EN BANC

[G.R. No. 144104. June 29, 2004.]

LUNG CENTER OF THE PHILIPPINES , petitioner, vs . QUEZON CITY

and CONSTANTINO P. ROSAS, in his capacity as City Assessor of
Quezon City , respondents.

DECISION

CALLEJO , SR. , J : p

This is a petition for review on certiorari under Rule 45 of the Rules of Court, as
amended, of the Decision 1 dated July 17, 2000 of the Court of Appeals in CA-G.R. SP No.
57014 which a rmed the decision of the Central Board of Assessment Appeals holding
that the lot owned by the petitioner and its hospital building constructed thereon are
subject to assessment for purposes of real property tax.
The Antecedents
The petitioner Lung Center of the Philippines is a non-stock and non-pro t entity
established on January 16, 1981 by virtue of Presidential Decree No. 1823. 2 It is the
registered owner of a parcel of land, particularly described as Lot No. RP-3-B-3A-1-B-1,
SWO-04-000495, located at Quezon Avenue corner Elliptical Road, Central District, Quezon
City. The lot has an area of 121,463 square meters and is covered by Transfer Certi cate
of Title (TCT) No. 261320 of the Registry of Deeds of Quezon City. Erected in the middle of
the aforesaid lot is a hospital known as the Lung Center of the Philippines. A big space at
the ground oor is being leased to private parties, for canteen and small store spaces, and
to medical or professional practitioners who use the same as their private clinics for their
patients whom they charge for their professional services. Almost one-half of the entire
area on the left side of the building along Quezon Avenue is vacant and idle, while a big
portion on the right side, at the corner of Quezon Avenue and Elliptical Road, is being
leased for commercial purposes to a private enterprise known as the Elliptical Orchids and
Garden Center.
The petitioner accepts paying and non-paying patients. It also renders medical
services to out-patients, both paying and non-paying. Aside from its income from paying
patients, the petitioner receives annual subsidies from the government.
On June 7, 1993, both the land and the hospital building of the petitioner were
assessed for real property taxes in the amount of P4,554,860 by the City Assessor of
Quezon City. 3 Accordingly, Tax Declaration Nos. C-021-01226 (16-2518) and C-021-01231
(15-2518-A) were issued for the land and the hospital building, respectively. 4 On August
25, 1993, the petitioner led a Claim for Exemption 5 from real property taxes with the City
Assessor, predicated on its claim that it is a charitable institution. The petitioner's request
was denied, and a petition was, thereafter, led before the Local Board of Assessment
Appeals of Quezon City (QC-LBAA, for brevity) for the reversal of the resolution of the City
Assessor. The petitioner alleged that under Section 28, paragraph 3 of the 1987
Constitution, the property is exempt from real property taxes. It averred that a minimum of
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 60% of its hospital beds are exclusively used for charity patients and that the major thrust
of its hospital operation is to serve charity patients. The petitioner contends that it is a
charitable institution and, as such, is exempt from real property taxes. The QC-LBAA
rendered judgment dismissing the petition and holding the petitioner liable for real
property taxes. 6
The QC-LBAA's decision was, likewise, a rmed on appeal by the Central Board of
Assessment Appeals of Quezon City (CBAA, for brevity) 7 which ruled that the petitioner
was not a charitable institution and that its real properties were not actually, directly and
exclusively used for charitable purposes; hence, it was not entitled to real property tax
exemption under the constitution and the law. The petitioner sought relief from the Court
of Appeals, which rendered judgment affirming the decision of the CBAA. 8
Undaunted, the petitioner filed its petition in this Court contending that:
A. THE COURT A QUO ERRED IN DECLARING PETITIONER AS NOT ENTITLED
TO REALTY TAX EXEMPTIONS ON THE GROUND THAT ITS LAND,
BUILDING AND IMPROVEMENTS, SUBJECT OF ASSESSMENT, ARE NOT
ACTUALLY, DIRECTLY AND EXCLUSIVELY DEVOTED FOR CHARITABLE
PURPOSES.

B. WHILE PETITIONER IS NOT DECLARED AS REAL PROPERTY TAX EXEMPT

UNDER ITS CHARTER, PD 1823, SAID EXEMPTION MAY NEVERTHELESS
BE EXTENDED UPON PROPER APPLICATION.

