Republic of the Philippines

SUPREME COURT
Manila

EN BANC

G.R. No. L-32096 October 24, 1970

ROMEO F. EDU, in his capacity as Land Transportation Commissioner, petitioner,

vs.
HON. VICENTE G. ERICTA in his capacity as Judge of the Court of First Instance of Rizal, Br. XVIII,
Quezon City, and TEDDY C. GALO respondents.

Office of the Solicitor General Felix Q. Antonio, Acting Assistant Solicitor General Hector C. Fule and
Solicitor Vicente A. Torres for petitioner.

Teddy C. Galo in his own behalf.

Judge Vicente Ericta in his own behalf.

FERNANDO, J.:.

Petitioner Romeo F. Edu, the Land Transportation Commissioner, would have us rule squarely on the
constitutionality of the Reflector Law1 in this proceeding for certiorari and prohibition against respondent
Judge, the Honorable Vicente G. Ericta of the Court of First Instance of Rizal, Quezon City Branch, to
annul and set aside his order for the issuance of a writ of preliminary injunction directed against
Administrative Order No. 2 of petitioner for the enforcement of the aforesaid statute, in a pending suit in
his court for certiorari and prohibition, filed by the other respondent Teddy C. Galo assailing; the validity of
such enactment as well as such administrative order. Respondent Judge, in his answer, would join such a
plea asking that the constitutional and legal questions raised be decided "once and for all." Respondent
Teddy C. Galo who was quite categorical in his assertion that both the challenged legislation and the
administrative order transgress the constitutional requirements of due process and non-delegation, is not
averse either to such a definitive ruling. Considering the great public interest involved and the reliance by
respondent Galo and the allegation that the repugnancy to the fundamental law could be discerned on the
face of the statute as enacted and the executive order as promulgated, this Court, sees no obstacle to the
determination in this proceeding of the constitutional questions raised. For reasons to be hereafter stated,
we sustain the validity of the Reflector Law and Administrative Order No. 2 issued in the implementation
thereof, the imputation of constitutional infirmity being at best flimsy and insubstantial.

As noted in the answer of respondent Judge, respondent Galo on his behalf and that of other motorist
filed on May 20, 1970 a suit for certiorari and prohibition with preliminary injunction assailing the validity of
the challenged Act as an invalid exercise of the police power, for being violative of the due process
clause. This he followed on May 28, 1970 with a manifestation wherein he sought as an alternative
remedy that, in the event that respondent Judge would hold said statute constitutional, Administrative
Order No. 2 of the Land Transportation Commissioner, now petitioner, implementing such legislation be
nullified as an undue exercise of legislative power. There was a hearing on the plea for the issuance of a
writ of preliminary injunction held on May 27. 1970 where both parties were duly represented, but no
evidence was presented. The next day, on May 28, 1970, respondent Judge ordered the issuance of a
preliminary injunction directed against the enforcement of such administrative order. There was the day
after, a motion for its reconsideration filed by the Solicitor General representing petitioner. In the
meanwhile, the clerk of court of respondent Judge issued, on June 1, 1970 the writ of preliminary
injunction upon the filing of the required bond. The answer before the lower court was filed by petitioner
Edu on June 4, 1970. Thereafter, on June 9, 1970, respondent Judge denied the motion for
reconsideration of the order of injunction. Hence this petition for certiorari and prohibition filed with this
court on June 18, 1970.

In a resolution of June 22, 1970, this Court required respondents to file an answer to the petition for
certiorari and prohibition. Respondent Judge, the Honorable Vicente G. Ericta, did file his answer on June
30, 1970 explaining why he restrained the enforcement of Administrative Order No. 2 and, as noted at the
outset, joining the Solicitor General in seeking that the legal questions raised namely the constitutionality
of the Reflector Law and secondly the validity of Administrative Order No. 2 alleged to be in excess of the
authority conferred on petitioner and therefore violative of the principle of non-delegation of legislative
power be definitely decided. It was on until July 6, 1970 that respondent Galo filed his answer seeking the
dismissal of this petition concentrating on what he considered to be the patent invalidity of Administrative
Order No. 2 as it went beyond the authority granted by the Reflector Law, even assuming that it is
constitutional. In the meanwhile, on July 2, 1970, the petition was called for hearing with Solicitor Vicente
Torres appearing for petitioner and respondent Galo for himself. It was made clear during the course of
such argumentation that the matter of the constitutionality of the Reflector Law was likewise under
consideration by this Court. The case is thus ripe for decision.

We repeat that we find for petitioner and sustain the Constitutionality of the Reflector Law as well as the
validity of Administrative Order No. 2.

1. The threshold question is whether on the basis of the petition, the answers, and the oral argument, it
would be proper for this Court to resolve the issue of the constitutionality of the Reflector Law. Our
answer, as indicated, is in the affirmative. It is to be noted that the main thrust of the petition before us is
to demonstrate in a rather convincing fashion that the challenged legislation does not suffer from the
alleged constitutional infirmity imputed to it by the respondent Galo. Since the special civil action for
certiorari and prohibition filed before him before respondent Judge would seek a declaration of nullity of
such enactment by the attribution of the violation the face thereof of the due process guarantee in the
deprivation of property rights, it would follow that there is sufficient basis for us to determine which view
should prevail. Moreover, any further hearing by respondent Judge would likewise to limited to a
discussion of the constitutional issues raised, no allegations of facts having made. This is one case then
where the question of validity is ripe for determination. If we do so, further effort need not be wasted and
time is saved moreover, the officials concerned as well as the public, both vitally concerned with a final
resolution of questions of validity, could know the definitive answer and could act accordingly. There is a
great public interest, as was mentioned, to be served by the final disposition of such crucial issue,
petitioner praying that respondent Galo be declared having no cause of action with respondent Judge
being accordingly directed to dismiss his suit.

There is another reinforcement to this avenue of approach. We have done so before in a suit, Climaco v.
Macadaeg, 2 involving the legality of a presidential directive. That was a petition for the review and
reversal of a writ of preliminary injunction issued by the then Judge Macadaeg. We there announced that
we "have decided to pass upon the question of the validity of the presidential directive ourselves,
believing that by doing so we would be putting an end to a dispute, a delay in the disposition of which has
caused considerable damage and injury to the Government and to the tobacco planters themselves."

There is no principle of constitutional adjudication that bars this Court from similarly passing upon the
question of the validity of a legislative enactment in a proceeding before it to test the propriety of the
issuance of a preliminary injunction. The same felt need for resolving once and for all the vexing question
as to the constitutionality of a challenged enactment and thus serve public interest exists. What we have
done in the case of an order proceeding from one of the coordinate branches, the executive, we can very
well do in the matter before us involving the alleged nullity of a legislative act. Accordingly, there is
nothing to preclude the grant of the writs prayed for, the burden of showing the constitutionality of the act
having proved to be as will now be shown too much for respondent Galo.
2. The Reflector Law reads in full: "(g) Lights and reflector when parked or disabled. — Appropriate
parking lights or flares visible one hundred meters away shall be displayed at a corner of the vehicle
whenever such vehicle is parked on highways or in places that are not well-lighted or is placed in such
manner as to endanger passing traffic. Furthermore, every motor vehicle shall be provided at all times
with built-in reflectors or other similar warning devices either pasted, painted or attached to its front and
back which shall likewise be visible at light at least one hundred meters away. No vehicle not provided
with any of the requirements mentioned in this subsection shall be registered." 3 It is thus obvious that the
challenged statute is a legislation enacted under the police power to promote public safety.

Justice Laurel, in the first leading decision after the Constitution came to force, Calalang v. Williams,4
identified police power with state authority to enact legislation that may interfere with personal liberty or
property in order to promote the general welfare. Persons and property could thus "be subjected to all
kinds of restraints and burdens in order to secure the general comfort, health and prosperity of the state."
Shortly after independence in 1948, Primicias v. Fugoso,5 reiterated the doctrine, such a competence
being referred to as "the power to prescribe regulations to promote the health, morals, peace, education,
good order or safety, and general welfare of the people." The concept was set forth in negative terms by
Justice Malcolm in a pre-Commonwealth decision as "that inherent and plenary power in the State which
enables it to prohibit all things hurtful to the comfort, safety and welfare of society." 6 In that sense it could
be hardly distinguishable as noted by this Court in Morfe v. Mutuc7 with the totality of legislative power.

It is in the above sense the greatest and most powerful attribute of government. It is to quote Justice
Malcolm anew "the most essential, insistent, and at least illimitable of powers," 8 extending as Justice
Holmes aptly pointed out "to all the great public needs." 9 Its scope, ever-expanding to meet the
exigencies of the times, even to anticipate the future where it could be done, provides enough room for an
efficient and flexible response to conditions and circumstances thus assuring the greatest benefits. In the
language of Justice Cardozo: "Needs that were narrow or parochial in the past may be interwoven in the
present with the well-being of the nation. What is critical or urgent changes with the
time." 10 The police power is thus a dynamic agency, suitably vague and far from precisely defined, rooted
in the conception that men in organizing the state and imposing upon its government limitations to
safeguard constitutional rights did not intend thereby to enable an individual citizen or a group of citizens
to obstruct unreasonably the enactment of such salutary measures calculated to insure communal peace,
safety, good order, and welfare.

It would then be to overturn a host of decisions impressive for their number and unanimity were this Court
to sustain respondent Galo. 11 That we are not disposed to do, especially so as the attack on the
challenged statute ostensibly for disregarding the due process safeguard is angularly unpersuasive. It
would be to close one's eyes to the hazards of traffic in the evening to condemn a statute of this
character. Such an attitude betrays lack of concern for public safety. How can it plausibly alleged then
that there was no observance of due process equated as it has always been with that is reasonable? The
statute assailed is not infected with arbitrariness. It is not the product of whim or caprice. It is far from
oppressive. It is a legitimate response to a felt public need. It can stand the test of the most
unsymphatetic appraisal.

Respondent Galo is of a different mind, having been unable to resist the teaching of many American
State Court decisions referred to in the secondary source, American Jurisprudence principally relied upon
by him. He ought to have been cautioned against an indiscriminate acceptance of such doctrines
predicated on what was once a fundamental postulate in American public law, laissez faire.

It is to be admitted that there was a period when such a concept did influence American court decisions
on constitutional law. As was explicitly stated by Justice Cardozo speaking of that era: "Laissez-faire was
not only a counsel of caution which would do well to heed. It was a categorical imperative which
statesmen as well as judges must obey." 12 For a long time legislation tending to reduce economic
inequality foundered on the rock that was the due process clause, enshrining as it did the liberty of
contract, based on such a basic assumption.
The New Deal administration of President Roosevelt more responsive to the social and economic forces
at work changed matters greatly. By 1937, there was a greater receptivity by the American Supreme
Court to an approach not too reverential of property rights. Even earlier, in 1935, Professor Coker of Yale,
speaking as a historian, could already discern a contrary drift. He did note the expending range of
governmental activity in the United States. 13 What is undeniable is that by 1943, laissez-faire was no
longer the dominant theory. In the language of Justice Jackson in the leading case of West Virginia State
Board of Education v. Barnette: 14 "We must, transplant these rights to a soil in which the laissez-faire
concept or non-interference has withered at least as to economic affairs, and social advancements are
increasingly sought through closer integration of society and through expanded and strengthened
governmental controls."

While authoritative precedents from the United States federal and state jurisdictions were deferred to
when the Philippines was still under American rule, it cannot be said that the laissez-faire principle was
invariably adhered to by us even then As early as 1919, in the leading case of Rubi v. Provincial Board of
Mindoro, 15 Justice Malcolm already had occasion to affirm: "The doctrines of laissez-faire and of
unrestricted freedom of the individual, as axioms of economic and political theory, are of the past. The
modern period has shown a widespread belief in the amplest possible demonstration of government
activity. The Courts unfortunately have sometimes seemed to trail after the other two branches of the
Government in this progressive march." People v. Pomar, 16 a 1924 decision which held invalid under the
due process clause a provision providing for maternity leave with pay thirty days before and thirty days
after confinement could be cited to show that such a principle did have its day. It is to be remembered
though that our Supreme Court had no other choice as the Philippines was then under the United States,
and only recently the year before, the American Supreme Court in Adkins v. Children's Hospital, 17 in line
with the laissez-faire theory, did hold that a statute providing for minimum wages was constitutionally
infirm.

What is more, to erase any doubts, the Constitutional Convention saw to it that the concept of laissez-
faire was rejected. It entrusted to our government the responsibility of coping with social and economic
problems with the commensurate power of control over economic affairs. Thereby it could live up to its
commitment to promote the general welfare through state action. No constitutional objection to regulatory
measures adversely affecting property rights, especially so when public safety is the aim, is likely to be
heeded, unless of course on the clearest and most satisfactory proof of invasion of rights guaranteed by
the Constitution. On such a showing, there may be a declaration of nullity, but not because the laissez-
faire principle was disregarded but because the due process, equal protection, or non-impairment
guarantees would call for vindication.

To repeat, our Constitution which took effect in 1935 erased whatever doubts there might be on that
score. Its philosophy is a repudiation of laissez-faire. One of the leading members of the Constitutional
Convention, Manuel A. Roxas, later the first President of the Republic, made it clear when he disposed of
the objection of Delegate Jose Reyes of Sorsogon, who noted the "vast extensions in the sphere of
governmental functions" and the "almost unlimited power to interfere in the affairs of industry and
agriculture as well as to compete with existing business" as "reflections of the fascination exerted by [the
then] current tendencies" in other jurisdictions. 18 He spoke thus: "My answer is that this constitution has
definite and well defined philosophy not only political but social and economic. ... If in this Constitution the
gentlemen will find declarations of economic policy they are there because they are necessary to
safeguard the interests and welfare of the Filipino people because we believe that the days have come
when in self-defense, a nation may provide in its constitution those safeguards, the patrimony, the
freedom to grow, the freedom to develop national aspirations and national interests, not to be hampered
by the artificial boundaries which a constitutional provision automatically imposes. 19

It was not expected then when in a concurring opinion, Justice Laurel, who likewise sat in the
Constitutional Convention and was one of its leading lights, explicitly affirmed in a concurring opinion,
later quoted with approval in the leading case of Antamok Goldfields Mining Co. v. Court of Industrial
Relations, 20 that the Constitution did away with the laissez-faire doctrine. In the course of such
concurring opinion and after noting the changes that have taken place calling for a more affirmative role
by the government and its undeniable power to curtail property rights, he categorically declared the
doctrine in People v. Pomar no longer retains "its virtuality as a living principle." 21

It is in the light of such rejection of the laissez-faire principle that during the Commonwealth era, no
constitutional infirmity was found to have attached to legislation covering such subjects as collective
bargaining, 22 security of tenure, 23 minimum wages, 24 compulsory arbitration, 25 the regulation of
tenancy 26 as well as the issuance of
securities, 27 and control of public services. 28 So it is likewise under the Republic this Court having
given the seal of approval to more favorable tenancy laws, 29 nationalization of the retail trade, 30
limitation of the hours of labor, 31 imposition of price control, 32 requirement of separation pay for one
month, 33 and social security scheme. 34

Respondent Galo thus could have profited by a little more diligence in the scrutiny of Philippine decisions
rendered with not unexpected regularity, during all the while our Constitution has been in force attesting
to the demise of such a shibboleth as laissez-faire. It was one of those fighting faiths that time and
circumstances had upset, to paraphrase Holmes. Yet respondent Galo would seek to vivify and resurrect
it. That, it would appear, is a vain quest, a futile undertaking. The Reflector Law is thus immune from the
attack so recklessly hurled against it. It can survive, and quite easily too, the constitutional test.

3. The same lack of success marks the effort of respondent Galo to impugn the validity of Administrative
Order No. 2 issued by petitioner in his official capacity, duly approved by the Secretary of Public Works
and Communications, for being contrary to the principle of non-delegation of legislative power. Such
administrative order, which took effect on April 17, 1970, has a provision on reflectors in effect
reproducing what was set forth in the Act. Thus: "No motor vehicles of whatever style, kind, make, class
or denomination shall be registered if not equipped with reflectors. Such reflectors shall either be factory
built-in-reflector commercial glass reflectors, reflection tape or luminous paint. The luminosity shall have
an intensity to be maintained visible and clean at all times such that if struck by a beam of light shall be
visible 100 meters away at night." 35 Then came a section on dimensions, placement and color. As to
dimensions the following is provided for: "Glass reflectors — Not less than 3 inches in diameter or not
less than 3 inches square; Reflectorized Tape — At least 3 inches wide and 12 inches long. The painted
or taped area may be bigger at the discretion of the vehicle owner." 36 Provision is then made as to how
such reflectors are to be "placed, installed, pasted or painted." 37 There is the further requirement that in
addition to such reflectors there shall be installed, pasted or painted four reflectors on each side of the
motor vehicle parallel to those installed, pasted or painted in front and those in the rear end of the body
thereof. 38 The color required of each reflectors, whether built-in, commercial glass, reflectorized tape or
reflectorized paint placed in the front part of any motor vehicle shall be amber or yellow and those placed
on the sides and in the rear shall all be red. 39

Penalties resulting from a violation thereof could be imposed. Thus: "Non-compliance with the
requirements contained in this Order shall be sufficient cause to refuse registration of the motor vehicle
affected and if already registered, its registration maybe suspended in pursuance of the provisions of
Section 16 of RA 4136; [Provided], However, that in the case of the violation of Section 1(a) and (b) and
paragraph (8) Section 3 hereof, a fine of not less than ten nor more than fifty pesos shall be imposed. 40 It
is not to be lost sight of that under Republic Act No. 4136, of which the Reflector Law is an amendment,
petitioner, as the Land Transportation Commissioner, may, with the approval of the Secretary of Public
Works and Communications, issue rules and regulations for its implementation as long as they do not
conflict with its provisions. 41 It is likewise an express provision of the above statute that for a violation of
any of its provisions or regulations promulgated pursuant thereto a fine of not less than P10 nor not less
than P50 could be imposed. 42

It is a fundamental principle flowing from the doctrine of separation of powers that Congress may not
delegate its legislative power to the two other branches of the government, subject to the exception that
local governments may over local affairs participate in its exercise. What cannot be delegated is the
authority under the Constitution to make laws and to alter and repeal them; the test is the completeness
of the statute in all its term and provisions when it leaves the hands of the legislature. To determine
whether or not there is an undue delegation of legislative power the inquiry must be directed to the scope
and definiteness of the measure enacted. The legislature does not abdicate its functions when it
describes what job must be done, who is to do it, and what is the scope of his authority. For a complex
economy, that may indeed be the only way in which the legislative process can go forward. A distinction
has rightfully been made between delegation of power to make the laws which necessarily involves a
discretion as to what it shall be, which constitutionally may not be done, and delegation of authority or
discretion as to its execution to exercised under and in pursuance of the law, to which no valid objection
call be made. The Constitution is thus not to be regarded as denying the legislature the necessary
resources of flexibility and practicability.

