Sotto v.

Sotto
Facts: This is a petition under section 513 of the Code of Civil Procedure to reopen
the land registration proceedings in regard to lot No. 7510 of the Cadaster of Cebu.
The petitioner alleges that he is the owner of said lot No. 7510; that in or about the
year 1907 he absented himself from the city of Cebu, leaving the respondent in
charge of the lot; that on or about the 16th of April, 1921, the petitioner, upon
visiting the office of the clerk of the Court of First Instance of Cebu, discovered that
the respondent had fraudulently obtained the registration of said lot in his own
name and that a certificate of title for said lot had been issued to said respondent
on January 24, 1920; that the petitioner, due to his long absence from Cebu, was
unable to appear in court in the land registration proceedings and to defend his
rights; and that this action is his only remedy to recover the property in question.
He therefore asks that the decision of the Court of First Instance in regard to said lot
No. 7510 be annulled and that a new trial be had. The case is now before us upon
demurrer by the respondent to the petition on the ground that it does not state
facts sufficient to constitute a cause of action.
The respondent maintains that section 513 of the Code of Civil Procedure is not
applicable to decisions in land registration proceedings which are covered by a final
decree and this is the only question of importance raised by the demurrer.
From the time of the passage of Act No. 1108 until the filing of the petition in the
recent case of Caballes vs. Director of Lands (41 Phil., 357) the final decrees in land
registration cases were always regarded as indefeasible and it apparently did not
occur to the members of the legal profession that the provisions of section 513,
supra, could be applied to such decrees or to the others or decisions upon which
they were based. Aside from the dictum in the Caballes case, this court has
consistently held that final decrees in land registration cases could not be reopened
except under the circumstances, and in the manner, mentioned in section 38 of the
Land Registration Act.
Issue: WON the land registration proceedings may be reopened
Held: No. As Act No. 1108 only amended certain sections of the Land Registration
Act and did not purport to amend the Act as a whole, or to introduce any new
principle therein, the amended sections should be read in connection with the other
sections of the Act as if all had been enacted in the same statute, and, as far as
possible, effect should be given to them all in furtherance of the general design of
the Act. Sutherland on Statutory Construction, 2d ed., says in paragraph 368:
"The practical inquiry is usually what a particular provision, clause, or word means.
To answer it one must proceed as he would with any other composition construe
it with reference to the leading idea or purpose of the whole and not in parts or
sections and is animated by one general purpose and intent. Consequently each

part or section should be construed in connection with every other part or section
and so as to produce a harmonious whole. It is not proper to confine the attention to
the one section to be construed. 'It is always an unsafe way of construing a statute
or contract to divide it by a process of etymological dissection, into separate words,
and then apply to each, thus separated from its context, some particular definition
given by lexicographers, and then reconstruct the instrument upon the basis of
these definitions. An instrument must always be construed as a whole, and the
particular meaning to be attached to any word or phrase is usually to be
ascertained from the context, the nature of the subject treated of and the purpose
or intention of the parties who executed the contract, or of the body which enacted
or framed the statute or constitution.
It must be conceded that section 14, as amended, is repugnant to several other
sections of the Land Registration Act, if we hold that the final "decree of
confirmation and registration" provided for in section 38 of the Act is a "judgment"
within the meaning of section 513 of the Code of Civil Procedure. But we do not
think it necessary to so hold. The Land Registration Act itself distinguishes between
a judgment and the final decree. In section 36 of the Act the decision rendered by
the court is styled "a judgment." The final "decree of confirmation and registration"
is separate and distinct from the judgment and cannot be entered until at least
thirty days after such judgment has been rendered.
Aquino v. Quezon City
Facts: The first case, docketed as G.R. No. 137534, deals with a 612-square meter
lot in East Avenue Subdivision, Diliman, Quezon City. The lot was formerly owned by
petitioner spouses Efren and Angelica Aquino (Petitioners Aquino) under Transfer
Certificate of Title (TCT) No. 260878. By their own admission, Petitioners Aquino
withheld payment of the real property taxes thereto from 1975 to 1982 as a form of
protest against the government of then President Marcos. As a result of the
nonpayment, the property was sold by the Quezon City local government, through
the Treasurer's Office, at public auction on February 29, 1984 to private respondent
Aida Linao, the highest bidder. Aida Linao eventually consolidated her ownership
under a petition granted by the Regional Trial Court (RTC) of Quezon City on
September 25, 1985. 1 Accordingly, TCT No. 260878 was cancelled and a new one
was issued under TCT No. 339476 in the name of Aida Linao.
Petitioners Aquino claimed that they learned of the sale only in April 1987 after they
were informed by people "squatting" on the property that Aida Linao was taking
steps to eject them. They then filed an action for annulment of title, reconveyance
and damages against respondents Quezon City local government, its Treasurer, the
Register of Deeds of Quezon City and Aida Linao 3 before the RTC of Quezon City. 4
They charged that the Quezon City local government sold their property without
informing them of their tax default, in derogation of the notice requirements of the

law. They also impute bad faith upon Aida Linao in buying their property despite
knowledge of the infirmities leading to the auction sale.
The first issue in common relates to the interpretation of the notice requirements
under Sections 65 and 73 of Presidential Decree (P.D.) No. 464 (the Real Property
Tax Code then in force.
Both petitioners construe the above-quoted provisions to mean that two sets of
notices, one under Section 65 and the other under Section 73, are required before a
delinquent property could be sold for failure to pay real property taxes. With respect
to the first notice under Section 65, the owner of the real property subject to tax is
supposed to be given a Notice of Tax Delinquency stating that if the property tax is
not paid, the local government would sell the real property to satisfy the tax in
arrears. The second notice under Section 73 pertains to a Notice of Sale at Public
Auction notifying the owner of the real property that since there was failure to heed
the first notice, the local government would now be selling his delinquent property
at public auction on a specified date to satisfy the tax in arrears.
Respondents, on the other hand, counter with their own interpretation of P.D. No.
464. Instead of a two-step notice requirement, respondents put forward the view
that there are three methods of enforcement on tax delinquent real property
provided under P.D. No. 464. The first method is by distraint of personal property
under Sections 65, 68, 70, 71 and 72. The second method is by sale of the
delinquent real property itself under Sections 73 to 81. The third method is by filing
a case in court under Section 82. Respondents submit that the real property in issue
was sold under the second method. That being the case, while they admit that there
was only partial compliance with the provisions of Section 65 11 this would be
relevant had the local government chosen the method of distraint of personal
property. In this case, the Quezon City local government chose the second method
of sale and there was full compliance with the provisions of Section 73. Hence, the
auction sale was valid.
Issue: WON the notice of delinquency requirement applies only to distraint of real
property.
Held: Yes. A simple application of the elementary rules of statutory construction
provides a straightforward resolution to this conflict. Section 65 basically provides
that upon delinquency of a real property tax, a notice of delinquency shall be given.
A rule of statutory construction is that a statute must be construed as a whole. The
meaning of the law is not to be extracted from a single part, portion or section or
from isolated words and phrases, clauses or sentences, but from a general
consideration or view of the act as a whole. Every part of the statute must be
interpreted with reference to the context. 12 In line with this rule, the Court finds
that Section 65's notice of delinquency should be read in line with the Section 67's
statement that the different tax remedies do not require a formal demand for the