The petitioner avers that it is a charitable institution within the context of Section
28(3), Article VI of the 1987 Constitution. It asserts that its character as a charitable
institution is not altered by the fact that it admits paying patients and renders medical
services to them, leases portions of the land to private parties, and rents out portions of
the hospital to private medical practitioners from which it derives income to be used for
operational expenses. The petitioner points out that for the years 1995 to 1999, 100% of
its out-patients were charity patients and of the hospital's 282-bed capacity, 60% thereof,
or 170 beds, is allotted to charity patients. It asserts that the fact that it receives subsidies
from the government attests to its character as a charitable institution. It contends that
the "exclusivity" required in the Constitution does not necessarily mean "solely." Hence,
even if a portion of its real estate is leased out to private individuals from whom it derives
income, it does not lose its character as a charitable institution, and its exemption from the
payment of real estate taxes on its real property. The petitioner cited our ruling in Herrera
v. QC-BAA 9 to bolster its pose. The petitioner further contends that even if P.D. No. 1823
does not exempt it from the payment of real estate taxes, it is not precluded from seeking
tax exemption under the 1987 Constitution.
In their comment on the petition, the respondents aver that the petitioner is not a
charitable entity. The petitioner's real property is not exempt from the payment of real
estate taxes under P.D. No. 1823 and even under the 1987 Constitution because it failed to
prove that it is a charitable institution and that the said property is actually, directly and
exclusively used for charitable purposes. The respondents noted that in a newspaper
report, it appears that graft charges were led with the Sandiganbayan against the director
of the petitioner, its administrative o cer, and Zenaida Rivera, the proprietress of the
Elliptical Orchids and Garden Center, for entering into a lease contract over 7,663.13
square meters of the property in 1990 for only P20,000 a month, when the monthly rental
should be P357,000 a month as determined by the Commission on Audit; and that instead
of complying with the directive of the COA for the cancellation of the contract for being
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 grossly prejudicial to the government, the petitioner renewed the same on March 13, 1995
for a monthly rental of only P24,000. They assert that the petitioner uses the subsidies
granted by the government for charity patients and uses the rest of its income from the
property for the bene t of paying patients, among other purposes. They aver that the
petitioner failed to adduce substantial evidence that 100% of its out-patients and 170
beds in the hospital are reserved for indigent patients. The respondents further assert,
thus:
13. That the claims/allegations of the Petitioner LCP do not speak well
of its record of service. That before a patient is admitted for treatment in the
Center, rst impression is that it is pay-patient and required to pay a certain
amount as deposit. That even if a patient is living below the poverty line, he is
charged with high hospital bills. And, without these bills being rst settled, the
poor patient cannot be allowed to leave the hospital or be discharged without rst
paying the hospital bills or issue a promissory note guaranteed and indorsed by
an in uential agency or person known only to the Center; that even the remains of
deceased poor patients suffered the same fate. Moreover, before a patient is
admitted for treatment as free or charity patient, one must undergo a series of
interviews and must submit all the requirements needed by the Center, usually
accompanied by endorsement by an in uential agency or person known only to
the Center. These facts were heard and admitted by the Petitioner LCP during the
hearings before the Honorable QC-BAA and Honorable CBAA. These are the
reasons of indigent patients, instead of seeking treatment with the Center, they
prefer to be treated at the Quezon Institute. Can such practice by the Center be
called charitable? 1 0

The Issues
The issues for resolution are the following: (a) whether the petitioner is a charitable
institution within the context of Presidential Decree No. 1823 and the 1973 and 1987
Constitutions and Section 234(b) of Republic Act No. 7160; and (b) whether the real
properties of the petitioner are exempt from real property taxes.
The Court's Ruling
The petition is partially granted.
On the rst issue, we hold that the petitioner is a charitable institution within the
context of the 1973 and 1987 Constitutions. To determine whether an enterprise is a
charitable institution/entity or not, the elements which should be considered include the
statute creating the enterprise, its corporate purposes, its constitution and by-laws, the
methods of administration, the nature of the actual work performed, the character of the
services rendered, the inde niteness of the bene ciaries, and the use and occupation of
the properties. 1 1
In the legal sense, a charity may be fully de ned as a gift, to be applied consistently
with existing laws, for the bene t of an inde nite number of persons, either by bringing
their minds and hearts under the in uence of education or religion, by assisting them to
establish themselves in life or otherwise lessening the burden of government. 1 2 It may be
applied to almost anything that tend to promote the well-doing and well-being of social
man. It embraces the improvement and promotion of the happiness of man. 1 3 The word
"charitable" is not restricted to relief of the poor or sick. 1 4 The test of a charity and a
charitable organization are in law the same. The test whether an enterprise is charitable or
not is whether it exists to carry out a purpose reorganized in law as charitable or whether it
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 is maintained for gain, profit, or private advantage. TDCcAE

