Moot and Academic Cases Lacson Vs.

Perez
357 SCRA 756 G.R. No. 147780
May 10, 2001
Facts: President Macapagal-Arroyo declared a State of Rebellion
(Proclamation No. 38) on May 1, 2001 as well as General Order No. 1
ordering the AFP and the PNP to suppress the rebellion in the NCR.
Warrantless arrests of several alleged leaders and promoters of the
rebellion were thereafter effected. Petitioner filed for prohibition,
injunction, mandamus and habeas corpus with an application for the
issuance of temporary restraining order and/or writ of preliminary injunction.
Petitioners assail the declaration of Proc. No. 38 and the warrantless arrests
allegedly effected by virtue thereof. Petitioners furthermore pray that the
appropriate court, wherein the information against them were filed, would
desist arraignment and trial until this instant petition is resolved. They also
contend that they are allegedly faced with impending warrantless arrests and
unlawful restraint being that hold departure orders were issued against
them.

Issue: Whether or Not Proclamation No. 38 is valid, along with the

warrantless arrests and hold departure orders allegedly effected by the
same.

Held: President Macapagal-Arroyo ordered the lifting of Proc. No. 38 on May

6, 2006, accordingly the instant petition has been rendered moot and
academic. Respondents have declared that the Justice Department and the
police authorities intend to obtain regular warrants of arrests from the courts
for all acts committed prior to and until May 1, 2001. Under Section 5, Rule
113 of the Rules of Court, authorities may only resort to warrantless arrests
of persons suspected of rebellion in suppressing the rebellion if the
circumstances so warrant, thus the warrantless arrests are not based on
Proc. No. 38. Petitioners prayer for mandamus and prohibition is improper
at this time because an individual warrantlessly arrested has adequate
remedies in law: Rule 112 of the Rules of Court, providing for preliminary
investigation, Article 125 of the Revised Penal Code, providing for the period
in which a warrantlessly arrested person must be delivered to the proper
judicial authorities, otherwise the officer responsible for such may be
penalized for the delay of the same. If the detention should have no legal
ground, the arresting officer can be charged with arbitrary detention, not
prejudicial to claim of damages under Article 32 of the Civil Code. Petitioners
were neither assailing the validity of the subject hold departure orders, nor
were they expressing any intention to leave the country in the near future.
To declare the hold departure orders null and void ab initio must be made in
the proper proceedings initiated for that purpose. Petitioners prayer for
relief regarding their alleged impending warrantless arrests is premature
being that no complaints have been filed against them for any crime,
furthermore, the writ of habeas corpus is uncalled for since its purpose is to
relieve unlawful restraint which Petitioners are not subjected to.