payment but may be substituted by the notice of delinquency. Reference to the

notice of delinquency in relation to tax remedies, in general, illustrates the former's
function as a prerequisite to all the individual tax remedies subsequently detailed.
Also, the phrase "notice of delinquency as required in Section sixty-five" found on
the last part of Section 67 further underscores its mandatory nature and
interrelation to the three remedies.
National Tabacco Administration vs. Commission on Audit
Facts: In 1989, R.A. 6758, an act for the revised compensation and position
classification in the government was passed. Prior to the effectivity of R.A. 6758,
employees of the NTA have been enjoying a Mid-Year Amelioration Benefit, later
renamed to Educational Assistance to reflect the rationale behind. However, for the
years 1993 and 1994, the said benefit was disallowed on the ground that there was
no statutory authority granting the same. Thus, here in issue is the propriety of said
disallowance.
The first sentence of Section 12, R.A. 6758 provides for the allowances excepted
from the prescribed salary rates.
Issue: WON the granting of the Educational Assistance is authorized.
Held: Yes. Analyzing No. 7, which is the last clause of the first sentence of Section
12, in relation to the other benefits therein enumerated, it can be gleaned
unerringly that it is a "catch-all proviso." Further reflection on the nature of subject
fringe benefits indicates that all of them have one thing in common they belong
to one category of privilege called allowances which are usually granted to officials
and employees of the government to defray or reimburse the expenses incurred in
the performance of their official functions. In Philippine Ports Authority vs.
Commission on Audit, 8 this Court rationalized that "if these allowances are
consolidated with the standardized rate, then the government official or employee
will be compelled to spend his personal funds in attending to his duties."
Cardinal is the rule in statutory construction "that the particular words, clauses and
phrases should not be studied as detached and isolated expressions, but the whole
and every part of the statute must be considered in fixing the meaning of any of its
parts and in order to produce a harmonious whole. A statute must be so construed
as to harmonize and give effect to all its provisions whenever possible." 10 And the
rule that statute must be construed as a whole requires that apparently
conflicting provisions should be reconciled and harmonized, if at all possible. 11 It is
likewise a basic precept in statutory construction that the intent of the legislature is
the controlling factor in the interpretation of the subject statute. 12 With these rules
and the foregoing distinction elaborated upon, it is evident that the two seemingly
irreconcilable propositions are susceptible to perfect harmony. Accordingly, the
Court concludes that under the aforesaid "catch-all proviso," the legislative intent is
just to include the fringe benefits which are in the nature of allowances and since

the benefit under controversy is not in the same category, it is safe to hold that
subject educational assistance is not one of the fringe benefits within the
contemplation of the first sentence of Section 12 but rather, of the second sentence
of Section 12, in relation to Section 17 of R.A. No. 6758, considering that (1) the
recipients were incumbents when R.A. No. 6758 took effect on July 1, 1989, (2)
were, in fact, receiving the same, at the time, and (3) such additional compensation
is distinct and separate from the specific allowances above-listed, as the former is
not integrated into the standardized salary rate. Simply stated, the challenged
benefit is covered by the second sentence of Section 12 of R.A. No. 6758, the
application of sub-paragraphs 5.4 and 5.5 of CCC No. 10 being only confined to the
first sentence of Section 12, particularly the last clause thereof which amplifies the
"catch-all proviso."
Sajonas vs CA
Facts: FACTS: The Sajonas couple are before us, on a Petition for Review on
Certiorari, praying inter alia to set aside the CAs decision, and to reinstate that of
the RTC
On September 22, 1983, spouses Uychocde agreed to sell a parcel of residential
land located in Antipolo, Rizal to the spouses Sajonas on installment basis as
evidenced by a Contract to Sell dated September 22, 1983. The property was
registered in the names of the Uychocde spouses under TCT No. N-79073 of the
Register of Deeds of Marikina, Rizal.
On August 27, 1984, the Sajonas couple caused the annotation of an adverse claim
based on the said Contract to Sell on the title of the subject property, which was
inscribed as Entry No. 116017. Upon full payment of the purchase price, the
Uychocdes executed a Deed of Sale involving the property in question in favor of
the Sajonas couple on September 4, 1984. The deed of absolute sale was registered
almost a year after, or on August 28, 1985.
Meanwhile, it appears that Pilares (defendant-appellant) filed a Civil Case for
collection of sum of money against Ernesto Uychocde. On June 1980, a Compromise
Agreement was entered into by the parties in the said case under which Uychocde
acknowledged his monetary obligation to Pilares amounting to P27,800 and agreed
to pay the same in two years. When Uychocde failed to comply with his undertaking
in the compromise agreement, Pilares moved for the issuance of a writ of execution
to enforce the decision based on the compromise agreement, which the court
granted in its order dated August 3, 1982. Accordingly, a writ of execution was
issued on August 12, 1982 by the CFI of Quezon City. Pursuant to the order of
execution a notice of levy on execution was issued on February 12, 1985. On the
same date, defendant sheriff Garcia of Quezon City presented said notice of levy on
execution before the Register of Deeds of Marikina and the same was annotated at
the back of the TCT of the subject land.

When the deed of absolute sale dated September 4, 1984 was registered on August
28, 1985, TCT No. N-79073 was cancelled and in lieu thereof, TCT No. N-109417 was
issued in the name of the Sajonas couple. The notice of levy on execution annotated
by defendant sheriff was carried over to the new title. On October 21, 1985, the
Sajonas couple filed a Third Party Claim with the sheriff of Quezon City, hence the
auction sale of the subject property did not push through as scheduled.
On January 1986, the Sajonas spouses demanded the cancellation of the notice of
levy on execution upon Pilares, through a letter to their lawyer. Despite said
demand, defendant-appellant Pilares refused to cause the cancellation of said
annotation. In view thereof, plaintiffs-appellees filed a complaint in the RTC of Rizal,
against Pilares, the judgment creditor of the Uychocdes. The trial court rendered its
decision in favor of the Sajonas couple, and ordered the cancellation of the Notice of
Levy from TCT No. N-109417. The court a quo stated, thus:
It is a well settled rule in this jurisdiction that actual notice of an adverse claim is
equivalent to registration and the subsequent registration of the Notice of Levy
could not have any legal effect in any respect on account of prior inscription of the
adverse claim annotated on the title of the Uychocdes.
On the issue of whether or not plaintiffs (Sajonas) are buyers in good faith of the
property of the spouses Uychocde even notwithstanding the claim of the defendant
that said sale executed by the spouses was made in fraud of creditors, the Court
finds that the evidence in this instance is bare of any indication that said plaintiffs
as purchasers had notice beforehand of the claim of the defendant over said
property or that the same is involved in a litigation between said spouses and the
defendant. Good faith is the opposite of fraud and bad faith, and the existence of
any bad faith must be established by competent proof.