To avoid the taint of unlawful delegation, there must be a standard, which implies at the very least that the
legislature itself determines matters of principle and lay down fundamental policy. Otherwise, the charge
of complete abdication may be hard to repel. A standard thus defines legislative policy, marks its limits, its
maps out its boundaries and specifies the public agency to apply it. It indicates the circumstances under
which the legislative command is to be effected. It is the criterion by which legislative purpose may be
carried out. Thereafter, the executive or administrative office designated may in pursuance of the above
guidelines promulgate supplemental rules and regulations.

The standard may be either express or implied. If the former, the non-delegation objection is easily met.
The standard though does not have to be spelled out specifically. It could be implied from the policy and
purpose of the act considered as a whole. In the Reflector Law, clearly the legislative objective is public
safety. That is sought to be attained as in Calalang v. Williams is "safe transit upon the roads." 43

This is to adhere to the recognition given expression by Justice Laurel in a decision announced not long
after the Constitution came into force and effect that the principle of non-delegation "has been made to
adapt itself the complexities of modern governments, giving rise to the adoption, within certain limits, of
the principle of "subordinate legislation" not only in the United States and England but in practically all
modern governments." 44 He continued: "Accordingly, with the growing complexity of modern life, the
multiplication of the subjects of governmental regulation, and the increased difficulty of administering the
laws, there is a constantly growing tendency toward the delegation of greater powers by the legislature
and toward the approval of the practice by the courts." 45 Consistency with the conceptual approach
requires the reminder that what is delegated is authority non-legislative in character, the completeness of
the statute when it leaves the hands of Congress being assumed.

Our later decisions speak to the same effect. Thus from, Justice J. B. L. Reyes in People vs. Exconde: 46
"It is well establish in this jurisdiction that, while the making of laws is a non-delegable activity that
corresponds exclusively to Congress, nevertheless the latter may constitutionally delegate authority to
promulgate rules and regulations to implement a given legislation and effectuate its policies, for the
reason that the legislature often finds it impracticable (if not impossible) to anticipate and proved for the
multifarious and complex situations that may be met in carrying the law in effect. All that is required is that
the regulation should germane to the objects and purposes of the law; that the regulation be not in
contradiction with it; but conform to the standards that the law prescribes ... " 47

An even more explicit formulation of the controlling principle comes from the pen of the then Justice, now
Chief Justice, Concepcion: "Lastly, the legality of Circular No. 21 is assailed upon the ground that the
grant of authority to issue the same constitutes an undue delegation of legislative power. It is true that,
under our system of government, said power may not be delegated except to local governments.
However, one thing is to delegate the power to determine what the law shall be, and another thing to
delegate the authority to fix the details in the execution of enforcement of a policy set out in the law itself.
Briefly stated, the rule is that the delegated powers fall under the second category, if the law authorizing
the, delegation furnishes a reasonable standard which "sufficiently marks the field within which the
Administrator is to act so that it may be known whether he has kept within it in compliance with the
legislative will." (Yakus vs. United States, 88 L. ed.
848) ... It should be noted, furthermore, that these powers must be construed and exercised in relation to
the objectives of the law creating the Central Bank, which are, among others, "to maintain monetary
stability in the Philippines," and "to promote a rising level of production, employment and real income in
the Philippines." (Section 2, Rep. Act No. 265). These standards are sufficiently concrete and definite to
vest in the delegated authority, the character of administrative details in the enforcement of the law and to
place the grant said authority beyond the category of a delegation of legislative powers ... " 48

It bears repeating that the Reflector Law construed together with the Land Transportation Code. Republic
Act No. 4136, of which it is an amendment, leaves no doubt as to the stress and emphasis on public
safety which is the prime consideration in statutes of this character. There is likewise a categorical
affirmation Of the power of petitioner as Land Transportation Commissioner to promulgate rules and
regulations to give life to and translate into actuality such fundamental purpose. His power is clear. There
has been no abuse. His Administrative Order No. 2 can easily survive the attack, far-from-formidable,
launched against it by respondent Galo.

WHEREFORE, the writs of certiorari and prohibition prayed for are granted, the orders of May 28, 1970 of
respondent Judge for the issuance of a writ of preliminary injunction, the writ of preliminary injunction of
June 1, 1970 and his order of June 9, 1970 denying reconsideration are annulled and set aside.
Respondent Judge is likewise directed to dismiss the petition for certiorari and prohibition filed by
respondent Teddy C. Galo, there being no cause of action as the Reflector Law and Administrative Order
No. 2 of petitioner have not been shown to be tainted by invalidity. Without pronouncement as to costs.

Reyes, J.B.L., Actg. C.J., Dizon, Makalintal, Zaldivar, Castro, Teehankee, Barredo and Makasiar, JJ.,
concur.

Concepcion, C.J. and Villamor, J., took no par

 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 110526 February 10, 1998

ASSOCIATION OF PHILIPPINE COCONUT DESICCATORS, petitioner,

vs.
PHILIPPINE COCONUT AUTHORITY, respondent.

MENDOZA, J.:

At issue in this case is the validity of a resolution, dated March 24, 1993, of the Philippine Coconut
Authority in which it declares that it will no longer require those wishing to engage in coconut processing
to apply to it for a license or permit as a condition for engaging in such business.

Petitioner Association of Philippine Coconut Desiccators (hereafter referred to as APCD) brought this suit
for certiorari and mandamus against respondent Philippine Coconut Authority (PCA) to invalidate the
latter's Board Resolution No. 018-93 and the certificates of registration issued under it on the ground that
the resolution in question is beyond the power of the PCA to adopt, and to compel said administrative
agency to comply instead with the mandatory provisions of statutes regulating the desiccated coconut
industry, in particular, and the coconut industry, in general.

As disclosed by the parties' pleadings, the facts are as follows:

On November 5, 1992, seven desiccated coconut processing companies belonging to the APCD brought
suit in the Regional Trial Court, National Capital Judicial Region in Makati, Metro Manila, to enjoin the
PCA from issuing permits to certain applicants for the establishment of new desiccated coconut
processing plants. Petitioner alleged that the issuance of licenses to the applicants would violate PCA's
Administrative Order No. 02, series of 1991, as the applicants were seeking permits to operate in areas
considered "congested" under the administrative order.1

On November 6, 1992, the trial court issued a temporary restraining order and, on November 25, 1992, a
writ of preliminary injunction, enjoining the PCA from processing and issuing licenses to Primex Products,
Inc., Coco Manila, Superstar (Candelaria) and Superstar (Davao) upon the posting of a bond in the
amount of P100,000.00.2

Subsequently and while the case was pending in the Regional Trial Court, the Governing Board of the
PCA issued on March 24, 1993 Resolution No. 018-93, providing for the withdrawal of the Philippine
Coconut Authority from all regulation of the coconut product processing industry. While it continues the
registration of coconut product processors, the registration would be limited to the "monitoring" of their
volumes of production and administration of quality standards. The full text of the resolution reads:

RESOLUTION NO. 018-93

POLICY DECLARATION DEREGULATING
THE ESTABLISHMENT OF NEW COCONUT
PROCESSING PLANTS
 WHEREAS, it is the policy of the State to promote free enterprise unhampered by protective
regulations and unnecessary bureaucratic red tapes;

WHEREAS, the deregulation of certain sectors of the coconut industry, such as marketing of
coconut oils pursuant to Presidential Decree No. 1960, the lifting of export and commodity
clearances under Executive Order No. 1016, and relaxation of regulated capacity for the
desiccated coconut sector pursuant to Presidential Memorandum of February 11, 1988, has
become a centerpiece of the present dispensation;

WHEREAS, the issuance of permits or licenses prior to business operation is a form of regulation
which is not provided in the charter of nor included among the powers of the PCA;

WHEREAS, the Governing Board of PCA has determined to follow and further support the
deregulation policy and effort of the government to promote free enterprise;

NOW THEREFORE, BE IT RESOLVED AS IT IS HEREBY RESOLVED, that, henceforth, PCA

shall no longer require any coconut oil mill, coconut oil refinery, coconut desiccator, coconut
product processor/factory, coconut fiber plant or any similar coconut processing plant to apply
with PCA and the latter shall no longer issue any form of license or permit as condition prior to
establishment or operation of such mills or plants;

RESOLVED, FURTHER, that the PCA shall limit itself only to simply registering the
aforementioned coconut product processors for the purpose of monitoring their volumes of
production, administration of quality standards with the corresponding service fees/charges.

ADOPTED this 24th day of March 1993, at Quezon City. 3

The PCA then proceeded to issue "certificates of registration" to those wishing to operate desiccated
coconut processing plants, prompting petitioner to appeal to the Office of the President of the Philippines
on April 26, 1993 not to approve the resolution in question. Despite follow-up letters sent on May 25 and
June 2, 1993, petitioner received no reply from the Office of the President. The "certificates of
registration" issued in the meantime by the PCA has enabled a number of new coconut mills to operate.
Hence this petition.

Petitioner alleges:

RESPONDENT PCA'S BOARD RESOLUTION NO. 018-93 IS NULL AND VOID FOR BEING AN
UNDUE EXERCISE OF LEGISLATIVE POWER BY AN ADMINISTRATIVE BODY.

II

ASIDE FROM BEING ULTRA-VIRES, BOARD RESOLUTION NO. 018-93 IS WITHOUT ANY
BASIS, ARBITRARY, UNREASONABLE AND THEREFORE IN VIOLATION OF SUBSTANTIVE
DUE PROCESS OF LAW.

III

IN PASSING BOARD RESOLUTION NO. 018-93, RESPONDENT PCA VIOLATED THE

PROCEDURAL DUE PROCESS REQUIREMENT OF CONSULTATION PROVIDED IN
PRESIDENTIAL DECREE NO. 1644, EXECUTIVE ORDER NO. 826 AND PCA
ADMINISTRATIVE ORDER NO. 002, SERIES OF 1991.
On the other hand, in addition to answering petitioner's arguments, respondent PCA alleges that this
petition should be denied on the ground that petitioner has a pending appeal before the Office of the
President. Respondent accuses petitioner of forum-shopping in filing this petition and of failing to exhaust
available administrative remedies before coming to this Court. Respondent anchors its argument on the
general rule that one who brings an action under Rule 65 must show that one has no appeal nor any
plain, speedy, and adequate remedy in the ordinary course of law.

I.

The rule of requiring exhaustion of administrative remedies before a party may seek judicial review, so
strenuously urged by the Solicitor General on behalf of respondent, has obviously no application here.
The resolution in question was issued by the PCA in the exercise of its rule-making or legislative power.
However, only judicial review of decisions of administrative agencies made in the exercise of their quasi-
judicial function is subject to the exhaustion doctrine. The exhaustion doctrine stands as a bar to an
action which is not yet complete4 and it is clear, in the case at bar, that after its promulgation the
resolution of the PCA abandoning regulation of the desiccated coconut industry became effective.
To be sure, the PCA is under the direct supervision of the President of the Philippines but there is
nothing in P.D. No. 232, P.D. No. 961, P.D. No. 1468 and P.D. No. 1644 defining the powers and
functions of the PCA which requires rules and regulations issued by it to be approved by the
President before they become effective.

In any event, although the APCD has appealed the resolution in question to the Office of the
President, considering the fact that two months after they had sent their first letter on April 26,
1993 they still had to hear from the President's office, meanwhile respondent PCA was issuing
certificates of registration indiscriminately to new coconut millers, we hold that petitioner was
justified in filing this case on June 25, 1993.5 Indeed, after writing the Office of the President on
April 26, 19936 petitioner sent inquiries to that office not once, but twice, on May 26, 1993 7 and on
June 2, 1993,8 but petitioner did not receive any reply.

II.

We now turn to the merit of the present petition. The Philippine Coconut Authority was originally
created by P.D. 232 on June 30, 1973, to take over the powers and functions of the Coconut
Coordinating Council, the Philippine Coconut Administration and the Philippine Coconut
Research Institute. On June 11, 1978, by P.D. No. 1468, it was made "an independent public
corporation . . . directly reporting to, and supervised by, the President of the Philippines," 9 and
charged with carrying out the State's policy "to promote the rapid integrated development and
growth of the coconut and other palm oil industry in all its aspects and to ensure that the coconut
farmers become direct participants in, and beneficiaries of, such development and growth." 10
through a regulatory scheme set up by law.11

Through this scheme, the government, on August 28, 1982, temporarily prohibited the opening of
new coconut processing plants and, four months later, phased out some of the existing ones in
view of overproduction in the coconut industry which resulted in cut-throat competition,
underselling and smuggling of poor quality products and ultimately in the decline of the export
performance of coconut-based commodities. The establishment of new plants could be
authorized only upon determination by the PCA of the existence of certain economic conditions
and the approval of the President of the Philippines. Thus, Executive Order No. 826, dated August
28, 1982, provided:

Sec. 1. Prohibition. — Except as herein provided, no government agency or

instrumentality shall hereafter authorize, approve or grant any permit or license for the
establishment or operation of new desiccated coconut processing plants, including the
importation of machinery or equipment for the purpose. In the event of a need to establish
 a new plant, or expand the capacity, relocate or upgrade the efficiencies of any existing
desiccated plant, the Philippine Coconut Authority may, upon proper determination of
such need and evaluation of the condition relating to:

a. the existing market demand;

b. the production capacity prevailing in the country or locality;

c. the level and flow of raw materials; and

d. other circumstances which may affect the growth or viability of the industry concerned,

authorize or grant the application for, the establishment or expansion of capacity,

relocation or upgrading of efficiencies of such desiccated coconut processing plant,
subject to the approval of the President.

On December 6, 1982, a phase-out of some of the existing plants was ordered by the government
after finding that "a mere freeze in the present capacity of existing plants will not afford a viable
solution to the problem considering that the total available limited market is not adequate to
support all the existing processing plants, making it imperative to reduce the number of existing
processing plants."12 Accordingly, it was ordered:13

Sec. 1. The Philippine Coconut Authority is hereby ordered to take such action as may be
necessary to reduce the number of existing desiccated coconut processing plants to a
level which will insure the survival of the remaining plants. The Authority is hereby
directed to determine which of the existing processing plants should be phased out and to
enter into appropriate contracts with such plants for the above purpose.

It was only on October 23, 1987 when the PCA adopted Resolution No. 058-87, authorizing the
establishment and operation of additional DCN plants, in view of the increased demand for
desiccated coconut products in the world's markets, particularly in Germany, the Netherlands and
Australia. Even then, the opening of new plants was made subject to "such implementing
guidelines to be set forth by the Authority" and "subject to the final approval of the President."

The guidelines promulgated by the PCA, as embodied in Administrative Order No. 002, series of
1991, inter alia authorized the opening of new plants in "non-congested areas only as declared by
the PCA" and subject to compliance by applicants with "all procedures and requirements for
registration under Administrative Order No. 003, series of 1981 and this Order." In addition, as the
opening of new plants was premised on the increased global demand for desiccated coconut
products, the new entrants were required to submit sworn statements of the names and
addresses of prospective foreign buyers.

This form of "deregulation" was approved by President Aquino in her memorandum, dated
February 11, 1988, to the PCA. Affirming the regulatory scheme, the President stated in her
memorandum:

It appears that pursuant to Executive Order No. 826 providing measures for the protection
of the Desiccated Coconut Industry, the Philippine Coconut Authority evaluated the
conditions relating to: (a) the existing market demands; (b) the production capacity
prevailing in the country or locality; (c) the level and flow of raw materials; and (d) other
circumstances which may affect the growth or viability of the industry concerned and that
the result of such evaluation favored the expansion of production and market of
desiccated coconut products.
 In view hereof and the favorable recommendation of the Secretary of Agriculture, the
deregulation of the Desiccated Coconut Industry as recommended in Resolution No. 058-
87 adopted by the PCA Governing Board on October 28, 1987 (sic) is hereby approved.14

These measures — the restriction in 1982 on entry into the field, the reduction the same year of
the number of the existing coconut mills and then the lifting of the restrictions in 1987 — were
adopted within the framework of regulation as established by law "to promote the rapid integrated
development and growth of the coconut and other palm oil industry in all its aspects and to
ensure that the coconut farmers become direct participants in, and beneficiaries of, such
development and growth." 15 Contrary to the assertion in the dissent, the power given to the
Philippine Coconut Authority — and before it to the Philippine Coconut Administration — "to
formulate and adopt a general program of development for the coconut and other palm oils
industry"16 is not a roving commission to adopt any program deemed necessary to promote the
development of the coconut and other palm oils industry, but one to be exercised in the context of
this regulatory structure.

In plain disregard of this legislative purpose, the PCA adopted on March 24, 1993 the questioned
resolution which allows not only the indiscriminate opening of new coconut processing plants but
the virtual dismantling of the regulatory infrastructure whereby, forsaking controls theretofore
placed in its keeping, the PCA limits its function to the innocuous one of "monitoring" compliance
by coconut millers with quality standards and volumes of production. In effect, the PCA would
simply be compiling statistical data on these matters, but in case of violations of standards there
would be nothing much it would do. The field would be left without an umpire who would retire to
the bleachers to become a mere spectator. As the PCA provided in its Resolution No. 018-93:

NOW, THEREFORE, BE IT RESOLVED AS IT IS HEREBY RESOLVED, that, henceforth, PCA

shall no longer require any coconut oil mill, coconut oil refinery, coconut desiccator,
coconut product processor/factory, coconut fiber plant or any similar coconut processing
plant to apply with PCA and the latter shall no longer issue any form of license or permit
as condition prior to establishment or operation of such mills or plants;

RESOLVED, FURTHER, that the PCA shall limit itself only to simply registering the
aforementioned coconut product processors for the purpose of monitoring their volumes
of production, administration of quality standards with the corresponding service
fees/charges.

