loss of his Filipino citizenship.
Application of PD 1638, as amended
Petitioner alleges that PD 1638, as amended, should apply prospectively. The Office of the Solicitor General (OSG)
agrees with petitioner. The OSG argues that PD 1638, as amended, should apply only to those who joined the
military service after its effectivity, citing Sections 33 and 35, thus:
Section 33. Nothing in this Decree shall be construed in any manner to reduce whatever retirement and separation
pay or gratuity or other monetary benefits which any person is heretofore receiving or is entitled to receive under the
provisions of existing law.
x x x x
Section. 35. Except those necessary to give effect to the provisions of this Decree and to preserve the rights granted
to retired or separated military personnel, all laws, rules and regulations inconsistent with the provisions of this
Decree are hereby repealed or modified accordingly.
The OSG further argues that retirement laws are liberally construed in favor of the retirees. Article 4 of the Civil Code
provides: "Laws shall have no retroactive effect, unless the contrary is provided." Section 36 of PD 1638, as
amended, provides that it shall take effect upon its approval. It was signed on 10 September 1979. PD 1638, as
amended, does not provide for its retroactive application. There is no question that PD 1638, as amended, applies
prospectively.
However, we do not agree with the interpretation of petitioner and the OSG that PD 1638, as amended, should apply
only to those who joined the military after its effectivity. Since PD 1638, as amended, is about the new system of
retirement and separation from service of military personnel, it should apply to those who were in the service at the
time of its approval. In fact, Section 2 of PD 1638, as amended, provides that "th[e] Decree shall apply to all military
personnel in the service of the Armed Forces of the Philippines." PD 1638, as amended, was signed on 10
September 1979. Petitioner retired in 1982, long after the approval of PD 1638, as amended. Hence, the provisions of
PD 1638, as amended, apply to petitioner.
Petitioner Has No Vested Right to his
Retirement Benefits
Petitioner alleges that Section 27 of PD 1638, as amended, deprives him of his property which the Constitution and
statutes vest in him. Petitioner alleges that his pension, being a property vested by the Constitution, cannot be
removed or taken from him just because he became a naturalized American citizen. Petitioner further alleges that the
termination of his monthly pension is a penalty equivalent to deprivation of his life.
The allegations have no merit. PD 1638, as amended, does not impair any vested right or interest of petitioner.
Where the employee retires and meets the eligibility requirements, he acquires a vested right to the benefits that is
protected by the due process clause.
14
At the time of the approval of PD 1638 and at the time of its amendment,
petitioner was still in active service. Hence, petitioners retirement benefits were only future benefits and did not
constitute a vested right. Before a right to retirement benefits or pension vests in an employee, he must have met the
stated conditions of eligibility with respect to the nature of employment, age, and length of service.
15
It is only upon
retirement that military personnel acquire a vested right to retirement benefits. Retirees enjoy a protected property
interest whenever they acquire a right to immediate payment under pre-existing law.
16

Further, the retirement benefits of military personnel are purely gratuitous in nature. They are not similar to pension
plans where employee participation is mandatory, hence, the employees have contractual or vested rights in the
pension which forms part of the compensation.
17

Constitutionality of Section 27 of PD 1638
Section 27 of PD 1638, as amended, provides:
Section 27. Military personnel retired under Sections 4, 5, 10, 11 and 12 shall be carried in the retired list of the
Armed Forces of the Philippines. The name of a retiree who loses his Filipino citizenship shall be removed from the
retired list and his retirement benefits terminated upon such loss.
The OSG agrees with petitioner that Section 27 of PD 1638, as amended, is unconstitutional. The OSG argues that
the obligation imposed on petitioner to retain his Filipino citizenship as a condition for him to remain in the AFP retired
list and receive his retirement benefit is contrary to public policy and welfare, oppressive, discriminatory, and violative
of the due process clause of the Constitution. The OSG argues that the retirement law is in the nature of a contract
between the government and its employees. The OSG further argues that Section 27 of PD 1638, as amended,
discriminates against AFP retirees who have changed their nationality.
We do not agree.
The constitutional right to equal protection of the laws is not absolute but is subject to reasonable classification.
18
To
be reasonable, the classification (a) must be based on substantial distinctions which make real differences; (b) must
be germane to the purpose of the law; (c) must not be limited to existing conditions only; and (d) must apply equally
to each member of the class.
19

There is compliance with all these conditions. There is a substantial difference between retirees who are citizens of
the Philippines and retirees who lost their Filipino citizenship by naturalization in another country, such as petitioner in
the case before us. The constitutional right of the state to require all citizens to render personal and military
service
20
necessarily includes not only private citizens but also citizens who have retired from military service. A
retiree who had lost his Filipino citizenship already renounced his allegiance to the state. Thus, he may no longer be
compelled by the state to render compulsory military service when the need arises. Petitioners loss of Filipino
citizenship constitutes a substantial distinction that distinguishes him from other retirees who retain their Filipino
citizenship. If the groupings are characterized by substantial distinctions that make real differences, one class may be
treated and regulated differently from another.
21

Republic Act No. 7077
22
(RA 7077) affirmed the constitutional right of the state to a Citizen Armed Forces. Section 11
of RA 7077 provides that citizen soldiers or reservists include ex-servicemen and retired officers of the AFP. Hence,
even when a retiree is no longer in the active service, he is still a part of the Citizen Armed Forces. Thus, we do not
find the requirement imposed by Section 27 of PD 1638, as amended, oppressive, discriminatory, or contrary to
public policy. The state has the right to impose a reasonable condition that is necessary for national defense. To rule
otherwise would be detrimental to the interest of the state.
There was no denial of due process in this case. When petitioner lost his Filipino citizenship, the AFP had no choice
but to stop his monthly pension in accordance with Section 27 of PD 1638, as amended. Petitioner had the
opportunity to contest the termination of his pension when he requested for reconsideration of the removal of his
name from the list of retirees and the termination of his pension. The Judge Advocate General denied the request
pursuant to Section 27 of PD 1638, as amended.
Petitioner argues that he can reacquire his Filipino citizenship under Republic Act No. 9225
23
(RA 9225), in which
case he will still be considered a natural-born Filipino. However, petitioner alleges that if he reacquires his Filipino
citizenship under RA 9225, he will still not be entitled to his pension because of its prior termination. This situation is
speculative. In the first place, petitioner has not shown that he has any intention of reacquiring, or has done anything
to reacquire, his Filipino citizenship. Secondly, in response to the request for opinion of then AFP Chief of Staff,
General Efren L. Abu, the Department of Justice (DOJ) issued DOJ Opinion No. 12, series of 2005, dated 19 January
2005, thus:
[T]he AFP uniformed personnel retirees, having re-acquired Philippine citizenship pursuant to R.A. No. 9225 and its
IRR, are entitled to pension and gratuity benefits reckoned from the date they have taken their oath of allegiance to
the Republic of the Philippines. It goes without saying that these retirees have no right to receive such pension
benefits during the time that they have ceased to be Filipinos pursuant to the aforequoted P.D. No. 1638, as
amended, and any payment made to them should be returned to the AFP. x x x.
24

Hence, petitioner has other recourse if he desires to continue receiving his monthly pension. Just recently, inAASJS
Member-Hector Gumangan Calilung v. Simeon Datumanong,
25
this Court upheld the constitutionality of RA 9225. If
petitioner reacquires his Filipino citizenship, he will even recover his natural-born citizenship.
26
In Tabasa v. Court of
Appeals,
27
this Court reiterated that "[t]he repatriation of the former Filipino will allow him to recover his natural-born
citizenship x x x."
Petitioner will be entitled to receive his monthly pension should he reacquire his Filipino citizenship since he will again
be entitled to the benefits and privileges of Filipino citizenship reckoned from the time of his reacquisition of Filipino
citizenship. There is no legal obstacle to the resumption of his retirement benefits from the time he complies again
with the condition of the law, that is, he can receive his retirement benefits provided he is a Filipino citizen.
We acknowledge the service rendered to the country by petitioner and those similarly situated. However, petitioner
failed to overcome the presumption of constitutionality of Section 27 of PD 1638, as amended. Unless the provision is
amended or repealed in the future, the AFP has to apply Section 27 of PD 1638, as amended.
WHEREFORE, we DISMISS the petition. We AFFIRM the 9 January 2003 Decision and 13 January 2004 Resolution
of the Commission on Audit.
SO ORDERED.
ANTONIO T. CARPIO
Associate Justice
WE CONCUR:
(On official leave)
REYNATO S. PUNO
Chief Justice

Acting Chief Justice
CONSUELO YNARES-SANTIAGO
Associate Justice
ANGELINA SANDOVAL-GUTIERREZ
Associate Justice
MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice
RENATO C. CORONA
Associate Justice
CONCHITA CARPIO MORALES
Associate Justice
ADOLFO S. AZCUNA
Associate Justice
DANTE O. TINGA
Associate Justice
MINITA V. CHICO-NAZARIO
Associate Justice
CANCIO C. GARCIA
Associate Justice
PRESBITERO J. VELASCO, JR.
Associate Justice
ANTONIO EDUARDO B. NACHURA
Associate Justice


C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above Decision had been
reached in consultation before the case was assigned to the writer of the opinion of the Court.
LEONARDO A. QUISUMBING
Acting Chief Justice
SUPREME COURT
Manila
EN BANC
G.R. No. 176947 February 19, 2009
GAUDENCIO M. CORDORA, Petitioner,
vs.
COMMISSION ON ELECTIONS and GUSTAVO S. TAMBUNTING, Respondents.
D E C I S I O N
CARPIO, J .:
The Case
This is a petition for certiorari and mandamus, with prayer for the issuance of a temporary restraining order under
Rule 65 of the 1997 Rules of Civil Procedure.
In EO Case No. 05-17, Gaudencio M. Cordora (Cordora) accused Gustavo S. Tambunting (Tambunting) of an
election offense for violating Section 74 in relation to Section 262 of the Omnibus Election Code. The Commission on
Elections (COMELEC) En Banc dismissed Cordoras complaint in a Resolution
1
dated 18 August 2006. The present
petition seeks to reverse the 18 August 2006 Resolution as well as the Resolution
2
dated 20 February 2007 of the
COMELEC En Banc which denied Cordoras motion for reconsideration.
The Facts
In his complaint affidavit filed before the COMELEC Law Department, Cordora asserted that Tambunting made false
assertions in the following items:
That Annex A [Tambuntings Certificate of Candidacy for the 2001 elections] and Annex B [Tambuntings Certificate
of Candidacy for the 2004 elections] state, among others, as follows, particularly Nos. 6, 9 and 12 thereof:
1. No. 6 I am a Natural Born/Filipino Citizen
2. No. 9 No. of years of Residence before May 14, 2001.
36 in the Philippines and 25 in the Constituency where I seek to be elected;
3. No. 12 I am ELIGIBLE for the office I seek to be elected.
3
(Boldface and capitalization in the original)
Cordora stated that Tambunting was not eligible to run for local public office because Tambunting lacked the required
citizenship and residency requirements.
To disprove Tambuntings claim of being a natural-born Filipino citizen, Cordora presented a certification from the
Bureau of Immigration which stated that, in two instances, Tambunting claimed that he is an American: upon arrival in
the Philippines on 16 December 2000 and upon departure from the Philippines on 17 June 2001. According to
Cordora, these travel dates confirmed that Tambunting acquired American citizenship through naturalization in
Honolulu, Hawaii on 2 December 2000. Cordora concluded:
That Councilor Gustavo S. Tambunting contrary to the provision of Sec 74 (OEC): [sic] Re: CONTENTS OF
CERTIFICATE OF CANDIDACY: which requires the declarant/affiant to state, among others, under oath, that he is a
Filipino (No. 6), No. 9- residence requirement which he lost when [he was] naturalized as an American Citizen on
December 2, 2000 at [sic] Honolulu, Hawaii, knowingly and willfully affirmed and reiterated that he possesses the
above basic requirements under No. 12 that he is indeed eligible for the office to which he seeks to be
elected, when in truth and in fact, the contrary is indubitably established by his own statements before the
Philippine Bureau of Immigration x x x.
4
(Emphases in the original)
Tambunting, on the other hand, maintained that he did not make any misrepresentation in his certificates of
candidacy. To refute Cordoras claim that Tambunting is not a natural-born Filipino, Tambunting presented a copy of
his birth certificate which showed that he was born of a Filipino mother and an American father. Tambunting further
denied that he was naturalized as an American citizen. The certificate of citizenship conferred by the US government
after Tambuntings father petitioned him through INS Form I-130 (Petition for Relative) merely confirmed
Tambuntings citizenship which he acquired at birth. Tambuntings possession of an American passport did not mean
that Tambunting is not a Filipino citizen. Tambunting also took an oath of allegiance on 18 November 2003 pursuant
to Republic Act No. 9225 (R.A. No. 9225), or the Citizenship Retention and Reacquisition Act of 2003.
Tambunting further stated that he has resided in the Philippines since birth. Tambunting has imbibed the Filipino
culture, has spoken the Filipino language, and has been educated in Filipino schools. Tambunting maintained that
proof of his loyalty and devotion to the Philippines was shown by his service as councilor of Paraaque.
To refute Cordoras claim that the number of years of residency stated in Tambuntings certificates of candidacy is
false because Tambunting lost his residency because of his naturalization as an American citizen, Tambunting
contended that the residency requirement is not the same as citizenship.
The Ruling of the COMELEC Law Department
The COMELEC Law Department recommended the dismissal of Cordoras complaint against Tambunting because
Cordora failed to substantiate his charges against Tambunting. Cordoras reliance on the certification of the Bureau of
Immigration that Tambunting traveled on an American passport is not sufficient to prove that Tambunting is an
American citizen.
The Ruling of the COMELEC En Banc
The COMELEC En Banc affirmed the findings and the resolution of the COMELEC Law Department. The
COMELEC En Banc was convinced that Cordora failed to support his accusation against Tambunting by sufficient
and convincing evidence.
The dispositive portion of the COMELEC En Bancs Resolution reads as follows:
WHEREFORE, premises considered, the instant complaint is hereby DISMISSED for insufficiency of evidence to
establish probable cause.
SO ORDERED.
5

Commissioner Rene V. Sarmiento (Commissioner Sarmiento) wrote a separate opinion which concurred with the
findings of the En Banc Resolution. Commissioner Sarmiento pointed out that Tambunting could be considered a
dual citizen. Moreover, Tambunting effectively renounced his American citizenship when he filed his certificates of
candidacy in 2001 and 2004 and ran for public office.
Cordora filed a motion for reconsideration which raised the same grounds and the same arguments in his complaint.
In its Resolution promulgated on 20 February 2007, the COMELEC En Banc dismissed Cordoras motion for
reconsideration for lack of merit.
The Issue
Cordora submits that the COMELEC acted with grave abuse of discretion amounting to lack or excess of jurisdiction
when it declared that there is no sufficient evidence to support probable cause that may warrant the prosecution of
Tambunting for an election offense.
Cordoras petition is not an action to disqualify Tambunting because of Tambuntings failure to meet citizenship and
residency requirements. Neither is the present petition an action to declare Tambunting a non-Filipino and a non-
resident. The present petition seeks to prosecute Tambunting for knowingly making untruthful statements in his
certificates of candidacy.
The Ruling of the Court
The petition has no merit. We affirm the ruling of the COMELEC En Banc.
Whether there is Probable Cause to Hold Tambunting for Trial for Having Committed an Election Offense
There was no grave abuse of discretion in the COMELEC En Bancs ruling that there is no sufficient and convincing
evidence to support a finding of probable cause to hold Tambunting for trial for violation of Section 74 in relation to
Section 262 of the Omnibus Election Code.
Probable cause constitutes those facts and circumstances which would lead a reasonably discreet and prudent man
to believe that an offense has been committed. Determining probable cause is an intellectual activity premised on the
prior physical presentation or submission of documentary or testimonial proofs either confirming, negating or
qualifying the allegations in the complaint.
6