Petition is dismissed. Respondents, consistent and congruent with their

undertaking earlier adverted to, together with their agents, representatives,
and all persons acting in their behalf, are hereby enjoined from arresting
Petitioners without the required judicial warrants for all acts committed in
relation to or in connection with the May 1, 2001 siege of Malacaang
SANLAKAS Vs. Executive Secretary
421 SCRA 656 G.R. No. 159085February 3, 2004
Legal standing or locus standi has been defined as a personal and substantial
interest in the case such that the party has sustained or will sustain direct
Facts: During the wee hours of July 27, 2003, some three-hundred junior injury as a result of the governmental act that is being challenged. The gist of
officers and enlisted men of the AFP, acting upon instigation, command and the question of standing is whether a party alleges "such personal stake in
direction of known and unknown leaders have seized the Oakwood Building the outcome of the controversy as to assure that concrete adverseness which
in Makati. Publicly, they complained of the corruption in the AFP and sharpens the presentation of Issue upon which the court depends for
declared their withdrawal of support for the government, demanding the illumination of difficult constitutional questions. Based on the foregoing,
resignation of the President, Secretary of Defense and the PNP Chief. These petitioners Sanlakas and PM, and SJS Officers/Members have no legal
acts constitute a violation of Article 134 of the Revised Penal Code, and by standing to sue. Only petitioners Rep. Suplico et al. and Sen. Pimentel, as
virtue of Proclamation No. 427 and General Order No. 4, the Philippines was Members of Congress, have standing to challenge the subject issuances. It
declared under the State of Rebellion. Negotiations took place and the sustained its decision in Philippine Constitution Association v. Enriquez, that
officers went back to their barracks in the evening of the same day. On the extent the powers of Congress are impaired, so is the power of each
August 1, 2003, both the Proclamation and General Orders were lifted, and member thereof, since his office confers a right to participate in the exercise
Proclamation No. 435, declaring the Cessation of the State of Rebellion was of the powers of that institution
issued.
On personality to sue:
In the interim, however, the following petitions were filed: (1) SANLAKAS
AND PARTIDO NG MANGGAGAWA VS. EXECUTIVE SECRETARY, petitioners ALAN PAGUIA v. OFFICE OF THE PRESIDENT
contending that Sec. 18 Article VII of the Constitution does not require the GR. No. 176278, June 25, 2010
declaration of a state of rebellion to call out the AFP, and that there is no
factual basis for such proclamation. (2)SJS Officers/Members v. Hon. FACTS: Petitioner, as a citizen and taxpayer filed an original action for the
Executive Secretary, et al, petitioners contending that the proclamation is a writ of certiorari to invalidate PGMA's nomination of respondent former
circumvention of the report requirement under the same Section 18, Article Chief Justice Davide, Jr. as Permanent Representative to the UN. Petitioner
VII, commanding the President to submit a report to Congress within 48 argues that respondent Davides age at that time of his nomination, 70,
hours from the proclamation of martial law. Finally, they contend that the disqualifies him from holding his post. Petitioner grounds his argument on
presidential issuances cannot be construed as an exercise of emergency Section 23 of RA 7157 pegging the mandatory retirement age of all officers
powers as Congress has not delegated any such power to the President. (3) and employees of the DFA at 65. Petitioner theorizes that Section 23 imposes
Rep. Suplico et al. v. President Macapagal-Arroyo and Executive Secretary an absolute rule for all DFA employees, career or non-career; thus,
Romulo, petitioners contending that there was usurpation of the power of respondent Davides entry into the DFA ranks discriminates against the rest
Congress granted by Section 23 (2), Article VI of the Constitution. (4) of the DFA officials and employees. Respondents raise threshold issues
Pimentel v. Romulo, et al, petitioner fears that the declaration of a state of against the petition. First, they question petitioners standing to bring this suit
rebellion "opens the door to the unconstitutional implementation of because of his indefinite suspension from the practice of law.
warrantless arrests" for the crime of rebellion.
ISSUE: Whether or not the petitioners standing to bring the suit is barred by
Issue: Whether or Not Proclamation No. 427 and General Order No. 4 are his indefinite suspension from the practice of law
constitutional?
HELD: Yes. Petitioners suspension from the practice of law bars him from
Whether or Not the petitioners have a legal standing or locus standi to bring performing any activity, in or out of court, which requires the application of
suit? law, legal procedure, knowledge, training and experience. Certainly,
preparing a petition raising carefully crafted arguments on equal protection
Held: The Court rendered that the both the Proclamation No. 427 and grounds and employing highly legalistic rules of statutory construction to
General Order No. 4 are constitutional. Section 18, Article VII does not parse Section 23 of RA 7157 falls within the proscribed conduct.
expressly prohibit declaring state or rebellion. The President in addition to its
Commander-in-Chief Powers is conferred by the Constitution executive
powers. It is not disputed that the President has full discretionary power to
call out the armed forces and to determine the necessity for the exercise of
such power. While the Court may examine whether the power was exercised
within constitutional limits or in a manner constituting grave abuse of