The issue is not whether the PCA has the power to adopt this resolution to carry out its mandate
under the law "to promote the accelerated growth and development of the coconut and other palm
oil industry."17 The issue rather is whether it can renounce the power to regulate implicit in the law
creating it for that is what the resolution in question actually is.

Under Art. II, § 3(a) of the Revised Coconut Code (P.D. No. 1468), the role of the PCA is "To
formulate and adopt a general program of development for the coconut and other palm oil
industry in all its aspects." By limiting the purpose of registration to merely "monitoring volumes
of production [and] administration of quality standards" of coconut processing plants, the PCA in
effect abdicates its role and leaves it almost completely to market forces how the coconut
industry will develop.

Art. II, § 3 of P.D. No. 1468 further requires the PCA:

(h) To regulate the marketing and the exportation of copra and its by-products by
establishing standards for domestic trade and export and, thereafter, to conduct an
inspection of all copra and its by-products proposed for export to determine if they
conform to the standards established;
Instead of determining the qualifications of market players and preventing the entry into the field
of those who are unfit, the PCA now relies entirely on competition — with all its wastefulness and
inefficiency — to do the weeding out, in its naive belief in survival of the fittest. The result can
very well be a repeat of 1982 when free enterprise degenerated into a "free-for-all," resulting in
cut-throat competition, underselling, the production of inferior products and the like, which badly
affected the foreign trade performance of the coconut industry.

Indeed, by repudiating its role in the regulatory scheme, the PCA has put at risk other statutory
provisions, particularly those of P.D. No. 1644, to wit:

Sec. 1. The Philippine Coconut Authority shall have full power and authority to regulate
the marketing and export of copra, coconut oil and their by-products, in furtherance of the
steps being taken to rationalize the coconut oil milling industry.

Sec. 2. In the exercise of its powers under Section 1 hereof, the Philippine Coconut
Authority may initiate and implement such measures as may be necessary to attain the
rationalization of the coconut oil milling industry, including, but not limited to, the
following measures:

(a) Imposition of floor and/or ceiling prices for all exports of copra, coconut oil and their
by-products;

(b) Prescription of quality standards;

(c) Establishment of maximum quantities for particular periods and particular markets;

(d) Inspection and survey of export shipments through an independent international

superintendent or surveyor.

In the exercise of its powers hereunder, the Philippine Coconut Authority shall consult
with, and be guided by, the recommendation of the coconut farmers, through corporations
owned or controlled by them through the Coconut Industry Investment Fund and the
private corporation authorized to be organized under Letter of Instructions No. 926.

and the Revised Coconut Code (P.D. No. 1468), Art. II, § 3, to wit:

(m) Except in respect of entities owned or controlled by the Government or by the coconut
farmers under Sections 9 and 10, Article III hereof, the Authority shall have full power and
authority to regulate the production, distribution and utilization of all subsidized coconut-
based products, and to require the submission of such reports or documents as may be
deemed necessary by the Authority to ascertain whether the levy payments and/or
subsidy claims are due and correct and whether the subsidized products are distributed
among, and utilized by, the consumers authorized by the Authority.

The dissent seems to be saying that in the same way that restrictions on entry into the field were
imposed in 1982 and then relaxed in 1987, they can be totally lifted now without prejudice to
reimposing them in the future should it become necessary to do so. There is really no
renunciation of the power to regulate, it is claimed. Trimming down of PCA's function to
registration is not an abdication of the power to regulate but is regulation itself. But how can this
be done when, under Resolution No. 018-93, the PCA no longer requires a license as condition for
the establishment or operation of a plant? If a number of processing firms go to areas which are
already congested, the PCA cannot stop them from doing so. If there is overproduction, the PCA
cannot order a cut back in their production. This is because the licensing system is the
mechanism for regulation. Without it the PCA will not be able to regulate coconut plants or mills.

In the first "whereas" clause of the questioned resolution as set out above, the PCA invokes a
policy of free enterprise that is "unhampered by protective regulations and unnecessary
bureaucratic red tape" as justification for abolishing the licensing system. There can be no
quarrel with the elimination of "unnecessary red tape." That is within the power of the PCA to do
and indeed it should eliminate red tape. Its success in doing so will be applauded. But free
enterprise does not call for removal of "protective regulations."

Our Constitutions, beginning with the 1935 document, have repudiated laissez-faire as an
economic principle.18 Although the present Constitution enshrines free enterprise as a policy, 19 it
nonetheless reserves to the government the power to intervene whenever necessary to promote
the general welfare. This is clear from the following provisions of Art. XII of the Constitution
which, so far as pertinent, state:

Sec. 6. . . . Individuals and private groups, including corporations, cooperatives, and

similar collective organizations, shall have the right to own, establish, and operate
economic enterprises, subject to the duty of the State to promote distributive justice and
to intervene when the common good so demands.

Sec. 19. The State shall regulate or prohibit monopolies when the public interest so
requires. No combinations in restraint of trade or unfair competition shall be allowed.
(Emphasis added).

At all events, any change in policy must be made by the legislative department of the government.
The regulatory system has been set up by law. It is beyond the power of an administrative agency
to dismantle it. Indeed, petitioner charges the PCA of seeking to render moot a case filed by some
of its members questioning the grant of licenses to certain parties by adopting the resolution in
question. It is alleged that members of petitioner complained to the court that the PCA had
authorized the establishment and operation of new plants in areas which were already crowded, in
violation of its Administrative Order No. 002, series of 1991. In response, the Regional Trial Court
issued a writ of preliminary injunction, enjoining the PCA from issuing licenses to the private
respondent in that case.

These allegations of petitioner have not been denied here. It would thus seem that instead of
defending its decision to allow new entrants into the field against petitioner's claim that the PCA
decision violated the guidelines in Administrative Order No. 002, series of 1991, the PCA adopted
the resolution in question to render the case moot. In so doing, the PCA abdicated its function of
regulation and left the field to untrammeled competition that is likely to resurrect the evils of cut-
throat competition, underselling and overproduction which in 1982 required the temporary closing
of the field to new players in order to save the industry.

The PCA cannot rely on the memorandum of then President Aquino for authority to adopt the
resolution in question. As already stated, what President Aquino approved in 1988 was the
establishment and operation of new DCN plants subject to the guidelines to be drawn by the
PCA.20 In the first place, she could not have intended to amend the several laws already
mentioned, which set up the regulatory system, by a mere memoranda to the PCA. In the second
place, even if that had been her intention, her act would be without effect considering that, when
she issued the memorandum in question on February 11, 1988, she was no longer vested with
legislative authority.21
WHEREFORE, the petition is GRANTED. PCA Resolution No. 018-93 and all certificates of
registration issued under it are hereby declared NULL and VOID for having been issued in excess
of the power of the Philippine Coconut Authority to adopt or issue.

SO ORDERED.

Narvasa, C.J., Regalado, Davide, Jr., Puno, Kapunan, Francisco, Panganiban and Martinez, JJ.,
concur.
 Republic of the Philippines
SUPREME COURT
Manila

SECOND DIVISION

G.R. No. L-25843 July 25, 1974

MELCHORA CABANAS, plaintiff-appellee,

vs.
FRANCISCO PILAPIL, defendant-appellant.

Seno, Mendoza & Associates for plaintiff-appellee.

Emilio Benitez, Jr. for defendant-appellant.

FERNANDO, J.:p

The disputants in this appeal from a question of law from a lower court decision are the mother and the
uncle of a minor beneficiary of the proceeds of an insurance policy issued on the life of her deceased
father. The dispute centers as to who of them should be entitled to act as trustee thereof. The lower court
applying the appropriate Civil Code provisions decided in favor of the mother, the plaintiff in this case.
Defendant uncle appealed. As noted, the lower court acted the way it did following the specific mandate
of the law. In addition, it must have taken into account the principle that in cases of this nature the welfare
of the child is the paramount consideration. It is not an unreasonable assumption that between a mother
and an uncle, the former is likely to lavish more care on and pay greater attention to her. This is all the
more likely considering that the child is with the mother. There are no circumstances then that did militate
against what conforms to the natural order of things, even if the language of the law were not as clear. It
is not to be lost sight of either that the judiciary pursuant to its role as an agency of the State as parens
patriae, with an even greater stress on family unity under the present Constitution, did weigh in the
balance the opposing claims and did come to the conclusion that the welfare of the child called for the
mother to be entrusted with such responsibility. We have to affirm.

The appealed decision made clear: "There is no controversy as to the facts. "1 The insured, Florentino
Pilapil had a child, Millian Pilapil, with a married woman, the plaintiff, Melchora Cabanas. She was ten
years old at the time the complaint was filed on October 10, 1964. The defendant, Francisco Pilapil, is the
brother of the deceased. The deceased insured himself and instituted as beneficiary, his child, with his
brother to act as trustee during her minority. Upon his death, the proceeds were paid to him. Hence this
complaint by the mother, with whom the child is living, seeking the delivery of such sum. She filed the
bond required by the Civil Code. Defendant would justify his claim to the retention of the amount in
question by invoking the terms of the insurance policy. 2

After trial duly had, the lower court in a decision of May 10, 1965, rendered judgment ordering the
defendant to deliver the proceeds of the policy in question to plaintiff. Its main reliance was on Articles
320 and 321 of the Civil Code. The former provides: "The father, or in his absence the mother, is the legal
administrator of the property pertaining to the child under parental authority. If the property is worth more
than two thousand pesos, the father or mother shall give a bond subject to the approval of the Court of
First Instance."3 The latter states: "The property which the unemancipated child has acquired or may
acquire with his work or industry, or by any lucrative title, belongs to the child in ownership, and in
usufruct to the father or mother under whom he is under parental authority and whose company he lives;
...4

Conformity to such explicit codal norm is apparent in this portion of the appealed decision: "The insurance
proceeds belong to the beneficiary. The beneficiary is a minor under the custody and parental authority of
the plaintiff, her mother. The said minor lives with plaintiff or lives in the company of the plaintiff. The said
minor acquired this property by lucrative title. Said property, therefore, belongs to the minor child in
ownership, and in usufruct to the plaintiff, her mother. Since under our law the usufructuary is entitled to
possession, the plaintiff is entitled to possession of the insurance proceeds. The trust, insofar as it is in
conflict with the above quoted provision of law, is pro tanto null and void. In order, however, to protect the
rights of the minor, Millian Pilapil, the plaintiff should file an additional bond in the guardianship
proceedings, Sp. Proc. No. 2418-R of this Court to raise her bond therein to the total amount of
P5,000.00."5

It is very clear, therefore, considering the above, that unless the applicability of the two cited Civil Code
provisions can be disputed, the decision must stand. There is no ambiguity in the language employed.
The words are rather clear. Their meaning is unequivocal. Time and time again, this Court has left no
doubt that where codal or statutory norms are cast in categorical language, the task before it is not one of
interpretation but of application.6 So it must be in this case. So it was in the appealed decision.

1. It would take more than just two paragraphs as found in the brief for the defendant-appellant7 to blunt
the force of legal commands that speak so plainly and so unqualifiedly. Even if it were a question of
policy, the conclusion will remain unaltered. What is paramount, as mentioned at the outset, is the welfare
of the child. It is in consonance with such primordial end that Articles 320 and 321 have been worded.
There is recognition in the law of the deep ties that bind parent and child. In the event that there is less
than full measure of concern for the offspring, the protection is supplied by the bond required. With the
added circumstance that the child stays with the mother, not the uncle, without any evidence of lack of
maternal care, the decision arrived at can stand the test of the strictest scrutiny. It is further fortified by the
assumption, both logical and natural, that infidelity to the trust imposed by the deceased is much less in
the case of a mother than in the case of an uncle. Manresa, commenting on Article 159 of the Civil Code
of Spain, the source of Article 320 of the Civil Code, was of that view: Thus "El derecho y la obligacion de
administrar el Patrimonio de los hijos es una consecuencia natural y lógica de la patria potestad y de la
presunción de que nadie cuidará de los bienes de acquéllos con mas cariño y solicitude que los padres.
En nuestro Derecho antiguo puede decirse que se hallaba reconocida de una manera indirecta aquelia
doctrina, y asi se desprende de la sentencia del Tribunal Supremeo de 30 de diciembre de 1864, que se
refiere a la ley 24, tit. XIII de la Partida 5. De la propia suerte aceptan en general dicho principio los
Codigos extranjeros, con las limitaciones y requisitos de que trataremos mis adelante."8

2. The appealed decision is supported by another cogent consideration. It is buttressed by its adherence
to the concept that the judiciary, as an agency of the State acting as parens patriae, is called upon
whenever a pending suit of litigation affects one who is a minor to accord priority to his best interest. It
may happen, as it did occur here, that family relations may press their respective claims. It would be more
in consonance not only with the natural order of things but the tradition of the country for a parent to be
preferred. it could have been different if the conflict were between father and mother. Such is not the case
at all. It is a mother asserting priority. Certainly the judiciary as the instrumentality of the State in its role of
parens patriae, cannot remain insensible to the validity of her plea. In a recent case, 9 there is this
quotation from an opinion of the United States Supreme Court: "This prerogative of parens patriae is
inherent in the supreme power of every State, whether that power is lodged in a royal person or in the
legislature, and has no affinity to those arbitrary powers which are sometimes exerted by irresponsible
monarchs to the great detriment of the people and the destruction of their liberties." What is more, there is
this constitutional provision vitalizing this concept. It reads: "The State shall strengthen the family as a
basic social institution." 10 If, as the Constitution so wisely dictates, it is the family as a unit that has to be
strengthened, it does not admit of doubt that even if a stronger case were presented for the uncle, still
deference to a constitutional mandate would have led the lower court to decide as it did.
WHEREFORE, the decision of May 10, 1965 is affirmed. Costs against defendant-appellant.

Zaldivar (Chairman), Antonio, Fernandez and Aquino, JJ., concur.

Barredo, J., took no part.

 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. 164785 March 15, 2010

ELISEO F. SORIANO, Petitioner,

vs.
MA. CONSOLIZA P. LAGUARDIA, in her capacity as Chairperson of the Movie and Television Review
and Classification Board, MOVIE AND TELEVISION REVIEW AND CLASSIFICATION BOARD,
JESSIE L. GALAPON, ANABEL M. DELA CRUZ, MANUEL M. HERNANDEZ, JOSE L. LOPEZ,
CRISANTO SORIANO, BERNABE S. YARIA, JR., MICHAEL M. SANDOVAL, and ROLDAN
A. GAVINO, Respondents.

x ----------------------------------------- x

G.R. No. 165636

ELISEO F. SORIANO, Petitioner,

vs.
MOVIE AND TELEVISION REVIEW AND CLASSIFICATION BOARD, ZOSIMO G. ALEGRE, JACKIE
AQUINO-GAVINO, NOEL R. DEL PRADO, EMMANUEL BORLAZA, JOSE E. ROMERO IV, and
FLORIMONDO C. ROUS, in their capacity as members of the Hearing and Adjudication Committee
of the MTRCB, JESSIE L. GALAPON, ANABEL M. DELA CRUZ, MANUEL M. HERNANDEZ, JOSE L.
LOPEZ, CRISANTO SORIANO, BERNABE S. YARIA, JR., MICHAEL M. SANDOVAL, and ROLDAN
A. GAVINO, in their capacity as complainants before the MTRCB, Respondents.

RESOLUTION

VELASCO, JR., J.:

Before us is this motion of petitioner Eliseo F. Soriano for reconsideration of the Decision of the Court dated
April 29, 2009, modifying that of the Movie and Television Review and Classification Board (MTRCB) by
imposing the penalty of three-month suspension on the television show Ang Dating Daan, instead of on
petitioner Soriano, as host of that program.

Petitioner seeks reconsideration on the following grounds or issues: (1) the suspension thus meted out to
the program constitutes prior restraint; (2) the Court erred in ruling that his utterances 1 did not constitute
exercise of religion; (3) the Court erred in finding the language used as offensive and obscene; (4) the Court
should have applied its policy of non-interference in cases of conflict between religious groups; and
(5) the Court erred in penalizing the television program for the acts of petitioner.

The motion has no merit.

Petitioner’s threshold posture that the suspension thus imposed constitutes prior restraint and an
abridgement of his exercise of religion and freedom of expression is a mere rehash of the position he
articulated in the underlying petitions for certiorari and expounded in his memorandum.2 So are the
supportive arguments and some of the citations of decisional law, Philippine and American, holding it
together. They have been considered, sufficiently discussed in some detail, and found to be without merit
in our Decision. It would, thus, make little sense to embark on another lengthy discussion of the same
issues and arguments.
Suffice it to reiterate that the sanction imposed on the TV program in question does not, under the factual
milieu of the case, constitute prior restraint, but partakes of the nature of subsequent punishment for past
violation committed by petitioner in the course of the broadcast of the program on August 10, 2004. To be
sure, petitioner has not contested the fact of his having made statements on the air that were contextually
violative of the program’s "G" rating. To merit a "G" rating, the program must be "suitable for all ages,"
which, in turn, means that the "material for television [does not], in the judgment of the [MTRCB], x x x
contain anything unsuitable for children and minors, and may be viewed without adult guidance or
supervision."3 As previously discussed by the Court, the vulgar language petitioner used on prime-time
television can in no way be characterized as suitable for all ages, and is wholly inappropriate for children.

Petitioner next harps on the primacy of his freedoms, referring particularly to the exercise of his religious
beliefs and profession, as presiding minister of his flock, over the right and duty of the state as parens
patriae. Petitioner’s position may be accorded some cogency, but for the fact that it fails to consider that
the medium he used to make his statements was a television broadcast, which is accessible to children of
virtually all ages. As already laid down in the Decision subject of this recourse, the interest of the
government in protecting children who may be subjected to petitioner’s invectives must take precedence
over his desire to air publicly his dirty laundry. The public soapbox that is television must be guarded by the
state, which purpose the MTRCB serves, and has served, in suspending Ang Dating Daan for petitioner’s
statements. As emphasized in Gonzalez v. Kalaw Katigbak, 4 the freedom of broadcast media is, in terms
of degree of protection it deserves, lesser in scope, especially as regards television, which reaches every
home where there is a set, and where children will likely be among the avid viewers of the programs shown.
The same case also laid the basis for the classification system of the MTRCB when it stated, "It cannot be
denied though that the State as parens patriae is called upon to manifest an attitude of caring for the welfare
of the young."5

The penalty of suspension imposed on petitioner has driven him to liken the Court to "a blind man who was
asked to describe an elephant, and by his description he stubbornly believed that an elephant is just the
same as a Meralco post after touching one if its legs."6 Petitioner makes this comparison with the view that
the factual backdrop against which his statements were made was purportedly not considered by the Court.
As he presently argues:

The Honorable Court should have rendered its decision in light of the surrounding circumstances why and
what prompted herein petitioner to utter those words. Clearly, he was provoked because of the malicious
and blatant splicing by the INC ministers of his recorded voice. Verily, Petitioner submits that the choice of
words he used has been harsh but strongly maintains that the same was consistent with his constitutional
right of freedom of speech and religion.