Section 74 of the Omnibus Election Code reads as follows:
Contents of certificate of candidacy. The certificate of candidacy shall state that the person filing it is
announcing his candidacy for the office stated therein and that he is eligible for said office; x x x the political party to
which he belongs; civil status; his date of birth; residence; his post office address for all election purposes; his
profession or occupation; that he will support and defend the Constitution of the Philippines and will maintain true
faith and allegiance thereto; that he will obey the laws, legal orders and decrees promulgated by the duly constituted
authorities; that he is not a permanent resident or immigrant to a foreign country; that the obligation imposed by his
oath is assumed voluntarily, without mental reservation or purpose of evasion; and that the facts stated in the
certificate of candidacy are true to the best of his knowledge.
x x x
The person filing a certificate of candidacy shall also affix his latest photograph, passport size; a statement in
duplicate containing his bio-data and program of government not exceeding one hundred words, if he so desires.
Section 262 of the Omnibus Election Code, on the other hand, provides that violation of Section 74, among other
sections in the Code, shall constitute an election offense.
Tambuntings Dual Citizenship
Tambunting does not deny that he is born of a Filipino mother and an American father. Neither does he deny that he
underwent the process involved in INS Form I-130 (Petition for Relative) because of his fathers citizenship.
Tambunting claims that because of his parents differing citizenships, he is both Filipino and American by birth.
Cordora, on the other hand, insists that Tambunting is a naturalized American citizen.
We agree with Commissioner Sarmientos observation that Tambunting possesses dual citizenship. Because of the
circumstances of his birth, it was no longer necessary for Tambunting to undergo the naturalization process to
acquire American citizenship. The process involved in INS Form I-130 only served to confirm the American
citizenship which Tambunting acquired at birth. The certification from the Bureau of Immigration which Cordora
presented contained two trips where Tambunting claimed that he is an American. However, the same certification
showed nine other trips where Tambunting claimed that he is Filipino. Clearly, Tambunting possessed dual
citizenship prior to the filing of his certificate of candidacy before the 2001 elections. The fact that Tambunting had
dual citizenship did not disqualify him from running for public office.
7

Requirements for dual citizens from birth who desire to run for public office
We deem it necessary to reiterate our previous ruling in Mercado v. Manzano, wherein we ruled that dual citizenship
is not a ground for disqualification from running for any elective local position.
To begin with, dual citizenship is different from dual allegiance. The former arises when, as a result of the concurrent
application of the different laws of two or more states, a person is simultaneously considered a national by the said
states. For instance, such a situation may arise when a person whose parents are citizens of a state which adheres
to the principle of jus sanguinis is born in a state which follows the doctrine of jus soli. Such a person, ipso facto and
without any voluntary act on his part, is concurrently considered a citizen of both states. Considering the citizenship
clause (Art. IV) of our Constitution, it is possible for the following classes of citizens of the Philippines to possess dual
citizenship:
(1) Those born of Filipino fathers and/or mothers in foreign countries which follow the principle of jus soli;
(2) Those born in the Philippines of Filipino mothers and alien fathers if by the laws of their fathers country
such children are citizens of that country;
(3) Those who marry aliens if by the laws of the latters country the former are considered citizens, unless by
their act or omission they are deemed to have renounced Philippine citizenship.
There may be other situations in which a citizen of the Philippines may, without performing any act, be also a citizen
of another state; but the above cases are clearly possible given the constitutional provisions on citizenship.
Dual allegiance, on the other hand, refers to the situation in which a person simultaneously owes, by some positive
act, loyalty to two or more states. While dual citizenship is involuntary, dual allegiance is the result of an individuals
volition.
x x x
[I]n including 5 in Article IV on citizenship, the concern of the Constitutional Commission was not with dual
citizensper se but with naturalized citizens who maintain their allegiance to their countries of origin even after their
naturalization. Hence, the phrase "dual citizenship" in R.A. No. 7160, 40(d) and in R.A. No. 7854, 20 must be
understood as referring to "dual allegiance." Consequently, persons with mere dual citizenship do not fall under
this disqualification. Unlike those with dual allegiance, who must, therefore, be subject to strict process with
respect to the termination of their status, for candidates with dual citizenship, it should suffice if, upon the
filing of their certificates of candidacy, they elect Philippine citizenship to terminate their status as persons
with dual citizenship considering that their condition is the unavoidable consequence of conflicting laws of
different states. As Joaquin G. Bernas, one of the most perceptive members of the Constitutional Commission,
pointed out: "[D]ual citizenship is just a reality imposed on us because we have no control of the laws on citizenship
of other countries. We recognize a child of a Filipino mother. But whether or not she is considered a citizen of another
country is something completely beyond our control."
By electing Philippine citizenship, such candidates at the same time forswear allegiance to the other country of which
they are also citizens and thereby terminate their status as dual citizens. It may be that, from the point of view of the
foreign state and of its laws, such an individual has not effectively renounced his foreign citizenship. That is of no
moment as the following discussion on 40(d) between Senators Enrile and Pimentel clearly shows:
SENATOR ENRILE. Mr. President, I would like to ask clarification of line 41, page 17: "Any person with dual
citizenship" is disqualified to run for any elective local position. Under the present Constitution, Mr. President,
someone whose mother is a citizen of the Philippines but his father is a foreigner is a natural-born citizen of the
Republic. There is no requirement that such a natural-born citizen, upon reaching the age of majority, must elect or
give up Philippine citizenship.
On the assumption that this person would carry two passports, one belonging to the country of his or her father and
one belonging to the Republic of the Philippines, may such a situation disqualify the person to run for a local
government position?
SENATOR PIMENTEL. To my mind, Mr. President, it only means that at the moment when he would want to run for
public office, he has to repudiate one of his citizenships.
SENATOR ENRILE. Suppose he carries only a Philippine passport but the country of origin or the country of the
father claims that person, nevertheless, as a citizen,? No one can renounce. There are such countries in the
world.1avvphi1
SENATOR PIMENTEL. Well, the very fact that he is running for public office would, in effect, be an election for him of
his desire to be considered a Filipino citizen.
SENATOR ENRILE. But, precisely, Mr. President, the Constitution does not require an election. Under the
Constitution, a person whose mother is a citizen of the Philippines is, at birth, a citizen without any overt act to claim
the citizenship.
SENATOR PIMENTEL. Yes. What we are saying, Mr. President, is: Under the Gentlemans example, if he does not
renounce his other citizenship, then he is opening himself to question. So, if he is really interested to run, the first
thing he should do is to say in the Certificate of Candidacy that: "I am a Filipino citizen, and I have only one
citizenship."
SENATOR ENRILE. But we are talking from the viewpoint of Philippine law, Mr. President. He will always have one
citizenship, and that is the citizenship invested upon him or her in the Constitution of the Republic.
SENATOR PIMENTEL. That is true, Mr. President. But if he exercises acts that will prove that he also acknowledges
other citizenships, then he will probably fall under this disqualification.
8
(Emphasis supplied)
We have to consider the present case in consonance with our rulings in Mercado v. Manzano,
9
Valles v.
COMELEC,
10
and AASJS v. Datumanong.
11
Mercado and Valles involve similar operative facts as the present case.
Manzano and Valles, like Tambunting, possessed dual citizenship by the circumstances of their birth. Manzano was
born to Filipino parents in the United States which follows the doctrine of jus soli. Valles was born to an Australian
mother and a Filipino father in Australia. Our rulings in Manzano and Valles stated that dual citizenship is different
from dual allegiance both by cause and, for those desiring to run for public office, by effect. Dual citizenship is
involuntary and arises when, as a result of the concurrent application of the different laws of two or more states, a
person is simultaneously considered a national by the said states. Thus, like any other natural-born Filipino, it is
enough for a person with dual citizenship who seeks public office to file his certificate of candidacy and swear to the
oath of allegiance contained therein. Dual allegiance, on the other hand, is brought about by the individuals active
participation in the naturalization process. AASJS states that, under R.A. No. 9225, a Filipino who becomes a
naturalized citizen of another country is allowed to retain his Filipino citizenship by swearing to the supreme authority
of the Republic of the Philippines. The act of taking an oath of allegiance is an implicit renunciation of a naturalized
citizens foreign citizenship.
R.A. No. 9225, or the Citizenship Retention and Reacquisition Act of 2003, was enacted years after the promulgation
of Manzano and Valles. The oath found in Section 3 of R.A. No. 9225 reads as follows:
I __________ , solemnly swear (or affirm) that I will support and defend the Constitution of the Republic of the
Philippines and obey the laws and legal orders promulgated by the duly constituted authorities of the Philippines; and
I hereby declare that I recognize and accept the supreme authority of the Philippines and will maintain true faith and
allegiance thereto; and that I impose this obligation upon myself voluntarily without mental reservation or purpose of
evasion.
In Sections 2 and 3 of R.A. No. 9225, the framers were not concerned with dual citizenship per se, but with the status
of naturalized citizens who maintain their allegiance to their countries of origin even after their
naturalization.
12
Section 5(3) of R.A. No. 9225 states that naturalized citizens who reacquire Filipino citizenship and
desire to run for elective public office in the Philippines shall "meet the qualifications for holding such public office as
required by the Constitution and existing laws and, at the time of filing the certificate of candidacy, make a personal
and sworn renunciation of any and all foreign citizenship before any public officer authorized to administer an oath"
aside from the oath of allegiance prescribed in Section 3 of R.A. No. 9225. The twin requirements of swearing to an
Oath of Allegiance and executing a Renunciation of Foreign Citizenship served as the bases for our recent rulings
in Jacot v. Dal and COMELEC,
13
Velasco v. COMELEC,
14
and Japzon v. COMELEC,
15
all of which involve natural-
born Filipinos who later became naturalized citizens of another country and thereafter ran for elective office in the
Philippines. In the present case, Tambunting, a natural-born Filipino, did not subsequently become a naturalized
citizen of another country. Hence, the twin requirements in R.A. No. 9225 do not apply to him.
Tambuntings residency
Cordora concluded that Tambunting failed to meet the residency requirement because of Tambuntings naturalization
as an American. Cordoras reasoning fails because Tambunting is not a naturalized American. Moreover, residency,
for the purpose of election laws, includes the twin elements of the fact of residing in a fixed place and the intention to
return there permanently,
16
and is not dependent upon citizenship.
In view of the above, we hold that Cordora failed to establish that Tambunting indeed willfully made false entries in
his certificates of candidacy. On the contrary, Tambunting sufficiently proved his innocence of the charge filed against
him. Tambunting is eligible for the office which he sought to be elected and fulfilled the citizenship and residency
requirements prescribed by law.
WHEREFORE, we DISMISS the petition. We AFFIRM the Resolutions of the Commission on Elections En
Bancdated 18 August 2006 and 20 February 2007 in EO Case No. 05-17.
SO ORDERED.
ANTONIO T. CARPIO
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
LEONARDO A. QUISUMBING
Associate Justice
(On official leave)
CONSUELO YNARES-SANTIAGO
*

Associate Justice
MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice
RENATO C. CORONA
Associate Justice
CONCHITA CARPIO MORALES
Associate Justice
(On official leave)
DANTE O. TINGA
**

Associate Justice
MINITA V. CHICO-NAZARIO
Associate Justice
(On official leave)
PRESBITERO J. VELASCO, JR.
***

Associate Justice
ANTONIO EDUARDO B. NACHURA
Associate Justice
ARTURO D. BRION
Associate Justice
TERESITA J. LEONARDO-DE CASTRO
Associate Justice
DIOSDADO M. PERALTA
Associate Justice
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, I certify that the conclusions in the above Decision had been
reached in consultation before the case was assigned to the writer of the opinion of the Court.
REYNATO S. PUNO
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 180048 June 19, 2009
ROSELLER DE GUZMAN, Petitioner,
vs.
COMMISSION ON ELECTIONS and ANGELINA DG. DELA CRUZ, Respondents.
D E C I S I O N
YNARES-SANTIAGO, J .:
This petition
1
for certiorari with prayer for preliminary injunction and temporary restraining order assails the June 15,
2007 Resolution
2
of the First Division of the Commission on Elections (COMELEC) in SPA No. 07-211, disqualifying
petitioner Roseller De Guzman from running as vice-mayor in the May 14, 2007 Synchronized National and Local
Elections. Also assailed is the October 9, 2007 Resolution
3
of the COMELEC En Banc denying petitioners motion for
reconsideration.
Petitioner De Guzman and private respondent Angelina DG. Dela Cruz were candidates for vice-mayor of Guimba,
Nueva Ecija in the May 14, 2007 elections. On April 3, 2007, private respondent filed against petitioner a petition
4
for
disqualification docketed as SPA No. 07-211, alleging that petitioner is not a citizen of the Philippines, but an
immigrant and resident of the United States of America.
In his answer, petitioner admitted that he was a naturalized American. However, on January 25, 2006, he applied for
dual citizenship under Republic Act No. 9225 (R.A. No. 9225), otherwise known as the Citizenship Retention and Re-
Acquisition Act of 2003.
5
Upon approval of his application, he took his oath of allegiance to the Republic of the
Philippines on September 6, 2006. He argued that, having re-acquired Philippine citizenship, he is entitled to exercise
full civil and political rights. As such, he is qualified to run as vice-mayor of Guimba, Nueva Ecija.
During the May 14, 2007 elections, private respondent won as vice-mayor. Petitioner filed an election protest on
grounds of irregularities and massive cheating. The case was filed before Branch 31 of the Regional Trial Court of
Guimba, Nueva Ecija and was docketed as Election Protest No. 07-01.
Meanwhile, in SPA No. 07-211, the COMELEC First Division rendered its June 15, 2007 Resolution disqualifying
petitioner, which reads as follows:
Section 3 of R.A. No. 9225 states:
"Retention of Philippine Citizenship. Natural-born citizens of the Philippines who have lost their Philippine
citizenship by reason of their naturalization as citizens of a foreign country are hereby deemed to have reacquired
Philippine citizenship upon taking the following oath of allegiance to the Republic: x x x"
Hence, under the provisions of the aforementioned law, respondent has validly reacquired Filipino citizenship. By
taking this Oath of Allegiance to the Republic of the Philippines on September 6, 2006 before Mary Jo Bernardo
Aragon, Deputy Consul General at the Philippine Consulate General, Los Angeles, California respondent was
deemed a dual citizen, possessing both Filipino and American citizenship.
However, subparagraph (2), Section 5 of the aforementioned Act also provides:
Section 5. Civil and Political Rights and Liabilities -- Those who retain or re-acquire Philippine Citizenship under this
Act shall enjoy full civil and political rights and be subject to all attendant liabilities and responsibilities under existing
laws of the Philippines and the following conditions:
x x x x
(2) Those seeking elective public office in the Philippines shall meet the qualifications for holding such public office as
required by the Constitution and existing laws and, at the time of the filing of the certificate of candidacy, make a
personal and sworn renunciation of any and all foreign citizenship before any public officer authorized to administer
an oath.
As can be gleaned from the above cited provision, respondent [herein petitioner] should have renounced his
American citizenship before he can run for any public elective position. This respondent did not do. The Oath of
Allegiance taken by respondent was for the purpose of re-acquiring Philippine citizenship. It did not, at the same time,
mean that respondent has renounced his American citizenship. Thus, at the time respondent filed his certificate of
candidacy for the position of Vice-Mayor of Guimba, Nueva Ecija he was, and still is, a dual citizen, possessing both
Philippine and American citizenship. For this reason alone, respondent is disqualified to run for the abovementioned
elective position.
WHEREFORE, premises considered, the Commission (First Division) RESOLVED, as it hereby RESOLVES, to
GRANT the instant petition finding it IMBUED WITH MERIT. Hence, respondent (petitioner herein) Roseller T. De
Guzman is disqualified to run as Vice-Mayor of Guimba, Nueva Ecija in the May 14, 2007 Synchronized National and
Local Elections.
6