Under P.D. No. 1823, the petitioner is a non-pro t and non-stock corporation which,
subject to the provisions of the decree, is to be administered by the O ce of the President
of the Philippines with the Ministry of Health and the Ministry of Human Settlements. It
was organized for the welfare and bene t of the Filipino people principally to help combat
the high incidence of lung and pulmonary diseases in the Philippines. The raison d'etre for
the creation of the petitioner is stated in the decree, viz:
Whereas, for decades, respiratory diseases have been a priority concern,
having been the leading cause of illness and death in the Philippines, comprising
more than 45% of the total annual deaths from all causes, thus, exacting a
tremendous toll on human resources, which ailments are likely to increase and
degenerate into serious lung diseases on account of unabated pollution,
industrialization and unchecked cigarette smoking in the country;

Whereas, the more common lung diseases are, to a great extent,

preventable, and curable with early and adequate medical care, immunization and
through prompt and intensive prevention and health education programs;
Whereas, there is an urgent need to consolidate and reinforce existing
programs, strategies and efforts at preventing, treating and rehabilitating people
affected by lung diseases, and to undertake research and training on the cure and
prevention of lung diseases, through a Lung Center which will house and nurture
the above and related activities and provide tertiary-level care for more di cult
and problematical cases;

Whereas, to achieve this purpose, the Government intends to provide

material and nancial support towards the establishment and maintenance of a
Lung Center for the welfare and benefit of the Filipino people. 1 5

The purposes for which the petitioner was created are spelled out in its Articles of
Incorporation, thus:
SECOND: That the purposes for which such corporation is formed are
as follows:

1. To construct, establish, equip, maintain, administer and conduct an

integrated medical institution which shall specialize in the treatment, care,
rehabilitation and/or relief of lung and allied diseases in line with the concern of
the government to assist and provide material and nancial support in the
establishment and maintenance of a lung center primarily to bene t the people of
the Philippines and in pursuance of the policy of the State to secure the well-being
of the people by providing them specialized health and medical services and by
minimizing the incidence of lung diseases in the country and elsewhere.
2. To promote the noble undertaking of scienti c research related to
the prevention of lung or pulmonary ailments and the care of lung patients,
including the holding of a series of relevant congresses, conventions, seminars
and conferences;
3. To stimulate and, whenever possible, underwrite scienti c
researches on the biological, demographic, social, economic, eugenic and
physiological aspects of lung or pulmonary diseases and their control; and to
collect and publish the findings of such research for public consumption;
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 4. To facilitate the dissemination of ideas and public acceptance of
information on lung consciousness or awareness, and the development of fact-
nding, information and reporting facilities for and in aid of the general purposes
or objects aforesaid, especially in human lung requirements, general health and
physical fitness, and other relevant or related fields;

5. To encourage the training of physicians, nurses, health o cers,

social workers and medical and technical personnel in the practical and scienti c
implementation of services to lung patients;
6. To assist universities and research institutions in their studies about
lung diseases, to encourage advanced training in matters of the lung and related
fields and to support educational programs of value to general health;
7. To encourage the formation of other organizations on the national,
provincial and/or city and local levels; and to coordinate their various efforts and
activities for the purpose of achieving a more effective programmatic approach
on the common problems relative to the objectives enumerated herein;
8. To seek and obtain assistance in any form from both international
and local foundations and organizations; and to administer grants and funds that
may be given to the organization;
9. To extend, whenever possible and expedient, medical services to the
public and, in general, to promote and protect the health of the masses of our
people, which has long been recognized as an economic asset and a social
blessing;
10. To help prevent, relieve and alleviate the lung or pulmonary
a ictions and maladies of the people in any and all walks of life, including those
who are poor and needy, all without regard to or discrimination, because of race,
creed, color or political belief of the persons helped; and to enable them to obtain
treatment when such disorders occur;
11. To participate, as circumstances may warrant, in any activity
designed and carried on to promote the general health of the community;
12. To acquire and/or borrow funds and to own all funds or
equipment, educational materials and supplies by purchase, donation, or
otherwise and to dispose of and distribute the same in such manner, and, on such
basis as the Center shall, from time to time, deem proper and best, under the
particular circumstances, to serve its general and non-pro t purposes and
objectives;