discretion, none of the petitioners here have, by way of proof, supported
their assertion that the President acted without factual basis. The issue of the
circumvention of the report is of no merit as there was no indication that
military tribunals have replaced civil courts or that military authorities have
taken over the functions of Civil Courts. The issue of usurpation of the
legislative power of the Congress is of no moment since the President, in
declaring a state of rebellion and in calling out the armed forces, was merely
exercising a wedding of her Chief Executive and Commander-in-Chief powers.
These are purely executive powers, vested on the President by Sections 1
and 18, Article VII, as opposed to the delegated legislative powers
contemplated by Section 23 (2), Article VI. The fear on warrantless arrest is
unreasonable, since any person may be subject to this whether there is
rebellion or not as this is a crime punishable under the Revised Penal Code,
and as long as a valid warrantless arrest is present.
HON. EXECUTIVE SECRETARY vs. SOUTHWING HEAVY INDUSTRIES, INC.
FACTS
On December 12, 2002, President Gloria Macapagal Arroyo issued Executive
Order 156 entitled "Providing for a comprehensive industrial policy and
directions for the motor vehicle development program and its implementing
guidelines." The said provision prohibits the importation of all types of used
motor vehicles in the country including the Subic Bay Freeport, or the
Freeport Zone, subject to a few exceptions.
Consequently, three separate actions for declaratory relief were filed by
Southwing Heavy Industries Inc, Subic Integrated Macro Ventures Corp, and
Motor Vehicle Importers Association of Subic Bay Freeport Inc. praying that
judgment be rendered declaring Article 2, Section3.1 of the EO 156
unconstitutional and illegal.
The RTC rendered a summary judgment declaring that Article 2, Section 3.1
of EO 156 constitutes an unlawful usurpation of legislative power vested by
the Constitution with Congress and that the proviso is contrary to the
mandate of Republic Act 7227(RA 7227) or the Bases Conversion and
Development Act of 1992 which allows the free flow of goods and capital
within the Freeport.
The petitioner appealed in the CA but was denied on the ground of lack of
any statutory basis for the President to issue the same. It held that the
prohibition on the importation of use motor vehicles is an exercise of police
power vested on the legislature and absent any enabling law, the exercise
thereof by the President through an executive issuance is void.
ISSUE: Whether or not Article2, Section 3.1 of EO 156 is a valid exercise of
the Presidents quasi-legislative power. YES.
RULING:
Police power is inherent in a government to enact laws, within
constitutional limits, to promote the order, safety, health, morals, and
general welfare of society. It is lodged primarily with the legislature. By virtue
of a valid delegation of legislative power, it may also be exercised by the
President and administrative boards, as well as the lawmaking bodies on all
municipal levels, including the barangay. Such delegation confers upon the
President quasi-legislative power which may be defined as the authority
delegated by the law-making body to the administrative body to adopt rules
and regulations intended to carry out the provisions of the law and
implement legislative policy provided that it must comply with the following
requisites:
(1) Its promulgation must be authorized by the legislature;
(2) It must be promulgated in accordance with the prescribed procedure;
(3) It must be within the scope of the authority given by the legislature; and
4) It must be reasonable.
The first requisite was actually satisfied since EO 156 has both constitutional
and statutory bases.
Anent the second requisite, that the order must be issued or promulgated
in accordance with the prescribed procedure, the presumption is that the
said executive issuance duly complied with the procedures and limitations
imposed by law since the respondents never questioned the procedure that
paved way for the issuance of EO 156 but instead, what they challenged was
the absence of substantive due process in the issuance of the EO.
In the third requisite, the Court held that the importation ban runs afoul
with the third requisite as administrative issuances must not be ultra vires or
beyond the limits of the authority conferred. In the instant case, the subject
matter of the laws authorizing the President to regulate or forbid
importation of used motor vehicles, is the domestic industry. EO 156,
however, exceeded the scope of its application by extending the prohibition
on the importation of used cars to the Freeport, which RA 7227, considers to
some extent, a foreign territory. The domestic industry which the EO seeks to
protect is actually the "customs territory" which is defined under the Rules
and Regulations Implementing RA 7227 which states: "the portion of the
Philippines outside the Subic Bay Freeport where the Tariff and Customs
Code of the Philippines and other national tariff and customs laws are in
force and effect."
Regarding the fourth requisite, the Court finds that the issuance of EO is
unreasonable. Since the nature of EO 156 is to protect the domestic industry
from the deterioration of the local motor manufacturing firms, the Court
however, finds no logic in all the encompassing application of the assailed
provision to the Freeport Zone which is outside the customs territory of the
Philippines. As long as the used motor vehicles do not enter the customs
territory, the injury or harm sought to be prevented or remedied will not
arise.
The Court finds that Article 2, Section 3.1 of EO 156 is VOID insofar as it is
made applicable within the secured fenced-in former Subic Naval Base area