Petitioner filed a motion for reconsideration but it was dismissed on October 9, 2007 by the COMELEC En Banc for
having been rendered moot in view of private respondents victory.
Thereafter, the trial court in Election Protest No. 07-01 rendered a Decision,
7
dated November 26, 2007, declaring
petitioner as the winner for the Vice-Mayoralty position. It held:
WHEREFORE, judgment is hereby rendered declaring protestant ROSELLER T. DE GUZMAN, as the winner for the
Vice-Mayoralty position with a plurality of 776 votes over the protestee, ANGELINA D.G. DELA CRUZ, in the May 14,
2007 Local Elections in Guimba, Nueva Ecija. With costs against the protestee.
There being no evidence presented as to the damages by both parties, the same are hereby denied.
SO ORDERED.
8

Petitioner filed the instant petition for certiorari, alleging that the COMELEC acted with grave abuse of discretion in
disqualifying him from running as Vice-Mayor because of his failure to renounce his American citizenship, and in
dismissing the motion for reconsideration for being moot.
Petitioner invokes the rulings in Frivaldo v. Commission on Elections
9
and Mercado v. Manzano,
10
that the filing by a
person with dual citizenship of a certificate of candidacy, containing an oath of allegiance, constituted as a
renunciation of his foreign citizenship. Moreover, he claims that the COMELEC En Banc prematurely dismissed the
motion for reconsideration because at that time, there was a pending election protest which was later decided in his
favor.
Meanwhile, private respondent claims that the passage of R.A. No. 9225 effectively abandoned the Courts rulings in
Frivaldo and Mercado; that the current law requires a personal and sworn renunciation of any and all foreign
citizenship; and that petitioner, having failed to renounce his American citizenship, remains a dual citizen and is
therefore disqualified from running for an elective public position under Section 40
11
of Republic Act No. 7160,
otherwise known as the Local Government Code of 1991 (LGC).
The issues for resolution are: 1) whether the COMELEC gravely abused its discretion in dismissing petitioners
motion for reconsideration for being moot; and 2) whether petitioner is disqualified from running for vice-mayor of
Guimba, Nueva Ecija in the May 14, 2007 elections for having failed to renounce his American citizenship in
accordance with R.A. No. 9225.
An issue becomes moot when it ceases to present a justifiable controversy so that a determination thereof would be
without practical use and value.
12
In this case, the pendency of petitioners election protest assailing the results of the
election did not render moot the motion for reconsideration which he filed assailing his disqualification. Stated
otherwise, the issue of petitioners citizenship did not become moot; the resolution of the issue remained relevant
because it could significantly affect the outcome of the election protest. Philippine citizenship is an indispensable
requirement for holding an elective office. As mandated by law: "An elective local official must be a citizen of the
Philippines."
13
It bears stressing that the Regional Trial Court later ruled in favor of petitioner in the election protest
and declared him the winner. In view thereof, a definitive ruling on the issue of petitioners citizenship was clearly
necessary. Hence, the COMELEC committed grave abuse of discretion in dismissing petitioners motion for
reconsideration solely on the ground that the same was rendered moot because he lost to private respondent.
Anent the second issue, we find that petitioner is disqualified from running for public office in view of his failure to
renounce his American citizenship.
R.A. No. 9225 was enacted to allow re-acquisition and retention of Philippine citizenship for: 1) natural-born citizens
who have lost their Philippine citizenship by reason of their naturalization as citizens of a foreign country; and 2)
natural-born citizens of the Philippines who, after the effectivity of the law, become citizens of a foreign country. The
law provides that they are deemed to have re-acquired or retained their Philippine citizenship upon taking the oath of
allegiance.
14

Petitioner falls under the first category, being a natural-born citizen who lost his Philippine citizenship upon his
naturalization as an American citizen. In the instant case, there is no question that petitioner re-acquired his
Philippine citizenship after taking the oath of allegiance on September 6, 2006. However, it must be emphasized that
R.A. No. 9225 imposes an additional requirement on those who wish to seek elective public office, as follows:
Section 5. Civil and Political Rights and Liabilities. Those who retain or re-acquire Philippine Citizenship under this
Act shall enjoy full civil and political rights and be subject to all attendant liabilities and responsibilities under existing
laws of the Philippines and the following conditions:
x x x x
(2) Those seeking elective public office in the Philippines shall meet the qualifications for holding such public office as
required by the Constitution and existing laws and, at the time of the filing of the certificate of candidacy, make a
personal and sworn renunciation of any and all foreign citizenship before any public officer authorized to administer
an oath.
Contrary to petitioners claims, the filing of a certificate of candidacy does not ipso facto amount to a renunciation of
his foreign citizenship under R.A. No. 9225. Our rulings in the cases of Frivaldo and Mercado are not applicable to
the instant case because R.A. No. 9225 provides for more requirements.
Thus, in Japzon v. COMELEC,
15
the Court held that Section 5(2) of R.A. No. 9225 requires the twin requirements of
swearing to an Oath of Allegiance and executing a Renunciation of Foreign Citizenship, viz:
Breaking down the afore-quoted provision, for a natural born Filipino, who reacquired or retained his Philippine
citizenship under Republic Act No. 9225, to run for public office, he must: (1) meet the qualifications for holding such
public office as required by the Constitution and existing laws; and (2) make a personal and sworn renunciation of
any and all foreign citizenships before any public officer authorized to administer an oath.1awphi1
Further, in Jacot v. Dal and COMELEC,
16
the Court ruled that a candidates oath of allegiance to the Republic of the
Philippines and his Certificate of Candidacy do not substantially comply with the requirement of a personal and sworn
renunciation of foreign citizenship. Thus:
The law categorically requires persons seeking elective public office, who either retained their Philippine citizenship
or those who reacquired it, to make a personal and sworn renunciation of any and all foreign citizenship before a
public officer authorized to administer an oath simultaneous with or before the filing of the certificate of candidacy.
Hence, Section 5(2) of Republic Act No. 9225 compels natural-born Filipinos, who have been naturalized as citizens
of a foreign country, but who reacquired or retained their Philippine citizenship (1) to take the oath of allegiance under
Section 3 of Republic Act No. 9225, and (2) for those seeking elective public offices in the Philippines, to additionally
execute a personal and sworn renunciation of any and all foreign citizenship before an authorized public officer prior
or simultaneous to the filing of their certificates of candidacy, to qualify as candidates in Philippine elections.
Clearly Section 5(2) of Republic Act No. 9225 (on the making of a personal and sworn renunciation of any and all
foreign citizenship) requires of the Filipinos availing themselves of the benefits under the said Act to accomplish an
undertaking other than that which they have presumably complied with under Section 3 thereof (oath of allegiance to
the Republic of the Philippines). This is made clear in the discussion of the Bicameral Conference Committee on
Disagreeing Provisions of House Bill No. 4720 and Senate Bill No. 2130 held on 18 August 2003 (precursors of
Republic Act No. 9225), where the Hon. Chairman Franklin Drilon and Hon. Representative Arthur Defensor
explained to Hon. Representative Exequiel Javier that the oath of allegiance is different from the renunciation of
foreign citizenship:
CHAIRMAN DRILON. Okay. So, No. 2. "Those seeking elective public office in the Philippines shall meet the
qualifications for holding such public office as required by the Constitution and existing laws and, at the time
of the filing of the certificate of candidacy, make a personal and sworn renunciation of any and all foreign
citizenship before any public officer authorized to administer an oath." I think its very good, ha? No
problem?
REP. JAVIER. I think its already covered by the oath.
CHAIRMAN DRILON. Renouncing foreign citizenship.
REP. JAVIER. Ah but he has taken his oath already.
CHAIRMAN DRILON. Nono, renouncing foreign citizenship.
x x x x
CHAIRMAN DRILON. Can I go back to No. 2. Whats your problem, Boy? Those seeking elective office in
the Philippines.
REP. JAVIER. They are trying to make him renounce his citizenship thinking that ano
CHAIRMAN DRILON. His American citizenship.
REP. JAVIER. To discourage him from running?
CHAIRMAN DRILON. No.
REP. A.D. DEFENSOR. No. When he runs he will only have one citizenship. When he runs for office, he will
have only one. (Emphasis ours.)
There is little doubt, therefore, that the intent of the legislators was not only for Filipinos reacquiring or retaining their
Philippine citizenship under Republic Act No. 9225 to take their oath of allegiance to the Republic of the Philippines,
but also to explicitly renounce their foreign citizenship if they wish to run for elective posts in the Philippines. To
qualify as a candidate in Philippine elections, Filipinos must only have one citizenship, namely, Philippine citizenship.
By the same token, the oath of allegiance contained in the Certificate of Candidacy, which is substantially similar to
the one contained in Section 3 of Republic Act No. 9225, does not constitute the personal and sworn renunciation
sought under Section 5(2) of Republic Act No. 9225. It bears to emphasize that the said oath of allegiance is a
general requirement for all those who wish to run as candidates in Philippine elections; while the renunciation of
foreign citizenship is an additional requisite only for those who have retained or reacquired Philippine citizenship
under Republic Act No. 9225 and who seek elective public posts, considering their special circumstance of having
more than one citizenship.
In the instant case, petitioners Oath of Allegiance and Certificate of Candidacy did not comply with Section 5(2) of
R.A. No. 9225 which further requires those seeking elective public office in the Philippines to make a personal and
sworn renunciation of foreign citizenship. Petitioner failed to renounce his American citizenship; as such, he is
disqualified from running for vice-mayor of Guimba, Nueva Ecija in the May 14, 2007 elections.
WHEREFORE, the petition is DISMISSED. Petitioner is declared DISQUALIFIED from running for Vice-Mayor of
Guimba, Nueva Ecija in the May 14, 2007 elections because of his failure to renounce his foreign citizenship pursuant
to Section 5(2) of R.A. No. 9225.
SO ORDERED.
CONSUELO YNARES-SANTIAGO
Associate Justice
WE CONCUR:
REYNATO S. PUNO
Chief Justice
LEONARDO A. QUISUMBING
Associate Justice
ANTONIO T. CARPIO
Associate Justice
RENATO C. CORONA
Associate Justice
CONCHITA CARPIO MORALES
Associate Justice
MINITA V. CHICO-NAZARIO
Associate Justice
PRESBITERO J. VELASCO, JR.
Associate Justice
ANTONIO EDUARDO B. NACHURA
Associate Justice
TERESITA J. LEONARDO-DE CASTRO
Associate Justice
ARTURO D. BRION
Associate Justice
DIOSDADO M. PERALTA
Associate Justice
LUCAS P. BERSAMIN
Associate Justice
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above Decision
were reached in consultation before the case was assigned to the writer of the opinion of the Court.
REYNATO S. PUNO
Chief Justice
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 157013 July 10, 2003
ATTY. ROMULO B. MACALINTAL, petitioner,
vs.
COMMISSION ON ELECTIONS, HON. ALBERTO ROMULO, in his official capacity as Executive Secretary, and
HON. EMILIA T. BONCODIN, Secretary of the Department of Budget and Management, respondents.
AUSTRIA-MARTINEZ, J .:
Before the Court is a petition for certiorari and prohibition filed by Romulo B. Macalintal, a member of the Philippine
Bar, seeking a declaration that certain provisions of Republic Act No. 9189 (The Overseas Absentee Voting Act of
2003)
1
suffer from constitutional infirmity. Claiming that he has actual and material legal interest in the subject matter
of this case in seeing to it that public funds are properly and lawfully used and appropriated, petitioner filed the instant
petition as a taxpayer and as a lawyer.
The Court upholds the right of petitioner to file the present petition.
R.A. No. 9189, entitled, "An Act Providing for A System of Overseas Absentee Voting by Qualified Citizens of the
Philippines Abroad, Appropriating Funds Therefor, and for Other Purposes," appropriates funds under Section 29
thereof which provides that a supplemental budget on the General Appropriations Act of the year of its enactment into
law shall provide for the necessary amount to carry out its provisions. Taxpayers, such as herein petitioner, have the
right to restrain officials from wasting public funds through the enforcement of an unconstitutional statute.
2
The Court
has held that they may assail the validity of a law appropriating public funds
3
because expenditure of public funds by
an officer of the State for the purpose of executing an unconstitutional act constitutes a misapplication of such funds.
4

The challenged provision of law involves a public right that affects a great number of citizens. The Court has adopted
the policy of taking jurisdiction over cases whenever the petitioner has seriously and convincingly presented an issue
of transcendental significance to the Filipino people. This has been explicitly pronounced in Kapatiran ng mga
Naglilingkod sa Pamahalaan ng Pilipinas, Inc. vs. Tan,
5
where the Court held:
Objections to taxpayers suit for lack of sufficient personality standing, or interest are, however, in the main
procedural matters. Considering the importance to the public of the cases at bar, and in keeping with the
Courts duty, under the 1987 Constitution, to determine whether or not the other branches of government
have kept themselves within the limits of the Constitution and the laws and that they have not abused the
discretion given to them, the Court has brushed aside technicalities of procedure and has taken cognizance
of these petitions.
6

Indeed, in this case, the Court may set aside procedural rules as the constitutional right of suffrage of a considerable
number of Filipinos is involved.
The question of propriety of the instant petition which may appear to be visited by the vice of prematurity as there are
no ongoing proceedings in any tribunal, board or before a government official exercising judicial, quasi-judicial or
ministerial functions as required by Rule 65 of the Rules of Court, dims in light of the importance of the constitutional
issues raised by the petitioner. In Taada vs. Angara,
7
the Court held:
In seeking to nullify an act of the Philippine Senate on the ground that it contravenes the Constitution, the
petition no doubt raises a justiciable controversy. Where an action of the legislative branch is seriously
alleged to have infringed the Constitution, it becomes not only the right but in fact the duty of the judiciary to
settle the dispute. "The question thus posed is judicial rather than political. The duty (to adjudicate) remains
to assure that the supremacy of the Constitution is upheld." Once a "controversy as to the application or
interpretation of constitutional provision is raised before this Court (as in the instant case), it becomes a legal
issue which the Court is bound by constitutional mandate to decide."
In another case of paramount impact to the Filipino people, it has been expressed that it is illogical to await the
adverse consequences of the law in order to consider the controversy actual and ripe for judicial resolution.
8
In yet
another case, the Court said that:
. . . despite the inhibitions pressing upon the Court when confronted with constitutional issues, it will not
hesitate to declare a law or act invalid when it is convinced that this must be done. In arriving at this
conclusion, its only criterion will be the Constitution and God as its conscience gives it in the light to probe its
meaning and discover its purpose. Personal motives and political considerations are irrelevancies that
cannot influence its decisions. Blandishment is as ineffectual as intimidation, for all the awesome power of
the Congress and Executive, the Court will not hesitate "to make the hammer fall heavily," where the acts of
these departments, or of any official, betray the peoples will as expressed in the Constitution . . .
9