Contrary to petitioner’s impression, the Court has, in fact, considered the factual antecedents of and his
motive in making his utterances, and has found those circumstances wanting as defense for violating the
program’s "G" rating. Consider the following excerpts from the Court’s Decision:

There is nothing in petitioner’s statements subject of the complaints expressing any particular religious
belief, nothing furthering his avowed evangelical mission. The fact that he came out with his statements in
a televised bible exposition program does not automatically accord them the character of a religious
discourse. Plain and simple insults directed at another person cannot be elevated to the status of religious
speech. Even petitioner’s attempts to place his words in context show that he was moved by anger and the
need to seek retribution, not by any religious conviction. His claim, assuming its veracity, that some INC
ministers distorted his statements respecting amounts Ang Dating Daan owed to a TV station does not
convert the foul language used in retaliation as religious speech. We cannot accept that petitioner made
his statements in defense of his reputation and religion, as they constitute no intelligible defense or
refutation of the alleged lies being spread by a rival religious group. They simply illustrate that petitioner
had descended to the level of name-calling and foul-language discourse. Petitioner could have chosen to
contradict and disprove his detractors, but opted for the low road.

And just to set things straight, the penalty imposed is on the program, not on petitioner.
Petitioner would next have the Court adopt a hands-off approach to the conflict between him and the Iglesia
Ni Cristo. In support of his urging, he cites Iglesia ni Cristo v. Court of Appeals.7

Petitioner’s invocation of Iglesia ni Cristo to support his hands-off thesis is erroneous. Obviously, he fails to
appreciate what the Court stated in that particular case when it rejected the argument that a religious
program is beyond MTRCB’s review and regulatory authority. We reproduce what the Court pertinently
wrote in Iglesia ni Cristo:

We thus reject petitioner’s postulate that its religious program is per se beyond review by the respondent
[MTRCB]. Its public broadcast on TV of its religious program brings it out of the bosom of internal belief.
Television is a medium that reaches even the eyes and ears of children. The Court iterates the rule that the
exercise of religious freedom can be regulated by the State when it will bring about the clear and
present danger of some substantive evil which the State is duty bound to prevent, i.e. serious detriment to
the more overriding interest of public health, public morals, or public welfare. A laissez faire policy on the
exercise of religion can be seductive to the liberal mind but history counsels the Court against its blind
adoption as religion is and continues to be a volatile area of concern in our country today. Across the sea
and in our shore, the bloodiest and bitterest wars fought by men were caused by irreconcilable religious
differences. Our country is still not safe from the recurrence of this stultifying strife considering our warring
religious beliefs and the fanaticism with which some of us cling and claw to these beliefs. x x x For when
religion divides and its exercise destroys, the State should not stand still.8 (Emphasis added.)

Lastly, petitioner claims that there was violation of due process of law, alleging that the registered producer
of the program is not a party to the proceedings. Hence, the program cannot, so petitioner asserts, be
penalized.

We will let the records speak for themselves to refute that argument.

As per petitioner’s admission in his petition for certiorari filed with the Court, he is "the Executive Producer
of Ang Dating Daan, a televised bible exposition program produced by the Philippine-based religious
organization, Church of God International."9 It is unclear, then, which producer the movant is referring to in
claiming that there was no representation before the MTRCB. He was and is the representative of Ang
Dating Daan, and the claim that there was no due process of law is simply bereft of merit.

Even as the foregoing disquisitions would suffice to write finis to the instant motion, certain relevant issues
have been raised by some members of the Court that ought to be addressed if only to put things in their
proper perspective. We refer to the matter of obscenity.

As stressed at every possible turn in the challenged Court’s Decision, the defining standards to be employed
in judging the harmful effects of the statements petitioner used would be those for the average child, not
those for the average adult. We note that the ratings and regulation of television broadcasts take into
account the protection of the child, and it is from the child’s narrow viewpoint that the utterances must be
considered, if not measured. The ratings "G," "PG" (parental guidance), "PG-13," and "R" (restricted or for
adults only) suggest as much. The concern was then, as now, that the program petitioner hosted and
produced would reach an unintended audience, the average child, and so it is how this audience would
view his words that matters. The average child would not be concerned with colorful speech, but, instead,
focus on the literal, everyday meaning of words used. It was this literal approach that rendered petitioner’s
utterances obscene.1avvphi1

The Court has taken stock of Action for Children’s Television v. FCC, 10 but finds this U.S. case not to be of
governing application to this jurisdiction under the present state of things. The so-called "safe harbor" of
10:00 p.m. to 6:00 a.m., adverted to in Action for Children’s Television as the time wherein broadcast of
indecent material may be permitted, is believed inapplicable here. As it were, there is no legislative
enactment or executive issuance setting a similar period in the Philippines wherein indecent material may
be broadcast. Rather than fix a period for allowing indecent programming, what is used in this jurisdiction
is the system of classification of television programs, which the petitioner violated. His program was rated
"G," purported to be suitable for all ages. We cannot lose sight of the violation of his program’s classification
that carried with it the producer’s implied assurance that the program did not contain anything unsuitable
for children and minors. The hour at which it was broadcasted was of little moment in light of the guarantee
that the program was safe for children’s viewing.

The suspension of the program has not been arrived at lightly. Taking into account all the factors involved
and the arguments pressed on the Court, the suspension of the program is a sufficiently limited disciplinary
action, both to address the violation and to serve as an object lesson for the future. The likelihood is great
that any disciplinary action imposed on petitioner would be met with an equally energetic defense as has
been put up here. The simple but stubborn fact is that there has been a violation of government regulations
that have been put in place with a laudable purpose, and this violation must accordingly be dealt with. We
are not unmindful of the concerns on the restriction of freedoms that may occur in imposing sanctions upon
erring individuals and institutions, but it cannot be over- emphasized that the freedoms encased in the Bill
of Rights are far from absolute. Each has its own limits, responsibilities, and obligations. Everyone is
expected to bear the burden implicit in the exercise of these freedoms. So it must be here.

WHEREFORE, petitioner’s motion for reconsideration is hereby DENIED.

No further pleadings shall be entertained in this case. Let entry of judgment be made in due course.

SO ORDERED.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

A.M. No. 133-J May 31, 1982

BERNARDITA R. MACARIOLA, complainant,

vs.
HONORABLE ELIAS B. ASUNCION, Judge of the Court of First Instance of Leyte, respondent.

MAKASIAR, J:

In a verified complaint dated August 6, 1968 Bernardita R. Macariola charged respondent Judge Elias B.
Asuncion of the Court of First Instance of Leyte, now Associate Justice of the Court of Appeals, with "acts
unbecoming a judge."

The factual setting of the case is stated in the report dated May 27, 1971 of then Associate Justice Cecilia
Muñoz Palma of the Court of Appeals now retired Associate Justice of the Supreme Court, to whom this
case was referred on October 28, 1968 for investigation, thus:

Civil Case No. 3010 of the Court of First Instance of Leyte was a complaint for
partition filed by Sinforosa R. Bales, Luz R. Bakunawa, Anacorita Reyes, Ruperto
Reyes, Adela Reyes, and Priscilla Reyes, plaintiffs, against Bernardita R.
Macariola, defendant, concerning the properties left by the deceased Francisco
Reyes, the common father of the plaintiff and defendant.

In her defenses to the complaint for partition, Mrs. Macariola alleged among
other things that; a) plaintiff Sinforosa R. Bales was not a daughter of the
deceased Francisco Reyes; b) the only legal heirs of the deceased were
defendant Macariola, she being the only offspring of the first marriage of
Francisco Reyes with Felisa Espiras, and the remaining plaintiffs who were the
children of the deceased by his second marriage with Irene Ondez; c) the
properties left by the deceased were all the conjugal properties of the latter and
his first wife, Felisa Espiras, and no properties were acquired by the deceased
during his second marriage; d) if there was any partition to be made, those
conjugal properties should first be partitioned into two parts, and one part is to be
adjudicated solely to defendant it being the share of the latter's deceased mother,
Felisa Espiras, and the other half which is the share of the deceased Francisco
Reyes was to be divided equally among his children by his two marriages.

On June 8, 1963, a decision was rendered by respondent Judge Asuncion in

Civil Case 3010, the dispositive portion of which reads:

IN VIEW OF THE FOREGOING CONSIDERATIONS, the Court,

upon a preponderance of evidence, finds and so holds, and
hereby renders judgment (1) Declaring the plaintiffs Luz R.
Bakunawa, Anacorita Reyes, Ruperto Reyes, Adela Reyes and
Priscilla Reyes as the only children legitimated by the
subsequent marriage of Francisco Reyes Diaz to Irene Ondez;
 (2) Declaring the plaintiff Sinforosa R. Bales to have been an
illegitimate child of Francisco Reyes Diaz; (3) Declaring Lots
Nos. 4474, 4475, 4892, 5265, 4803, 4581, 4506 and 1/4 of Lot
1145 as belonging to the conjugal partnership of the spouses
Francisco Reyes Diaz and Felisa Espiras; (4) Declaring Lot No.
2304 and 1/4 of Lot No. 3416 as belonging to the spouses
Francisco Reyes Diaz and Irene Ondez in common partnership;
(5) Declaring that 1/2 of Lot No. 1184 as belonging exclusively to
the deceased Francisco Reyes Diaz; (6) Declaring the defendant
Bernardita R. Macariola, being the only legal and forced heir of
her mother Felisa Espiras, as the exclusive owner of one-half of
each of Lots Nos. 4474, 4475, 4892, 5265, 4803, 4581, 4506;
and the remaining one-half (1/2) of each of said Lots Nos. 4474,
4475, 4892, 5265, 4803, 4581, 4506 and one-half (1/2) of one-
fourth (1/4) of Lot No. 1154 as belonging to the estate of
Francisco Reyes Diaz; (7) Declaring Irene Ondez to be the
exclusive owner of one-half (1/2) of Lot No. 2304 and one-half
(1/2) of one-fourth (1/4) of Lot No. 3416; the remaining one-half
(1/2) of Lot 2304 and the remaining one-half (1/2) of one-fourth
(1/4) of Lot No. 3416 as belonging to the estate of Francisco
Reyes Diaz; (8) Directing the division or partition of the estate of
Francisco Reyes Diaz in such a manner as to give or grant to
Irene Ondez, as surviving widow of Francisco Reyes Diaz, a
hereditary share of. one-twelfth (1/12) of the whole estate of
Francisco Reyes Diaz (Art. 996 in relation to Art. 892, par 2, New
Civil Code), and the remaining portion of the estate to be divided
among the plaintiffs Sinforosa R. Bales, Luz R. Bakunawa,
Anacorita Reyes, Ruperto Reyes, Adela Reyes, Priscilla Reyes
and defendant Bernardita R. Macariola, in such a way that the
extent of the total share of plaintiff Sinforosa R. Bales in the
hereditary estate shall not exceed the equivalent of two-fifth (2/5)
of the total share of any or each of the other plaintiffs and the
defendant (Art. 983, New Civil Code), each of the latter to
receive equal shares from the hereditary estate, (Ramirez vs.
Bautista, 14 Phil. 528; Diancin vs. Bishop of Jaro, O.G. [3rd Ed.]
p. 33); (9) Directing the parties, within thirty days after this
judgment shall have become final to submit to this court, for
approval a project of partition of the hereditary estate in the
proportion above indicated, and in such manner as the parties
may, by agreement, deemed convenient and equitable to them
taking into consideration the location, kind, quality, nature and
value of the properties involved; (10) Directing the plaintiff
Sinforosa R. Bales and defendant Bernardita R. Macariola to pay
the costs of this suit, in the proportion of one-third (1/3) by the
first named and two-thirds (2/3) by the second named; and (I 1)
Dismissing all other claims of the parties [pp 27-29 of Exh. C].

The decision in civil case 3010 became final for lack of an appeal, and on
October 16, 1963, a project of partition was submitted to Judge Asuncion which
is marked Exh. A. Notwithstanding the fact that the project of partition was not
signed by the parties themselves but only by the respective counsel of plaintiffs
and defendant, Judge Asuncion approved it in his Order dated October 23, 1963,
which for convenience is quoted hereunder in full:
The parties, through their respective counsels, presented to this
Court for approval the following project of partition:

COMES NOW, the plaintiffs and the defendant in the above-

entitled case, to this Honorable Court respectfully submit the
following Project of Partition:

l. The whole of Lots Nos. 1154, 2304 and 4506 shall belong
exclusively to Bernardita Reyes Macariola;

2. A portion of Lot No. 3416 consisting of 2,373.49 square

meters along the eastern part of the lot shall be awarded likewise
to Bernardita R. Macariola;

3. Lots Nos. 4803, 4892 and 5265 shall be awarded to Sinforosa

Reyes Bales;

4. A portion of Lot No. 3416 consisting of 1,834.55 square

meters along the western part of the lot shall likewise be
awarded to Sinforosa Reyes-Bales;

5. Lots Nos. 4474 and 4475 shall be divided equally among Luz
Reyes Bakunawa, Anacorita Reyes, Ruperto Reyes, Adela
Reyes and Priscilla Reyes in equal shares;

6. Lot No. 1184 and the remaining portion of Lot No. 3416 after
taking the portions awarded under item (2) and (4) above shall
be awarded to Luz Reyes Bakunawa, Anacorita Reyes, Ruperto
Reyes, Adela Reyes and Priscilla Reyes in equal shares,
provided, however that the remaining portion of Lot No. 3416
shall belong exclusively to Priscilla Reyes.

WHEREFORE, it is respectfully prayed that the Project of

Partition indicated above which is made in accordance with the
decision of the Honorable Court be approved.

Tacloban City, October 16, 1963.

(SGD) BONIFACIO RAMO Atty. for the Defendant Tacloban City

(SGD) ZOTICO A. TOLETE Atty. for the Plaintiff Tacloban City

While the Court thought it more desirable for all the parties to
have signed this Project of Partition, nevertheless, upon
assurance of both counsels of the respective parties to this Court
that the Project of Partition, as above- quoted, had been made
after a conference and agreement of the plaintiffs and the
defendant approving the above Project of Partition, and that both
lawyers had represented to the Court that they are given full
authority to sign by themselves the Project of Partition, the Court,
therefore, finding the above-quoted Project of Partition to be in
accordance with law, hereby approves the same. The parties,
therefore, are directed to execute such papers, documents or
 instrument sufficient in form and substance for the vesting of the
rights, interests and participations which were adjudicated to the
respective parties, as outlined in the Project of Partition and the
delivery of the respective properties adjudicated to each one in
view of said Project of Partition, and to perform such other acts
as are legal and necessary to effectuate the said Project of
Partition.

SO ORDERED.

Given in Tacloban City, this 23rd day of October, 1963.

(SGD) ELIAS B. ASUNCION Judge

EXH. B.

The above Order of October 23, 1963, was amended on November 11, 1963,
only for the purpose of giving authority to the Register of Deeds of the Province
of Leyte to issue the corresponding transfer certificates of title to the respective
adjudicatees in conformity with the project of partition (see Exh. U).

One of the properties mentioned in the project of partition was Lot 1184 or rather
one-half thereof with an area of 15,162.5 sq. meters. This lot, which according to
the decision was the exclusive property of the deceased Francisco Reyes, was
adjudicated in said project of partition to the plaintiffs Luz, Anacorita Ruperto,
Adela, and Priscilla all surnamed Reyes in equal shares, and when the project of
partition was approved by the trial court the adjudicatees caused Lot 1184 to be
subdivided into five lots denominated as Lot 1184-A to 1184-E inclusive (Exh. V).

Lot 1184-D was conveyed to Enriqueta D. Anota, a stenographer in Judge

Asuncion's court (Exhs. F, F-1 and V-1), while Lot 1184-E which had an area of
2,172.5556 sq. meters was sold on July 31, 1964 to Dr. Arcadio Galapon (Exh. 2)
who was issued transfer certificate of title No. 2338 of the Register of Deeds of
the city of Tacloban (Exh. 12).

On March 6, 1965, Dr. Arcadio Galapon and his wife Sold a portion of Lot 1184-E
with an area of around 1,306 sq. meters to Judge Asuncion and his wife, Victoria
S. Asuncion (Exh. 11), which particular portion was declared by the latter for
taxation purposes (Exh. F).

On August 31, 1966, spouses Asuncion and spouses Galapon conveyed their
respective shares and interest in Lot 1184-E to "The Traders Manufacturing and
Fishing Industries Inc." (Exit 15 & 16). At the time of said sale the stockholders of
the corporation were Dominador Arigpa Tan, Humilia Jalandoni Tan, Jaime
Arigpa Tan, Judge Asuncion, and the latter's wife, Victoria S. Asuncion, with
Judge Asuncion as the President and Mrs. Asuncion as the secretary (Exhs. E-4
to E-7). The Articles of Incorporation of "The Traders Manufacturing and Fishing
Industries, Inc." which we shall henceforth refer to as "TRADERS" were
registered with the Securities and Exchange Commission only on January 9,
1967 (Exh. E) [pp. 378-385, rec.].

Complainant Bernardita R. Macariola filed on August 9, 1968 the instant complaint dated August 6, 1968
alleging four causes of action, to wit: [1] that respondent Judge Asuncion violated Article 1491, paragraph
5, of the New Civil Code in acquiring by purchase a portion of Lot No. 1184-E which was one of those
properties involved in Civil Case No. 3010 decided by him; [2] that he likewise violated Article 14,
paragraphs I and 5 of the Code of Commerce, Section 3, paragraph H, of R.A. 3019, otherwise known as
the Anti-Graft and Corrupt Practices Act, Section 12, Rule XVIII of the Civil Service Rules, and Canon 25
of the Canons of Judicial Ethics, by associating himself with the Traders Manufacturing and Fishing
Industries, Inc., as a stockholder and a ranking officer while he was a judge of the Court of First Instance
of Leyte; [3] that respondent was guilty of coddling an impostor and acted in disregard of judicial decorum
by closely fraternizing with a certain Dominador Arigpa Tan who openly and publicly advertised himself as
a practising attorney when in truth and in fact his name does not appear in the Rolls of Attorneys and is
not a member of the Philippine Bar; and [4] that there was a culpable defiance of the law and utter
disregard for ethics by respondent Judge (pp. 1-7, rec.).