Dissatisfied, Pilares appealed to the CA assigning errors on the part of the lower
court. The appellate court reversed the lower courts decision, and upheld the
annotation of the levy on execution on the certificate of title. The respondent
appellate court upheld private respondents theory when it ruled:
The above staled conclusion of the lower court is based on the premise that the
adverse claim filed by plaintiffs-appellees is still effective despite the lapse of 30
days from the date of registration. However, under the provisions of Section 70 of
P.D. 1529, an adverse claim shall be effective only for a period of 30 days from the
date of its registration.
Hence this petition.
ISSUE:

1. THE LOWER COURT ERRED IN HOLDING THAT THE RULE ON THE 30-DAY PERIOD
FOR ADVERSE CLAIM UNDER SECTION 70 OF P.D. NO. 1529 IS ABSOLUTE INASMUCH
AS IT FAILED TO READ OR CONSTRUE THE PROVISION IN ITS ENTIRETY AND TO
RECONCILE THE APPARENT INCONSISTENCY WITHIN THE PROVISION IN ORDER TO
GIVE EFFECT TO IT AS A WHOLE.
HELD: ACCORDINGLY, the assailed decision of the respondent CA dated October 17,
1991 is hereby REVERSED and SET ASIDE. The decision of the RTC finding for the
cancellation of the notice of levy on execution from Transfer Certificate of Title No.
N-109417 is hereby REINSTATED. The inscription of the notice of levy on execution
on TCT No. N-109417 is hereby CANCELLED.
The question may be posed, was the adverse claim inscribed in the TCT still in force
when private respondent caused the notice of levy on execution to be registered
and annotated in the said title, considering that more than thirty days had already
lapsed since it was annotated ? (Pilares argues that the adverse claim ceases to
have any legal force and effect (30) days after August 27, 1984 pursuant to Section
70 of P.D. 1529)
In construing the law aforesaid, care should be taken that every part thereof be
given effect and a construction that could render a provision inoperative should be
avoided, and inconsistent provisions should be reconciled whenever possible as
parts of a harmonious whole. For taken in solitude, a word or phrase might easily
convey a meaning quite different from the one actually intended and evident when
a word or phrase is considered with those with which it is associated. In ascertaining
the period of effectivity of an inscription of adverse claim, we must read the law in
its entirety. Sentence three, paragraph two of Section 70 of P.D. 1529 provides:
The adverse claim shall be effective for a period of thirty days from the date of
registration.
At first blush, the provision in question would seem to restrict the effectivity of the
adverse claim to thirty days. But the above provision cannot and should not be
treated separately, but should be read in relation to the sentence following, which
reads:

After the lapse of said period, the annotation of adverse claim may be cancelled
upon filing of a verified petition therefor by the party in interest.
If the rationale of the law was for the adverse claim to ipso facto lose force and
effect after the lapse of thirty days, then it would not have been necessary to
include the foregoing caveat to clarify and complete the rule. For then, no adverse
claim need be cancelled. If it has been automatically terminated by mere lapse of
time, the law would not have required the party in interest to do a useless act. The

law, taken together, simply means that the cancellation of the adverse claim is still
necessary to render it ineffective, otherwise, the inscription will remain annotated
and shall continue as a lien upon the property.
To hold otherwise would be to deprive petitioners of their property, who waited a
long time to complete payments on their property, convinced that their interest was
amply protected by the inscribed adverse claim.
In sum, the disputed inscription of an adverse claim on the TCT No. N-79073 was
still in effect on February 12, 1985 when Quezon City Sheriff Roberto Garcia
annotated the notice of levy on execution thereto. Consequently, he is charged with
knowledge that the property sought to be levied upon the execution was
encumbered by an interest the same as or better than that of the registered owner
thereof. Such notice of levy cannot prevail over the existing adverse claim inscribed
on the certificate of title in favor of the petitioners
People vs Bustinera
Facts: From the decision 1 of the Regional Trial Court, Branch 217, Quezon City
finding appellant Luisito D. Bustinera guilty beyond reasonable doubt of qualified
theft 2 for the unlawful taking of a Daewoo Racer GTE Taxi and sentencing him to
suffer the penalty of reclusion perpetua, he comes to this Court on appeal.
appellant does not deny that he did not return the taxi on December 25, 1996 as he
was short of the boundary fee, he claims that he did not abandon the taxi but
actually returned it on January 5, 1997; 12 and that on December 27, 1996, he gave
the amount of P2,000.00 13 to his wife whom he instructed to remit the same to
Cipriano as payment of the boundary fee 14 and to tell the latter that he could not
return the taxi as he still had a balance thereof. Brushing aside appellant's claim
that he returned the taxi on January 5, 1997 and that he had in fact paid the total
amount of P4,500.00, the trial court found him guilty beyond reasonable doubt of
qualified theft by Decision of May 17, 2001.
Issue: WON the court a quo erred in finding accused guilty beyond reasonable doubt
of the crime charged.
Held: No. It is settled that an appeal in a criminal proceeding throws the whole case
open for review, and it becomes the duty of the appellate court to correct such
errors as may be found in the judgment even if they have not been specifically
assigned. 26

Appellant was convicted of qualified theft under Article 310 of the Revised Penal
Code, as amended for the unlawful taking of a motor vehicle. However, Article 310
has been modified, with respect to certain vehicles, 27 by Republic Act No. 6539, as
amended, otherwise known as "AN ACT PREVENTING AND PENALIZING

CARNAPPING." When statutes are in pari materia 28 or when they relate to the
same person or thing, or to the same class of persons or things, or cover the same
specific or particular subject matter, 29 or have the same purpose or object, 30 the
rule dictates that they should be construed together interpretare et concordare
leges legibus, est optimus interpretandi modus. 31 Every statute must be so
construed and harmonized with other statutes as to form a uniform system of
jurisprudence. The designation in the information of the offense committed by
appellant as one for qualified theft notwithstanding, appellant may still be convicted
of the crime of carnapping. For while it is necessary that the statutory designation
be stated in the information, a mistake in the caption of an indictment in
designating the correct name of the offense is not a fatal defect as it is not the
designation that is controlling but the facts alleged in the information which
determines the real nature of the crime.
Paras v. COMELEC
FACTS:
A petition for recall was filed against Paras, who is the incumbent Punong
Barangay. The recall election was deferred due to Petitioners opposition that under
Sec. 74 of RA No. 7160, no recall shall take place within one year from the date of
the officials assumption to office or one year immediately preceding a regular
local election. Since the Sangguniang Kabataan (SK) election was set on the first
Monday of May 2006, no recall may be instituted.
ISSUE:
W/N the SK election is a local election.
HELD:
No. Every part of the statute must be interpreted with reference to its context, and
it must be considered together and kept subservient to its general intent. The
evident intent of Sec. 74 is to subject an elective local official to recall once during
his term, as provided in par. (a) and par. (b). The spirit, rather than the letter of a
law, determines its construction. Thus, interpreting the phrase regular local
election to include SK election will unduly circumscribe the Code for there will
never be a recall election rendering inutile the provision. In interpreting a statute,
the Court assumed that the legislature intended to enact an effective law. An
interpretation should be avoided under which a statute or provision being
construed is defeated, meaningless, inoperative or nugatory
Uytengsu v. Republic
Facts: Petitioner-appellee was born, of Chinese parents, in Dumaguete, Negros
Oriental on October 6, 1927. Then, to be exact, on July 15, 1950, his present
application for naturalization was filed. Forthwith, he returned to the United States

and took a postgraduate course, in chemical engineering, in another educational

institution, in Fort Wayne, Indiana. He finished this course in July 1951; but did not
return to the Philippines until October 13, 1951. Hence, the hearing of the case,
originally scheduled to take place on July 12, 1951, had to be postponed on motion
of counsel for the petitioner.
The only question for the determination in this appeal is whether or not the
application for naturalization may be granted, notwithstanding the fact that
petitioner left the Philippines immediately after the filing of his petition and did not
return until several months after the first date set for the hearing thereof. The Court
of First Instance of Cebu decided this question in the affirmative and accordingly
rendered judgment for the petitioner. The Solicitor General, who maintains the
negative, has appealed from said judgment.
Section 7 of Commonwealth Act No. 473 reads as follows:
"Any person desiring to acquire Philippine citizenship shall file with the competent
court, a petition in triplicate, accompanied by two photographs of the petitioner,
setting forth his name and surname, his present and former place of residence; his
occupation; the place and date of his birth; whether single or married and if the
father of children, the name, age, birthplace and residence of the wife and of each
of the children; the approximate date of his arrival in the Philippines, the name of
the port of debarkation, and if he remembers it, the name of the ship on which he
came; a declaration that he has the qualifications required by this Act, specifying
the same, and that he is not disqualified for naturalization under the provisions of
this Act; that he has complied with the requirements of section five of this Act, and
that he will reside continuously in the Philippines from the date of the filing of the
petition up to the time of his admission to Philippine citizenship . . ." (Emphasis
supplied.)
In conformity with this provision, petitioner stated in paragraph 13 of his
application:
". . . I will reside continuously in the Philippines from the date of the filing of my
petition up to the time of my admission to Philippine citizenship." (Record on
Appeal, page 3.)
Petitioner contends, and the lower court held, that the word "residence", as used in
the aforesaid provision of the Naturalization Law, is synonymous with domicile,
which, once acquired, is not lost by physical absence, until another domicile is
obtained, and that, from 1946 to 1951, he continued to be domiciled in, and hence
a resident of the Philippines, his purpose in staying in the United States, at that
time, being, merely to study therein.
Issue: WON petitioner has complied with the requirements for naturalization