The need to consider the constitutional issues raised before the Court is further buttressed by the fact that it is now
more than fifteen years since the ratification of the 1987 Constitution requiring Congress to provide a system for
absentee voting by qualified Filipinos abroad. Thus, strong reasons of public policy demand that the Court resolves
the instant petition
10
and determine whether Congress has acted within the limits of the Constitution or if it had
gravely abused the discretion entrusted to it.
11

The petitioner raises three principal questions:
A. Does Section 5(d) of Rep. Act No. 9189 allowing the registration of voters who are immigrants or
permanent residents in other countries by their mere act of executing an affidavit expressing their intention
to return to the Philippines, violate the residency requirement in Section 1 of Article V of the Constitution?
B. Does Section 18.5 of the same law empowering the COMELEC to proclaim the winning candidates for
national offices and party list representatives including the President and the Vice-President violate the
constitutional mandate under Section 4, Article VII of the Constitution that the winning candidates for
President and the Vice-President shall be proclaimed as winners by Congress?
C. May Congress, through the Joint Congressional Oversight Committee created in Section 25 of Rep. Act
No. 9189, exercise the power to review, revise, amend, and approve the Implementing Rules and
Regulations that the Commission on Elections shall promulgate without violating the independence of the
COMELEC under Section 1, Article IX-A of the Constitution?
The Court will resolve the questions in seriatim.
A. Does Section 5(d) of Rep. Act No. 9189 violate Section 1, Article V of the 1987 Constitution of the Republic
of the Philippines?
Section 5(d) provides:
Sec. 5. Disqualifications. The following shall be disqualified from voting under this Act:
. . . . . . . . .
d) An immigrant or a permanent resident who is recognized as such in the host country, unless he/she
executes, upon registration, an affidavit prepared for the purpose by the Commission declaring that he/she
shall resume actual physical permanent residence in the Philippines not later than three (3) years from
approval of his/her registration under this Act. Such affidavit shall also state that he/she has not applied for
citizenship in another country. Failure to return shall be cause for the removal of the name of the immigrant
or permanent resident from the National Registry of Absentee Voters and his/her permanent disqualification
to vote in absentia.
Petitioner posits that Section 5(d) is unconstitutional because it violates Section 1, Article V of the 1987 Constitution
which requires that the voter must be a resident in the Philippines for at least one year and in the place where he
proposes to vote for at least six months immediately preceding an election. Petitioner cites the ruling of the Court
in Caasi vs. Court of Appeals
12
to support his claim. In that case, the Court held that a "green card" holder immigrant
to the United States is deemed to have abandoned his domicile and residence in the Philippines.
Petitioner further argues that Section 1, Article V of the Constitution does not allow provisional registration or a
promise by a voter to perform a condition to be qualified to vote in a political exercise;
13
that the legislature should not
be allowed to circumvent the requirement of the Constitution on the right of suffrage by providing a condition thereon
which in effect amends or alters the aforesaid residence requirement to qualify a Filipino abroad to vote.
14
He claims
that the right of suffrage should not be granted to anyone who, on the date of the election, does not possess the
qualifications provided for by Section 1, Article V of the Constitution.
Respondent COMELEC refrained from commenting on this issue.
15

In compliance with the Resolution of the Court, the Solicitor General filed his comment for all public respondents. He
contraposes that the constitutional challenge to Section 5(d) must fail because of the absence of clear and
unmistakable showing that said provision of law is repugnant to the Constitution. He stresses: All laws are presumed
to be constitutional; by the doctrine of separation of powers, a department of government owes a becoming respect
for the acts of the other two departments; all laws are presumed to have adhered to constitutional limitations; the
legislature intended to enact a valid, sensible, and just law.
In addition, the Solicitor General points out that Section 1, Article V of the Constitution is a verbatim reproduction of
those provided for in the 1935 and the 1973 Constitutions. Thus, he cites Co vs. Electoral Tribunal of the House of
Representatives
16
wherein the Court held that the term "residence" has been understood to be synonymous with
"domicile" under both Constitutions. He further argues that a person can have only one "domicile" but he can have
two residences, one permanent (the domicile) and the other temporary;
17
and that the definition and meaning given to
the term residence likewise applies to absentee voters. Invoking Romualdez-Marcos vs. COMELEC
18
which
reiterates the Courts ruling in Faypon vs. Quirino,
19
the Solicitor General maintains that Filipinos who are immigrants
or permanent residents abroad may have in fact never abandoned their Philippine domicile.
20

Taking issue with the petitioners contention that "green card" holders are considered to have abandoned their
Philippine domicile, the Solicitor General suggests that the Court may have to discard its ruling in Caasi vs. Court of
Appeals
21
in so far as it relates to immigrants and permanent residents in foreign countries who have executed and
submitted their affidavits conformably with Section 5(d) of R.A. No. 9189. He maintains that through the execution of
the requisite affidavits, the Congress of the Philippines with the concurrence of the President of the Republic had in
fact given these immigrants and permanent residents the opportunity, pursuant to Section 2, Article V of the
Constitution, to manifest that they had in fact never abandoned their Philippine domicile; that indubitably, they would
have formally and categorically expressed the requisite intentions, i.e., "animus manendi" and "animus revertendi;"
that Filipino immigrants and permanent residents abroad possess the unquestionable right to exercise the right of
suffrage under Section 1, Article V of the Constitution upon approval of their registration, conformably with R.A. No.
9189.
22

The seed of the present controversy is the interpretation that is given to the phrase, "qualified citizens of the
Philippines abroad" as it appears in R.A. No. 9189, to wit:
SEC. 2. Declaration of Policy. It is the prime duty of the State to provide a system of honest and orderly overseas
absentee voting that upholds the secrecy and sanctity of the ballot. Towards this end, the State ensures equal
opportunity to all qualified citizens of the Philippines abroad in the exercise of this fundamental right.
SEC. 3. Definition of Terms. For purposes of this Act:
a) "Absentee Voting" refers to the process by which qualified citizens of the Philippines abroad,
exercise their right to vote;
. . . (Emphasis supplied)
f) "Overseas Absentee Voter" refers to a citizen of the Philippines who is qualified to register
and vote under this Act, not otherwise disqualified by law, who is abroad on the day of elections.
(Emphasis supplied)
SEC. 4. Coverage. All citizens of the Philippines abroad, who are not otherwise disqualified by law,
at least eighteen (18) years of age on the day of elections, may vote for president, vice-president, senators
and party-list representatives. (Emphasis supplied)
in relation to Sections 1 and 2, Article V of the Constitution which read:
SEC. 1. Suffrage may be exercised by all citizens of the Philippines not otherwise disqualified by law, who
are at least eighteen years of age, and who shall have resided in the Philippines for at least one year and in
the place wherein they propose to vote for at least six months immediately preceding the election. No
literacy, property, or other substantive requirement shall be imposed on the exercise of suffrage.
SEC. 2. The Congress shall provide a system for securing the secrecy and sanctity of the ballot as well
as a system for absentee voting by qualified Filipinos abroad.
. . . . . . . . . (Emphasis supplied)
Section 1, Article V of the Constitution specifically provides that suffrage may be exercised by (1) all citizens of the
Philippines, (2) not otherwise disqualified by law, (3) at least eighteen years of age, (4) who are residents in the
Philippines for at least one year and in the place where they propose to vote for at least six months immediately
preceding the election. Under Section 5(d) of R.A. No. 9189, one of those disqualified from voting is an immigrant or
permanent resident who is recognized as such in the host country unless he/she executes an affidavit declaring that
he/she shall resume actual physical permanent residence in the Philippines not later than three years from approval
of his/her registration under said Act.
Petitioner questions the rightness of the mere act of execution of an affidavit to qualify the Filipinos abroad who are
immigrants or permanent residents, to vote. He focuses solely on Section 1, Article V of the Constitution in ascribing
constitutional infirmity to Section 5(d) of R.A. No. 9189, totally ignoring the provisions of Section 2 empowering
Congress to provide a system for absentee voting by qualified Filipinos abroad.
A simple, cursory reading of Section 5(d) of R.A. No. 9189 may indeed give the impression that it contravenes
Section 1, Article V of the Constitution. Filipino immigrants and permanent residents overseas are perceived as
having left and abandoned the Philippines to live permanently in their host countries and therefore, a provision in the
law enfranchising those who do not possess the residency requirement of the Constitution by the mere act of
executing an affidavit expressing their intent to return to the Philippines within a given period, risks a declaration of
unconstitutionality. However, the risk is more apparent than real.
The Constitution is the fundamental and paramount law of the nation to which all other laws must conform and in
accordance with which all private rights must be determined and all public authority administered.
23
Laws that do not
conform to the Constitution shall be stricken down for being unconstitutional.
Generally, however, all laws are presumed to be constitutional. In Peralta vs. COMELEC, the Court said:
. . . An act of the legislature, approved by the executive, is presumed to be within constitutional limitations.
The responsibility of upholding the Constitution rests not on the courts alone but on the legislature as well.
The question of the validity of every statute is first determined by the legislative department of the
government itself.
24

Thus, presumption of constitutionality of a law must be overcome convincingly:
. . . To declare a law unconstitutional, the repugnancy of that law to the Constitution must be clear and
unequivocal, for even if a law is aimed at the attainment of some public good, no infringement of
constitutional rights is allowed. To strike down a law there must be a clear showing that what the
fundamental law condemns or prohibits, the statute allows it to be done.
25

As the essence of R.A. No. 9189 is to enfranchise overseas qualified Filipinos, it behooves the Court to take a holistic
view of the pertinent provisions of both the Constitution and R.A. No. 9189. It is a basic rule in constitutional
construction that the Constitution should be construed as a whole. In Chiongbian vs. De Leon,
26
the Court held that a
constitutional provision should function to the full extent of its substance and its terms, not by itself alone, but in
conjunction with all other provisions of that great document. Constitutional provisions are mandatory in character
unless, either by express statement or by necessary implication, a different intention is manifest.
27
The intent of the
Constitution may be drawn primarily from the language of the document itself. Should it be ambiguous, the Court may
consider the intent of its framers through their debates in the constitutional convention.
28