13. To buy, purchase, acquire, own, lease, hold, sell, exchange, transfer
and dispose of properties, whether real or personal, for purposes herein
mentioned; and
14. To do everything necessary, proper, advisable or convenient for the
accomplishment of any of the powers herein set forth and to do every other act
and thing incidental thereto or connected therewith. 1 6

Hence, the medical services of the petitioner are to be rendered to the public in
general in any and all walks of life including those who are poor and the needy without
discrimination. After all, any person, the rich as well as the poor, may fall sick or be injured
or wounded and become a subject of charity. 1 7
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 As a general principle, a charitable institution does not lose its character as such
and its exemption from taxes simply because it derives income from paying patients,
whether out-patient, or con ned in the hospital, or receives subsidies from the
government, so long as the money received is devoted or used altogether to the charitable
object which it is intended to achieve; and no money inures to the private bene t of the
persons managing or operating the institution. 1 8 In Congregational Sunday School, etc. v.
Board of Review, 1 9 the State Supreme Court of Illinois held, thus:
. . . [A]n institution does not lose its charitable character, and consequent
exemption from taxation, by reason of the fact that those recipients of its bene ts
who are able to pay are required to do so, where no pro t is made by the
institution and the amounts so received are applied in furthering its charitable
purposes, and those bene ts are refused to none on account of inability to pay
therefor. The fundamental ground upon which all exemptions in favor of
charitable institutions are based is the bene t conferred upon the public by them,
and a consequent relief, to some extent, of the burden upon the state to care for
and advance the interests of its citizens. 2 0

As aptly stated by the State Supreme Court of South Dakota in Lutheran Hospital
Association of South Dakota v. Baker: 2 1
. . . [T]he fact that paying patients are taken, the pro ts derived from
attendance upon these patients being exclusively devoted to the maintenance of
the charity, seems rather to enhance the usefulness of the institution to the poor;
for it is a matter of common observation amongst those who have gone about at
all amongst the suffering classes, that the deserving poor can with di culty be
persuaded to enter an asylum of any kind con ned to the reception of objects of
charity; and that their honest pride is much less wounded by being placed in an
institution in which paying patients are also received. The fact of receiving money
from some of the patients does not, we think, at all impair the character of the
charity, so long as the money thus received is devoted altogether to the charitable
object which the institution is intended to further. 2 2

The money received by the petitioner becomes a part of the trust fund and must be
devoted to public trust purposes and cannot be diverted to private profit or benefit. 2 3
Under P.D. No. 1823, the petitioner is entitled to receive donations. The petitioner
does not lose its character as a charitable institution simply because the gift or donation is
in the form of subsidies granted by the government. As held by the State Supreme Court of
Utah in Yorgason v. County Board of Equalization of Salt Lake County: 2 4
Second, the . . . government subsidy payments are provided to the project.
Thus, those payments are like a gift or donation of any other kind except they
come from the government. In both Intermountain Health Care and the present
case, the crux is the presence or absence of material reciprocity. It is entirely
irrelevant to this analysis that the government, rather than a private benefactor,
chose to make up the de cit resulting from the exchange between St. Mark's
Tower and the tenants by making a contribution to the landlord, just as it would
have been irrelevant in Intermountain Health Care if the patients' income
supplements had come from private individuals rather than the government.
Therefore, the fact that subsidization of part of the cost of furnishing such
housing is by the government rather than private charitable contributions does
not dictate the denial of a charitable exemption if the facts otherwise support
such an exemption, as they do here. 2 5
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 In this case, the petitioner adduced substantial evidence that it spent its income,
including the subsidies from the government for 1991 and 1992 for its patients and for the
operation of the hospital. It even incurred a net loss in 1991 and 1992 from its operations.
Even as we nd that the petitioner is a charitable institution, we hold, anent the
second issue, that those portions of its real property that are leased to private entities are
not exempt from real property taxes as these are not actually, directly and exclusively used
for charitable purposes.
The settled rule in this jurisdiction is that laws granting exemption from tax are
construed strictissimi juris against the taxpayer and liberally in favor of the taxing power.
Taxation is the rule and exemption is the exception. The effect of an exemption is
equivalent to an appropriation. Hence, a claim for exemption from tax payments must be
clearly shown and based on language in the law too plain to be mistaken. 2 6 As held in
Salvation Army v. Hoehn: 2 7
An intention on the part of the legislature to grant an exemption from the
taxing power of the state will never be implied from language which will admit of
any other reasonable construction. Such an intention must be expressed in clear
and unmistakable terms, or must appear by necessary implication from the
language used, for it is a well settled principle that, when a special privilege or
exemption is claimed under a statute, charter or act of incorporation, it is to be
construed strictly against the property owner and in favor of the public. This
principle applies with peculiar force to a claim of exemption from taxation. . . . 2 8