but is declared VALID insofar as it applies to the customs territory or the
Philippine territory outside the presently secured fenced-in former Subic
Naval Base area as stated in Section 1.1 of EO 97-A (an EO executed by Pres.
Fidel V. Ramos in 1993 providing the Tax and Duty Free Privilege within the
Subic Freeport Zone). Hence, used motor vehicles that come into the
Philippine territory via the secured fenced-in former Subic Naval Base area
may be stored, used or traded therein, or exported out of the Philippine
territory, but they cannot be imported into the Philippine territory outside of
the secured fenced-in former Subic Naval Base area.
Petitions are PARTIALLY GRANTED provided that said provision is declared
VALID insofar as it applies to the Philippine territory outside the presently
fenced-in former Subic Naval Base area and VOID with respect to its
application to the secured fenced-in former Subic Naval Base area.
PASCUAL vs. SECRETARY OF PUBLIC WORKS
110 PHIL 331
GR No. L-10405, December 29, 1960
"A law appropriating the public revenue is invalid if the public advantage or benefit,
derived from such expenditure, is merely incidental in the promotion of a particular
enterprise."
FACTS: Governor Wenceslao Pascual of Rizal instituted this action for declaratory relief,
with injunction, upon the ground that RA No. 920, which apropriates funds for public
works particularly for the construction and improvement of Pasig feeder road terminals.
Some of the feeder roads, however, as alleged and as contained in the tracings attached
to the petition, were nothing but projected and planned subdivision roads, not yet
constructed within the Antonio Subdivision, belonging to private respondent Zulueta,
situated at Pasig, Rizal; and which projected feeder roads do not connect any
government property or any important premises to the main highway. The respondents'
contention is that there is public purpose because people living in the subdivision will
directly be benefitted from the construction of the roads, and the government also gains
from the donation of the land supposed to be occupied by the streets, made by its
owner to the government.
ISSUE: Should incidental gains by the public be considered "public purpose" for the
purpose of justifying an expenditure of the government?
HELD: No. It is a general rule that the legislature is without power to appropriate public
revenue for anything but a public purpose. It is the essential character of the direct
object of the expenditure which must determine its validity as justifying a tax, and not
the magnitude of the interest to be affected nor the degree to which the general
advantage of the community, and thus the public welfare, may be ultimately benefited
by their promotion. Incidental to the public or to the state, which results from the
promotion of private interest and the prosperity of private enterprises or business, does
not justify their aid by the use public money. The test of the constitutionality of a statute
requiring the use of public funds is whether the statute is designed to promote the
public interest, as opposed to the furtherance of the advantage of individuals, although
each advantage to individuals might incidentally serve the public.
PABLITO SANIDAD VS COMELEC
FACTS: In September 1976, then President Ferdinand Marcos issued PD 991
calling for a national referendum on 16 Oct 1976 for the Citizens Assemblies
(barangays) to resolve, among other things, the issues of martial law, the
interim assembly, its replacement, the powers of such replacement, the
period of its existence, the length of the period for the exercise by the
President of his present powers. 20 days after, the President issued another
related decree, PD 1031, amending the previous PD 991, by declaring the
provisions of PD 229 providing for the manner of voting and canvass of votes
in barangays applicable to the national referendum-plebiscite of Oct 16,
1976. Quite relevantly, PD 1031 repealed inter alia, Sec 4, of PD. 991. On the
same date of 22 Sept 1976, Marcos issued PD. 1033, stating the questions to
he submitted to the people in the referendum-plebiscite on Oct 16, 1976.
The PD recites in its whereas clauses that the peoples continued Industry, from enforcing the said law. The Sol-Gen commented that NEPA et
opposition to the convening of the interim NA evinces their desire to have
such body abolished and replaced thru a constitutional amendment,
providing for a new interim legislative body, which will be submitted directly
to the people in the referendum-plebiscite of Oct 16.
On September 27, 1976, Atty. Pablito Sanidad filed a Prohibition with
Preliminary Injunction seeking to enjoin the COMELEC from holding and
conducting the Referendum Plebiscite on Oct 16; to declare without force
and effect PD Nos. 991 and 1033, insofar as they propose amendments to the
Constitution, as well as PD 1031, insofar as it directs the COMELEC to
supervise, control, hold, and conduct the Referendum-Plebiscite scheduled
on Oct 16, 1976.Petitioners contend that under the 1935 and 1973
Constitutions there is no grant to the incumbent President to exercise the
constituent power to propose amendments to the new Constitution. As a
consequence, the Referendum-Plebiscite on Oct 16 has no constitutional or
legal basis. The Sol-Gen contended that the question is political in nature
hence the court cannot take cognizance of it. The Sol-Gen principally
maintains that petitioners have no standing to sue; the issue raised is
political in nature, beyond judicial cognizance of the SC; at this state of the
transition period, only the incumbent President has the authority to exercise
constituent power; the referendum-plebiscite is a step towards
normalization.
ISSUE: Whether or not the issue is a political question.
HELD: The SC ruled that the issue is not a political question but rather a