R.A. No. 9189 was enacted in obeisance to the mandate of the first paragraph of Section 2, Article V of the
Constitution that Congress shall provide a system for voting by qualified Filipinos abroad. It must be stressed that
Section 2 does not provide for the parameters of the exercise of legislative authority in enacting said law. Hence, in
the absence of restrictions, Congress is presumed to have duly exercised its function as defined in Article VI (The
Legislative Department) of the Constitution.
To put matters in their right perspective, it is necessary to dwell first on the significance of absentee voting. The
concept of absentee voting is relatively new. It is viewed thus:
The method of absentee voting has been said to be completely separable and distinct from the regular
system of voting, and to be a new and different manner of voting from that previously known, and an
exception to the customary and usual manner of voting. The right of absentee and disabled voters to cast
their ballots at an election is purely statutory; absentee voting was unknown to, and not recognized at, the
common law.
Absentee voting is an outgrowth of modern social and economic conditions devised to accommodate those
engaged in military or civil life whose duties make it impracticable for them to attend their polling places on
the day of election, and the privilege of absentee voting may flow from constitutional provisions or be
conferred by statutes, existing in some jurisdictions, which provide in varying terms for the casting and
reception of ballots by soldiers and sailors or other qualified voters absent on election day from the district or
precinct of their residence.
Such statutes are regarded as conferring a privilege and not a right, or an absolute right. When the
legislature chooses to grant the right by statute, it must operate with equality among all the class to
which it is granted; but statutes of this nature may be limited in their application to particular types
of elections. The statutes should be construed in the light of any constitutional provisions affecting
registration and elections, and with due regard to their texts prior to amendment and to predecessor
statutes and the decisions thereunder; they should also be construed in the light of the circumstances
under which they were enacted; and so as to carry out the objects thereof, if this can be done without
doing violence to their provisions and mandates. Further, in passing on statutes regulating absentee
voting, the court should look to the whole and every part of the election laws, the intent of the entire
plan, and reasons and spirit of their adoption, and try to give effect to every portion
thereof.
29
(Emphasis supplied)
Ordinarily, an absentee is not a resident and vice versa; a person cannot be at the same time, both a resident and an
absentee.
30
However, under our election laws and the countless pronouncements of the Court pertaining to elections,
an absentee remains attached to his residence in the Philippines as residence is considered synonymous
with domicile.
In Romualdez-Marcos,
31
the Court enunciated:
Article 50 of the Civil Code decrees that "[f]or the exercise of civil rights and the fulfillment of civil obligations,
the domicile of natural persons is their place of habitual residence." In Ong vs. Republic, this court took the
concept of domicile to mean an individuals "permanent home," "a place to which, whenever absent for
business or for pleasure, one intends to return, and depends on facts and circumstances in the sense that
they disclose intent." Based on the foregoing, domicile includes the twin elements of "the fact of residing or
physical presence in a fixed place" and animus manendi, or the intention of returning there permanently.
Residence, in its ordinary conception, implies the factual relationship of an individual to a certain place. It is
the physical presence of a person in a given area, community or country. The essential distinction between
residence and domicile in law is that residence involves the intent to leave when the purpose for which the
resident has taken up his abode ends. One may seek a place for purposes such as pleasure, business, or
health. If a persons intent be to remain, it becomes his domicile; if his intent is to leave as soon as his
purpose is established it is residence. It is thus, quite perfectly normal for an individual to have different
residences in various places. However, a person can only have a single domicile, unless, for various
reasons, he successfully abandons his domicile in favor of another domicile of choice. In Uytengsu vs.
Republic, we laid this distinction quite clearly:
"There is a difference between domicile and residence. Residence is used to indicate a place of
abode, whether permanent or temporary; domicile denotes a fixed permanent residence to which,
when absent, one has the intention of returning. A man may have a residence in one place and a
domicile in another. Residence is not domicile, but domicile is residence coupled with the intention
to remain for an unlimited time. A man can have but one domicile for the same purpose at any time,
but he may have numerous places of residence. His place of residence is generally his place of
domicile, but it is not by any means necessarily so since no length of residence without intention of
remaining will constitute domicile."
For political purposes the concepts of residence and domicile are dictated by the peculiar criteria of political
laws. As these concepts have evolved in our election law, what has clearly and unequivocally emerged
is the fact that residence for election purposes is used synonymously with domicile.
32
(Emphasis
supplied)
Aware of the domiciliary legal tie that links an overseas Filipino to his residence in this country, the framers of the
Constitution considered the circumstances that impelled them to require Congress to establish a system for overseas
absentee voting, thus:
MR. OPLE. With respect to Section 1, it is not clear whether the right of suffrage, which here has a
residential restriction, is not denied to citizens temporarily residing or working abroad. Based on the statistics
of several government agencies, there ought to be about two million such Filipinos at this time.
Commissioner Bernas had earlier pointed out that these provisions are really lifted from the two previous
Constitutions of 1935 and 1973, with the exception of the last paragraph. They could not therefore have
foreseen at that time the phenomenon now described as the Filipino labor force explosion overseas.
According to government data, there are now about 600,000 contract workers and employees, and although
the major portions of these expatriate communities of workers are to be found in the Middle East, they are
scattered in 177 countries in the world.
In a previous hearing of the Committee on Constitutional Commissions and Agencies, the Chairman of the
Commission on Elections, Ramon Felipe, said that there was no insuperable obstacle to making effective
the right of suffrage for Filipinos overseas. Those who have adhered to their Filipino citizenship
notwithstanding strong temptations are exposed to embrace a more convenient foreign citizenship. And
those who on their own or under pressure of economic necessity here, find that they have to detach
themselves from their families to work in other countries with definite tenures of employment. Many of them
are on contract employment for one, two, or three years. They have no intention of changing their residence
on a permanent basis, but are technically disqualified from exercising the right of suffrage in their countries
of destination by the residential requirement in Section 1 which says:
Suffrage shall be exercised by all citizens of the Philippines not otherwise disqualified by law, who
are eighteen years of age or over, and who shall have resided in the Philippines for at least one
year and in the place wherein they propose to vote for at least six months preceding the election.
I, therefore, ask the Committee whether at the proper time they might entertain an amendment that will
make this exercise of the right to vote abroad for Filipino citizens an effective, rather than merely a nominal
right under this proposed Constitution.
FR. BERNAS. Certainly, the Committee will consider that. But more than just saying that, I would like to
make a comment on the meaning of "residence" in the Constitution because I think it is a concept that has
been discussed in various decisions of the Supreme Court, particularly in the case of Faypon vs. Quirino, a
1954 case which dealt precisely with the meaning of "residence" in the Election Law. Allow me to quote:
A citizen may leave the place of his birth to look for greener pastures, as the saying goes, to
improve his lot and that, of course, includes study in other places, practice of his avocation,
reengaging in business. When an election is to be held, the citizen who left his birthplace to
improve his lot may decide to return to his native town, to cast his ballot, but for professional or
business reasons, or for any other reason, he may not absent himself from the place of his
professional or business activities.
So, they are here registered as voters as he has the qualifications to be one, and is not willing to
give up or lose the opportunity to choose the officials who are to run the government especially in
national elections. Despite such registration, the animus revertendi to his home, to his domicile or
residence of origin has not forsaken him.
This may be the explanation why the registration of a voter in a place other than his residence of origin has not been
deemed sufficient to consider abandonment or loss of such residence of origin.
In other words, "residence" in this provision refers to two residence qualifications: "residence" in the
Philippines and "residence" in the place where he will vote. As far as residence in the Philippines is
concerned, the word "residence" means domicile, but as far as residence in the place where he will actually
cast his ballot is concerned, the meaning seems to be different. He could have a domicile somewhere else
and yet he is a resident of a place for six months and he is allowed to vote there. So that there may be
serious constitutional obstacles to absentee voting, unless the vote of the person who is absent is a vote
which will be considered as cast in the place of his domicile.
MR. OPLE. Thank you for citing the jurisprudence.
It gives me scant comfort thinking of about two million Filipinos who should enjoy the right of suffrage, at
least a substantial segment of these overseas Filipino communities. The Committee, of course, is aware that
when this Article of the Constitution explicitly and unequivocally extends the right of effective suffrage to
Filipinos abroad, this will call for a logistical exercise of global proportions. In effect, this will require
budgetary and administrative commitments on the part of the Philippine government, mainly through the
COMELEC and the Ministry of Foreign Affairs, and perhaps, a more extensive elaboration of this
mechanism that will be put in place to make effective the right to vote. Therefore, seeking shelter in some
wise jurisprudence of the past may not be sufficient to meet the demands of the right of suffrage for
Filipinos abroad that I have mentioned. But I want to thank the Committee for saying that an amendment to
this effect may be entertained at the proper time. . . . . . . . . .
33
(Emphasis supplied)
Thus, the Constitutional Commission recognized the fact that while millions of Filipinos reside abroad principally for
economic reasons and hence they contribute in no small measure to the economic uplift of this country, their voices
are marginal insofar as the choice of this countrys leaders is concerned.
The Constitutional Commission realized that under the laws then existing and considering the novelty of the system
of absentee voting in this jurisdiction, vesting overseas Filipinos with the right to vote would spawn constitutional
problems especially because the Constitution itself provides for the residency requirement of voters:
MR. REGALADO. Before I act on that, may I inquire from Commissioner Monsod if the term "absentee
voting" also includes transient voting; meaning, those who are, let us say, studying in Manila need not go
back to their places of registration, for instance, in Mindanao, to cast their votes.
MR. MONSOD. I think our provision is for absentee voting by Filipinos abroad.
MR. REGALADO. How about those people who cannot go back to the places where they are registered?
MR. MONSOD. Under the present Election Code, there are provisions for allowing students and military
people who are temporarily in another place to register and vote. I believe that those situations can be
covered by the Omnibus Election Code. The reason we want absentee voting to be in the Constitution
as a mandate to the legislature is that there could be inconsistency on the residence rule if it is just
a question of legislation by Congress. So, by allowing it and saying that this is possible, then
legislation can take care of the rest.
34
(Emphasis supplied)
Thus, Section 2, Article V of the Constitution came into being to remove any doubt as to the inapplicability of the
residency requirement in Section 1. It is precisely to avoid any problems that could impede the implementation of its
pursuit to enfranchise the largest number of qualified Filipinos who are not in the Philippines that the Constitutional
Commission explicitly mandated Congress to provide a system for overseas absentee voting.
The discussion of the Constitutional Commission on the effect of the residency requirement prescribed by Section 1,
Article V of the Constitution on the proposed system of absentee voting for qualified Filipinos abroad is enlightening:
MR. SUAREZ. May I just be recognized for a clarification. There are certain qualifications for the exercise of
the right of suffrage like having resided in the Philippines for at least one year and in the place where they
propose to vote for at least six months preceding the elections. What is the effect of these mandatory
requirements on the matter of the exercise of the right of suffrage by the absentee voters like Filipinos
abroad?
THE PRESIDENT. Would Commissioner Monsod care to answer?
MR. MONSOD. I believe the answer was already given by Commissioner Bernas, that the domicile
requirements as well as the qualifications and disqualifications would be the same.
THE PRESIDENT. Are we leaving it to the legislature to devise the system?
FR. BERNAS. I think there is a very legitimate problem raised there.
THE PRESIDENT. Yes.
MR. BENGZON. I believe Commissioner Suarez is clarified.
FR. BERNAS. But I think it should be further clarified with regard to the residence requirement or the place
where they vote in practice; the understanding is that it is flexible. For instance, one might be a resident of
Naga or domiciled therein, but he satisfies the requirement of residence in Manila, so he is able to vote in
Manila.
MR. TINGSON. Madam President, may I then suggest to the Committee to change the word "Filipinos" to
QUALIFIED FILIPINO VOTERS. Instead of "VOTING BY FILIPINOS ABROAD," it should be QUALIFIED
FILIPINO VOTERS. If the Committee wants QUALIFIED VOTERS LIVING ABROAD, would that not satisfy
the requirement?
THE PRESIDENT. What does Commissioner Monsod say?
MR. MONSOD. Madam President, I think I would accept the phrase "QUALIFIED FILIPINOS ABROAD"
because "QUALIFIED" would assume that he has the qualifications and none of the disqualifications to vote.
MR. TINGSON. That is right. So does the Committee accept?
FR. BERNAS. "QUALIFIED FILIPINOS ABROAD"?
THE PRESIDENT. Does the Committee accept the amendment?
MR. REGALADO. Madam President.
THE PRESIDENT. Commissioner Regalado is recognized.
MR. REGALADO. When Commissioner Bengzon asked me to read my proposed amendment, I specifically
stated that the National Assembly shall prescribe a system which will enable qualified citizens, temporarily
absent from the Philippines, to vote. According to Commissioner Monsod, the use of the phrase "absentee
voting" already took that into account as its meaning. That is referring to qualified Filipino citizens
temporarily abroad.
MR. MONSOD. Yes, we accepted that. I would like to say that with respect to registration we will leave it
up to the legislative assembly, for example, to require where the registration is. If it is, say, members
of the diplomatic corps who may be continuously abroad for a long time, perhaps, there can be a
system of registration in the embassies. However, we do not like to preempt the legislative assembly.
THE PRESIDENT. Just to clarify, Commissioner Monsods amendment is only to provide a system.
MR. MONSOD. Yes.
THE PRESIDENT. The Commissioner is not stating here that he wants new qualifications for these
absentee voters.
MR. MONSOD. That is right. They must have the qualifications and none of the disqualifications.
THE PRESIDENT. It is just to devise a system by which they can vote.
MR. MONSOD. That is right, Madam President.
35
(Emphasis supplied)
Clearly therefrom, the intent of the Constitutional Commission is to entrust to Congress the responsibility of devising a
system of absentee voting. The qualifications of voters as stated in Section 1 shall remain except for the residency
requirement. This is in fact the reason why the Constitutional Commission opted for the termqualified Filipinos
abroad with respect to the system of absentee voting that Congress should draw up. As stressed by Commissioner
Monsod, by the use of the adjective qualified with respect to Filipinos abroad, the assumption is that they have the
"qualifications and none of the disqualifications to vote." In fine-tuning the provision on absentee voting, the
Constitutional Commission discussed how the system should work:
MR. SUAREZ. For clarification purposes, we just want to state for the record that in the case of qualified
Filipino citizens residing abroad and exercising their right of suffrage, they can cast their votes for the
candidates in the place where they were registered to vote in the Philippines. So as to avoid any
complications, for example, if they are registered in Angeles City, they could not vote for a mayor in Naga
City.
In other words, if that qualified voter is registered in Angeles City, then he can vote only for the local and
national candidates in Angeles City. I just want to make that clear for the record.
MR. REGALADO. Madam President.
THE PRESIDENT. What does Commissioner Regalado say?
MR. REGALADO. I just want to make a note on the statement of Commissioner Suarez that this envisions
Filipinos residing abroad. The understanding in the amendment is that the Filipino is temporarily abroad. He
may not be actually residing abroad; he may just be there on a business trip. It just so happens that the day
before the elections he has to fly to the United States, so he could not cast his vote. He is temporarily
abroad, but not residing there. He stays in a hotel for two days and comes back. This is not limited only to
Filipinos temporarily residing abroad. But as long as he is temporarily abroad on the date of the
elections, then he can fall within the prescription of Congress in that situation.
MR. SUAREZ. I thank the Commissioner for his further clarification. Precisely, we need this clarification on
record.
MR. MONSOD. Madam President, to clarify what we mean by "temporarily abroad," it need not be on
very short trips. One can be abroad on a treaty traders visa. Therefore, when we talk about registration, it
is possible that his residence is in Angeles and he would be able to vote for the candidates in Angeles,
butCongress or the Assembly may provide the procedure for registration, like listing ones name, in
a registry list in the embassy abroad. That is still possible under the system.
FR. BERNAS. Madam President, just one clarification if Commissioner Monsod agrees with this.
Suppose we have a situation of a child of a diplomatic officer who reaches the voting age while living abroad
and he has never registered here. Where will he register? Will he be a registered voter of a certain locality in
the Philippines?
MR. MONSOD. Yes, it is possible that the system will enable that child to comply with the registration
requirements in an embassy in the United States and his name is then entered in the official registration
book in Angeles City, for instance.
FR. BERNAS. In other words, he is not a registered voter of Los Angeles, but a registered voter of a locality
here.
MR. MONSOD. That is right. He does not have to come home to the Philippines to comply with the
registration procedure here.
FR. BERNAS. So, he does not have to come home.
MR. BENGZON. Madam President, the Floor Leader wishes to inquire if there are more clarifications
needed from the body.
Also, the Floor Leader is happy to announce that there are no more registered Commissioners to propose
amendments. So I move that we close the period of amendments.
36
(Emphasis supplied)
It is clear from these discussions of the members of the Constitutional Commission that they intended to enfranchise
as much as possible all Filipino citizens abroad who have not abandoned their domicile of origin. The Commission
even intended to extend to young Filipinos who reach voting age abroad whose parents domicile of origin is in the
Philippines, and consider them qualified as voters for the first time.
It is in pursuance of that intention that the Commission provided for Section 2 immediately after the residency
requirement of Section 1. By the doctrine of necessary implication in statutory construction, which may be applied in
construing constitutional provisions,
37
the strategic location of Section 2 indicates that the Constitutional Commission