Section 2 of Presidential Decree No. 1823, relied upon by the petitioner, speci cally
provides that the petitioner shall enjoy the tax exemptions and privileges:
SEC. 2. TAX EXEMPTIONS AND PRIVILEGES. — Being a non-pro t,
non-stock corporation organized primarily to help combat the high incidence of
lung and pulmonary diseases in the Philippines, all donations, contributions,
endowments and equipment and supplies to be imported by authorized entities or
persons and by the Board of Trustees of the Lung Center of the Philippines, Inc.,
for the actual use and bene t of the Lung Center, shall be exempt from income
and gift taxes, the same further deductible in full for the purpose of determining
the maximum deductible amount under Section 30, paragraph (h), of the National
Internal Revenue Code, as amended.
The Lung Center of the Philippines shall be exempt from the payment of
taxes, charges and fees imposed by the Government or any political subdivision
or instrumentality thereof with respect to equipment purchases made by, or for
the Lung Center. 2 9
It is plain as day that under the decree, the petitioner does not enjoy any property tax
exemption privileges for its real properties as well as the building constructed thereon. If
the intentions were otherwise, the same should have been among the enumeration of tax
exempt privileges under Section 2:
It is a settled rule of statutory construction that the express mention of one
person, thing, or consequence implies the exclusion of all others. The rule is
expressed in the familiar maxim, expressio unius est exclusio alterius.
The rule of expressio unius est exclusio alterius is formulated in a number
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 of ways. One variation of the rule is the principle that what is expressed puts an
end to that which is implied. Expressium facit cessare tacitum. Thus, where a
statute, by its terms, is expressly limited to certain matters, it may not, by
interpretation or construction, be extended to other matters.

xxx xxx xxx

The rule of expressio unius est exclusio alterius and its variations are
canons of restrictive interpretation. They are based on the rules of logic and the
natural workings of the human mind. They are predicated upon one's own
voluntary act and not upon that of others. They proceed from the premise that the
legislature would not have made speci ed enumeration in a statute had the
intention been not to restrict its meaning and con ne its terms to those expressly
mentioned. 3 0

The exemption must not be so enlarged by construction since the reasonable

presumption is that the State has granted in express terms all it intended to grant at all,
and that unless the privilege is limited to the very terms of the statute the favor would be
intended beyond what was meant. 3 1
Section 28(3), Article VI of the 1987 Philippine Constitution provides, thus:
(3) Charitable institutions, churches and parsonages or convents
appurtenant thereto, mosques, non-pro t cemeteries, and all lands, buildings, and
improvements, actually, directly and exclusively used for religious, charitable or
educational purposes shall be exempt from taxation. 3 2

The tax exemption under this constitutional provision covers property taxes only. 3 3
As Chief Justice Hilario G. Davide, Jr., then a member of the 1986 Constitutional
Commission, explained: ". . . what is exempted is not the institution itself . . .; those
exempted from real estate taxes are lands, buildings and improvements actually, directly
and exclusively used for religious, charitable or educational purposes." 3 4
Consequently, the constitutional provision is implemented by Section 234(b) of
Republic Act No. 7160 (otherwise known as the Local Government Code of 1991) as
follows:
SECTION 234. Exemptions from Real Property Tax . — The following
are exempted from payment of the real property tax:
xxx xxx xxx