justiciable one. This is especially true in cases where the power of the
Presidency to initiate the amending process by proposals of amendments, a
function normally exercised by the legislature, is seriously doubted. Political
questions are neatly associated with the wisdom, not the legality of a
particular act. Where the vortex of the controversy refers to the legality or
validity of the contested act, that matter is definitely justiciable or non-
political. What is confronting the SC is not the wisdom of the act of the
incumbent President in proposing amendments to the Constitution, but his
constitutional authority to perform such act or to assume the power of a
constituent assembly. Whether the amending process confers on the
President that power to propose amendments is therefore a downright
justiciable question. Should the contrary be found, the actuation of the
President would merely be a brutum fulmen. If the Constitution provides
how it may be amended, the judiciary as the interpreter of that Constitution,
can declare whether the procedure followed or the authority assumed was
valid or not.
This petition is however dismissed. The President, who was also the
legislature, can propose amendments to the Constitution and he was able to
present those proposals to the people in sufficient time.
NATIONAL ECONOMIC PROTECTIONISM ASSOCIATION VS ROBERTO
ONGPIN
171 SCRA 657 Political Law Constitutional Law The Judicial Department
Judicial Review Requisites
FACTS: After the lifting of martial law in 1981, President Ferdinand Marcos
issued Presidential Decree No. 1789 and some other PDs. The said PD was
issued in order to suspend for one year the requirement that in order for
companies to validly operate in the country it must be composed of at least
60% Filipino. NEPA (National Economic Protectionism Association), an
association of local businessmen, assailed the said PD averring that as
taxpayers and Filipinos they will be greatly adversed by such PD. They sought
to enjoin Roberto Ongpin, then the Minister (Secretary) of Trade and
al have no personality and standing to sue in the absence of an actual
controversy concerning the enforcement of the PD in question that they
were not actually adversely affected by said PD.
ISSUE: Whether or not the requisites for judicial review are met.
HELD: No. NEPA et al question the constitutionality of Secs 1 and 3 of PD
1892 in relation to PD 1789, the 1981 Investment Priorities Plan and EO 676,
as being violative of the due process and equal protection clauses of the
1973 Constitution as well as Secs 8 & 9 of Article 14 thereof, and seek to
prohibit Ongpin from implementing said laws. Yet, not even one of the
petitioners has been adversely affected by the application of those
provisions. No actual conflict has been alleged wherein NEPA could validly
and possibly say that the increase in foreign equity participation in non-
pioneer areas of investment from the period of Dec 2, 1983 to Dec 4, 1984
had any direct bearing on them, such as considerable rise in unemployment,
real increase in foreign investment, unfair competition with Philippine
nationals, exploitation of the countrys natural resources by foreign investors
under the decrees. NEPA et al advance an abstract, hypothetical issue which
is in effect a petition for an advisory opinion from the SC. The power of
courts to declare a law unconstitutional arises only when the interests of
litigants require the use of that judicial authority for their protection against
actual interference, a hypothetical threat being insufficient.
There must be a bona fide suit. Judicial power is limited to the decision of
actual cases and controversies. The authority to pass on the validity of
statutes is incidental to the decision of such cases where conflicting claims
under the Constitution and under a legislative act assailed as contrary to the
Constitution are raised. It is legitimate only in the last resort, and as necessity
in the determination of real, earnest, and vital controversy between litigants.
KILOSBAYAN VS MORATO
FACTS: GR 113375 (KIlosbayan vs. Guingona) held invalidity of the contract
between Philippine Charity Sweepstakes Office (PCSO) and the privately
owned Philippine Gaming Management Corporation (PGMC) for the
operation of a nationwide on-line lottery system. The contract violated the
provision in the PCSO Charter which prohibits PCSO from holding and
conducting lotteries through a collaboration, association, or joint venture.
Both parties again signed an Equipment Lease Agreement (ELA) for online
lottery equipment and accessories on January 25, 1995. The agreement are
as follow:
Rental is 4.3% of gross amount of ticket sales by PCSO at which in no case be
less than an annual rental computed at P35,000 per terminal in commercial
operation.
Rent is computed bi-weekly.
Term is 8 years.
PCSO is to employ its own personnel and responsible for the facilities.
Upon expiration of term, PCSO can purchase the equipment at P25M.
Kilosbayan again filed a petition to declare amended ELA invalid because:
It is the same as the old contract of lease.
It is still violative of PCSOs charter.
It is violative of the law regarding public bidding. It has not been approved by
the President and it is not most advantageous to the government.
PCSO and PGMC filed separate comments
ELA is a different lease contract with none of the vestiges in the prior
contract.
ELA is not subject to public bidding because it fell in the exception provided
in EO No. 301.
Power to determine if ELA is advantageous vests in the Board of Directors of
PCSO.
Lack of funds. PCSO cannot purchase its own online lottery equipment.
Petitioners seek to further their moral crusade.
Petitioners do not have a legal standing because they were not parties to the
contract.
Issues: Whether or not petitioner Kilosbayan, Incorporated has a legal