provided for an exception to the actual residency requirement of Section 1 with respect to qualified Filipinos abroad.
The same Commission has in effect declared that qualified Filipinos who are not in the Philippines may be allowed to
vote even though they do not satisfy the residency requirement in Section 1, Article V of the Constitution.
That Section 2 of Article V of the Constitution is an exception to the residency requirement found in Section 1 of the
same Article was in fact the subject of debate when Senate Bill No. 2104, which became R.A. No. 9189, was
deliberated upon on the Senate floor, thus:
Senator Arroyo. Mr. President, this bill should be looked into in relation to the constitutional provisions. I
think the sponsor and I would agree that the Constitution is supreme in any statute that we may enact.
Let me read Section 1, Article V, of the Constitution entitled, "Suffrage." It says:
Section 1. Suffrage may be exercised by all citizens of the Philippines not otherwise disqualified by
law, who are at least eighteen years of age, and who shall have resided in the Philippines for at
least one year and in the place wherein they propose to vote for at least six months immediately
preceding the election.
Now, Mr. President, the Constitution says, "who shall have resided in the Philippines." They are permanent
immigrants. They have changed residence so they are barred under the Constitution. This is why I asked
whether this committee amendment which in fact does not alter the original text of the bill will have any
effect on this?
Senator Angara. Good question, Mr. President. And this has been asked in various fora. This is in
compliance with the Constitution. One, the interpretation here of "residence" is synonymous with "domicile."
As the gentleman and I know, Mr. President, "domicile" is the intent to return to ones home. And the fact
that a Filipino may have been physically absent from the Philippines and may be physically a
resident of the United States, for example, but has a clear intent to return to the Philippines, will
make him qualified as a resident of the Philippines under this law.
This is consistent, Mr. President, with the constitutional mandate that we that Congress must provide a
franchise to overseas Filipinos.
If we read the Constitution and the suffrage principle literally as demanding physical presence, then
there is no way we can provide for offshore voting to our offshore kababayan, Mr. President.
Senator Arroyo. Mr. President, when the Constitution says, in Section 2 of Article V, it reads: "The
Congress shall provide a system for securing the secrecy and sanctity of the ballot as well as a system for
absentee voting by qualified Filipinos abroad."
The key to this whole exercise, Mr. President, is "qualified." In other words, anything that we may do
or say in granting our compatriots abroad must be anchored on the proposition that they are
qualified. Absent the qualification, they cannot vote. And "residents" (sic) is a qualification.
I will lose votes here from permanent residents so-called "green-card holders", but the Constitution is the
Constitution. We cannot compromise on this. The Senate cannot be a party to something that would affect
or impair the Constitution.
Look at what the Constitution says "In the place wherein they propose to vote for at least six months
immediately preceding the election."
Mr. President, all of us here have run (sic) for office.
I live in Makati. My neighbor is Pateros where Senator Cayetano lives. We are separated only by a creek.
But one who votes in Makati cannot vote in Pateros unless he resides in Pateros for six months. That is how
restrictive our Constitution is. I am not talking even about the Election Code. I am talking about the
Constitution.
As I have said, if a voter in Makati would want to vote in Pateros, yes, he may do so. But he must do so,
make the transfer six months before the election, otherwise, he is not qualified to vote.
That is why I am raising this point because I think we have a fundamental difference here.
Senator Angara. It is a good point to raise, Mr. President. But it is a point already well-debated even in the
constitutional commission of 1986. And the reason Section 2 of Article V was placed immediately after
the six-month/one-year residency requirement is to demonstrate unmistakably that Section 2 which
authorizes absentee voting is an exception to the six-month/one-year residency requirement. That is
the first principle, Mr. President, that one must remember.
The second reason, Mr. President, is that under our jurisprudence and I think this is so well-entrenched
that one need not argue about it "residency" has been interpreted as synonymous with "domicile."
But the third more practical reason, Mr. President, is, if we follow the interpretation of the gentleman,
then it is legally and constitutionally impossible to give a franchise to vote to overseas Filipinos who
do not physically live in the country, which is quite ridiculous because that is exactly the whole
point of this exercise to enfranchise them and empower them to vote.
38
(Emphasis supplied)
Accordingly, Section 4 of R.A. No. 9189 provides for the coverage of the absentee voting process, to wit:
SEC. 4. Coverage. All citizens of the Philippines abroad, who are not otherwise disqualified by law, at least
eighteen (18) years of age on the day of elections, may vote for president, vice-president, senators and
party-list representatives.
which does not require physical residency in the Philippines; and Section 5 of the assailed law which enumerates
those who are disqualified, to wit:
SEC. 5. Disqualifications. The following shall be disqualified from voting under this Act:
a) Those who have lost their Filipino citizenship in accordance with Philippine laws;
b) Those who have expressly renounced their Philippine citizenship and who have pledged allegiance to a
foreign country;
c) Those who have committed and are convicted in a final judgment by a court or tribunal of an offense
punishable by imprisonment of not less than one (1) year, including those who have committed and been
found guilty of Disloyalty as defined under Article 137 of the Revised Penal Code, such disability not having
been removed by plenary pardon or amnesty: Provided, however, That any person disqualified to vote under
this subsection shall automatically acquire the right to vote upon expiration of five (5) years after service of
sentence; Provided, further, That the Commission may take cognizance of final judgments issued by foreign
courts or tribunals only on the basis of reciprocity and subject to the formalities and processes prescribed by
the Rules of Court on execution of judgments;
d) An immigrant or a permanent resident who is recognized as such in the host country, unless he/she
executes, upon registration, an affidavit prepared for the purpose by the Commission declaring that he/she
shall resume actual physical permanent residence in the Philippines not later than three (3) years from
approval of his/her registration under this Act. Such affidavit shall also state that he/she has not applied for
citizenship in another country. Failure to return shall be cause for the removal of the name of the immigrant
or permanent resident from the National Registry of Absentee Voters and his/her permanent disqualification
to vote in absentia.
e) Any citizen of the Philippines abroad previously declared insane or incompetent by competent authority in
the Philippines or abroad, as verified by the Philippine embassies, consulates or foreign service
establishments concerned, unless such competent authority subsequently certifies that such person is no
longer insane or incompetent.
As finally approved into law, Section 5(d) of R.A. No. 9189 specifically disqualifies an immigrant or permanent
resident who is "recognized as such in the host country" because immigration or permanent residence in another
country implies renunciation of ones residence in his country of origin. However, same Section allows an immigrant
and permanent resident abroad to register as voter for as long as he/she executes an affidavit to show that he/she
has not abandoned his domicile in pursuance of the constitutional intent expressed in Sections 1 and 2 of Article V
that "all citizens of the Philippines not otherwise disqualified by law" must be entitled to exercise the right of suffrage
and, that Congress must establish a system for absentee voting; for otherwise, if actual, physical residence in the
Philippines is required, there is no sense for the framers of the Constitution to mandate Congress to establish a
system for absentee voting.
Contrary to the claim of petitioner, the execution of the affidavit itself is not the enabling or enfranchising act. The
affidavit required in Section 5(d) is not only proof of the intention of the immigrant or permanent resident to go back
and resume residency in the Philippines, but more significantly, it serves as an explicit expression that he had not in
fact abandoned his domicile of origin. Thus, it is not correct to say that the execution of the affidavit under Section
5(d) violates the Constitution that proscribes "provisional registration or a promise by a voter to perform a condition to
be qualified to vote in a political exercise."
To repeat, the affidavit is required of immigrants and permanent residents abroad because by their status in their host
countries, they are presumed to have relinquished their intent to return to this country; thus, without the affidavit, the
presumption of abandonment of Philippine domicile shall remain.
Further perusal of the transcripts of the Senate proceedings discloses another reason why the Senate required the
execution of said affidavit. It wanted the affiant to exercise the option to return or to express his intention to return to
his domicile of origin and not to preempt that choice by legislation. Thus:
Senator Villar. Yes, we are going back.
It states that: "For Filipino immigrants and those who have acquired permanent resident status abroad," a
requirement for the registration is the submission of "a Sworn Declaration of Intent to Return duly sworn
before any Philippine embassy or consulate official authorized to administer oath"
Mr. President, may we know the rationale of this provision? Is the purpose of this Sworn Declaration to
include only those who have the intention of returning to be qualified to exercise the right of suffrage? What
if the Filipino immigrant has no purpose of returning? Is he automatically disbarred from exercising this right
to suffrage?
Senator Angara. The rationale for this, Mr. President, is that we want to be expansive and all-
inclusive in this law. That as long as he is a Filipino, no matter whether he is a green-card holder in
the U.S. or not, he will be authorized to vote. But if he is already a green-card holder, that means he
has acquired permanent residency in the United States, then he must indicate an intention to return.
This is what makes for the definition of "domicile." And to acquire the vote, we thought that we would
require the immigrants and the green-card holders . . . Mr. President, the three administration senators are
leaving, maybe we may ask for a vote [Laughter].
Senator Villar. For a merienda, Mr. President.
Senator Angara. Mr. President, going back to the business at hand. The rationale for the requirement that
an immigrant or a green-card holder should file an affidavit that he will go back to the Philippines is that, if he
is already an immigrant or a green-card holder, that means he may not return to the country any more and
that contradicts the definition of "domicile" under the law.
But what we are trying to do here, Mr. President, is really provide the choice to the voter. The voter,
after consulting his lawyer or after deliberation within the family, may decide "No, I think we are risking our
permanent status in the United States if we file an affidavit that we want to go back." But we want to give
him the opportunity to make that decision. We do not want to make that decision for
him.
39
(Emphasis supplied)
The jurisprudential declaration in Caasi vs. Court of Appeals that green card holders are disqualified to run for any
elective office finds no application to the present case because the Caasi case did not, for obvious reasons, consider
the absentee voting rights of Filipinos who are immigrants and permanent residents in their host countries.
In the advent of The Overseas Absentee Voting Act of 2003 or R.A. 9189, they may still be considered as a "qualified
citizen of the Philippines abroad" upon fulfillment of the requirements of registration under the new law for the
purpose of exercising their right of suffrage.
It must be emphasized that Section 5(d) does not only require an affidavit or a promise to "resume actual physical
permanent residence in the Philippines not later than three years from approval of his/her registration," the Filipinos
abroad must also declare that they have not applied for citizenship in another country. Thus, they must return to the
Philippines; otherwise, their failure to return "shall be cause for the removal" of their names "from the National
Registry of Absentee Voters and his/her permanent disqualification to vote in absentia."
Thus, Congress crafted a process of registration by which a Filipino voter permanently residing abroad who is at least
eighteen years old, not otherwise disqualified by law, who has not relinquished Philippine citizenship and who has not
actually abandoned his/her intentions to return to his/her domicile of origin, the Philippines, is allowed to register and
vote in the Philippine embassy, consulate or other foreign service establishments of the place which has jurisdiction
over the country where he/she has indicated his/her address for purposes of the elections, while providing for
safeguards to a clean election.
Thus, Section 11 of R.A. No. 9189 provides:
SEC. 11. Procedure for Application to Vote in Absentia.
11.1. Every qualified citizen of the Philippines abroad whose application for registration has been approved,
including those previously registered under Republic Act No. 8189, shall, in every national election, file with
the officer of the embassy, consulate or other foreign service establishment authorized by the Commission,
a sworn written application to vote in a form prescribed by the Commission. The authorized officer of such
embassy, consulate or other foreign service establishment shall transmit to the Commission the said
application to vote within five (5) days from receipt thereof. The application form shall be accomplished in
triplicate and submitted together with the photocopy of his/her overseas absentee voter certificate of
registration.
11.2. Every application to vote in absentia may be done personally at, or by mail to, the embassy, consulate
or foreign service establishment, which has jurisdiction over the country where he/she has indicated his/her
address for purposes of the elections.
11.3. Consular and diplomatic services rendered in connection with the overseas absentee voting processes
shall be made available at no cost to the overseas absentee voter.
Contrary to petitioners claim that Section 5(d) circumvents the Constitution, Congress enacted the law prescribing a
system of overseas absentee voting in compliance with the constitutional mandate. Such mandate expressly requires
that Congress provide a system of absentee voting that necessarily presupposes that the "qualified citizen of the
Philippines abroad" is not physically present in the country. The provisions of Sections 5(d) and 11 are components of
the system of overseas absentee voting established by R.A. No. 9189. The qualified Filipino abroad who executed
the affidavit is deemed to have retained his domicile in the Philippines. He is presumed not to have lost his domicile
by his physical absence from this country. His having become an immigrant or permanent resident of his host country
does not necessarily imply an abandonment of his intention to return to his domicile of origin, the Philippines.
Therefore, under the law, he must be given the opportunity to express that he has not actually abandoned his
domicile in the Philippines by executing the affidavit required by Sections 5(d) and 8(c) of the law.
Petitioners speculative apprehension that the implementation of Section 5(d) would affect the credibility of the
elections is insignificant as what is important is to ensure that all those who possess the qualifications to vote on the
date of the election are given the opportunity and permitted to freely do so. The COMELEC and the Department of
Foreign Affairs have enough resources and talents to ensure the integrity and credibility of any election conducted
pursuant to R.A. No. 9189.
As to the eventuality that the Filipino abroad would renege on his undertaking to return to the Philippines, the penalty
of perpetual disenfranchisement provided for by Section 5(d) would suffice to serve as deterrence to non-compliance
with his/her undertaking under the affidavit.
Petitioner argues that should a sizable number of "immigrants" renege on their promise to return, the result of the
elections would be affected and could even be a ground to contest the proclamation of the winning candidates and
cause further confusion and doubt on the integrity of the results of the election. Indeed, the probability that after an
immigrant has exercised the right to vote, he shall opt to remain in his host country beyond the third year from the
execution of the affidavit, is not farfetched. However, it is not for this Court to determine the wisdom of a legislative
exercise. As expressed in Taada vs. Tuvera,
40
the Court is not called upon to rule on the wisdom of the law or to
repeal it or modify it if we find it impractical.
Congress itself was conscious of said probability and in fact, it has addressed the expected problem. Section 5(d)
itself provides for a deterrence which is that the Filipino who fails to return as promised stands to lose his right of
suffrage. Under Section 9, should a registered overseas absentee voter fail to vote for two consecutive national
elections, his name may be ordered removed from the National Registry of Overseas Absentee Voters.
Other serious legal questions that may be raised would be: what happens to the votes cast by the qualified voters
abroad who were not able to return within three years as promised? What is the effect on the votes cast by the non-
returnees in favor of the winning candidates? The votes cast by qualified Filipinos abroad who failed to return within
three years shall not be invalidated because they were qualified to vote on the date of the elections, but their failure to
return shall be cause for the removal of the names of the immigrants or permanent residents from the National
Registry of Absentee Voters and their permanent disqualification to vote in absentia.
In fine, considering the underlying intent of the Constitution, the Court does not find Section 5(d) of R.A. No. 9189 as
constitutionally defective.
B. Is Section 18.5 of R.A. No. 9189 in relation to Section 4 of the same Act in contravention of Section 4,
Article VII of the Constitution?
Section 4 of R.A. No. 9189 provides that the overseas absentee voter may vote for president, vice-president,
senators and party-list representatives.
Section 18.5 of the same Act provides:
SEC. 18. On-Site Counting and Canvassing.
. . . . . . . . .
18. 5 The canvass of votes shall not cause the delay of the proclamation of a winning candidate if the
outcome of the election will not be affected by the results thereof. Notwithstanding the foregoing, the
Commission is empowered to order the proclamation of winning candidates despite the fact that the
scheduled election has not taken place in a particular country or countries, if the holding of elections therein
has been rendered impossible by events, factors and circumstances peculiar to such country or countries, in
which events, factors and circumstances are beyond the control or influence of the Commission. (Emphasis
supplied)
Petitioner claims that the provision of Section 18.5 of R.A. No. 9189 empowering the COMELEC to order the
proclamation of winning candidates insofar as it affects the canvass of votes and proclamation of winning candidates
for president and vice-president, is unconstitutional because it violates the following provisions of paragraph 4,
Section 4 of Article VII of the Constitution:
SEC. 4 . . .
The returns of every election for President and Vice-President, duly certified by the board of canvassers of
each province or city, shall be transmitted to the Congress, directed to the President of the Senate. Upon
receipt of the certificates of canvass, the President of the Senate shall, not later than thirty days after the day
of the election, open all the certificates in the presence of the Senate and the House of Representatives in
joint public session, and the Congress, upon determination of the authenticity and due execution thereof in
the manner provided by law, canvass the votes.
The person having the highest number of votes shall be proclaimed elected, but in case two or more shall
have an equal and highest number of votes, one of them shall forthwith be chosen by the vote of a majority
of all the Members of both Houses of the Congress, voting separately.
The Congress shall promulgate its rules for the canvassing of the certificates.
. . .
which gives to Congress the duty to canvass the votes and proclaim the winning candidates for president and vice-
president.
The Solicitor General asserts that this provision must be harmonized with paragraph 4, Section 4, Article VII of the
Constitution and should be taken to mean that COMELEC can only proclaim the winning Senators and party-list
representatives but not the President and Vice-President.
41