Held: No. It should be noted that to become a citizen of the Philippines by

naturalization, one must reside therein for not less than 10 years, except in some
special cases, in which 5 years of residence is sufficient (sections 2 and 3,
Commonwealth Act No. 473). Pursuant to the provision above quoted, he must, also,
file an application stating therein, among other things, that he "has the
qualifications required" by law. Inasmuch as these qualifications include the
residence requirement already referred to, it follows that the applicant must prove
that he is a resident of the Philippines at the time, not only of the filing of the
application, but, also, of its hearing. If the residence thus required is the actual or
constructive permanent home, otherwise known as legal residence or domicile, then
the applicant must be domiciled in the Philippines on both dates. Consequently,
when section 7 of Commonwealth Act No. 473 imposes upon the applicant the duty
to state in his sworn application "that he will reside continuously in the Philippines"
in the intervening period, it can not refer merely to the need of an uninterrupted
domicile or legal residence, irrespective of actual residence, for said legal residence
or domicile is obligatory under the law, even in the absence of the requirement
contained in said clause, and, it is well settled that, whenever possible, a legal
provision must not be so construed as to be a useless surplusage, and, accordingly,
meaningless, in the sense of adding nothing to the law or having no effect
whatsoever thereon. This consequences may be avoided only by construing the
clause in question as demanding actual residence in the Philippines from the filing
of the petition for naturalization to its determination by the court.
OSG vs. Court of Appeals
Facts: The Municipality of Saguiran was named a respondent in a petition for
mandamus 4 filed with the Regional Trial Court (RTC) of Lanao del Sur by the former
members of the Sangguniang Bayan of Saguiran, namely, Macmod P. Masorong,
Amrosi Macote Samporna, Alanie L. Dalama, Hassan P. Amai-Kurot and Cadalay S.
Rataban. Therein petitioners sought to compel the Municipality of Saguiran to pay
them the aggregate amount of PhP726,000.00, representing their unpaid terminal
leave benefits under Section 5 of the Civil Service Commission Memorandum
Circular Nos. 41, Series of 1998 and 14, Series of 1999. 5 The Municipality of
Saguiran sought the trial court's dismissal of the petition through its Verified Answer
with Affirmative Defenses and Counterclaim 6 which was signed by Municipal Mayor
Hadjah Rasmia B. Macabago and Municipal Treasurer Hadji Mautinter Dimacaling.
On August 5, 2010, the OSG filed a Manifestation and Motion 12 requesting to be
excused from filing the memorandum on the ground of lack of legal authority to
represent the Municipality of Saguiran. It reasoned that the Municipality of Saguiran
had to be represented by its legal officer, pursuant to Article XI (3) (i) of Republic
Act No. 7160, otherwise known as the Local Government Code of 1991 (LGC).
The CA ruled that We are at a loss as to how the OSG views a local government
unit then if it does not consider the same part of the Government of the Philippines

or an agency or instrumentality thereof; but to enlighten the said Office, the

Supreme Court in Province of Camarines Sur vs. Court of Appeals, Et Al. held that a
local government unit, in the performance of its political functions, is an agency of
the Republic and acts for the latter's benefit.
The OSG argues that the legal officer of a local government unit must represent it in
its lawsuits, citing the provisions of the LGC and jurisprudence which bar local
government units from obtaining the services of a lawyer other than their
designated legal officers.
Issue: WON the OSG should represent the local government unit in its lawsuits
Held: No. the OSG's mandate under the Administrative Code must be construed
taking into account the other statutes that pertain to the same subject of
representation in courts. Statutes are in pari materia when they relate to the same
person or thing or to the same class of persons or things, or object, or cover the
same specific or particular subject matter.

It is axiomatic in statutory construction that a statute must be interpreted, 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. The rule is
expressed in the maxim, "interpretare et concordare legibus est optimus
interpretandi," or every statute must be so construed and harmonized with other
statutes as to form a uniform system of jurisprudence.
Evidently, this provision of the LGC not only identifies the powers and functions of a
local government unit's legal officer. It also restricts, as it names, the lawyer who
may represent the local government unit as its counsel in court proceedings. Being
a special law on the issue of representation in court that is exclusively made
applicable to local government units, the LGC must prevail over the provisions of
the Administrative Code, which classifies only as a general law on the subject
matter. 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.
Tanada vs Yulo
Facts: Juan Taada, the petitioner, was appointed justice of the peace of Alabat,
Tayabas, by the Governor-General with the advice and consent of the Philippine
Commission on December 4, 1911. He continued in that position until September 8,

1934, when at his own request, "Pursuant to the provisions of section 206 of the
Revised Administrative Code", he was "transferred from the position of justice of the
peace for the municipality of Alabat, Province of Tayabas, to the same position in
the municipality of Perez, same province", by a communication signed by the
Governor-General from which the foregoing is quoted. Taada completed the age of
sixty-five years on October 5, 1934. Thereupon the Judge of First Instance of
Tayabas, acting in accordance with instructions from the Department of Justice,
directed Taada to cease to act as justice of the peace of Perez, Tayabas. Taada
surrendered his office under protest, and thereafter instituted this original action of
quo warranto.
The applicable law is found in the last proviso to section 203 of the Administrative
Code, as inserted by Act No. 3899, and in the proviso to section 206 of the same
Code as last amended by Act No. 2768, which read as follows:
"SEC. 203. Appointment and distribution of justices of the peace. . . . Provided,
further, That the present justices and auxiliary justices of the peace who shall, at
the time this Act takes effect, have completed sixty-five years of age, shall cease to
hold office on January first, nineteen hundred and thirty-three; and the GovernorGeneral, with the advice and consent of the Philippine Senate, shall make new
appointments to cover the vacancies occurring by operation of this Act."
"SEC. 206. Tenure of office Transfer from one municipality to another. A justice
of the peace having the requisite legal qualifications shall hold office during good
behavior unless his office be lawfully abolished or merged in the jurisdiction of some
other justice: Provided, That in case the public interest requires it, a justice of the
peace of one municipality may be transferred to another."
Issue: WON Act No. 3899 applies to a justice of the peace appointed prior to the
approval of the Act who completed sixty-five years of age after January 1, 1933.
Held: No. a justice of the peace like the petitioner who became sixty-five years of
age on October 5, 1934, was not included in a law which required justices of the
peace sixty-five years of age to cease to hold office on January 1, 1933. That result
is now arrived at in banc.
In substantiation of what has just been said, it is of course fundamental that the
determination of the legislative intent is the primary consideration. However, it is
equally fundamental that that legislative intent must be determined from the
language of the statute itself. This principle must be adhered to even though the
court be convinced by extraneous circumstances that the Legislature intended to
enact something very different from that which it did enact. An obscurity cannot be
created to be cleared up by construction and hidden meanings at variance with the
language used cannot be sought out. To attempt to do so is a perilous undertaking,
and is quite apt to lead to an amendment of a law by judicial construction. To depart