Respondent Judge Asuncion filed on September 24, 1968 his answer to which a reply was filed on
October 16, 1968 by herein complainant. In Our resolution of October 28, 1968, We referred this case to
then Justice Cecilia Muñoz Palma of the Court of Appeals, for investigation, report and recommendation.
After hearing, the said Investigating Justice submitted her report dated May 27, 1971 recommending that
respondent Judge should be reprimanded or warned in connection with the first cause of action alleged in
the complaint, and for the second cause of action, respondent should be warned in case of a finding that
he is prohibited under the law to engage in business. On the third and fourth causes of action, Justice
Palma recommended that respondent Judge be exonerated.

The records also reveal that on or about November 9 or 11, 1968 (pp. 481, 477, rec.), complainant herein
instituted an action before the Court of First Instance of Leyte, entitled "Bernardita R. Macariola, plaintiff,
versus Sinforosa R. Bales, et al., defendants," which was docketed as Civil Case No. 4235, seeking the
annulment of the project of partition made pursuant to the decision in Civil Case No. 3010 and the two
orders issued by respondent Judge approving the same, as well as the partition of the estate and the
subsequent conveyances with damages. It appears, however, that some defendants were dropped from
the civil case. For one, the case against Dr. Arcadio Galapon was dismissed because he was no longer a
real party in interest when Civil Case No. 4234 was filed, having already conveyed on March 6, 1965 a
portion of lot 1184-E to respondent Judge and on August 31, 1966 the remainder was sold to the Traders
Manufacturing and Fishing Industries, Inc. Similarly, the case against defendant Victoria Asuncion was
dismissed on the ground that she was no longer a real party in interest at the time the aforesaid Civil
Case No. 4234 was filed as the portion of Lot 1184 acquired by her and respondent Judge from Dr.
Arcadio Galapon was already sold on August 31, 1966 to the Traders Manufacturing and Fishing
industries, Inc. Likewise, the cases against defendants Serafin P. Ramento, Catalina Cabus, Ben Barraza
Go, Jesus Perez, Traders Manufacturing and Fishing Industries, Inc., Alfredo R. Celestial and Pilar P.
Celestial, Leopoldo Petilla and Remedios Petilla, Salvador Anota and Enriqueta Anota and Atty. Zotico A.
Tolete were dismissed with the conformity of complainant herein, plaintiff therein, and her counsel.

On November 2, 1970, Judge Jose D. Nepomuceno of the Court of First Instance of Leyte, who was
directed and authorized on June 2, 1969 by the then Secretary (now Minister) of Justice and now Minister
of National Defense Juan Ponce Enrile to hear and decide Civil Case No. 4234, rendered a decision, the
dispositive portion of which reads as follows:

A. IN THE CASE AGAINST JUDGE ELIAS B. ASUNCION

(1) declaring that only Branch IV of the Court of First Instance of Leyte has
jurisdiction to take cognizance of the issue of the legality and validity of the
Project of Partition [Exhibit "B"] and the two Orders [Exhibits "C" and "C- 3"]
approving the partition;

(2) dismissing the complaint against Judge Elias B. Asuncion;

(3) adjudging the plaintiff, Mrs. Bernardita R. Macariola to pay defendant Judge
Elias B. Asuncion,
 (a) the sum of FOUR HUNDRED THOUSAND PESOS
[P400,000.00] for moral damages;

(b) the sum of TWO HUNDRED THOUSAND PESOS

[P200,000.001 for exemplary damages;

(c) the sum of FIFTY THOUSAND PESOS [P50,000.00] for

nominal damages; and

(d) he sum of TEN THOUSAND PESOS [PI0,000.00] for

Attorney's Fees.

B. IN THE CASE AGAINST THE DEFENDANT MARIQUITA

VILLASIN, FOR HERSELF AND FOR THE HEIRS OF THE
DECEASED GERARDO VILLASIN —

(1) Dismissing the complaint against the defendants Mariquita Villasin and the
heirs of the deceased Gerardo Villasin;

(2) Directing the plaintiff to pay the defendants Mariquita Villasin and the heirs of
Gerardo Villasin the cost of the suit.

C. IN THE CASE AGAINST THE DEFENDANT SINFOROSA R.

BALES, ET AL., WHO WERE PLAINTIFFS IN CIVIL CASE NO.
3010 —

(1) Dismissing the complaint against defendants Sinforosa R. Bales, Adela R.

Herrer, Priscilla R. Solis, Luz R. Bakunawa, Anacorita R. Eng and Ruperto O.
Reyes.

D. IN THE CASE AGAINST DEFENDANT BONIFACIO RAMO

—

(1) Dismissing the complaint against Bonifacio Ramo;

(2) Directing the plaintiff to pay the defendant Bonifacio Ramo the cost of the suit.

SO ORDERED [pp. 531-533, rec.]

It is further disclosed by the record that the aforesaid decision was elevated to the Court of Appeals upon
perfection of the appeal on February 22, 1971.

WE find that there is no merit in the contention of complainant Bernardita R. Macariola, under her first
cause of action, that respondent Judge Elias B. Asuncion violated Article 1491, paragraph 5, of the New
Civil Code in acquiring by purchase a portion of Lot No. 1184-E which was one of those properties
involved in Civil Case No. 3010. 'That Article provides:

Article 1491. The following persons cannot acquire by purchase, even at a public
or judicial action, either in person or through the mediation of another:
 xxx xxx xxx

(5) Justices, judges, prosecuting attorneys, clerks of superior and inferior courts,
and other officers and employees connected with the administration of justice,
the property and rights in litigation or levied upon an execution before the court
within whose jurisdiction or territory they exercise their respective functions; this
prohibition includes the act of acquiring by assignment and shall apply to
lawyers, with respect to the property and rights which may be the object of any
litigation in which they may take part by virtue of their profession [emphasis
supplied].

The prohibition in the aforesaid Article applies only to the sale or assignment of the property which is the
subject of litigation to the persons disqualified therein. WE have already ruled that "... for the prohibition to
operate, the sale or assignment of the property must take place during the pendency of the litigation
involving the property" (The Director of Lands vs. Ababa et al., 88 SCRA 513, 519 [1979], Rosario vda. de
Laig vs. Court of Appeals, 86 SCRA 641, 646 [1978]).

In the case at bar, when the respondent Judge purchased on March 6, 1965 a portion of Lot 1184-E, the
decision in Civil Case No. 3010 which he rendered on June 8, 1963 was already final because none of
the parties therein filed an appeal within the reglementary period; hence, the lot in question was no longer
subject of the litigation. Moreover, at the time of the sale on March 6, 1965, respondent's order dated
October 23, 1963 and the amended order dated November 11, 1963 approving the October 16, 1963
project of partition made pursuant to the June 8, 1963 decision, had long become final for there was no
appeal from said orders.

Furthermore, respondent Judge did not buy the lot in question on March 6, 1965 directly from the plaintiffs
in Civil Case No. 3010 but from Dr. Arcadio Galapon who earlier purchased on July 31, 1964 Lot 1184-E
from three of the plaintiffs, namely, Priscilla Reyes, Adela Reyes, and Luz R. Bakunawa after the finality
of the decision in Civil Case No. 3010. It may be recalled that Lot 1184 or more specifically one-half
thereof was adjudicated in equal shares to Priscilla Reyes, Adela Reyes, Luz Bakunawa, Ruperto Reyes
and Anacorita Reyes in the project of partition, and the same was subdivided into five lots denominated
as Lot 1184-A to 1184-E. As aforestated, Lot 1184-E was sold on July 31, 1964 to Dr. Galapon for which
he was issued TCT No. 2338 by the Register of Deeds of Tacloban City, and on March 6, 1965 he sold a
portion of said lot to respondent Judge and his wife who declared the same for taxation purposes only.
The subsequent sale on August 31, 1966 by spouses Asuncion and spouses Galapon of their respective
shares and interest in said Lot 1184-E to the Traders Manufacturing and Fishing Industries, Inc., in which
respondent was the president and his wife was the secretary, took place long after the finality of the
decision in Civil Case No. 3010 and of the subsequent two aforesaid orders therein approving the project
of partition.

While it appears that complainant herein filed on or about November 9 or 11, 1968 an action before the
Court of First Instance of Leyte docketed as Civil Case No. 4234, seeking to annul the project of partition
and the two orders approving the same, as well as the partition of the estate and the subsequent
conveyances, the same, however, is of no moment.

The fact remains that respondent Judge purchased on March 6, 1965 a portion of Lot 1184-E from Dr.
Arcadio Galapon; hence, after the finality of the decision which he rendered on June 8, 1963 in Civil Case
No. 3010 and his two questioned orders dated October 23, 1963 and November 11, 1963. Therefore, the
property was no longer subject of litigation.

The subsequent filing on November 9, or 11, 1968 of Civil Case No. 4234 can no longer alter, change or
affect the aforesaid facts — that the questioned sale to respondent Judge, now Court of Appeals Justice,
was effected and consummated long after the finality of the aforesaid decision or orders.
Consequently, the sale of a portion of Lot 1184-E to respondent Judge having taken place over one year
after the finality of the decision in Civil Case No. 3010 as well as the two orders approving the project of
partition, and not during the pendency of the litigation, there was no violation of paragraph 5, Article 1491
of the New Civil Code.

It is also argued by complainant herein that the sale on July 31, 1964 of Lot 1184-E to Dr. Arcadio
Galapon by Priscilla Reyes, Adela Reyes and Luz R. Bakunawa was only a mere scheme to conceal the
illegal and unethical transfer of said lot to respondent Judge as a consideration for the approval of the
project of partition. In this connection, We agree with the findings of the Investigating Justice thus:

And so we are now confronted with this all-important question whether or not the
acquisition by respondent of a portion of Lot 1184-E and the subsequent transfer
of the whole lot to "TRADERS" of which respondent was the President and his
wife the Secretary, was intimately related to the Order of respondent approving
the project of partition, Exh. A.

Respondent vehemently denies any interest or participation in the transactions

between the Reyeses and the Galapons concerning Lot 1184-E, and he insists
that there is no evidence whatsoever to show that Dr. Galapon had acted, in the
purchase of Lot 1184-E, in mediation for him and his wife. (See p. 14 of
Respondent's Memorandum).

xxx xxx xxx

On this point, I agree with respondent that there is no evidence in the record
showing that Dr. Arcadio Galapon acted as a mere "dummy" of respondent in
acquiring Lot 1184-E from the Reyeses. Dr. Galapon appeared to this
investigator as a respectable citizen, credible and sincere, and I believe him
when he testified that he bought Lot 1184-E in good faith and for valuable
consideration from the Reyeses without any intervention of, or previous
understanding with Judge Asuncion (pp. 391- 394, rec.).

On the contention of complainant herein that respondent Judge acted illegally in approving the project of
partition although it was not signed by the parties, We quote with approval the findings of the Investigating
Justice, as follows:

1. I agree with complainant that respondent should have required the signature of
the parties more particularly that of Mrs. Macariola on the project of partition
submitted to him for approval; however, whatever error was committed by
respondent in that respect was done in good faith as according to Judge
Asuncion he was assured by Atty. Bonifacio Ramo, the counsel of record of Mrs.
Macariola, That he was authorized by his client to submit said project of partition,
(See Exh. B and tsn p. 24, January 20, 1969). While it is true that such written
authority if there was any, was not presented by respondent in evidence, nor did
Atty. Ramo appear to corroborate the statement of respondent, his affidavit being
the only one that was presented as respondent's Exh. 10, certain actuations of
Mrs. Macariola lead this investigator to believe that she knew the contents of the
project of partition, Exh. A, and that she gave her conformity thereto. I refer to the
following documents:

1) Exh. 9 — Certified true copy of OCT No. 19520 covering Lot 1154 of the
Tacloban Cadastral Survey in which the deceased Francisco Reyes holds a "1/4
share" (Exh. 9-a). On tills certificate of title the Order dated November 11, 1963,
 (Exh. U) approving the project of partition was duly entered and registered on
November 26, 1963 (Exh. 9-D);

2) Exh. 7 — Certified copy of a deed of absolute sale executed by Bernardita

Reyes Macariola on October 22, 1963, conveying to Dr. Hector Decena the one-
fourth share of the late Francisco Reyes-Diaz in Lot 1154. In this deed of sale the
vendee stated that she was the absolute owner of said one-fourth share, the
same having been adjudicated to her as her share in the estate of her father
Francisco Reyes Diaz as per decision of the Court of First Instance of Leyte
under case No. 3010 (Exh. 7-A). The deed of sale was duly registered and
annotated at the back of OCT 19520 on December 3, 1963 (see Exh. 9-e).

In connection with the abovementioned documents it is to be noted that in the

project of partition dated October 16, 1963, which was approved by respondent
on October 23, 1963, followed by an amending Order on November 11, 1963, Lot
1154 or rather 1/4 thereof was adjudicated to Mrs. Macariola. It is this 1/4 share
in Lot 1154 which complainant sold to Dr. Decena on October 22, 1963, several
days after the preparation of the project of partition.

Counsel for complainant stresses the view, however, that the latter sold her one-
fourth share in Lot 1154 by virtue of the decision in Civil Case 3010 and not
because of the project of partition, Exh. A. Such contention is absurd because
from the decision, Exh. C, it is clear that one-half of one- fourth of Lot 1154
belonged to the estate of Francisco Reyes Diaz while the other half of said one-
fourth was the share of complainant's mother, Felisa Espiras; in other words, the
decision did not adjudicate the whole of the one-fourth of Lot 1154 to the herein
complainant (see Exhs. C-3 & C-4). Complainant became the owner of the entire
one-fourth of Lot 1154 only by means of the project of partition, Exh. A.
Therefore, if Mrs. Macariola sold Lot 1154 on October 22, 1963, it was for no
other reason than that she was wen aware of the distribution of the properties of
her deceased father as per Exhs. A and B. It is also significant at this point to
state that Mrs. Macariola admitted during the cross-examination that she went to
Tacloban City in connection with the sale of Lot 1154 to Dr. Decena (tsn p. 92,
November 28, 1968) from which we can deduce that she could not have been
kept ignorant of the proceedings in civil case 3010 relative to the project of
partition.

Complainant also assails the project of partition because according to her the
properties adjudicated to her were insignificant lots and the least valuable.
Complainant, however, did not present any direct and positive evidence to prove
the alleged gross inequalities in the choice and distribution of the real properties
when she could have easily done so by presenting evidence on the area,
location, kind, the assessed and market value of said properties. Without such
evidence there is nothing in the record to show that there were inequalities in the
distribution of the properties of complainant's father (pp. 386389, rec.).

Finally, while it is. true that respondent Judge did not violate paragraph 5, Article 1491 of the New Civil
Code in acquiring by purchase a portion of Lot 1184-E which was in litigation in his court, it was, however,
improper for him to have acquired the same. He should be reminded of Canon 3 of the Canons of Judicial
Ethics which requires that: "A judge's official conduct should be free from the appearance of impropriety,
and his personal behavior, not only upon the bench and in the performance of judicial duties, but also in
his everyday life, should be beyond reproach." And as aptly observed by the Investigating Justice: "... it
was unwise and indiscreet on the part of respondent to have purchased or acquired a portion of a piece
of property that was or had been in litigation in his court and caused it to be transferred to a corporation of
which he and his wife were ranking officers at the time of such transfer. One who occupies an exalted
position in the judiciary has the duty and responsibility of maintaining the faith and trust of the citizenry in
the courts of justice, so that not only must he be truly honest and just, but his actuations must be such as
not give cause for doubt and mistrust in the uprightness of his administration of justice. In this particular
case of respondent, he cannot deny that the transactions over Lot 1184-E are damaging and render his
actuations open to suspicion and distrust. Even if respondent honestly believed that Lot 1184-E was no
longer in litigation in his court and that he was purchasing it from a third person and not from the parties
to the litigation, he should nonetheless have refrained from buying it for himself and transferring it to a
corporation in which he and his wife were financially involved, to avoid possible suspicion that his
acquisition was related in one way or another to his official actuations in civil case 3010. The conduct of
respondent gave cause for the litigants in civil case 3010, the lawyers practising in his court, and the
public in general to doubt the honesty and fairness of his actuations and the integrity of our courts of
justice" (pp. 395396, rec.).

II

With respect to the second cause of action, the complainant alleged that respondent Judge violated
paragraphs 1 and 5, Article 14 of the Code of Commerce when he associated himself with the Traders
Manufacturing and Fishing Industries, Inc. as a stockholder and a ranking officer, said corporation having
been organized to engage in business. Said Article provides that:

Article 14 — The following cannot engage in commerce, either in person or by

proxy, nor can they hold any office or have any direct, administrative, or financial
intervention in commercial or industrial companies within the limits of the districts,
provinces, or towns in which they discharge their duties:

1. Justices of the Supreme Court, judges and officials of the department of public
prosecution in active service. This provision shall not be applicable to mayors,
municipal judges, and municipal prosecuting attorneys nor to those who by
chance are temporarily discharging the functions of judge or prosecuting
attorney.

xxx xxx xxx

5. Those who by virtue of laws or special provisions may not engage in

commerce in a determinate territory.

It is Our considered view that although the aforestated provision is incorporated in the Code of Commerce
which is part of the commercial laws of the Philippines, it, however, partakes of the nature of a political
law as it regulates the relationship between the government and certain public officers and employees,
like justices and judges.

Political Law has been defined as that branch of public law which deals with the organization and
operation of the governmental organs of the State and define the relations of the state with the inhabitants
of its territory (People vs. Perfecto, 43 Phil. 887, 897 [1922]). It may be recalled that political law
embraces constitutional law, law of public corporations, administrative law including the law on public
officers and elections. Specifically, Article 14 of the Code of Commerce partakes more of the nature of an
administrative law because it regulates the conduct of certain public officers and employees with respect
to engaging in business: hence, political in essence.