(b) Charitable institutions, churches, parsonages or convents

appurtenant thereto, mosques, non-pro t or religious cemeteries and all lands,
buildings, and improvements actually, directly , and exclusively used for religious,
charitable or educational purposes. 3 5

We note that under the 1935 Constitution, ". . . all lands, buildings, and improvements
used 'exclusively' for … charitable . . . purposes shall be exempt from taxation." 3 6 However,
under the 1973 and the present Constitutions, for "lands, buildings, and improvements" of
the charitable institution to be considered exempt, the same should not only be
"exclusively" used for charitable purposes; it is required that such property be used
"actually" and "directly" for such purposes. 3 7
In light of the foregoing substantial changes in the Constitution, the petitioner
cannot rely on our ruling in Herrera v. Quezon City Board of Assessment Appeals which
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 was promulgated on September 30, 1961 before the 1973 and 1987 Constitutions took
effect. 3 8 As this Court held in Province of Abra v. Hernando: 3 9
. . . Under the 1935 Constitution: "Cemeteries, churches, and parsonages or
convents appurtenant thereto, and all lands, buildings, and improvements used
exclusively for religious, charitable, or educational purposes shall be exempt from
taxation." The present Constitution added "charitable institutions, mosques, and
non-pro t cemeteries" and required that for the exemption of "lands, buildings,
and improvements," they should not only be "exclusively" but also "actually" and
"directly" used for religious or charitable purposes. The Constitution is worded
differently. The change should not be ignored. It must be duly taken into
consideration. Reliance on past decisions would have su ced were the words
"actually" as well as "directly" not added. There must be proof therefore of the
actual and direct use of the lands, buildings, and improvements for religious or
charitable purposes to be exempt from taxation . . .

Under the 1973 and 1987 Constitutions and Rep. Act No. 7160 in order to be
entitled to the exemption, the petitioner is burdened to prove, by clear and unequivocal
proof, that (a) it is a charitable institution; and (b) its real properties are ACTUALLY,
DIRECTLY and EXCLUSIVELY used for charitable purposes. "Exclusive" is de ned as
possessed and enjoyed to the exclusion of others; debarred from participation or
enjoyment; and "exclusively" is de ned, "in a manner to exclude; as enjoying a privilege
exclusively." 4 0 If real property is used for one or more commercial purposes, it is not
exclusively used for the exempted purposes but is subject to taxation. 4 1 The words
"dominant use" or "principal use" cannot be substituted for the words "used exclusively"
without doing violence to the Constitutions and the law. 4 2 Solely is synonymous with
exclusively. 4 3
What is meant by actual, direct and exclusive use of the property for charitable
purposes is the direct and immediate and actual application of the property itself to the
purposes for which the charitable institution is organized. It is not the use of the income
from the real property that is determinative of whether the property is used for tax-exempt
purposes. 4 4
The petitioner failed to discharge its burden to prove that the entirety of its real
property is actually, directly and exclusively used for charitable purposes. While portions of
the hospital are used for the treatment of patients and the dispensation of medical
services to them, whether paying or non-paying, other portions thereof are being leased to
private individuals for their clinics and a canteen. Further, a portion of the land is being
leased to a private individual for her business enterprise under the business name
"Elliptical Orchids and Garden Center." Indeed, the petitioner's evidence shows that it
collected P1,136,483.45 as rentals in 1991 and P1,679,999.28 for 1992 from the said
lessees.
Accordingly, we hold that the portions of the land leased to private entities as well
as those parts of the hospital leased to private individuals are not exempt from such taxes.
4 5 On the other hand, the portions of the land occupied by the hospital and portions of the
hospital used for its patients, whether paying or non-paying, are exempt from real property
taxes.

IN LIGHT OF ALL THE FOREGOING, the petition is PARTIALLY GRANTED. The

respondent Quezon City Assessor is hereby DIRECTED to determine, after due hearing, the
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 precise portions of the land and the area thereof which are leased to private persons, and
to compute the real property taxes due thereon as provided for by law.
SO ORDERED. cCAIES

Davide, Jr., C .J ., Puno, Panganiban, Quisumbing, Sandoval-Gutierrez, Carpio, Corona,

Carpio-Morales, Azcuna and Tinga, JJ ., concur.
Vitug, J ., is on official leave.
Ynares-Santiago and Austria-Martinez, JJ ., are on leave.