from the meaning expressed by the words is to alter the statute, is to legislate not
to interpret.
Counsel in effect urges us to adopt a liberal construction of the statute. That in this
instance, as in the past, we aim to do. But counsel in his memorandum concedes
"that the language of the proviso in question is somewhat defective and does not
clearly convey the legislative intent", and at the hearing in response to questions
was finally forced to admit that what the Government desired was for the court to
insert words and phrases in the law in order to supply an intention for the
legislature. That we cannot do. By liberal construction of statutes, courts from the
language used, the subject matter, and the purposes of those framing them are
able to find out their true meaning. There is a sharp distinction, however, between
construction of this nature and the act of a court in engrafting upon a law
something that has been omitted which someone believes ought to have been
embraced. The former is liberal construction and is a legitimate exercise of judicial
power. The latter is judicial legislation forbidden by the tripartite division of powers
among the three departments of government, the executive, the legislative, and the
judicial.
Yu Oh vs Court of Appeals
Facts: Petitioner purchased pieces of jewelry from Solid Gold International Traders,
Inc., a company engaged in jewelry trading. Due to her failure to pay the purchase
price, Solid Gold filed civil cases 2 against her for specific performance before the
Regional Trial Court of Pasig. On September 17, 1990, petitioner and Solid Gold,
through its general manager Joaquin Novales III, entered into a compromise
agreement to settle said civil cases. 3 The compromise agreement, as approved by
the trial court, provided that petitioner shall issue a total of ninety-nine post-dated
checks in the amount of P50,000.00 each, dated every 15th and 30th of the month
starting October 1, 1990 and the balance of over P1 million to be paid in lump sum
on November 16, 1994 which is also the due date of the 99th and last postdated
check. Petitioner issued ten checks at P50,000.00 each, for a total of P500,000.00,
drawn against her account at the Equitable Banking Corporation (EBC), Grace Park,
Caloocan City Branch. Novales then deposited each of the ten checks on their
respective due dates with the Far East Bank and Trust Company (FEBTC). However,
said checks were dishonored by EBC for the reason "Account Closed." Dishonor slips
were issued for each check that was returned to Novales. RTC found accused guilty.
Petitioner appealed to the Court of Appeals alleging that: the RTC has no jurisdiction
over the offense charged in the ten informations; it overlooked the fact that no
notice of dishonor had been given to the appellant as drawer of the dishonored
checks.
Issue: whether or not notice of dishonor is dispensable in this case;

Held: Yes. The effects of the issuance of a worthless check transcend the private
interests of the parties directly involved in the transaction and touches the interests
of the community at large. The mischief it creates is not only a wrong to the payee
or holder but also an injury to the public. The harmful practice of putting valueless
commercial papers in circulation, multiplied a thousandfold, can very well pollute
the channels of trade and commerce, injure the banking system and eventually hurt
the welfare of society and the public interest.
This Court, in Lozano vs. Martinez, was explicit in ruling that the language of B.P.
Blg. 22 is broad enough to cover all kinds of checks, whether present dated or
postdated, or whether issued in payment of pre-existing obligations or given in
mutual or simultaneous exchange for something of value.
Based on the law and existing jurisprudence, we find that the appellate court erred
in convicting petitioner.
In cases for violation of B.P. Blg. 22, it is necessary that the prosecution prove that
the issuer had received a notice of dishonor. Since service of notice is an issue, the
person alleging that the notice was served must prove the fact of service. Basic also
is the doctrine that in criminal cases, the quantum of proof required is proof beyond
reasonable doubt. Hence, for cases of B.P. Blg. 22 there should be clear proof of
notice.
Indeed, this requirement cannot be taken lightly because Section 2 provides for an
opportunity for the drawer to effect full payment of the amount appearing on the
check, within five banking days from notice of dishonor. The absence of said notice
therefore deprives an accused of an opportunity to preclude criminal prosecution. In
other words, procedural due process demands that a notice of dishonor be actually
served on petitioner. In the case at bar, appellant has a right to demand and the
basic postulate of fairness requires that the notice of dishonor be actually sent to
and received by her to afford her to opportunity to aver prosecution under B.P. Blg.
22.
People vs Subido
Facts: The CFI found Subido guilty of libel. Therefore, he was sentenced of 3 months
of arresto mayor with the accessory penalties of the law, pay the fine of P500.00,
indemnify the offended party, Mayor Arsenio Lacson, of P10,000.00, with subsidiary
imprisonment in case of insolvency and to pay the costs. However, the Court of
Appeals modified the judgment by removing the penalty of arresto mayor, reducing
the indemnity amount from P10,000 to P5,000 and mentioned nothing of the
subsidiary imprisonment in case of insolvency. As a result, Subido filed with the trial
court to recognize the decision of the Court of Appeals and to cancel his appeal
bond.

Issue: Whether or not, the accused-appellant can be required to serve the fine and
indemnity prescribed in the judgment of the Court of Appeals in form of subsidiary
imprisonment in case of insolvency?
Held: Yes
Ratio: The use of a comma (,) in the part of the sentence is to make the subsidiary
imprisonment in case of insolvency refer not only to non-payment of the
indemnity, but also to non-payment of the fine.
People vs Atop
Facts: This is a combined appeal from, and an automatic review of, the Joint
Decision of the Regional Trial Court, Branch 12, of Ormoc City, finding Appellant
Alejandro Atop, alias "Ali," guilty beyond reasonable doubt of three (3) counts of
rape and sentencing him to two (2) terms of reclusion perpetua for the first two
counts, and to death for the third.
The trial court sentenced appellant to death, holding that his common-law
relationship with the victim's grandmother aggravated the penalty. The trial court
ruled that the circumstances of nighttime and relationship aggravated all the three
incidents of rape, and considering that the last rape occurred after the effectivity of
the RA 7659, the death penalty law, the Court meted the capital punishment of
death. In this appeal, appellant maintains that the trial court erred in appreciating
the circumstances of nighttime and relationship as aggravating the penalty
imposable to the rape allegedly committed on October 9, 1992 and on December
26, 1994.
Issue: WON the circumstances of nighttime and relationship as aggravating can be
appreciated.
Held: No. The prosecution failed to prove that nighttime was deliberately sought by
appellant to facilitate his dastardly acts. Neither can we appreciate relationship as
an aggravating circumstance. The scope of relationship as defined by law
encompasses (1) the spouse; (2) an ascendant; (3) a descendant; (4) a legitimate,
natural or adopted brother or sister; or (5) a relative by affinity in the same degree.
17 Relationship by affinity refers to a relation by virtue of a legal bond such as
marriage. Relatives by affinity therefore are those commonly referred to as "inlaws," or stepfather, stepmother, stepchild and the like; in contrast to relatives by
consanguinity or blood relatives encompassed under the second, third and fourth
enumeration above. The law cannot be stretched to include persons attached by
common-law relations. Here, there is no blood relationship or legal bond that links
the appellant to his victim. Thus, the modifying circumstance of relationship cannot
be considered against him.

