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53 SCRA 476

G.R. No. L-36409 October 26, 1973

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,

Vs.

Loreta Gozo, defendant-appellent

FACTS: Gozo bought a house and lot situated at the United States Naval Reservation which is
within the jurisdiction of Olongapo City. However, she did not acquire a building permit after
she demolished and built a new house in the said lot, asserting that her neighbours, as well as
one Ernesto Evalle, an assistant in the City Mayors office told her that a permit was not
necessary.

On December 29, 1966 four carpenters working on the house were apprehended by Juan
Malones, a building and lot inspector of the City Engineers Office, and by Ramon Macahilas, a
patrolman of the Olongapo City police force. Gozo was charged with violation of Municipal
Ordinance No. 14, Series of 1964, and was sentenced to imprisonment for one month, and
payment of costs.

Upon appeal to the Court of First Instance of Zambales, she was found guilty and ordered to
pay a fine of P200, and to demolish the house. In the Court of Appeals, Gozo raised the
question of constitutional validity of the said ordinance or at least its applicability to her case.

ISSUE: Whether or not the Philippine Government has sovereignty over and thus may exercise
its jurisdiction over the land where Gozos house and lot is located.

HELD: Yes, Section 1, of Article II of the 1987 Constitution states that The Philippines is a
democratic and republican state. Sovereignty resides in the people and all government
authority emanates from them.

Sovereignty here refers to legal sovereignty, the supreme power to affect legal interests either
by legislative, executive, or judicial action. Government refers to aggregate of institutions
by which an independent society makes and carries out those rules which are imposed upon
the people forming that society.

In Reagan vs. Commissioner of Internal Revenue it is clearly stated: Nothing is better settled
than that the Philippines, being independent and sovereign, its authority may be exercised over
its entire domain. Thus, Gozo may not claim that the Municipal Ordinance does not apply to
her for the reason that the house she built is situated in the US Naval Reserve.

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