It is significant to note that the present Code of Commerce is the Spanish Code of Commerce of 1885,
with some modifications made by the "Commission de Codificacion de las Provincias de Ultramar," which
was extended to the Philippines by the Royal Decree of August 6, 1888, and took effect as law in this
jurisdiction on December 1, 1888.
Upon the transfer of sovereignty from Spain to the United States and later on from the United States to
the Republic of the Philippines, Article 14 of this Code of Commerce must be deemed to have been
abrogated because where there is change of sovereignty, the political laws of the former sovereign,
whether compatible or not with those of the new sovereign, are automatically abrogated, unless they are
expressly re-enacted by affirmative act of the new sovereign.

Thus, We held in Roa vs. Collector of Customs (23 Phil. 315, 330, 311 [1912]) that:

By well-settled public law, upon the cession of territory by one nation to another,
either following a conquest or otherwise, ... those laws which are political in their
nature and pertain to the prerogatives of the former government immediately
cease upon the transfer of sovereignty. (Opinion, Atty. Gen., July 10, 1899).

While municipal laws of the newly acquired territory not in conflict with the, laws
of the new sovereign continue in force without the express assent or affirmative
act of the conqueror, the political laws do not. (Halleck's Int. Law, chap. 34, par.
14). However, such political laws of the prior sovereignty as are not in conflict
with the constitution or institutions of the new sovereign, may be continued in
force if the conqueror shall so declare by affirmative act of the commander-in-
chief during the war, or by Congress in time of peace. (Ely's Administrator vs.
United States, 171 U.S. 220, 43 L. Ed. 142). In the case of American and Ocean
Ins. Cos. vs. 356 Bales of Cotton (1 Pet. [26 U.S.] 511, 542, 7 L. Ed. 242), Chief
Justice Marshall said:

On such transfer (by cession) of territory, it has never been held

that the relations of the inhabitants with each other undergo any
change. Their relations with their former sovereign are dissolved,
and new relations are created between them and the
government which has acquired their territory. The same act
which transfers their country, transfers the allegiance of those
who remain in it; and the law which may be denominated
political, is necessarily changed, although that which regulates
the intercourse and general conduct of individuals, remains in
force, until altered by the newly- created power of the State.

Likewise, in People vs. Perfecto (43 Phil. 887, 897 [1922]), this Court stated that: "It is a general principle
of the public law that on acquisition of territory the previous political relations of the ceded region are
totally abrogated. "

There appears no enabling or affirmative act that continued the effectivity of the aforestated provision of
the Code of Commerce after the change of sovereignty from Spain to the United States and then to the
Republic of the Philippines. Consequently, Article 14 of the Code of Commerce has no legal and binding
effect and cannot apply to the respondent, then Judge of the Court of First Instance, now Associate
Justice of the Court of Appeals.

It is also argued by complainant herein that respondent Judge violated paragraph H, Section 3 of
Republic Act No. 3019, otherwise known as the Anti-Graft and Corrupt Practices Act, which provides that:

Sec. 3. Corrupt practices of public officers. — In addition to acts or omissions of

public officers already penalized by existing law, the following shall constitute
corrupt practices of any public officer and are hereby declared to be unlawful:

xxx xxx xxx

 (h) Directly or indirectly having financial or pecuniary interest in
any business, contract or transaction in connection with which he
intervenes or takes part in his official capacity, or in which he is
prohibited by the Constitution or by any Iaw from having any
interest.

Respondent Judge cannot be held liable under the aforestated paragraph because there is no showing
that respondent participated or intervened in his official capacity in the business or transactions of the
Traders Manufacturing and Fishing Industries, Inc. In the case at bar, the business of the corporation in
which respondent participated has obviously no relation or connection with his judicial office. The
business of said corporation is not that kind where respondent intervenes or takes part in his capacity as
Judge of the Court of First Instance. As was held in one case involving the application of Article 216 of the
Revised Penal Code which has a similar prohibition on public officers against directly or indirectly
becoming interested in any contract or business in which it is his official duty to intervene, "(I)t is not
enough to be a public official to be subject to this crime; it is necessary that by reason of his office, he has
to intervene in said contracts or transactions; and, hence, the official who intervenes in contracts or
transactions which have no relation to his office cannot commit this crime.' (People vs. Meneses, C.A. 40
O.G. 11th Supp. 134, cited by Justice Ramon C. Aquino; Revised Penal Code, p. 1174, Vol. 11 [1976]).

It does not appear also from the records that the aforesaid corporation gained any undue advantage in its
business operations by reason of respondent's financial involvement in it, or that the corporation benefited
in one way or another in any case filed by or against it in court. It is undisputed that there was no case
filed in the different branches of the Court of First Instance of Leyte in which the corporation was either
party plaintiff or defendant except Civil Case No. 4234 entitled "Bernardita R. Macariola, plaintiff, versus
Sinforosa O. Bales, et al.," wherein the complainant herein sought to recover Lot 1184-E from the
aforesaid corporation. It must be noted, however, that Civil Case No. 4234 was filed only on November 9
or 11, 1968 and decided on November 2, 1970 by CFI Judge Jose D. Nepomuceno when respondent
Judge was no longer connected with the corporation, having disposed of his interest therein on January
31, 1967.

Furthermore, respondent is not liable under the same paragraph because there is no provision in both the
1935 and 1973 Constitutions of the Philippines, nor is there an existing law expressly prohibiting
members of the Judiciary from engaging or having interest in any lawful business.

It may be pointed out that Republic Act No. 296, as amended, also known as the Judiciary Act of 1948,
does not contain any prohibition to that effect. As a matter of fact, under Section 77 of said law, municipal
judges may engage in teaching or other vocation not involving the practice of law after office hours but
with the permission of the district judge concerned.

Likewise, Article 14 of the Code of Commerce which prohibits judges from engaging in commerce is, as
heretofore stated, deemed abrogated automatically upon the transfer of sovereignty from Spain to
America, because it is political in nature.

Moreover, the prohibition in paragraph 5, Article 1491 of the New Civil Code against the purchase by
judges of a property in litigation before the court within whose jurisdiction they perform their duties, cannot
apply to respondent Judge because the sale of the lot in question to him took place after the finality of his
decision in Civil Case No. 3010 as well as his two orders approving the project of partition; hence, the
property was no longer subject of litigation.

In addition, although Section 12, Rule XVIII of the Civil Service Rules made pursuant to the Civil Service
Act of 1959 prohibits an officer or employee in the civil service from engaging in any private business,
vocation, or profession or be connected with any commercial, credit, agricultural or industrial undertaking
without a written permission from the head of department, the same, however, may not fall within the
purview of paragraph h, Section 3 of the Anti-Graft and Corrupt Practices Act because the last portion of
said paragraph speaks of a prohibition by the Constitution or law on any public officer from having any
interest in any business and not by a mere administrative rule or regulation. Thus, a violation of the
aforesaid rule by any officer or employee in the civil service, that is, engaging in private business without
a written permission from the Department Head may not constitute graft and corrupt practice as defined
by law.

On the contention of complainant that respondent Judge violated Section 12, Rule XVIII of the Civil
Service Rules, We hold that the Civil Service Act of 1959 (R.A. No. 2260) and the Civil Service Rules
promulgated thereunder, particularly Section 12 of Rule XVIII, do not apply to the members of the
Judiciary. Under said Section 12: "No officer or employee shall engage directly in any private business,
vocation, or profession or be connected with any commercial, credit, agricultural or industrial undertaking
without a written permission from the Head of Department ..."

It must be emphasized at the outset that respondent, being a member of the Judiciary, is covered by
Republic Act No. 296, as amended, otherwise known as the Judiciary Act of 1948 and by Section 7,
Article X, 1973 Constitution.

Under Section 67 of said law, the power to remove or dismiss judges was then vested in the President of
the Philippines, not in the Commissioner of Civil Service, and only on two grounds, namely, serious
misconduct and inefficiency, and upon the recommendation of the Supreme Court, which alone is
authorized, upon its own motion, or upon information of the Secretary (now Minister) of Justice to conduct
the corresponding investigation. Clearly, the aforesaid section defines the grounds and prescribes the
special procedure for the discipline of judges.

And under Sections 5, 6 and 7, Article X of the 1973 Constitution, only the Supreme Court can discipline
judges of inferior courts as well as other personnel of the Judiciary.

It is true that under Section 33 of the Civil Service Act of 1959: "The Commissioner may, for ... violation of
the existing Civil Service Law and rules or of reasonable office regulations, or in the interest of the
service, remove any subordinate officer or employee from the service, demote him in rank, suspend him
for not more than one year without pay or fine him in an amount not exceeding six months' salary." Thus,
a violation of Section 12 of Rule XVIII is a ground for disciplinary action against civil service officers and
employees.

However, judges cannot be considered as subordinate civil service officers or employees subject to the
disciplinary authority of the Commissioner of Civil Service; for, certainly, the Commissioner is not the
head of the Judicial Department to which they belong. The Revised Administrative Code (Section 89) and
the Civil Service Law itself state that the Chief Justice is the department head of the Supreme Court (Sec.
20, R.A. No. 2260) [1959]); and under the 1973 Constitution, the Judiciary is the only other or second
branch of the government (Sec. 1, Art. X, 1973 Constitution). Besides, a violation of Section 12, Rule
XVIII cannot be considered as a ground for disciplinary action against judges because to recognize the
same as applicable to them, would be adding another ground for the discipline of judges and, as
aforestated, Section 67 of the Judiciary Act recognizes only two grounds for their removal, namely,
serious misconduct and inefficiency.

Moreover, under Section 16(i) of the Civil Service Act of 1959, it is the Commissioner of Civil Service who
has original and exclusive jurisdiction "(T)o decide, within one hundred twenty days, after submission to it,
all administrative cases against permanent officers and employees in the competitive service, and, except
as provided by law, to have final authority to pass upon their removal, separation, and suspension and
upon all matters relating to the conduct, discipline, and efficiency of such officers and employees; and
prescribe standards, guidelines and regulations governing the administration of discipline" (emphasis
supplied). There is no question that a judge belong to the non-competitive or unclassified service of the
government as a Presidential appointee and is therefore not covered by the aforesaid provision. WE have
already ruled that "... in interpreting Section 16(i) of Republic Act No. 2260, we emphasized that only
permanent officers and employees who belong to the classified service come under the exclusive
jurisdiction of the Commissioner of Civil Service" (Villaluz vs. Zaldivar, 15 SCRA 710,713 [1965], Ang-
Angco vs. Castillo, 9 SCRA 619 [1963]).

Although the actuation of respondent Judge in engaging in private business by joining the Traders
Manufacturing and Fishing Industries, Inc. as a stockholder and a ranking officer, is not violative of the
provissions of Article 14 of the Code of Commerce and Section 3(h) of the Anti-Graft and Corrupt
Practices Act as well as Section 12, Rule XVIII of the Civil Service Rules promulgated pursuant to the
Civil Service Act of 1959, the impropriety of the same is clearly unquestionable because Canon 25 of the
Canons of Judicial Ethics expressly declares that:

A judge should abstain from making personal investments in enterprises which

are apt to be involved in litigation in his court; and, after his accession to the
bench, he should not retain such investments previously made, longer than a
period sufficient to enable him to dispose of them without serious loss. It is
desirable that he should, so far as reasonably possible, refrain from all relations
which would normally tend to arouse the suspicion that such relations warp or
bias his judgment, or prevent his impartial attitude of mind in the administration of
his judicial duties. ...

WE are not, however, unmindful of the fact that respondent Judge and his wife had withdrawn on January
31, 1967 from the aforesaid corporation and sold their respective shares to third parties, and it appears
also that the aforesaid corporation did not in anyway benefit in any case filed by or against it in court as
there was no case filed in the different branches of the Court of First Instance of Leyte from the time of
the drafting of the Articles of Incorporation of the corporation on March 12, 1966, up to its incorporation on
January 9, 1967, and the eventual withdrawal of respondent on January 31, 1967 from said corporation.
Such disposal or sale by respondent and his wife of their shares in the corporation only 22 days after the
incorporation of the corporation, indicates that respondent realized that early that their interest in the
corporation contravenes the aforesaid Canon 25. Respondent Judge and his wife therefore deserve the
commendation for their immediate withdrawal from the firm after its incorporation and before it became
involved in any court litigation

III

With respect to the third and fourth causes of action, complainant alleged that respondent was guilty of
coddling an impostor and acted in disregard of judicial decorum, and that there was culpable defiance of
the law and utter disregard for ethics. WE agree, however, with the recommendation of the Investigating
Justice that respondent Judge be exonerated because the aforesaid causes of action are groundless, and
WE quote the pertinent portion of her report which reads as follows:

The basis for complainant's third cause of action is the claim that respondent
associated and closely fraternized with Dominador Arigpa Tan who openly and
publicly advertised himself as a practising attorney (see Exhs. I, I-1 and J) when
in truth and in fact said Dominador Arigpa Tan does not appear in the Roll of
Attorneys and is not a member of the Philippine Bar as certified to in Exh. K.

The "respondent denies knowing that Dominador Arigpa Tan was an "impostor"
and claims that all the time he believed that the latter was a bona fide member of
the bar. I see no reason for disbelieving this assertion of respondent. It has been
shown by complainant that Dominador Arigpa Tan represented himself publicly
as an attorney-at-law to the extent of putting up a signboard with his name and
the words "Attorney-at Law" (Exh. I and 1- 1) to indicate his office, and it was but
natural for respondent and any person for that matter to have accepted that
statement on its face value. "Now with respect to the allegation of complainant
 that respondent is guilty of fraternizing with Dominador Arigpa Tan to the extent
of permitting his wife to be a godmother of Mr. Tan's child at baptism (Exh. M &
M-1), that fact even if true did not render respondent guilty of violating any canon
of judicial ethics as long as his friendly relations with Dominador A. Tan and
family did not influence his official actuations as a judge where said persons were
concerned. There is no tangible convincing proof that herein respondent gave
any undue privileges in his court to Dominador Arigpa Tan or that the latter
benefitted in his practice of law from his personal relations with respondent, or
that he used his influence, if he had any, on the Judges of the other branches of
the Court to favor said Dominador Tan.

Of course it is highly desirable for a member of the judiciary to refrain as much as

possible from maintaining close friendly relations with practising attorneys and
litigants in his court so as to avoid suspicion 'that his social or business relations
or friendship constitute an element in determining his judicial course" (par. 30,
Canons of Judicial Ethics), but if a Judge does have social relations, that in itself
would not constitute a ground for disciplinary action unless it be clearly shown
that his social relations be clouded his official actuations with bias and partiality in
favor of his friends (pp. 403-405, rec.).

In conclusion, while respondent Judge Asuncion, now Associate Justice of the Court of Appeals, did not
violate any law in acquiring by purchase a parcel of land which was in litigation in his court and in
engaging in business by joining a private corporation during his incumbency as judge of the Court of First
Instance of Leyte, he should be reminded to be more discreet in his private and business activities,
because his conduct as a member of the Judiciary must not only be characterized with propriety but must
always be above suspicion.

WHEREFORE, THE RESPONDENT ASSOCIATE JUSTICE OF THE COURT OF APPEALS IS HEREBY

REMINDED TO BE MORE DISCREET IN HIS PRIVATE AND BUSINESS ACTIVITIES.

SO ORDERED.

Teehankee, Guerrero, De Castro, Melencio-Herrera, Plana, Vasquez, Relova and Gutierrez, JJ., concur.

Concepcion Jr., J., is on leave.

Fernando, C.J., Abad Santos and Esolin JJ., took no part

 United States Supreme Court

VILAS v. CITY OF MANILA(1911)

No. 53

Argued: Decided: April 3, 1911

[220 U.S. 345, 346] Messrs. Frederic R. Coudert, Howard Thayer Kingsbury, Paul Fuller, and Harry
Weston Van Dyke for plaintiffs in error and appellants.

[220 U.S. 345, 349] Messrs. Paul Charlton andIsaac Adams for appellee.

[220 U.S. 345, 351]

Mr. Justice Lurton delivered the opinion of the court:

The plaintiffs in error, who were plaintiffs below, are creditors of the city of Manila as it existed before the
cession of the Philippine Islands to the United States by the treaty of Paris, December 10, 1898 [30 Stat.
at L. 1754]. Upon the theory that the city, under its present charter from the government of the Philippine
Islands, is the same juristic person and liable upon the obligations of the old city, these actions were
brought against it. The supreme court of the Philippine Islands denied relief, holding that the present
municipality is a totally different corporate entity, and in no way liable for the debts of the Spanish
municipality. [220 U.S. 345, 352] The fundamental question is whether, notwithstanding the cession of
the Philippine Islands to the United States, followed by a reincorporation of the city, the present
municipality is liable for the obligations of the city incurred prior to the cession to the United States.

We shall confine ourselves to the question whether the plaintiffs in error are entitled to judgments against
the city upon their several claims. Whether there is a remedy adequate to the collection when reduced to
judgment is not presented by the record. But whether there is or is not a remedy affords no reason why
the plaintiffs in error may not reduce their claims to judgment. Mt. Pleasant v. Beckwith, 100 U.S. 514,
530 , 25 S. L. ed. 699, 703. The city confessedly may be sued under its existing charter, and that implies
at least a right to judgment if they establish their demands.

The city as now incorporated has succeeded to all of the property rights of the old city and to the right to
enforce all of its causes of action. There is identity of purpose between the Spanish and American
charters and substantial identity of municipal powers. The area and the inhabitants incorporated are
substantially the same. But for the change of sovereignty which has occurred under the treaty of Paris,
the question of the liability of the city under its new charter for the debts of the old city would seem to be
of easy solution. The principal question would therefore seem to be the legal consequence of the cession
referred to upon the property rights and civil obligations of the city incurred before the cession. And so the
question was made to turn in the court below upon the consequence of a change in sovereignty and a
reincorporation of the city by the substituted sovereignty.

This disposes of the question of the jurisdiction of this court, grounded upon the absence from the petition
of the plaintiffs of any distinct claim under the treaty of Paris, since, under 10 of the Philippine organic act
[220 U.S. 345, 353] of July 1, 1902 [32 Stat. at L. 695, chap. 1369, U. S. Comp. Stat. Supp. 1909, p.
226], this court is given jurisdiction to review any final decree or judgment of the supreme court of the
Philippine Islands where any treaty of the United States 'is involved.' That treaty was necessarily
'involved,' since neither the court below nor this court can determine the continuity of the municipality nor
the liability of the city as it now exists for the obligation of the old city, without considering the effect of the
change of sovereignty resulting from that treaty. See Reavis v. Fianza, 215 U.S. 16, 22 , 54 S. L. ed. 72,
75, 30 Sup. Ct. rep. 1.