Undisputed is the fact that appellant is not the common-law spouse of the parent of
the victim. He is the common-law husband of the girl's grandmother. Needless to
state, neither is appellant the victim's "parent, ascendant, step-parent, guardian,
relative by consanguinity or affinity within the third civil degree." Hence, he is not
encompassed in any of the relationships expressly enumerated in the aforecited
provision.
It is a basic rule of statutory construction that penal statutes are to be liberally
construed in favor of the accused. 18 Courts must not bring cases within the
provision of a law which are not clearly embraced by it. No act can be pronounced
criminal which is not clearly made so by statute; so, too, no person who is not
clearly within the terms of a statute can be brought within them. 19 Any reasonable
doubt must be resolved in favor of the accused
People vs Manantan
Facts: Guillermo Manantan was charged with a violation of Section 54, Revised
Election Code. However, Manantan claims that as "justice of peace", the defendant
is not one of the officers enumerated in the said section. The lower court denied the
motion to dismiss holding that a justice of peace is within the purview of Section 54.
Under Section 54, "No justice, judge, fiscal, treasurer, or assessor of any province,
no officer or employee of the Army, no member of the national, provincial, city,
municipal or rural police force and no classified civil service officer or employee
shall aid any candidate, or exert any influence in any manner in a election or take
part therein, except to vote, if entitled thereto, or to preserve public peace, if he is a
peace officer.".
Defendant submits that the said election was taken from Section 449 of the Revised
Administration Code wherein, "No judge of the First Instance, justice of the peace, or
treasurer, fiscal or assessor of any province and no officer or employee of the
Philippine Constabulary, or any Bureau or employee of the classified civil service,
shall aid any candidate or exert influence in any manner in any election or take part
therein otherwise than exercising the right to vote.". He claims that the words
"justice of peace" was omitted revealed the intention of Legislature to exclude
justices of peace from its operation.
Issue: Is justice of peace included in the prohibition of Section 64 of the Revised
Election Code?
Held: Yes, it is included in Section 54. Justices of the peace were expressly included
in Section 449 of the Revised Administrative Code because the kinds of judges
therein were specified, i.e., judge of the First Instance and justice of the peace. In
Section 54, however, there was no necessity therefore to include justices of the
peace in the enumeration because the legislature had availed itself of the more
generic and broader term, "judge.", which includes all kinds of judges.

A "justice of the peace" is a judge. A "judge" is a public officer, who, by virtue of his
office, is clothed with judicial authority. This term includes all officers appointed to
to decide litigated questions while acting in that capacity, including justices of the
peace, and even jurors, it is said, who are judges of facts.
From the history of Section 54 of REC, the first omission of the word "justice of the
peace" was effected in Section 48 of Commonwealth Act No. 357 and not in the
present code as averred by defendant-appellee. Whenever the word "judge" was
qualified by the phrase "of the First Instance', the words "justice of the peace" were
omitted. It follows that when the legislature omitted the words "justice of the peace"
in RA 180, it did not intend to exempt the said officer from its operation. Rather, it
had considered the said officer as already comprehended in the broader term
"judge".
The rule of "casus omisus pro omisso habendus est" is likewise invoked by the
defendant-appellee. Under the said rule, a person, object or thing omitted from an
enumeration must be held to have been omitted intentionally. However, it is
applicable only if the omission has been clearly established. In the case at bar, the
legislature did not exclude or omit justices of the peace from the enumeration of
officers precluded from engaging in partisan political activities. In Section 54,
justices of the peace were just called "judges". Also, the application of this rule does
not proceed from the mere fact that a case is criminal in nature, but rather from a
reasonable certainty that a particular person, object or thing has been omitted from
a legislative enumeration. In the case at bar, there is no omission but only
substitution of terms.
The rule that penal statutes are given a strict construction is not the only factor
controlling the interpretation of such laws; instead, the rule merely serves as an
additional, single factor to be considered as an aid in determining the meaning of
penal laws.
Also, the purpose of the statute s to enlarge the officers within its purview. Justices
of the Supreme Court, the Court of Appeals, and various judges, such as the judges
of the Court of Industrial Relations, judges of the Court of Agrarian Relations, etc.,
who were not included in the prohibition under the old statute, are now within its
encompass.
The rule "expressio unius est exclusion alterius" has been erroneously applied by CA
and lower courts because they were not able to give reasons for the exclusion of the
legislature for the term "justices of peace".
Mapulo Mining v. Lopez
Facts: In 1940, Eliseo Chavez and his wife, Lucia B. Mercado, located a limestone
mining claim (then known as the San Jose Placer Claim) over a piece of registered
private land situated at Barrio Mapulo, Taysan, Batangas with an area of 12.4469

hectares. The said land, owned by Quiliano Mercado, Lucia B. Mercado's father, is
covered by Original Certificate of Title (OCT) No. RO-174 (0-510). On 6-12 and 18-27
March 1943, the lease survey of the placer claim was undertaken by then Assistant
Mineral Land Surveyor of the Bureau of Mines, Mr. Julian Lagman; on 5 July 1943,
then Director of Mines, Hon. Quirico A. Abadilla, approved the survey plan (Pla-163)
prepared by the former. Under a temporary permit to extract minerals issued to
them by the Director of Mines on 3 February 1943, the spouses extracted and mined
limestone from the land.
Subsequently, the Mineral Lands and Administrative Division of the Bureau of Mines
declared as abandoned this claim of Mr. Chavez due to his failure to comply with
some requirements. 4 Thereafter, the Mapulo Mining Association, petitioner herein,
relocated the area through Antonio Chavez on 16-22 December 1963 and registered
it as the Mapulo Placer Mining Area with the Office of the Mining Recorder (Register
of Deeds) of Batangas on 22 January 1964. On 4 February 1964, the Mapulo Mining
Association filed an application for a mining lease.
Private respondent Projects & Ventures, Inc. (PROVEN) located mining claims known
as "BAT 40, 41, 60, 22, 23, 38, 37, 44, 57, 61, 62, 63, 64, 39, 42, 58, 59, 43, and 24"
over an area embraced by petitioners' mining claims. Later, PROVEN filed with the
Bureau of Mines Lode Lease Applications Nos. V-9176 Amd., V-9177 Amd., V-9178,
V-9226 and V-9227 Amd.-A. The notice of application was published in the 7, 14,
and 21 August 1967 issues of the Official Gazette; however, these issues were
actually released for circulation to the public only on 5, 19 and 29 September 1967,
respectively, per certification of the Bureau of Printing. 7 The notice was also
published in the 15, 22 and 29 July 1967 issues of the Philippines Herald and El
Debate, both published in Manila. It was not, however, published in a local
newspaper in Batangas such as the People's Courier or The Batangas Reporter. 8
Although disputed by petitioners, private respondent alleges that the notice was
also posted at the places required by law.
petitioners filed an Adverse Claim and/or Opposition to the Issuance of Mining
Lease.
Private respondent, on 20 October 1967, filed a Motion to Dismiss petitioners'
adverse claim on the ground that the same was filed one (1) day late. 13
On 20 November 1967, petitioners opposed the motion to dismiss contending that:
(1) Section 72 of the Mining Act, as amended, requiring the publication of the notice
of mining lease application in the provincial newspaper, has not been complied with
and so, therefore, there is no publication deadline to speak of; Director of Mines
dismissed petitioners' adverse claim on the ground that: (1) the publication of
private respondent's notice of filing of applications for lease in a provincial
newspaper is not necessary;||| (Mapulo Mining Ass'n v. Lopez, G.R. No. L-30440,
[February 7, 1992])