standing to sue.
Whether or not the ELA between PCSO and PGMC in operating an online
lottery is valid.
RULINGS: Petitioners do not have a legal standing to sue.
STARE DECISIS cannot apply. The previous ruling sustaining the standing of
the petitioners is a departure from the settled rulings on real parties in
interest because no constitutional issues were actually involved.
LAW OF THE CASE (opinion delivered on a former appeal) cannot also apply.
Since the present case is not the same one litigated by the parties before in
Kilosbayan vs. Guingona, Jr., the ruling cannot be in any sense be regarded as
the law of this case. The parties are the same but the cases are not.
RULE ON CONCLUSIVENESS OF JUDGMENT cannot still apply. An issue
actually and directly passed upon and determine in a former suit cannot
again be drawn in question in any future action between the same parties
involving a different cause of action. But the rule does not apply to issues of
law at least when substantially unrelated claims are involved. When the
second proceeding involves an instrument or transaction identical with, but
in a form separable from the one dealt with in the first proceeding, the Court
is free in the second proceeding to make an independent examination of the
legal matters at issue.
Since ELA is a different contract, the previous decision does not preclude
determination of the petitioners standing.
Standing is a concept in constitutional law and here no constitutional
question is actually involved. The more appropriate issue is whether the
petitioners are real parties of interest.
Question of contract of law: The real parties are those who are parties to the
agreement or are bound either principally or are prejudiced in their rights
with respect to one of the contracting parties and can show the detriment
which would positively result to them from the contract.
Petitioners do not have such present substantial interest. Questions to the
nature or validity of public contracts maybe made before COA or before the
Ombudsman.
Equipment Lease Agreement (ELA) is valid.
It is different with the prior lease agreement: PCSO now bears all losses
because the operation of the system is completely in its hands.
Fixing the rental rate to a minimum is a matter of business judgment and the
Court is not inclined to review.
Rental rate is within the 15% net receipts fixed by law as a maximum. (4.3%
of gross receipt is discussed in the dissenting opinion of Feliciano, J.)
In the contract, it stated that the parties can change their agreement.
Petitioners state that this would allow PGMC to control and operate the on-
line lottery system. The Court held that the claim is speculative. In any case,
in the construction of statutes, the resumption is that in making contracts,
the government has acted in good faith. The doctrine that the possibility of
abuse is not a reason for denying power.
It was held in Kilosbayan Vs. Guingona that PCSO does not have the power to
enter into any contract which would involve it in any form of collaboration,
association, or joint venture for the holding of sweepstakes activities. This
only mentions that PCSO is prohibited from investing in any activities that
would compete in their own activities.
It is claimed that ELA is a joint venture agreement which does not compete
with their own activities. The Court held that is also based on speculation.
Evidence is needed to show that the transfer of technology would involve the
PCSO and its personnel in prohibited association with the PGMC.
O. 301 (on law of public bidding) applies only to contracts for the purchase of
supplies, materials and equipment and not on the contracts of lease. Public
bidding for leases are only for privately-owned buildings or spaces for
government use or of government owned buildings or spaces for private use.
Petitioners have no standing. ELA is a valid lease contract. The motion for
reconsideration of petitioners is DENIED with finality.
KILOSBAYAN, INCORPORATED, ET. AL. VS. TEOFISTO GUINGONA, PCSO AND
PGMC
FACTS: The PCSO decided to establish an online lottery system for the
purpose of increasing its revenue base and diversifying its sources of funds.
Sometime before March 1993, after learning that the PCSO was interested in
operating on an online lottery system, the Berjaya Group Berhad, with its
affiliate, the International Totalizator Systems, Inc. became interested to
offer its services and resources to PCSO. Considering the citizenship
requirement, the PGMC claims that Berjaya Group undertook to reduce its
equity stakes in PGMC to 40% by selling 35% out of the original 75% foreign
stockholdings to local investors. An open letter was sent to President Ramos
strongly opposing the setting up of an online lottery system due to ethical
and moral concerns, however the project pushed through.
ISSUES:
Whether the petitioners have locus standi (legal standing); and
Whether the Contract of Lease is legal and valid in light of Sec. 1 of R.A. 1169
as amended by B.P. Blg. 42.
RULING:
The petitioners have locus standi due to the transcendental importance to
the public that the case demands. The ramifications of such issues
immeasurably affect the social, economic and moral well-being of the
people. The legal standing then of the petitioners deserves recognition, and
in the exercise of its sound discretion, the Court brushes aside the procedural
barrier.
Sec. 1 of R.A. No. 1169, as amended by B.P. Blg. 42, prohibits the PCSO from
holding and conducting lotteries in collaboration, association or joint
venture with any person, association, company, or entity, whether domestic
or foreign. The language of the section is clear that with respect to its
franchise or privilege to hold and conduct charity sweepstakes races,
lotteries and other similar activities, the PCSO cannot exercise it in