The historical continuity of a municipality embracing the inhabitants of the territory now occupied by the
city of Manila is impressive. Before the conquest of the Philippine Islands by Spain, Manila existed. The
Spaniards found on the spot now occupied a populous and fortified community of Moros. In 1571 they
occupied what was then and is now known as Manila, and established it as a municipal corporation. In
1574 there was conferred upon it the title of 'Illustrious and ever loyal city of Manila.' From time to time
there occurred amendments, and, on January 19, 1894, there was a reorganization of the city
government under a royal decree of that date. Under that charter there was power to incur debts for
municipal purposes and power to sue and be sued. The obligations here in suit were incurred under the
charter referred to, and are obviously obligations strictly within the provision of the municipal power. To
pay judgments upon such debts it was the duty of the ayuntamiento of Manila, which was the corporate
name of the old city, to make provision in its budget.

The contention that the liability of the city upon such obligations was destroyed by a mere change of
sovereignty is obviously one which is without a shadow of moral force, and, if true, must result from
settled principles of rigid law. While the contracts from which the claims in suit resulted were in progress,
war between the United [220 U.S. 345, 354] States and Spain ensued. On August 13, 1898, the city was
occupied by the forces of this government, and its affairs conducted by military authority. On July 31,
1901, the present incorporating act was passed, and the city since that time has been an autonomous
municipality. The charter in force is act 183 of the Philippine Commission, and now may be found as
chapters 68 to 75 of the compiled acts of the Philippine Commission. The 1st section of the charter of
1901 reads as follows:

'The inhabitants of the city of Manila, residing within the territory described in 2 of this act, are hereby
constituted a municipality, which shall be known as the city of Manila, and by that name shall have
perpetual succession, and shall possess all the rights of property herein granted or heretofore enjoyed
and possessed by the city of Manila as organized under Spanish sovereignty.'

The boundaries described in 2 include substantially the area and inhabitants which had theretofore
constituted the old city.

By 4 of the same act, the government of the city was invested in a municipal board.

Section 16 grants certain legislative powers to the board, and provides that it shall 'take possession of all
lands, buildings, offices, books, papers, records, moneys, credits, securities, assets, accounts, or other
property or rights belonging to the former city of Manila, or pertaining to the business or interests thereof,
and, subject to the provisions herein set forth, shall have control of all its property except the building
known as the ayuntamiento, provision for the occupation and control of which is made in 15 of this act;
shall collect taxes and other revenues, and apply the same in accordance with appropriations, as
hereinbefore provided, to the payment of the municipal expenses; shall supervise and control the
discharge of official duties by subordinates; shall institute judicial proceedings to recover property and
[220 U.S. 345, 355] funds of the city wherever found, or otherwise to protect the interests of the city, and
shall defend all suits against the city,' etc.

Section 69 of the charter expressly preserved 'all city ordinances and orders in force at the time of the
passage of this act, and not inconsistent herewith,' until modified or repealed by ordinances passed under
this act.

Section 72 is the repealing clause, and provides for the repeal of 'all acts, orders, and regulations' which
are inconsistent with the provisions of the act.

The charter contains no reference to the obligations or contracts of the old city.
If we understand the argument against the liability here asserted, it proceeds mainly upon the theory that
inasmuch as the predecessor of the present city, the ayuntamiento of Manila, was a corporate entity
created by the Spanish government, when the sovereignty of Spain in the islands was terminated by the
treaty of cession, if not by the capitulation of August 13, 1898, the municipality ipso facto disappeared for
all purposes. This conclusion is reached upon the supposed analogy to the doctrine of principal and
agent, the death of the principal ending the agency. So complete is the supposed death and annihilation
of a municipal entity by extinction of sovereignty of the creating state that it was said in one of the
opinions below that all of the public property of Manila passed to the United States, 'for a consideration,
which was paid,' and that the United States was therefore justified in creating an absolutely new
municipality, and endowing it with all of the assets of the defunct city, free from any obligation to the
creditors of that city. And so the matter was dismissed in the Trigas Case by the court of first instance, by
the suggestion that 'the plaintiff may have a claim against the Crown of Spain, which has received from
the United States payment for that done by the plaintiff.' [220 U.S. 345, 356] We are unable to agree
with the argument. It loses sight of the dual character of municipal corporations. They exercise powers
which are governmental and powers which are of a private or business character. In the one character a
municipal corporation is a governmental subdivision, and for that purpose exercises by delegation a part
of the sovereignty of the state. In the other character it is a mere legal entity or juristic person. In the latter
character it stands for the community in the administration of local affairs wholly beyond the sphere of the
public purposes for which its governmental powers are conferred.

The distinction is observed in South Carolina v. United States, 199 U.S. 437, 461 , 50 S. L. ed. 261, 269,
26 Sup. Ct. Rep. 110, 4 A. & E. Ann. Cas. 737, where Lloyd v. New York, 5 N. Y. 369, 374, 55 Am. Dec.
347, and Western Sav. Fund Soc. v. Philadelphia, 31 Pa. 175, 72 Am. Dec. 730, are cited and approved.
In Lloyd v. New York, supra, it is said:

'The corporation of the city of New York possesses two kinds of powers: one governmental and public,
and to the extent they are held and exercised, is clothed with sovereignty; the other private, and to the
extent they are held and exercised, is a legal individual. The former are given and used for public
purposes, the latter for private purposes. While in the exercise of the former, the corporation is a
municipal government; and while in the exercise of the latter, is a corporate legal individual.'

See also Dill. Mun. Corp. 4th ed. 66; Petersburg v. Applegarth, 28 Gratt. 321, 343, 26 Am. Rep. 357, and
Oliver v. Worcester, 102 Mass. 489, 3 Am. Rep. 485.
In view of the dual character of municipal corporations there is no public reason for presuming their total
dissolution as a mere consequence of military occupation or territorial cession. The suspension of such
governmental functions as are obviously incompatible with the new political relations thus brought about
may be presumed. [220 U.S. 345, 357] But no such implication may be reasonably indulged beyond that
result.

Such a conclusion is in harmony with the settled principles of public law as declared by this and other
courts and expounded by the text-books upon the laws of war and international law. Taylor, International
Pub. Law , 578.

That there is a total abrogation of the former political relations of the inhabitants of the ceded region is
obvious. That all laws theretofore in force which are in confiict with the political character, constitution, or
institutions of the substituted sovereign, lose their force, is also plain. Alvarez y Sanchez v. United States,
216 U.S. 167 , 54 L. ed. 432, 30 Sup. Ct. Rep. 367. But it is equally settled in the same public law that
that great body of municipal law which regulates private and domestic rights continues in force until
abrogated or changed by the new ruler. In Chicago, R. I. & P. R. Co. v. McGlinn, 114 U.S. 542, 546 , 29
S. L. ed. 270, 271, 5 Sup. Ct. Rep. 1005, it was said:

'It is a general rule of public law, recognized and acted upon by the United States, that whenever
political jurisdiction and legislative power over any territory are transferred from one nation or
sovereign to another, the municipal laws of the country, that is, laws which are intended for the
protection of private rights, continue in force until abrogated or changed by the new government or
sovereign. By the cession, public property passes from one government to the other, but private
property remains as before, and with it those municipal laws which are designed to secure its peaceful
use and enjoyment. As a matter of course, all laws, ordinances, and regulations in conflict with the
political character, institutions, and constitution of the new government are at once displaced. Thus,
upon a cession of political jurisdiction and legislative power-and the latter is involved in the former-to
the United States, the laws of the country in support of an established religion, or abridging the
freedom of the [220 U.S. 345, 358] press, or authorizing cruel and unusual punishments, and the
like, would at once cease to be of obligatory force without any declaration to that effect; and the laws
of the country on other subjects would necessarily be superseded by existing laws of the new
government upon the same matters. But with respect to other laws affecting the possession, use, and
transfer of property, and designed to secure good order and peace in the community, and promote its
health and prosperity, which are strictly of a municipal character, the rule is general, that a change of
 government leaves them in force until, by direct action of the new government, they are altered or
repealed.'

The above language was quoted with approval in Downes v. Bidwell, 182 U.S. 244, 298 , 45 S. L. ed.
1088, 1110, 21 Sup. Ct. Rep. 770.

That the United States might, by virtue of its situation under a treaty ceding full title, have utterly
extinguished every municipality which it found in existence in the Philippine Islands, may be conceded.
That it did so, in view of the practice of nations to the contrary, is not to be presumed, and can only be
established by cogent evidence.

That during military occupation the affairs of the city were in a large part administered by officials put in
place by military order did not operate to dissolve the corporation, or relieve it from liability upon
obligations incurred before the occupation, nor those created for municipal purposes by the
administrators of its affairs while its old officials were displaced. New Orleans v. New York Mail S. S. Co.
20 Wall. 387, 394, 22 L. ed. 354, 358. During that occupation and military administration the business of
the city was carried on as usual. Taxes were assessed and taxes collected and expended for local
purposes, and many of the officials carrying on the government were those found in office when the city
was occupied. The continuity of the corporate city was not inconsistent with military occupation or the
constitution or institutions of the occupying power. This [220 U.S. 345, 359] is made evident by the
occurrences at the time of capitulation. Thus, the articles of capitulation concluded in these words: 'This
city, its inhabitants, . . . and its private property of all descriptions, are placed under the special safeguard
of the faith and honor of the American Army.' This was quoted in President McKinley's instructions of April
7, 1900, to the Philippine Commission, and touching this he said: 'I believe that this pledge has been
faithfully kept.' And the commission was directed to labor for the full performance of this obligation. This
instruction was in line with and in fulfilment of the 8th article of the treaty of Paris of December 10, 1898.
Under the 3d article of that treaty the archipelago known as the Philippine Islands was ceded to the
United States, the latter agreeing to pay to Spain the sum of $20,000,000. Under the first paragraph of
the 8th article, Spain relinquished to the United States 'all the buildings, wharves, barracks, forts,
structures, public highways, and other immovable property which, in conformity with law, belong to the
public domain, and as such belong to the Crown of Spain.' It is under this clause, in connection with the
clause agreeing to pay to Spain $20,000,000 for the cession of the Philippine group, that the contention
that all of the public rights of the city of Manila were acquired by the United States, which country was
therefore justified, as absolute owner, in granting the property rights so acquired to what is called the
'absolutely new corporation' created thereafter. But the qualifying words touching property rights
relinquished by Spain limit the relinquishment to 'property which, in conformity with law, belonging to the
public domain, and as such belong to the Crown of Spain.' It did not affect property which did not, in
'conformity with law, belong to the Crown of Spain.' That it was not intended to apply to property which, 'in
conformity with law,' belonged to the city of Manila as a municipal cor- [220 U.S. 345, 360] poration, is
clear. This is demonstrated by the second paragraph of the same article, which reads: 'And it is hereby
declared that the relinquishment or cession, as the case may be, to which the preceding paragraph
refers, cannot in any respect impair the property or rights which by law belong to the peaceful possession
of property of all kinds, of provinces, municipalities, public or private establishments . . . having legal
capacity to acquire and possess property in the aforesaid territories renounced or ceded, or of private
individuals.' Thus, the property and property rights of municipal corporations were protected and
safeguarded precisely as were the property and property rights of individuals.

That the cession did not operate as an extinction or dissolution of corporations is herein recognized, for
the stipulation against impairment of their property rights has this plain significance.

The conclusion we reach, that the legal entity survived both the military occupation and the cession which
followed, finds support in the cases which hold that the Pueblos of San Francisco and Los Angeles, which
existed as municipal organizations prior to the cession of California by Mexico, continued to exist with
their community and property rights intact. Cohas v. Raisin, 3 Cal. 443; Hart v. Burnett, 15 Cal. 530;
Townsend v. Greeley, 5 Wall. 326, 18 L. ed. 547; Merryman v. Bourne, 9 Wall. 592, 602, 19 L. ed. 683,
686; Moore v. Steinbach, 127 U.S. 70 , 32 L. ed. 51, 8 Sup. Ct. Rep. 1067; Los Angeles Farming & Mill.
Co. v. Los Angeles, 217 U.S. 217 , 54 L. ed. 736, 30 Sup. Ct. Rep. 452.

Were corporate identity and corporate liability extinguished as a necessary legal result of the new charter
granted in 1901 by the Philippine Commission? The inhabitants of the old city are the incorporators of the
new. There is substantially identity of area. There are some changes in the form of government and some
changes in corporate powers and methods of administration. the new corporation is endowed with all of
the property and [220 U.S. 345, 361] property rights of the old. It has the same power to sue and be
sued which the former corporation had. There is not the slightest suggestion that the new corporation
shall not succeed to the contracts and obligations of the old corporation. Laying out of view any question
of the constitutional guaranty against impairment of the obligation of contracts, there is, in the absence of
express legislative declaration of a contrary purpose, no reason for supposing that the reincorporation of
an old municipality is intended to permit an escape from the obligations of the old, to whose property and
rights it has succeeded. The juristic identity of the corporation has been in no wise affected, and, in law,
the present city is, in every legal sense, the successor of the old. As such it is entitled to the property and
property rights of the predecessor corporation, and is, in law, subject to all of its liabilities. Broughton v.
Pensacola 93 U.S. 266 , 23 L. ed. 896; Mt. Pleasant v. Beckwith, 100 U.S. 520 , 25 L. ed. 699; Mobile v.
Watson, 116 U.S. 289 , 29 L. ed. 620, 6 Sup. Ct. Rep. 398; Shapleigh v. San Angelo, 167 U.S. 646, 655 ,
42 S. L. ed. 310, 313, 17 Sup. Ct. Rep. 957; O'Connor v. Memphis, 6 Lea, 730; Colchester v. Seaber, 3
Burr. 1866, 1870, in which case, when a municipality became disabled to act and obtained a new charter,
in an action upon an obligation of the old corporation, there was judgment for the creditor, Lord Mansfield
saying:

'Many corporations, for want of legal magistrates, have lost their activity, and obtained new charters.
Maidstone, Radnor, Carmarthen, and many more are in the same case with Colchester. And yet it has
never been disputed but that the new charters revive and give activity to the old corporation; except,
perhaps, in that case in Levinz, where the corporation had a new name; and even there the court
made no doubt. Where the question has arisen upon any remarkable metamorphosis, it has always
been determined 'that they remain the same as to debts and rights."

Morris v. State, 62 Tex. 728, 730. [220 U.S. 345, 362] In Shapleigh v. San Angelo, supra, this court said
in a similar case:

'The state's plenary power over its municipal corporations to change their organization, to modify their
method of internal government, or to abolish them altogether, is not restricted by contracts entered
into by the municipality with its creditors or with private parties. An absolute repeal of a municipal
charter is therefor effectual so far as it abolishes the old corporate organization; but when the same or
substantially the same inhabitants are erected into a new corporation, whether with extended or
restricted territorial limits, such new corporation is treated as in law the successor of the old one,
entitled to its property rights, and subject to its liabilities.'

The cases of Trigas and Vilas went off upon demurrers, and no question of remedy arises here.

The appeal of Aguado is from a decree upon a final hearing denying him all relief.

That all three of the plaintiffs in error are entitled to proceed to judgment when they shall establish their
several claims is obvious from what we have said. But in the Aguado Case it is sought to establish his
claim as a charge against certain property and funds held by the city as trustee, known as the Carriedo
fund. In 1734 one Don Francisco Carriedo y Perodo bequeathed to the city a fund for the establishment of
waterworks, to be kept as a separate fund and devoted to the erection and maintenance of the works.
This fund was loyally kept and greatly increased, and was enlarged by a special tax upon meat, devoted
to that purpose. The works were finally completed in 1878, and have been since operated by the city, the
income and special tax going to maintenance. Certain securities belonging to the fund are now held by
the city, the income being applied to the operation of the works. Aguado took a contract to supply coal for
the use of the [220 U.S. 345, 363] Carriedo works, and made a deposit to guarantee the contract. When
the city was occupied by the American Army it was indebted to him for coal so supplied, as well as for the
deposit so made. That the coal was bought for and used in the operation of the Carriedo works is not
denied. But there is no evidence that the credit was given to the Carriedo fund so held in trust under the
will of Carriedo. The contract was made with the ayuntamiento of Manila, just as all other contracts for city
supplies or works were made. The contract not having been made with special reference to the liability of
the fund held in trust by the city, but apparently upon the general credit of the city, we are not disposed to
reverse the judgment of the court below, holding that the claim of Aguado did not constitute a charge
upon the Carriedo fund.

Aguado is, nevertheless, entitled to a judgment. The designation of the city in the petition as trustee may
be regarded as descriptive. The debt having been incurred by the city, it must be regarded as a city
liability. Taylor v. Davis (Taylor v. Mayo), 110 U.S. 330, 336 , 28 S. L. ed. 163, 165, 4 Sup. Ct. Rep. 147.

Our conclusion is that the decree in the Aguado Case must be reversed and the case remanded, with
direction to render judgment and such other relief as may seem in conformity with law. The judgments in
the Trigas and Vilas Cases will be reversed and the cases remanded, with direction to overrule the
respective demurrers, and for such other action as may be consistent with law, and consistent with this
opinion.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-49 November 12, 1945

WILLIAM F. PERALTA, petitioner,

vs.
THE DIRECTOR OF PRISONS, respondent.

William F. Peralta in his own behalf.

Office of the Solicitor General Tañada for respondent.
City Fiscal Mabanag as amicus curiae.

FERIA, J.:

Petitioner-defendant, a member of the Metropolitan Constabulary of Manila charged with the supervision
and control of the production, procurement and distribution of goods and other necessaries as defined in
section 1 of Act No. 9 of the National Assembly of the so-called Republic of the Philippines, was prosecuted
for the crime of robbery as defined and penalized by section 2 (a) of Act No. 65 of the same Assembly. He
was found guilty and sentenced to life imprisonment, which he commenced to serve on August 21, 1944,
by the Court of Special and Exclusive Criminal Jurisdiction, created in section 1 of Ordinance No. 7
promulgated by the President of the so-called Republic of the Philippines, pursuant to the authority
conferred upon him by the Constitution and laws of the said Republic. And the procedure followed in the
trial was the summary one established in Chapter II of Executive Order No. 157 of the Chairman of the
Executive Commission, made applicable to the trial violations of said Act No. 65 by section 9 thereof and
section 5 of said Ordinance No. 7.