Issue: whether or not there was valid and sufficient publication of the notice of
private respondent's application for a mining lease over its claims.
Held: No. the publication requirements prescribed in Section 72 of the Mining Act
are mandatory and that substantial compliance therewith is not enough. Such
mandatory character is obvious from the Section itself, which provides that:
". . . the Director of the Bureau of Mines shall publish a notice that such application
has been made, once a week for a period of three consecutive weeks, in the Official
Gazette and in two newspapers, one published in Manila either in English or
Spanish, and the other published in the municipality or province in which the mining
claim is located, if there is such newspaper, otherwise, in the newspaper published
in the nearest municipality or province. . . .."
It is evident that the newspaper first mentioned refers to a periodical published in
Manila and circulated in the Philippines while the second refers to a local
newspaper. Publication in one does not mean that the applicant can dispense with
publication in the other. Otherwise, it would have been absurd, nay ridiculous, for
the law to require publication in both newspapers in addition to publication in the
Official Gazette. The legislature certainly abhors absurdity. Corollarily, courts should
not give a statute a meaning that would lead to absurdity. 39 Besides, Section 72
imposes upon the Director of Mines the duty, "[u]pon receipt of the application, and
provided that the requirements of this Act have been complied with," to publish the
notice in the Official Gazette and in the said two (2) newspapers. The language of
the mandate is undeniably clear and unequivocal. It should be taken to mean
exactly what it says:
". . . It is the rule in statutory construction that if the words and phrases of a statute
are not obscure or ambiguous, its meaning and the intention of the legislature must
be determined from the language employed, and, where there is no ambiguity in
the words, there is no room for construction (Black on Interpretation of Laws, sec.
51). The courts may not speculate as to the probable intent of the legislature apart
from the words (Hondoras vs. Soto, 8 Am. St., Rep. 744). The reason for the rule is
that the legislature must be presumed to know the meaning of words, to have used
words advisedly and to have expressed its intent by the use of such words as are
found in the statute (50 Am. Jur. p. 212)." 40
Another reason why the publication requirements should be strictly complied with is
that any person who fails to file an adverse claim against the applicant during the
period of publication is forever barred to file such a claim since the section itself
provides that "if no adverse claim shall have been presented to the Director of the
Bureau of Mines, it shall be conclusively presumed that no such adverse claim exists
and thereafter no objection from third parties of the granting of the lease shall be
heard." 41 In view then of its adverse consequences on the rights of others, nothing

short of strict compliance is demanded. Statutes in derogation of rights must be

construed strictly.
Comm. Of Internal Revenue vs Solid Bank Corp
Facts: Solidbank filed its Quarterly Percentage Tax Returns reflecting gross receipts
amounting to P1,474,693.44. It alleged that the total included P350,807,875.15
representing gross receipts from passive income which was already subjected to
20%final withholding tax (FWT).
The Court of Tax Appeals (CTA) held in Asian Ban Corp. v Commissioner, that the
20% FWT should not form part of its taxable gross receipts for purposes of
computing the tax.
Solidbank, relying on the strength of this decision, filed with the BIR a letter-request
for the refund or tax credit. It also filed a petition for review with the CTA where the
it ordered the refund.
The CA ruling, however, stated that the 20% FWT did not form part of the taxable
gross receipts because the FWT was not actually received by the bank but was
directly remitted to the government.
The Commissioner claims that although the FWT was not actually received by
Solidbank, the fact that the amount redounded to the banks benefit makes it part
of the taxable gross receipts in computing the Gross Receipts Tax. Solidbank says
the CA ruling is correct.
Issue: Whether or not the FWT forms part of the gross receipts tax.
Held: Yes. In a withholding tax system, the payee is the taxpayer, the person on
whom the tax is imposed. The payor, a separate entity, acts as no more than an
agent of the government for the collection of tax in order to ensure its payment.
This amount that is used to settle the tax liability is sourced from the proceeds
constitutive of the tax base.
These proceeds are either actual or constructive. Both parties agree that there is no
actual receipt by the bank. What needs to be determined is if there is constructive
receipt. Since the payee is the real taxpayer, the rule on constructive receipt can be
rationalized.
The Court
applied provisions of the Civil Code on actual and constructive
possession. Article 531 of the Civil Code clearly provides that the acquisition of the
right of possession is through the proper acts and legal formalities established. The
withholding process is one such act. There may not be actual receipt of the income
withheld; however, as provided for in Article 532, possession by any person without
any power shall be considered as acquired when ratified by the person in whose
name the act of possession is executed.

In our withholding tax system, possession is acquired by the payor as the

withholding agent of the government, because the taxpayer ratifies the very act of
possession for the government. There is thus constructive receipt.
The processes of bookkeeping and accounting for interest on deposits and yield on
deposit substitutes that are subjected to FWT are tantamount to delivery, receipt or
remittance. Besides, Solidbank admits that its income is subjected to a tax burden
immediately upon receipt, although it claims that it derives no pecuniary benefit
or advantage through the withholding process.
There being constructive receipt, part of which is withheld, that income is included
as part of the tax base on which the gross receipts tax is imposed.
In general, rules and regulations issued by administrative or executive officers
pursuant to the procedure or authority conferred by law upon the administrative
agency have the force and effect, or partake of the nature, of a statute. The reason
is that statutes express the policies, purposes, objectives, remedies and sanctions
intended by the legislature in general terms. The details and manner of carrying
them out are oftentimes left to the administrative agency entrusted with their
enforcement. In the present case, it is the finance secretary who promulgates the
revenue regulations, upon recommendation of the BIR commissioner. These
regulations are the consequences of a delegated power to issue legal provisions
that have the effect of law.
Repeals by implication are not favored and will not be indulged, unless it is manifest
that the administrative agency intended them. As a regulation is presumed to have
been made with deliberation and full knowledge of all existing rules on the subject,
it may reasonably be concluded that its promulgation was not intended to interfere
with or abrogate any earlier rule relating to the same subject, unless it is either
repugnant to or fully inclusive of the subject matter of an earlier one, or unless the
reason for the earlier one is "beyond peradventure removed." Every effort must be
exerted to make all regulations stand and a later rule will not operate as a repeal
of an earlier one, if by any reasonable construction, the two can be reconciled.

Chartered Bank Employees Assn Vs. Ople

Facts: On May 20, 1975, the Chartered Bank Employees Association, in
representation of its monthly paid employees/members, instituted a complaint with
the Regional Office No. IV, Department of Labor, now Ministry of Labor and
Employment (MOLE) against private respondent Chartered Bank, for the payment of
ten (10) unworked legal holidays, as well as for premium and overtime differentials
for worked legal holidays from November 1, 1974.

On the bases of the foregoing facts, both the arbitrator and the National Labor
Relations Commission (NLRC) ruled in favor of the petitioners ordering the
respondent bank to pay its monthly paid employees, holiday pay for the ten (10)
legal holidays effective November 1, 1974 and to pay premium or overtime pay
differentials to all employees who rendered work during said legal holidays. On
appeal, the Minister of Labor set aside the decision of the NLRC and dismissed the
petitioner's claim for lack of merit basing its decision on Section 2, Rule IV, Book III
of the Integrated Rules and Policy Instruction No. 9, which respectively provide:
"Sec. 2. Status of employees paid by the month. Employees who are uniformly
paid by the month, irrespective of the number of working days therein, with a salary
of not less than the statutory or established minimum wage shall be presumed to be
paid for all days in the month whether worked or not."
POLICY INSTRUCTION NO. 9.
TO: All Regional Directors
SUBJECT: PAID LEGAL HOLIDAYS
"The rules implementing PD 850 have clarified the policy in the implementation of
the ten (10) paid legal holidays. Before PD 850, the number of working days a year
in a firm was considered important in determining entitlement to the benefit. Thus,
where an employee was working for at least 313 days, he was considered definitely
already paid. If he was working for less than 313, there was no certainty whether
the ten (10) paid legal holidays were already paid to him or not.
"The ten (10) paid legal holidays law, to start with, is intended to benefit principally
daily employees. In the case of monthly, only those whose monthly salary did not
yet include payment for the ten (10) paid legal holidays are entitled to the benefit.
"Under the rules implementing PD 850, this policy has been fully clarified to
eliminate controversies on the entitlement of monthly paid employees. The new
determining rule is this: 'If the monthly paid employee is receiving not less than
P240, the maximum monthly minimum wage, and his monthly pay is uniform from
January to December, he is presumed to be already paid the ten (10) paid legal
holidays. However, if deductions are made from his monthly salary on account of
holidays in months where they occur, then he is still entitled to the ten (10) paid
legal holidays.
"These new interpretations must be uniformly and consistently upheld.
"This issuance shall take effect immediately."
Issue: Whether or not the Secretary of Labor erred and acted contrary to law in
promulgating Sec. 2, Rule IV, Book III of the Integrated Rules and Policy Instruction
No. 9.