Footnotes
1. Penned by Associate Justice Remedios A. Salazar-Fernando, with Associate Justices
Fermin A. Martin, Jr. and Salvador J. Valdez, Jr. concurring.
2. SECTION 1. — CREATION OF THE LUNG CENTER OF THE PHILIPPINES. There is hereby
created a trust, under the name and style of Lung Center of the Philippines, which,
subject to the provisions of this Decree, shall be administered, according to the Articles
of Incorporation, By-Laws and Objectives of the Lung Center of the Philippines, Inc., duly
registered (reg. No. 85886) with the Securities and Exchange Commission of the
Republic of the Philippines, by the Office of the President, in coordination with the
Ministry of Human Settlements and the Ministry of Health.
3. Annex "C," Rollo, p. 49.
4. Annexes "2" & "2-A," id. at 93–94.

5. Annex "D," id. at 50–52.

6. Annex "E," id. at 53–55.
7. Annexes "4" & "5," id. at 100–109.
8. Annex "A," id. at 33–41.

9. 3 SCRA 187 (1961).

10. Rollo, pp. 83–84.
11. See Workmen's Circle Educational Center of Springfield v. Board of Assessors of City of
Springfield, 51 N.E.2d 313 (1943).
12. Congregational Sunday School & Publishing Society v. Board of Review, 125 N.E. 7
(1919), citing Jackson v. Philipps, 14 Allen (Mass.) 539.
13. Bader Realty & Investment Co. v. St. Louis Housing Authority, 217 S.W.2d 489 (1949).
14. Board of Assessors of Boston v. Garland School of Homemaking, 6 N.E.2d 379.
15. Rollo, pp. 119–120.
16. Id. at 123–125.
17. Scripps Memorial Hospital v. California Employment Commission, 24 Cal.2d 669, 151
P.2d 109 (1944).

18. Sisters of Third Order of St. Frances v. Board of Review of Peoria County, 83 N.E. 272.
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 19. See note 12.
20. Id. at 10.
21. 167 N.W. 148 (1918), citing State v. Powers, 10 Mo. App. 263, 74 Mo. 476.
22. Id. at 149.
23. See O'brien v. Physicians' Hospital Association, 116 N.E. 975 (1917).

24. 714 P.2d 653 (1986).

25. Id. at 660–661.
26. Commissioner of Internal Revenue v. Court of Appeals, 298 SCRA 83 (1998).
27. 188 S.W.2d. 826 (1945).
28. Id. at 829.
29. Rollo, p. 120. (Emphasis supplied.)
30. Malinias v. COMELEC, 390 SCRA 480 (2002).
31. St. Louis Young Men's Christian Association v. Gehner, 47 S.W.2d 776 (1932).
32. Emphasis supplied.
33. Commissioner of Internal Revenue v. Court of Appeals, supra.
34. Ibid. Citing II RECORDS OF THE CONSTITUTIONAL COMMISSION 90.
35. Emphasis supplied.

36. Article VI, Section 22, par. (3) of the 1935 Constitution provides that, "Cemeteries,
churches and parsonages or convents appurtenant thereto, and all lands, buildings, and
improvements used exclusively for religious, charitable, or educational purposes shall be
exempt from taxation."
37. Article VIII, Section 17, par. (3) of the 1973 Constitution provides that, "Charitable
institutions, churches, parsonages or convents appurtenant thereto, mosques, and non-
profit cemeteries, and all lands, buildings, and improvements actually, directly, and
exclusively used for religious or charitable purposes shall be exempt from taxation."
38. 3 SCRA 186 (1961).

39. 107 SCRA 105 (1981).

40. Young Men's Christian Association of Omaha v. Douglas County, 83 N.W. 924 (1900).
41. St. Louis Young Men's Christian Association v. Gehner, supra.
42. See State ex rel Koeln v. St. Louis Y.M.C.A., 168 S.W. 589 (1914).

43. Lodge v. Nashville, 154 S.W. 141.

44. Christian Business College v. Kalamanzoo, 131 N.W. 553.
45. See Young Men's Christian Association of Omaha v. Douglas County, supra; Martin v.
City of New Orleans, 58 Am. 194 (1886).

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