Respondent COMELEC has no comment on the matter.
Indeed, the phrase, proclamation of winning candidates, in Section 18.5 of R.A. No. 9189 is far too sweeping that it
necessarily includes the proclamation of the winning candidates for the presidency and the vice-presidency.
Section 18.5 of R.A. No. 9189 appears to be repugnant to Section 4, Article VII of the Constitution only insofar as said
Section totally disregarded the authority given to Congress by the Constitution to proclaim the winning candidates for
the positions of president and vice-president.
In addition, the Court notes that Section 18.4 of the law, to wit:
18.4. . . . Immediately upon the completion of the canvass, the chairman of the Special Board of Canvassers
shall transmit via facsimile, electronic mail, or any other means of transmission equally safe and reliable the
Certificates of Canvass and the Statements of Votes to the Commission, . . . [Emphasis supplied]
clashes with paragraph 4, Section 4, Article VII of the Constitution which provides that the returns of every election for
President and Vice-President shall be certified by the board of canvassers to Congress.
Congress could not have allowed the COMELEC to usurp a power that constitutionally belongs to it or, as aptly stated
by petitioner, to encroach "on the power of Congress to canvass the votes for president and vice-president and the
power to proclaim the winners for the said positions." The provisions of the Constitution as the fundamental law of the
land should be read as part of The Overseas Absentee Voting Act of 2003 and hence, the canvassing of the votes
and the proclamation of the winning candidates for president and vice-president for the entire nation must remain in
the hands of Congress.
C. Are Sections 19 and 25 of R.A. No. 9189 in violation of Section 1, Article IX-A of the Constitution?
Petitioner avers that Sections 19 and 25 of R.A. No. 9189 violate Article IX-A (Common Provisions) of the
Constitution, to wit:
Section 1. The Constitutional Commissions, which shall be independent, are the Civil Service Commission,
the Commission on Elections, and the Commission on Audit. (Emphasis supplied)
He submits that the creation of the Joint Congressional Oversight Committee with the power to review, revise, amend
and approve the Implementing Rules and Regulations promulgated by the COMELEC, R.A. No. 9189 intrudes into
the independence of the COMELEC which, as a constitutional body, is not under the control of either the executive or
legislative departments of government; that only the COMELEC itself can promulgate rules and regulations which
may be changed or revised only by the majority of its members; and that should the rules promulgated by the
COMELEC violate any law, it is the Court that has the power to review the same via the petition of any interested
party, including the legislators.
It is only on this question that respondent COMELEC submitted its Comment. It agrees with the petitioner that
Sections 19 and 25 of R.A. No. 9189 are unconstitutional. Like the petitioner, respondent COMELEC anchors its
claim of unconstitutionality of said Sections upon Section 1, Article IX-A of the Constitution providing for the
independence of the constitutional commissions such as the COMELEC. It asserts that its power to formulate rules
and regulations has been upheld in Gallardo vs. Tabamo, Jr.
42
where this Court held that the power of the COMELEC
to formulate rules and regulations is implicit in its power to implement regulations under Section 2(1) of Article IX-
C
43
of the Constitution. COMELEC joins the petitioner in asserting that as an independent constitutional body, it may
not be subject to interference by any government instrumentality and that only this Court may review COMELEC rules
and only in cases of grave abuse of discretion.
The COMELEC adds, however, that another provision, vis--vis its rule-making power, to wit:
SEC. 17. Voting by Mail.
17.1. For the May, 2004 elections, the Commission shall authorize voting by mail in not more than three (3)
countries, subject to the approval of the Congressional Oversight Committee. Voting by mail may be
allowed in countries that satisfy the following conditions:
a) Where the mailing system is fairly well-developed and secure to prevent occasion for fraud;
b) Where there exists a technically established identification system that would preclude multiple or proxy
voting; and
c) Where the system of reception and custody of mailed ballots in the embassies, consulates and other
foreign service establishments concerned are adequate and well-secured.
Thereafter, voting by mail in any country shall be allowed only upon review and approval of the Joint
Congressional Oversight Committee . . . . . . . . . (Emphasis supplied)
is likewise unconstitutional as it violates Section 1, Article IX-A mandating the independence of constitutional
commissions.
The Solicitor General takes exception to his prefatory statement that the constitutional challenge must fail and agrees
with the petitioner that Sections 19 and 25 are invalid and unconstitutional on the ground that there is nothing in
Article VI of the Constitution on Legislative Department that would as much as imply that Congress has concurrent
power to enforce and administer election laws with the COMELEC; and by the principles of exclusio unius est
exclusio alterius and expressum facit cessare tacitum, the constitutionally enumerated powers of Congress
circumscribe its authority to the exclusion of all others.
The parties are unanimous in claiming that Sections 19, 25 and portions of Section 17.1 are unconstitutional. Thus,
there is no actual issue forged on this question raised by petitioner.
However, the Court finds it expedient to expound on the role of Congress through the Joint Congressional Oversight
Committee (JCOC) vis--vis the independence of the COMELEC, as a constitutional body.
R.A. No. 9189 created the JCOC, as follows:
SEC. 25. Joint Congressional Oversight Committee. A Joint Congressional Oversight Committee is hereby
created, composed of the Chairman of the Senate Committee on Constitutional Amendments, Revision of
Codes and Laws, and seven (7) other Senators designated by the Senate President, and the Chairman of
the House Committee on Suffrage and Electoral Reforms, and seven (7) other Members of the House of
Representatives designated by the Speaker of the House of Representatives: Provided, That, of the seven
(7) members to be designated by each House of Congress, four (4) should come from the majority and the
remaining three (3) from the minority.
The Joint Congressional Oversight Committee shall have the power to monitor and evaluate the
implementation of this Act. It shall review, revise, amend and approve the Implementing Rules and
Regulations promulgated by the Commission. (Emphasis supplied)
SEC. 19. Authority of the Commission to Promulgate Rules. The Commission shall issue the necessary
rules and regulations to effectively implement the provisions of this Act within sixty (60) days from the
effectivity of this Act. The Implementing Rules and Regulations shall be submitted to the Joint
Congressional Oversight Committee created by virtue of this Act for prior approval.
. . . . . . . . . (Emphasis supplied)
Composed of Senators and Members of the House of Representatives, the Joint Congressional Oversight Committee
(JCOC) is a purely legislative body. There is no question that the authority of Congress to "monitor and evaluate the
implementation" of R.A. No. 9189 is geared towards possible amendments or revision of the law itself and thus, may
be performed in aid of its legislation.
However, aside from its monitoring and evaluation functions, R.A. No. 9189 gives to the JCOC the following
functions: (a) to "review, revise, amend and approve the Implementing Rules and Regulations" (IRR) promulgated by
the COMELEC [Sections 25 and 19]; and (b) subject to the approval of the JCOC [Section 17.1], the voting by mail in
not more than three countries for the May 2004 elections and in any country determined by COMELEC.
The ambit of legislative power under Article VI of the Constitution is circumscribed by other constitutional provisions.
One such provision is Section 1 of Article IX-A of the 1987 Constitution ordaining that constitutional commissions
such as the COMELEC shall be "independent."
Interpreting Section 1, Article X of the 1935 Constitution providing that there shall be an independent COMELEC, the
Court has held that "[w]hatever may be the nature of the functions of the Commission on Elections, the fact is that the
framers of the Constitution wanted it to be independent from the other departments of the Government."
44
In an earlier
case, the Court elucidated:
The Commission on Elections is a constitutional body. It is intended to play a distinct and important part in
our scheme of government. In the discharge of its functions, it should not be hampered with restrictions that
would be fully warranted in the case of a less responsible organization. The Commission may err, so may
this court also. It should be allowed considerable latitude in devising means and methods that will insure the
accomplishment of the great objective for which it was created free, orderly and honest elections. We may
not agree fully with its choice of means, but unless these are clearly illegal or constitute gross abuse of
discretion, this court should not interfere. Politics is a practical matter, and political questions must be dealt
with realistically not from the standpoint of pure theory. The Commission on Elections, because of its fact-
finding facilities, its contacts with political strategists, and its knowledge derived from actual experience in
dealing with political controversies, is in a peculiarly advantageous position to decide complex political
questions.
45
(Emphasis supplied)
The Court has no general powers of supervision over COMELEC which is an independent body "except those
specifically granted by the Constitution," that is, to review its decisions, orders and rulings.
46
In the same vein, it is not
correct to hold that because of its recognized extensive legislative power to enact election laws, Congress may
intrude into the independence of the COMELEC by exercising supervisory powers over its rule-making authority.
By virtue of Section 19 of R.A. No. 9189, Congress has empowered the COMELEC to "issue the necessary rules and
regulations to effectively implement the provisions of this Act within sixty days from the effectivity of this Act." This
provision of law follows the usual procedure in drafting rules and regulations to implement a law the legislature
grants an administrative agency the authority to craft the rules and regulations implementing the law it has enacted, in
recognition of the administrative expertise of that agency in its particular field of operation.
47
Once a law is enacted
and approved, the legislative function is deemed accomplished and complete. The legislative function may spring
back to Congress relative to the same law only if that body deems it proper to review, amend and revise the law, but
certainly not to approve, review, revise and amend the IRR of the COMELEC.
By vesting itself with the powers to approve, review, amend, and revise the IRR for The Overseas Absentee Voting
Act of 2003, Congress went beyond the scope of its constitutional authority. Congress trampled upon the
constitutional mandate of independence of the COMELEC. Under such a situation, the Court is left with no option but
to withdraw from its usual reticence in declaring a provision of law unconstitutional.
The second sentence of the first paragraph of Section 19 stating that "[t]he Implementing Rules and Regulations shall
be submitted to the Joint Congressional Oversight Committee created by virtue of this Act for prior approval," and the
second sentence of the second paragraph of Section 25 stating that "[i]t shall review, revise, amend and approve the
Implementing Rules and Regulations promulgated by the Commission," whereby Congress, in both provisions,
arrogates unto itself a function not specifically vested by the Constitution, should be stricken out of the subject statute
for constitutional infirmity. Both provisions brazenly violate the mandate on the independence of the COMELEC.
Similarly, the phrase, "subject to the approval of the Congressional Oversight Committee" in the first sentence of
Section 17.1 which empowers the Commission to authorize voting by mail in not more than three countries for the
May, 2004 elections; and the phrase, "only upon review and approval of the Joint Congressional Oversight
Committee" found in the second paragraph of the same section are unconstitutional as they require review and
approval of voting by mail in any country after the 2004 elections. Congress may not confer upon itself the authority to
approve or disapprove the countries wherein voting by mail shall be allowed, as determined by the COMELEC
pursuant to the conditions provided for in Section 17.1 of R.A. No. 9189.
48
Otherwise, Congress would overstep the
bounds of its constitutional mandate and intrude into the independence of the COMELEC.
During the deliberations, all the members of the Court agreed to adopt the separate opinion of Justice Reynato S.
Puno as part of the ponencia on the unconstitutionality of Sections 17.1, 19 and 25 of R.A. No. 9189 insofar as they
relate to the creation of and the powers given to the Joint Congressional Oversight Committee.
WHEREFORE, the petition is partly GRANTED. The following portions of R.A. No. 9189 are
declared VOIDfor being UNCONSTITUTIONAL:
a) The phrase in the first sentence of the first paragraph of Section 17.1, to wit: "subject to the approval of
the J oint Congressional Oversight Committee;"
b) The portion of the last paragraph of Section 17.1, to wit: "only upon review and approval of the J oint
Congressional Oversight Committee;"
c) The second sentence of the first paragraph of Section 19, to wit: "The Implementing Rules and
Regulations shall be submitted to the J oint Congressional Oversight Committee created by virtue of
this Act for prior approval;" and
d) The second sentence in the second paragraph of Section 25, to wit: "It shall review, revise, amend and
approve the Implementing Rules and Regulations promulgated by the Commission" of the same law;
for being repugnant to Section 1, Article IX-A of the Constitution mandating the independence of constitutional
commission, such as COMELEC.
The constitutionality of Section 18.5 of R.A. No. 9189 is UPHELD with respect only to the authority given to the
COMELEC to proclaim the winning candidates for the Senators and party-list representatives but not as to the power
to canvass the votes and proclaim the winning candidates for President and Vice-President which is lodged with
Congress under Section 4, Article VII of the Constitution.
The constitutionality of Section 5(d) is UPHELD.
Pursuant to Section 30 of R.A. No. 9189, the rest of the provisions of said law continues to be in full force and effect.
SO ORDERED.
Davide, Jr., C.J., and Corona, JJ., concur.
Quisumbing, J., on leave.
Tinga, J., no part.
Bellosillo, and Carpio, JJ., see concurring opinion.
Puno, Ynares-Santiago, and Callejo, Sr., JJ., see concurring and dissenting opinion.
Sandoval-Gutierrez, J., see concurring and dissenting opinion. On official leave.
Vitug, and Panganiban, JJ., see separate opinion.
Carpio-Morales, and Azcuna, JJ., see separate (concurring) opinion.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. 162759 August 4, 2006
LOIDA NICOLAS-LEWIS, GREGORIO B. MACABENTA, ALEJANDRO A. ESCLAMADO, ARMANDO B.
HEREDIA, REUBEN S. SEGURITAN, ERIC LACHICA FURBEYRE, TERESITA A. CRUZ, JOSEFINA OPENA
DISTERHOFT, MERCEDES V. OPENA, CORNELIO R. NATIVIDAD, EVELYN D. NATIVIDAD, Petitioners,
vs.
COMMISSION ON ELECTIONS, Respondent.
D E C I S I O N
GARCIA, J .:
In this petition for certiorari and mandamus, petitioners, referring to themselves as "duals" or dual citizens, pray that
they and others who retained or reacquired Philippine citizenship under Republic Act (R.A.) No. 9225, the Citizenship
Retention and Re-Acquisition Act of 2003, be allowed to avail themselves of the mechanism provided under the
Overseas Absentee Voting Act of 2003
1
(R.A. 9189) and that the Commission on Elections (COMELEC) accordingly
be ordered to allow them to vote and register as absentee voters under the aegis of R.A. 9189.
The facts:
Petitioners are successful applicants for recognition of Philippine citizenship under R.A. 9225 which accords to such
applicants the right of suffrage, among others. Long before the May 2004 national and local elections, petitioners
sought registration and certification as "overseas absentee voter" only to be advised by the Philippine Embassy in the
United States that, per a COMELEC letter to the Department of Foreign Affairs dated September 23, 2003
2
, they
have yet no right to vote in such elections owing to their lack of the one-year residence requirement prescribed by the
Constitution. The same letter, however, urged the different Philippine posts abroad not to discontinue their campaign
for voters registration, as the residence restriction adverted to would contextually affect merely certain individuals
who would likely be eligible to vote in future elections.
Prodded for clarification by petitioner Loida Nicolas-Lewis in the light of the ruling in Macalintal vs. COMELEC
3
on
the residency requirement, the COMELEC wrote in response:
Although R.A. 9225 enjoys the presumption of constitutionality , it is the Commission's position that those who have
availed of the law cannot exercise the right of suffrage given under the OAVL for the reason that the OAVL was not
enacted for them. Hence, as Filipinos who have merely re-acquired their citizenship on 18 September 2003 at the
earliest, and as law and jurisprudence now stand, they are considered regular voters who have to meet the
requirements of residency, among others under Section 1, Article 5 of the Constitution.
4