collaboration, association or joint venture with any other party. This is the
unequivocal meaning and import of the phrase. By the exception explicitly
made, the PCSO cannot share its franchise with another by way of the
methods mentioned, nor can it transfer, assign or lease such franchise.
FRANCISCO TATAD VS JESUS GARCIA, JR.
FACTS: In 1989, the government planned to build a railway transit line along
EDSA. No bidding was made but certain corporations were invited to
prequalify. The only corporation to qualify was the EDSA LRT Consortium
which was obviously formed for this particular undertaking. An agreement
was then made between the government, through the Department of
Transportation and Communication (DOTC), and EDSA LRT Consortium. The
agreement was based on the Build-Operate-Transfer scheme provided for by
law (RA 6957, amended by RA 7718). Under the agreement, EDSA LRT
Consortium shall build the facilities, i.e., railways, and shall supply the train
cabs. Every phase that is completed shall be turned over to the DOTC and the
latter shall pay rent for the same for 25 years. By the end of 25 years, it was
projected that the government shall have fully paid EDSA LRT Consortium.
Thereafter, EDSA LRT Consortium shall sell the facilities to the government
for $1.00.
However, Senators Francisco Tatad, John Osmea, and Rodolfo Biazon
opposed the implementation of said agreement as they averred that EDSA
LRT Consortium is a foreign corporation as it was organized under Hongkong
laws; that as such, it cannot own a public utility such as the EDSA railway
transit because this falls under the nationalized areas of activities. The
petition was filed against Jesus Garcia, Jr. in his capacity as DOTC Secretary.
ISSUE: Whether or not the petition shall prosper.
HELD: No. The Supreme Court made a clarification. The SC ruled that EDSA
LRT Consortium, under the agreement, does not and will not become the
owner of a public utility hence, the question of its nationality is misplaced. It
is true that a foreign corporation cannot own a public utility but in this case
what EDSA LRT Consortium will be owning are the facilities that it will be
building for the EDSA railway project. There is no prohibition against a
foreign corporation to own facilities used for a public utility. Further, it
cannot be said that EDSA LRT Consortium will be the one operating the
public utility for it will be DOTC that will operate the railway transit. DOTC
will be the one exacting fees from the people for the use of the railway and
from the proceeds, it shall be paying the rent due to EDSA LRT Consortium.
All that EDSA LRT Consortium has to do is to build the facilities and receive
rent from the use thereof by the government for 25 years it will not
operate the railway transit. Although EDSA LRT Consortium is a corporation
formed for the purpose of building a public utility it does not automatically
mean that it is operating a public utility. The moment for determining the
requisite Filipino nationality is when the entity applies for a franchise,
certificate or any other form of authorization for that purpose.
BUGNAY CONSTRUCTION V. LARON DIGEST
Facts:
1. A lease contract between the City of Dagupan and P & M Agro was
executed for the use of a city lot called the Magsaysay Market Area.
Subsequently, the City filed a case to rescind the contract due to the failure
of P&M to comply with the lease contract conditions.
2. Thereafter, the City issued a resolution granting the lease of said lot to the
petitioner Bugnay COnstruction for the establishment of a Magsaysay Market
building. As a result, respondent Ravanzo filed a taxpayer's suit against the
City assailing the validity of the lease contract between the petitioner and
the city. Ravanzo was the counsel of P&M Agro in the earlier case.
Issue: Whether or not the respondent is the real party in interest
NO.
1. The Court held that the respondent has no standing to file the case. There
was no disbursement of public funds involved in this case since it is the
petitioner, a private party which will fund the planned construction of the
market building.
RESTITUTO YNOT VS INTERMEDIATE APPELLATE COURT
There had been an existing law which prohibited the slaughtering of carabaos
(EO 626). To strengthen the law, Marcos issued EO 626-A which not only
banned the movement of carabaos from interprovinces but as well as the
movement of carabeef. On 13 Jan 1984, Ynot was caught transporting 6
carabaos from Masbate to Iloilo. He was then charged in violation of EO 626-
A. Ynot averred EO 626-A as unconstitutional for it violated his right to be
heard or his right to due process. He said that the authority provided by EO
626-A to outrightly confiscate carabaos even without being heard is
unconstitutional. The lower court ruled against Ynot ruling that the EO is a
valid exercise of police power in order to promote general welfare so as to
curb down the indiscriminate slaughter of carabaos.
ISSUE: Whether or not the law is valid.
It is difficult to meet it by any argument beyond thisstatement: An
unconstitutional act is not a law; it confers no rights; it imposes no duties;
itaffords no protection; it creates no office; it is, in legal contemplation, as
inoperative asthough it had never been passed.
The Supreme Court affirmed this decision. However, it said that even if
thecommissioners were not appointed de jure, they were working de facto,
thus still providinglawful authority. It is contended that if the act creating the
board was void, and thecommissioners were not officers de jure, they were
nevertheless officers de facto, and that theacts of the board as a de facto
court are binding upon the county. This contention is met by thefact that
there can be no officer, either de jure or de facto, if there be no office to fill.
SHEPARD V. BARRON