Held: Yes. "While it is true that the contemporaneous construction placed upon a
statute by executive officers whose duty is to enforce it should be given great
weight by the courts, still if such construction is so erroneous, as in the instant case,
the same must be declared as null and void. It is the role of the Judiciary to refine
and, when necessary, correct constitutional (and/or statutory) interpretation, in the
context of the interactions of the three branches of the government, almost always
in situations where some agency of the State has engaged in action that stems
ultimately from some legitimate area of governmental power. The questioned
Section 2, Rule IV, Book III of the Integrated Rules and the Secretary's Policy
Instruction No. 9 add another excluded group, namely, "employees who are
Uniformly paid by the month." While the additional exclusion is only in the form of a
presumption that all monthly paid employees have already been paid holiday pay, it
constitutes a taking away or a deprivation which must be in the law if it is to be
valid. An administrative interpretation which diminishes the benefits of labor more
than what the statute delimits or withholds is obviously ultra vires.
Franklin Baker Co. vs SSS
Facts: Petitioner-appellant Franklin Baker Company of the Philippines is engaged in
the manufacture of desiccated coconut in San Pablo City. The deceased Tomas
Zamora was one of its employees. Both were compulsory members of the Social
Security System.
Due to the annual overhauling of its machinery and also to lack of production orders
from its mother company in the United States petitioner temporarily ceased its
operations from December 22, 1957 to February 18, 1958. Zamora rendered no
actual services during that period. He then went on sick leave without pay from
March 9, 1958, up to the day of his death, June 13, 1958.
On July 10, 1958 the System received a death claim application from petitioner for
and in behalf of the designated beneficiaries of the deceased employee. After
processing the claim the System found that no premium remittances had been
made for him for the months of February, March, and June, 1958. Of the unpaid
premiums, P5.85 was chargeable to the employee while P8.18 was due from the
employer- petitioner. The employee's share of the unpaid premiums was
subsequently deducted from the death benefits awarded to his beneficiaries and the
System billed petitioner for its share.
Under Resolution No. 139, Series of 1958, the Social Security Commission adopted
the rule that "employers are liable to the 3 1/2% company's share during the
months when there are no premiums remitted, if there is existing employeremployee relationship between them during those months." Petitioner excepted to
the System's demand for payment by filing a petition for reconsideration with the

Commission. On April 28, 1960 the Commission resolved to dismiss said petition,
and the case is now before us on appeal from the resolution of dismissal.
Issue: WON the employer is not liable for its share of the premiums during the
period when the employee is on leave without pay since he receives no
compensation.
Held: No. payment of contributions by an employer is compulsory during its
coverage, and in accordance with the provisions of Section 9 of the Social Security
Act, coverage is determined solely by the existence of an employer-employee
relationship. While an employee is on leave, even without pay, he is still an
employee of his employer, their contract of employment has not yet terminated. So
much so that the employee may still return to work and the employer is still bound
to accept him. His responsibility as an employee still exists. He is still entitled to the
benefits of the System when he returns. Consequently, his employer is still liable to
pay his contributions to the Commission on account of its employee who is on leave
without pay. The time when an employee may not be actually receiving
compensation, as when he is on sick leave without pay, is not excepted. Obviously,
inasmuch as the obligation to contribute does not cease during that period, a
reasonable basis for computing the amount of the contribution must be adopted;
and the one prescribed by the Commission in its circular Nos. 21 and 24 and applied
in the case at bar is reasonable, both on legal and actuarial considerations. It does
not amount to legislation, but merely implementation of the existing statute. The
provisions of the Social Security Act should be liberally construed in favor of those
seeking its benefits. "Any interpretation which would defeat rather than promote the
ends for which the Social Security Act was enacted should be eschewed."
PLDT paid a franchise tax equal to three percent (3%) of its gross receipts. The
franchise tax was paid in lieu of all taxes on this franchise or earnings thereof
pursuant to RA 7082. The exemption from all taxes on this franchise or earnings
thereof was subsequently withdrawn by RA 7160 (LGC), which at the same time
gave local government units the power to tax businesses enjoying a franchise on
the basis of income received or earned by them within their territorial jurisdiction.
The LGC took effect on January 1, 1992. The City of Davao enacted Ordinance No.
519, Series of 1992, which in pertinent part provides: Notwithstanding any
exemption granted by law or other special laws, there is hereby imposed a tax on
businesses enjoying a franchise, a rate of seventy-five percent (75%) of one percent
(1%) of the gross annual receipts for the preceding calendar year based on the
income receipts realized within the territorial jurisdiction of Davao City.
Subsequently, Congress granted in favor of Globe Mackay Cable and Radio
Corporation (Globe) and Smart Information Technologies, Inc. (Smart) franchises
which contained in leiu of all taxes provisos.

In 1995, it enacted RA 7925, or the Public Telecommunication Policy of the

Philippines, Sec. 23 of which provides that any advantage, favor, privilege,
exemption, or immunity granted under existing franchises, or may hereafter be
granted, shall ipso facto become part of previously granted telecommunications
franchises and shall be accorded immediately and unconditionally to the grantees of
such franchises. The law took effect on March 16, 1995.
In January 1999, when PLDT applied for a mayors permit to operate its Davao Metro
exchange, it was required to pay the local franchise tax which then had amounted
to P3,681,985.72. PLDT challenged the power of the city government to collect the
local franchise tax and demanded a refund of what had been paid as a local
franchise tax for the year 1997 and for the first to the third quarters of 1998.
Issue: Whether or not by virtue of RA 7925, Sec. 23, PLDT is again entitled to the
exemption from payment of the local franchise tax in view of the grant of tax
exemption to Globe and Smart.
Held: Petitioner contends that because their existing franchises contain in lieu of all
taxes clauses, the same grant of tax exemption must be deemed to have become
ipso facto part of its previously granted telecommunications franchise. But the rule
is that tax exemptions should be granted only by a clear and unequivocal provision
of law expressed in a language too plain to be mistaken and assuming for the
nonce that the charters of Globe and of Smart grant tax exemptions, then this
runabout way of granting tax exemption to PLDT is not a direct, clear and
unequivocal way of communicating the legislative intent.
Nor does the term exemption in Sec. 23 of RA 7925 mean tax exemption. The
term refers to exemption from regulations and requirements imposed by the
National Telecommunications Commission (NTC). For instance, RA 7925, Sec. 17
provides: The Commission shall exempt any specific telecommunications service
from its rate or tariff regulations if the service has sufficient competition to ensure
fair and reasonable rates of tariffs. Another exemption granted by the law in line
with its policy of deregulation is the exemption from the requirement of securing
permits from the NTC every time a telecommunications company imports
equipment.
Tax exemptions should be granted only by clear and unequivocal provision of law on
the basis of language too plain to be mistaken.