Faced with the prospect of not being able to vote in the May 2004 elections owing to the COMELEC's refusal to
include them in the National Registry of Absentee Voters, petitioner Nicolas-Lewis et al.,
5
filed on April 1, 2004 this
petition for certiorari and mandamus.
A little over a week before the May 10, 2004 elections, or on April 30, 2004, the COMELEC filed a Comment,
6
therein
praying for the denial of the petition. As may be expected, petitioners were not able to register let alone vote in said
elections.
On May 20, 2004, the Office of the Solicitor General (OSG) filed a Manifestation (in Lieu of Comment), therein stating
that "all qualified overseas Filipinos, including dual citizens who care to exercise the right of suffrage, may do so" ,
observing, however, that the conclusion of the 2004 elections had rendered the petition moot and academic.
7

The holding of the 2004 elections had, as the OSG pointed out, indeed rendered the petition moot and academic, but
insofar only as petitioners participation in such political exercise is concerned. The broader and transcendental issue
tendered or subsumed in the petition, i.e., the propriety of allowing "duals" to participate and vote as absentee voter
in future elections, however, remains unresolved.
Observing the petitioners and the COMELECs respective formulations of the issues, the same may be reduced into
the question of whether or not petitioners and others who might have meanwhile retained and/or reacquired
Philippine citizenship pursuant to R.A. 9225 may vote as absentee voter under R.A. 9189.
The Court resolves the poser in the affirmative, and thereby accords merit to the petition.
In esse, this case is all about suffrage. A quick look at the governing provisions on the right of suffrage is, therefore,
indicated.
We start off with Sections 1 and 2 of Article V of the Constitution, respectively reading as follows:
SECTION 1. Suffrage may be exercised by all citizens of the Philippines not otherwise disqualified by law, who are at
least eighteen years of age, and who shall have resided in the Philippines for at least one year and in the place
wherein they propose to vote for at least six months immediately preceding the election. xxx.
SEC 2. The Congress shall provide a system for absentee voting by qualified Filipinos abroad.
In a nutshell, the aforequoted Section 1 prescribes residency requirement as a general eligibility factor for the right to
vote. On the other hand, Section 2 authorizes Congress to devise a system wherein an absentee may vote, implying
that a non-resident may, as an exception to the residency prescription in the preceding section, be allowed to vote.
In response to its above mandate, Congress enacted R.A. 9189 - the OAVL
8
- identifying in its Section 4 who can
vote under it and in the following section who cannot, as follows:
Section 4. Coverage. All citizens of the Philippines abroad, who are not otherwise disqualified by law, at least
eighteen (18) years of age on the day of elections, may vote for president, vice-president, senators and party-list
representatives.
Section 5. Disqualifications. The following shall be disqualified from voting under this Act:
(a) Those who have lost their Filipino citizenship in accordance with Philippine laws;
(b) Those who have expressly renounced their Philippine citizenship and who have pledged allegiance to a foreign
country;
(c) Those who have [been] convicted in a final judgment by a court or tribunal of an offense punishable by
imprisonment of not less than one (1) year, including those who have been found guilty of Disloyalty as defined
under Article 137 of the Revised Penal Code, .;
(d) An immigrant or a permanent resident who is recognized as such in the host country, unless he/she executes,
upon registration, an affidavit prepared for the purpose by the Commission declaring that he/she shall resume actual
physical permanent residence in the Philippines not later than three (3) years from approval of his/her registration
under this Act. Such affidavit shall also state that he/she has not applied for citizenship in another country. Failure to
return shall be the cause for the removal of the name of the immigrant or permanent resident from the National
Registry of Absentee Voters and his/her permanent disqualification to vote in absentia.
(e) Any citizen of the Philippines abroad previously declared insane or incompetent by competent authority .
(Words in bracket added.)
Notably, Section 5 lists those who cannot avail themselves of the absentee voting mechanism. However, Section 5(d)
of the enumeration respecting Filipino immigrants and permanent residents in another country opens an exception
and qualifies the disqualification rule. Section 5(d) would, however, face a constitutional challenge on the ground that,
as narrated in Macalintal, it -
violates Section 1, Article V of the 1987 Constitution which requires that the voter must be a resident in the
Philippines for at least one year and in the place where he proposes to vote for at least six months immediately
preceding an election. [The challenger] cites Caasi vs. Court of Appeals
9
to support his claim [where] the Court
held that a "green card" holder immigrant to the [US] is deemed to have abandoned his domicile and residence in the
Philippines.
[The challenger] further argues that Section 1, Article V of the Constitution does not allow provisional registration or a
promise by a voter to perform a condition to be qualified to vote in a political exercise; that the legislature should not
be allowed to circumvent the requirement of the Constitution on the right of suffrage by providing a condition thereon
which in effect amends or alters the aforesaid residence requirement to qualify a Filipino abroad to vote. He claims
that the right of suffrage should not be granted to anyone who, on the date of the election, does not possess the
qualifications provided for by Section 1, Article V of the Constitution.
10
(Words in bracket added.)
As may be recalled, the Court upheld the constitutionality of Section 5(d) of R.A. 9189 mainly on the strength of the
following premises:
As finally approved into law, Section 5(d) of R.A. No. 9189 specifically disqualifies an immigrant or permanent
resident who is "recognized as such in the host country" because immigration or permanent residence in another
country implies renunciation of one's residence in his country of origin. However, same Section allows an immigrant
and permanent resident abroad to register as voter for as long as he/she executes an affidavit to show that he/she
has not abandoned his domicile in pursuance of the constitutional intent expressed in Sections 1 and 2 of Article V
that "all citizens of the Philippines not otherwise disqualified by law" must be entitled to exercise the right of suffrage
and, that Congress must establish a system for absentee voting; for otherwise, if actual, physical residence in the
Philippines is required, there is no sense for the framers of the Constitution to mandate Congress to establish a
system for absentee voting.
Contrary to the claim of [the challenger], the execution of the affidavit itself is not the enabling or enfranchising act.
The affidavit required in Section 5(d) is not only proof of the intention of the immigrant or permanent resident to go
back and resume residency in the Philippines, but more significantly, it serves as an explicit expression that he had
not in fact abandoned his domicile of origin. Thus, it is not correct to say that the execution of the affidavit under
Section 5(d) violates the Constitution that proscribes "provisional registration or a promise by a voter to perform a
condition to be qualified to vote in a political exercise."
11

Soon after Section 5(d) of R.A. 9189 passed the test of constitutionality, Congress enacted R.A. 9225 the relevant
portion of which reads:
SEC. 2. Declaration of Policy. It is hereby declared the policy of the State that all Philippine citizens who become
citizens of another country shall be deemed not to have lost their Philippine citizenship under the conditions of this
Act.
SEC. 3. Retention of Philippine Citizenship. Any provision of law to the contrary notwithstanding, natural-born
citizens of the Philippines who have lost their Philippine citizenship by reason of their naturalization as citizens of a
foreign country are hereby deemed to have re-acquired Philippine citizenship upon taking the following oath of
allegiance to the Republic:
xxx xxx xxx
Natural-born citizens of the Philippines who, after the effectivity of this Act, become citizens of a foreign country shall
retain their Philippine citizenship upon taking the aforesaid oath.
SEC. 4. Derivative Citizenship. The unmarried child, whether legitimate, illegitimate or adopted, below eighteen (18)
years of age, of those who re-acquire Philippine citizenship upon effectivity of this Act shall be deemed citizens of the
Philippines.
SEC. 5. Civil and Political Rights and Liabilities. Those who retain or re-acquire Philippine citizenship under this Act
shall enjoy full civil and political rights and be subject to all attendant liabilities and responsibilities under existing laws
of the Philippines and the following conditions:
(1) Those intending to exercise their right of suffrage must meet the requirements under Section 1, Article V of the
Constitution, Republic Act No. 9189, otherwise known as "The Overseas Absentee Voting Act of 2003" and other
existing laws;
(2) Those seeking elective public office in the Philippines shall meet the qualifications for holding such public office as
required by the Constitution and existing laws and, at the time of the filing of the certificate of candidacy, make a
personal and sworn renunciation of any and all foreign citizenship ;
3) xxx xxx xxx.
(4) xxx xxx xxx;
(5) That right to vote or be elected or appointed to any public office in the Philippines cannot be exercised by, or
extended to, those who:
(a) are candidates for or are occupying any public office in the country of which they are naturalized citizens; and/or
(b) are in active service as commissioned or non-commissioned officers in the armed forces of the country which they
are naturalized citizens.
After what appears to be a successful application for recognition of Philippine citizenship under R.A. 9189, petitioners
now invoke their right to enjoy political rights, specifically the right of suffrage, pursuant to Section 5 thereof.
Opposing the petitioners bid, however, respondent COMELEC invites attention to the same Section 5 (1) providing
that "duals" can enjoy their right to vote, as an adjunct to political rights, only if they meet the requirements of Section
1, Article V of the Constitution, R.A. 9189 and other existing laws. Capitalizing on what at first blush is the clashing
provisions of the aforecited provision of the Constitution, which, to repeat, requires residency in the Philippines for a
certain period, and R.A. 9189 which grants a Filipino non-resident absentee voting rights,
12
COMELEC argues:
4. DUALS MUST FIRST ESTABLISH THEIR DOMICILE/ RESIDENCE IN THE PHILIPPINES
4.01. The inclusion of such additional and specific requirements in RA 9225 is logical. The duals, upon
renouncement of their Filipino citizenship and acquisition of foreign citizenship, have practically and legally
abandoned their domicile and severed their legal ties to the homeland as a consequence. Having subsequently
acquired a second citizenship (i.e., Filipino) then, duals must, for purposes of voting, first of all, decisively and
definitely establish their domicile through positive acts;
13

The Court disagrees.
As may be noted, there is no provision in the dual citizenship law - R.A. 9225 - requiring "duals" to actually establish
residence and physically stay in the Philippines first before they can exercise their right to vote. On the contrary, R.A.
9225, in implicit acknowledgment that "duals" are most likely non-residents, grants under its Section 5(1) the same
right of suffrage as that granted an absentee voter under R.A. 9189. It cannot be overemphasized that R.A. 9189
aims, in essence, to enfranchise as much as possible all overseas Filipinos who, save for the residency requirements
exacted of an ordinary voter under ordinary conditions, are qualified to vote. Thus, wrote the Court in Macalintal:
It is clear from these discussions of the Constitutional Commission that [it] intended to enfranchise as much as
possible all Filipino citizens abroad who have not abandoned their domicile of origin. The Commission even intended
to extend to young Filipinos who reach voting age abroad whose parents domicile of origin is in the Philippines, and
consider them qualified as voters for the first time.
It is in pursuance of that intention that the Commission provided for Section 2 [Article V] immediately after the
residency requirement of Section 1. By the doctrine of necessary implication in statutory construction, , the
strategic location of Section 2 indicates that the Constitutional Commission provided for an exception to the actual
residency requirement of Section 1 with respect to qualified Filipinos abroad. The same Commission has in effect
declared that qualified Filipinos who are not in the Philippines may be allowed to vote even though they do not satisfy
the residency requirement in Section 1, Article V of the Constitution.
That Section 2 of Article V of the Constitution is an exception to the residency requirement found in Section 1 of the
same Article was in fact the subject of debate when Senate Bill No. 2104, which became R.A. No. 9189, was
deliberated upon on the Senate floor, thus:
Senator Arroyo. Mr. President, this bill should be looked into in relation to the constitutional provisions. I think the
sponsor and I would agree that the Constitution is supreme in any statute that we may enact.
Let me read Section 1, Article V, of the Constitution .
xxx xxx xxx
Now, Mr. President, the Constitution says, "who shall have resided in the Philippines." They are permanent
immigrants. They have changed residence so they are barred under the Constitution. This is why I asked whether this
committee amendment which in fact does not alter the original text of the bill will have any effect on this?
Senator Angara. Good question, Mr. President. And this has been asked in various fora. This is in compliance with
the Constitution. One, the interpretation here of "residence" is synonymous with "domicile."
As the gentleman and I know, Mr. President, "domicile" is the intent to return to one's home. And the fact that a
Filipino may have been physically absent from the Philippines and may be physically a resident of the United States,
for example, but has a clear intent to return to the Philippines, will make him qualified as a resident of the Philippines
under this law.
This is consistent, Mr. President, with the constitutional mandate that we that Congress must provide a franchise
to overseas Filipinos.
If we read the Constitution and the suffrage principle literally as demanding physical presence, then there is no way
we can provide for offshore voting to our offshore kababayan, Mr. President.
Senator Arroyo. Mr. President, when the Constitution says, in Section 2 of Article V, it reads: "The Congress shall
provide a system for securing the secrecy and sanctity of the ballot as well as a system for absentee voting by
qualified Filipinos abroad."
The key to this whole exercise, Mr. President, is "qualified." In other words, anything that we may do or say in
granting our compatriots abroad must be anchored on the proposition that they are qualified. Absent the qualification,
they cannot vote. And "residents" (sic) is a qualification.
xxx xxx xxx
Look at what the Constitution says "In the place wherein they propose to vote for at least six months immediately
preceding the election."
Mr. President, all of us here have run (sic) for office.
I live in Makati. My neighbor is Pateros . We are separated only by a creek. But one who votes in Makati cannot
vote in Pateros unless he resides in Pateros for six months. That is how restrictive our Constitution is. .
As I have said, if a voter in Makati would want to vote in Pateros, yes, he may do so. But he must do so, make the
transfer six months before the election, otherwise, he is not qualified to vote.
xxx xxx xxx
Senator Angara. It is a good point to raise, Mr. President. But it is a point already well-debated even in the
constitutional commission of 1986. And the reason Section 2 of Article V was placed immediately after the six-
month/one-year residency requirement is to demonstrate unmistakably that Section 2 which authorizes absentee
voting is an exception to the six-month/one-year residency requirement. That is the first principle, Mr. President, that
one must remember.
The second reason, Mr. President, is that under our jurisprudence "residency" has been interpreted as
synonymous with "domicile."
But the third more practical reason, is, if we follow the interpretation of the gentleman, then it is legally and
constitutionally impossible to give a franchise to vote to overseas Filipinos who do not physically live in the country,
which is quite ridiculous because that is exactly the whole point of this exercise to enfranchise them and empower
them to vote.
14
(Emphasis and words in bracket added; citations omitted)
Lest it be overlooked, no less than the COMELEC itself admits that the Citizenship Retention and Re-Acquisition Act
expanded the coverage of overseas absentee voting. According to the poll body:
1.05 With the passage of RA 9225 the scope of overseas absentee voting has been consequently expanded so as to
include Filipinos who are also citizens of other countries, subject, however, to the strict prerequisites indicated in the
pertinent provisions of RA 9225;
15

Considering the unison intent of the Constitution and R.A. 9189 and the expansion of the scope of that law with the
passage of R.A. 9225, the irresistible conclusion is that "duals" may now exercise the right of suffrage thru the
absentee voting scheme and as overseas absentee voters. R.A. 9189 defines the terms adverted to in the following
wise:
"Absentee Voting" refers to the process by which qualified citizens of the Philippines abroad exercise their right to
vote;
"Overseas Absentee Voter" refers to a citizen of the Philippines who is qualified to register and vote under this Act,
not otherwise disqualified by law, who is abroad on the day of elections;
While perhaps not determinative of the issue tendered herein, we note that the expanded thrust of R.A. 9189 extends
also to what might be tag as the next generation of "duals". This may be deduced from the inclusion of the provision
on derivative citizenship in R.A. 9225 which reads:
SEC. 4. Derivative Citizenship. The unmarried child, whether legitimate, illegitimate or adopted, below eighteen (18)
years of age, of those who re-acquire Philippine citizenship upon effectivity of this Act shall be deemed citizens of the
Philippines.
It is very likely that a considerable number of those unmarried children below eighteen (18) years of age had never
set foot in the Philippines. Now then, if the next generation of "duals" may nonetheless avail themselves the right to
enjoy full civil and political rights under Section 5 of the Act, then there is neither no rhyme nor reason why the
petitioners and other present day "duals," provided they meet the requirements under Section 1, Article V of the
Constitution in relation to R.A. 9189, be denied the right of suffrage as an overseas absentee voter. Congress could
not have plausibly intended such absurd situation.
WHEREFORE, the instant petition is GRANTED. Accordingly, the Court rules and so holds that those who retain or
re-acquire Philippine citizenship under Republic Act No. 9225, the Citizenship Retention and Re-Acquisition Act of
2003, may exercise the right to vote under the system of absentee voting in Republic Act No. 9189, the Overseas
Absentee Voting Act of 2003.
SO ORDERED.
CANCIO C. GARCIA
Associate Justice
WE CONCUR:
ARTEMIO V. PANGANIBAN
Chief Justice
REYNATO S. PUNO
Associate Justice
LEONARDO A. QUISUMBING
Associate Justice
CONSUELO YNARES-SANTIAGO
Associate Justice
ANGELINA SANDOVAL-GUTIERREZ
Associate Justice
ANTONIO T. CARPIO
Associate Justice
MA. ALICIA AUSTRIA-MARTINEZ
Associate Justice
RENATO C. CORONA
Associate Justice
CONCHITA CARPIO MORALES
Associate Justice
ROMEO J. CALLEJO, SR.
Associate Justice
ADOLFO S. AZCUNA
Associate Justice
DANTE O. TINGA
Associate Justice
MINITA V. CHICO-NAZARIO
Associate Justice
PRESBITERO J. VELASCO, JR.
Associate Justice
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above decision
were reached in consultation before the case was assigned to the writer of the opinion of the Court.
ARTEMIO V. PANGANIBAN
Chief Justice