HELD: The SC ruled that the EO is not valid as it indeed violates due process.
EO 626-A ctreated a presumption based on the judgment of the executive.
The movement of carabaos from one area to the other does not mean a
subsequent slaughter of the same would ensue. Ynot should be given to
defend himself and explain why the carabaos are being transferred before
they can be confiscated. The SC found that the challenged measure is an
invalid exercise of the police power because the method employed to
conserve the carabaos is not reasonably necessary to the purpose of the law
and, worse, is unduly oppressive. Due process is violated because the owner
of the property confiscated is denied the right to be heard in his defense and
is immediately condemned and punished. The conferment on the
administrative authorities of the power to adjudge the guilt of the supposed
offender is a clear encroachment on judicial functions and militates against
the doctrine of separation of powers. There is, finally, also an invalid
delegation of legislative powers to the officers mentioned therein who are
granted unlimited discretion in the distribution of the properties arbitrarily
taken.

Effects on the dec;aration on unconstitutionality of a law

NORTON VS. SHELBY COUNTY

118 U.S. 425 May 10, 1886
Facts:A case was filed before the Tennessee Court, questioning the action
upon twenty-ninebonds of $1,000 each, alleged to be the bonds of Shelby
County, Tennessee, issued on the first of March, 1869, and payable on the
first of January, 1873, with interest from January 1, 1869 at 6percent per
annum; and three coupons of $60 each. Plaintiffs contend that the
commissionerswho issued to them the said bonds were lawful officers,
thereby authorized to bind the county tothe legal obligations of the bonds.
However, the defendants contend that such commissionerswere not lawful
officers, thereby absolving them from the legal obligations of the bonds, and
thatthere was no office in Tennessee as that of a county commissioner, and
thereby rendering theissued bonds as void. Also they challenged the statutes
that commissioned the commissioners,particularly the act of March 9, 1867
which provides for the creation of the board of commissioners in issuing the
bonds, as unconstitutional.

Issue:Whether or not the act of March 9, 1867 is unconstitutional, therefore

rendering thecommissioned officers as illegally appointed

.Held:The Tennessee high court rendered the act of March 9, 1867

unconstitutional. Thecreation of the board of commissioners also confers the
powers of the justices of the peace of thecounty court, and such a provision
is unconstitutional and void, since these powers shall beexercised only by the
justices.