The petition for habeas corpus is based on the ground that the Court of Special and Executive Criminal
Jurisdiction created by Ordinance No. 7 "was a political instrumentality of the military forces of the Japanese
Imperial Army, the aims and purposes of which are repugnant to those aims and political purposes of the
Commonwealth of the Philippines, as well as those of the United States of America, and therefore, null and
void ab initio," that the provisions of said Ordinance No. 7 are violative of the fundamental laws of the
Commonwealth of the Philippines and "the petitioner has been deprived of his constitutional rights"; that
the petitioner herein is being punished by a law created to serve the political purpose of the Japanese
Imperial Army in the Philippines, and "that the penalties provided for are much (more) severe than the
penalties provided for in the Revised Penal Code."

The Solicitor General, in his answer in behalf of the respondent, states that, in his own opinion, for the
reasons expressed in his brief in the case of People of the Philippines, plaintiff-appellant, vs. Benedicto
Jose y Santos, defendant-appellee, G. R. No. L-22 (p. 612, post), the acts and proceedings taken and had
before the said Court of Special and Exclusive Criminal Jurisdiction which resulted in the conviction and
imprisonment of the herein petitioner, should now be denied force and efficacy, and therefore the petition
for habeas corpus should be granted. The reasons advanced by the Solicitor General in said brief and in
his reply memorandum in support of his contention are, that the Court of Special and Exclusive Criminal
Jurisdiction created, and the summary procedure prescribed therefor, by said Ordinance No. 7 in
connection with Executive Order No. 157 of the Chairman of the Executive Commission are tinged with
political complexion; that the procedure prescribed in Ordinance No. 7 does not afford a fair trial, violates
the Constitution of the Commonwealth, and impairs the Constitutional rights of accused persons under their
legitimate Constitution. And he cites, in support of this last proposition, the decisions of the Supreme Court
of the United States in the cases of Texas vs. White (7 Wall., 700, 743); Horn vs. Lockart (17 Wall.,
570, 581); United States vs. Home Insurance Co. (22 Wall., 99, 104); Sprott vs. United States (20 Wall.,
459).

The City Fiscal of Manila appeared before this Court as amicus curiae. In his memorandum he submits that
the petition for habeas corpus be denied on the following grounds: That the Court of Special and Exclusive
Criminal Jurisdiction and the Acts, Ordinances and Executive Orders, creating it are not of a political
complexion, for said Court was created, and the crimes and offenses placed under its jurisdiction were
penalized heavily, in response to an urgent necessity, according to the preamble of Ordinance No. 7; that
the right to appeal in a criminal case is not a constitutional right; and that the summary procedure
established in said Ordinance No. 7 is not violative of the provision of Article III, section 1 (18) of the
Constitution of the Commonwealth, to the effect that no person shall be compelled to be a witness against
himself, nor of the provision of section 1 (1) of the same Article that no person shall be deprived of life,
liberty, or property without due process of law.

The features of the summary procedure adopted by Ordinance No. 7, assailed by the petitioner and the
Solicitor General as impairing the constitutional rights of an accused are: that court may interrogate the
accused and witnesses before trial in order to clarify the points in dispute; that the refusal of the accused
to answer the questions may be considered unfavorable to him; that if from the facts admitted at the
preliminary interrogatory it appears that the defendant is guilty, he may be immediately convicted; and that
the sentence of the sentence of the court is not appealable, except in case of death penalty which cannot
be executed unless and until reviewed and affirmed by a special division of the Supreme Court composed
of three Justices.

Before proceeding further, and in order to determine the law applicable to the questions involved in the
present case, it is necessary to bear in mind the nature and status of the government established in these
Islands by the Japanese forces of occupation under the designation of Republic of the Philippines.

In the case of Co Kim Cham vs. Valdez Tan Keh and Dizon (G. R. No. L-5, pp. 113, 127, ante), recently
decided, this Court, speaking through the Justice who pens this decision, held:

In view of the foregoing, it is evident that the Philippines Executive Commission, which was
organized by Order No. 1, issued on January 23, 1942, by the Commander of the Japanese
forces, was a civil government established by the military forces of occupation and therefore a de
facto government of the second kind. It was not different from the government established by the
British in Castine, Maine, or by the United States in Tanpico, Mexico. As Halleck says, "the
government established over an enemy's territory during the military occupation may exercise all
the powers given by the laws of war to the conqueror over the conquered, and is subject to all
restrictions which that code imposes. It is of little consequence whether such government be
called a military or civil government. Its character is the same and the source of its authority the
same. In either case it is a government imposed by the laws of war and so far as it concerns the
inhabitants of such territory or the rest of the world those laws alone determine the legality or
illegality of its acts." (vol. 2 p. 466.) The fact that the Philippine Executive Commission was a civil
and not a military government and was run by Filipinos and not by Japanese nationals is of no
consequence.

And speaking of the so-called Republic of the Philippines in the same decision, this Court said:

The so-called Republic of the Philippines, apparently established and organized as a sovereign
state independent from any other government by the Filipino people, was, in truth and reality, a
government established by the belligerent occupant or the Japanese forces of occupation. It was
of the same character as the Philippine Executive Commission, and the ultimate source of its
authority was the same — the Japanese military authority and government. As General
MacArthur stated in his proclamation of October 23, 1944, a portion of which has been already
quoted, "under enemy duress, a so-called government styled as the 'Republic of the Philippines'
 was established on October 14, 1943, based upon neither the free expression of the peoples" will
nor the sanction of the Government of the United States.' Japan had no legal power to grant
independence to the Philippines or transfer the sovereignty of the United States to, or recognize
the latent sovereignty of the Filipino people, before its military occupation and possession of the
Islands had matured into an absolute and permanent dominion or sovereignty by a treaty of
peace or other means recognized in the law of nations.

As the so-called Republic of the Philippines was a de facto government of the second kind (of paramount
force), as the government established in Castine, Maine, during its occupation by the British forces and as
that of Tampico, Mexico, occupied during the war with that the country by the United State Army, the
question involved in the present case cannot be decided in the light of the Constitution of the
Commonwealth Government; because the belligerent occupant was totally independent of the constitution
of the occupied territory in carrying out the administration over said territory; and the doctrine laid down by
the Supreme Court of the United States in the cases involving the validity of judicial and legislative acts of
the Confederate States, considered as de facto governments of the third kind, does not apply to the acts of
the so-called Republic of the Philippines which is a de facto government of paramount force. The
Constitution of the so-called Republic of the Philippines can neither be applied, since the validity of an act
of a belligerent occupant cannot be tested in the light of another act of the same occupant, whose criminal
jurisdiction is drawn entirely from the law martial as defined in the usages of nations.

In the case of United States vs. Rice (4 Wheaton, 246), the Supreme Court of the United States held that,
by the military occupation of Castine, Maine, the sovereignty of the United States in the territory was, of
course, suspended, and the laws of the United States could no longer be rightfully enforced there or be
obligatory upon the inhabitants who remained and submitted to the belligerent occupant. By the surrender
the inhabitants passed under a temporary allegiance to the British government, and were bound by such
laws, and such only, as it chose to recognize and impose. And Oppenheim, in his Treatise on International
Law, says that, in carrying out the administration over the occupied territory and its inhabitants, "the
(belligerent) occupant is totally independent of the constitution and the laws of the territory, since occupation
is an aim of warfare, and the maintenance and safety of his forces, and the purpose of war, stand in the
foreground of his interest and must be promoted under all circumstances or conditions. (Vol. II, Sixth
Edition, Revised, 1944, p. 342.)

The doctrine laid down in the decisions of the Supreme Court of the United States (in the cases of Texas
vs. White, 7 Wall., 700; Horn vs. Lockart, 17 Wall., 570; Williams vs. Bruffy, 96 U. S., 176 United States vs.
Home Insurance Co., 20 Wall., 249; Sprott vs. United States, 20 Wall., 459, and others) that the judicial
and legislative acts of the Confederate States which impaired the rights of the citizens under the Constitution
of the United States or of the States, or were in conflict with those constitutions, were null and void, is not
applicable to the present case. Because that doctrine rests on the propositions that "the concession (of
belligerency) made to the Confederate Government . . . sanctioned no hostile legislation . .
. and it impaired in no respect the rights of loyal and citizens as they existed at the commencement of
hostilities" (Williams vs. Bruffy, supra);that the Union is perpetual and indissoluble, and the obligation of
allegiance to the to the estate and obedience to her laws and the estate constitution, subject to the
Constitution of the United States, remained unimpaired during the War of Secession (Texas vs. White,
supra) and that the Confederate States "in most, if not in all instances, merely transferred the existing state
organizations to the support of a new and different national head. the same constitution, the same laws for
the protection of the property and personal rights remained and were administered by the same officers."
(Sprott vs. United States, supra). In fine, because in the case of the Confederate States, the constitution of
each state and that of the United States or the Union continued in force in those states during the War of
Secession; while the Constitution of the Commonwealth Government was suspended during the occupation
of the Philippines by the Japanese forces of the belligerent occupant at regular war with the United States.

The question which we have to resolve in the present case in the light of the law of nations are, first, the
validity of the creation of the Court of Special and Exclusive Criminal Jurisdiction, and of the summary
procedure adopted for that court; secondly, the validity of the sentence which imprisonment during the
Japanese military occupation; and thirdly, if they were then valid, the effect on said punitive sentence of the
reoccupation of the Philippines and the restoration therein of the Commonwealth Government.

(1) As to the validity of the creation of the Court of Special and Exclusive Criminal Jurisdiction by Ordinance
No. 7, the only factor to be considered is the authority of the legislative power which promulgated said law
or ordinance. It is well established in International Law that "The criminal jurisdiction established by the
invader in the occupied territory finds its source neither in the laws of the conquering or conquered state,
— it is drawn entirely form the law martial as defined in the usages of nations. The authority thus derived
can be asserted either through special tribunals, whose authority and procedure is defined in the military
code of the conquering state, or through the ordinary courts and authorities of the occupied district." (Taylor,
International Public Law, p. 598.) The so-called Republic of the Philippines, being a governmental
instrumentality of the belligerent occupant, had therefore the power or was competent to create the Court
of Special and Exclusive Criminal Jurisdiction. No question may arise as to whether or not a court is of
political complexion, for it is mere a governmental agency charged with the duty of applying the law to cases
falling within its jurisdiction. Its judgments and sentences may be of political complexion, or not depending
upon the nature or character of the law so applied. There is no room for doubt, therefore, as to the validity
of the creation of the court in question.

With respect to the Summary procedure adopted by Ordinance No. 7, and followed in the trial of the case
which resulted in the conviction of the herein petitioner, there is also no question as to the power or
competence of the belligerent occupant to promulgate the law providing for such procedure. For "the
invader deals freely with the relations of the inhabitants of the occupied territory towards himself . . . for his
security also, he declares certain acts, not forbidden by the ordinary laws of the country, to be punishable;
and he so far suspends the laws which guard personal liberty as is required for the summary punishment
of any one doing such acts." (Hall's International Law, seventh ed., p. 5000). A belligerent "occupant may
where necessary, set up military courts instead of the ordinary courts; and in case, and in so far as, he
admits the administration of justice by the ordinary courts, he may nevertheless, so far as is necessary for
military purposes, or for the maintenance of public order and safety temporarily alter the laws, especially
the Criminal Law, on the basis of which justice is administered as well as the laws regarding procedure."
(Oppenheim's International Law, Vol. II, sixth edition, 1944, p.349.)

No objection can be set up to the legality of its provisions in the light of the precepts of our Commonwealth
Constitution relating to the rights of accused under that Constitution, because the latter was not in force
during the period of the Japanese military occupation, as we have already stated. Nor may said Constitution
be applied upon its revival at the time of the re-occupation of the Philippines by virtue of the principle of
postliminium because "a constitution should operate prospectively only, unless the words employed show
a clear intention that it should have a retrospective effect" (Cooley's Constitutional Limitations, seventh
edition, page 97, and cases quoted and cited in the footnote), especially as regards laws of procedure
applied to cases already terminated completely.

The only restrictions or limitations imposed upon the power of a belligerent occupant to alter the laws or
promulgate new ones, especially the criminal law as well as the laws regarding procedure, so far as it is
necessary for military purposes, that is, for his control of the territory and the safety and protection of his
army, are those imposed by the Hague Regulations, the usages established by civilized nations, the laws
of humanity and the requirements of public conscience. It is obvious that the summary procedure under
consideration does not violate those precepts. It cannot be considered as violating the laws of humanity
and public conscience, for it is less objectionable, even from the point of view of those who are used to the
accusatory system of criminal procedure than the procedural laws based on the semi-inquisitorial or mixed
system prevailing in France and other countries in continental Europe.

(2) The validity of the sentence rendered by the Court of Special and Exclusive Criminal Jurisdiction which
imposes life imprisonment upon the herein petitioner, depends upon the competence or power of the
belligerent occupant to promulgate Act No. 65 which punishes the crime of which said petitioner was
convicted.
Westlake says that Article XLIII, Section III, of the Hague Conventions of 1907 "indicates that the laws to
be enforced by the occupant consist of, first, the territorial law in general, as that which stands to the public
order and social and commercial life of the district in a relation of mutual adaptation, so that any needless
displacement of it would defeat the object which the invader is enjoined to have in view, and secondly, such
variations of the territorial law as may be required by real necessity and are not expressly prohibited by any
of the rules which will come before us. Such variations will naturally be greatest in what concerns the relation
of the communities and individuals within the district to the invading army and its followers, it being
necessary for the protection of the latter, and for the unhindered prosecution of the war by them, that acts
committed to their detriment shall not only lose what justification the territorial law might give them as
committed against enemies, but shall be repressed more severely than the territorial law would repress
acts committed against fellow subjects. Indeed the entire relation between the invaders and the invaded,
so far as it may fall within the criminal department whether by the intrinsic nature of the acts done or in
consequence of the regulations made by the invaders, may be considered as taken out of the territorial law
and referred to what is called martial law." (Westlake, International Law, Part II, War, p. 96.)

According to Hyde (International Law, Vol. II, p. 386), the term "martial law," in so far as it is used to describe
any fact in relation to belligerent occupation, does not refer to a particular code or system of law, or to a
special agency entrusted with its administration. The term merely signifies that the body of law actually
applied, having the sanction of military authority, is essentially martial. All law, by whomsoever
administered, in an occupied district martial law; and it is none the less so when applied by civil courts in
matters devoid of special interest to the occupant. The words "martial law" are doubtless suggestive of the
power of the occupant to share the law as he sees fit; that is, to determine what shall be deemed lawful or
unlawful acts, to establish tests for ascertaining the guilt of offenders, to fix penalties, and generally to
administer justice through such agencies as the found expedient.

And the United States Rules of Land Warfare provide that the belligerent occupant may promulgate such
new laws and regulations as military necessity demands, and in this class will be included those laws which
come into being as a result of military rule; that is, those which establish new crimes and offenses incident
to a state of war and are necessary for the control of the country and the protection of the army, for the
principal object of the occupant is to provide for the security of the invading army and to contribute to its
support and efficiency and the success of its operations. (Pub. 1940, pp. 76, 77.)

From the above it appears clear that it was within the power and competence of the belligerent occupant
to promulgate, through the National Assembly of the so-called Republic of the Philippines, Act No. 65 of
the said Assembly, which penalizes the crimes of robbery and other offenses by imprisonment ranging from
the maximum period of the imprisonment prescribed by the laws and ordinances promulgated by the
President of the so-called Republic as minimum, to life imprisonment or death as maximum. Although these
crimes are defined in the Revised Penal Code, they were altered and penalized by said Act No. 65 with
different and heavier penalties, as new crimes and offenses demanded by military necessity, incident to a
state of war, and necessary for the control of the country by the belligerent occupant, the protection and
safety of the army of occupation, its support and efficiency, and the success of its operations.

They are not the same ordinary offenses penalized by the Revised Penal Code. — The criminal acts
penalized by said Act No. 65 are those committed by persons charged or connected with the supervision
and control of the production, procurement and distribution of foods and other necessaries; and the
penalties imposed upon the violators are different from and much heavier than those provided by the
Revised Penal Code for the same ordinary crimes. The acts penalized by said Act were taken out of the
territorial law or Revised Penal Code, and referred to what is called martial law by international jurists,
defined above by Hyde, in order, not only to prevent food and other necessaries from reaching the
"guerrillas" which were harassing the belligerent occupant from every nook and corner of the country, but
also to preserve the food supply and other necessaries in order that, in case of necessity, the Imperial
Japanese forces could easily requisition them, as they did, and as they had the right to do in accordance
with the law of nations for their maintenance and subsistence (Art. LII, Sec. III, Hague Conventions of
1907). Especially taking into consideration the fact, of which this court may take judicial notice, that the
Imperial Japanese Army had depended mostly for their supply upon the produce of this country.

The crimes penalized by Act No. 65 — as well as the crimes against national security and the law of nations,
to wit: treason, espionage, inciting war, violation of neutrality, correspondence with hostile country, flight to
enemy's country, piracy; and the crimes against public order, such as rebellion, sedition and disloyalty,
illegal possession of firearms and other, penalized by Ordinance No. 7 and placed under jurisdiction of the
Court of Special and Exclusive Criminal Jurisdiction — are all of a political complexion, because the acts
constituting those offenses were punished, as are all political offenses, for public rather than private
reasons, and were acts in aid or favor of the enemy and against the welfare, safety and security of the
belligerent occupant. While it is true that these offenses, when committed against the Commonwealth or
United States Government, are defined and also penalized by the territorial law Revised Penal Code, they
became inapplicable as crimes against the occupier upon the occupation of the Islands by the Japanese
forces. And they had to be taken out of the territorial law and made punishable by said Ordinance No. 7,
for they were not penalized before under the Revised Penal Code when committed against the belligerent
occupant or the government established by him in these Island. They are also considered by some writers
as war crimes in a broad sense. In this connection Wheaton observes the following:

"Of 'war crimes' the number is naturally indefinite, depending as they do on the acts from time to time
ordered to be done or forbidden to be done in the martial law proclamation or regulations of the invading or
occupying commander. Thus, in the Anglo-Boer war, the British military authorities proclaimed the following
to be offenses against their martial law; — Being in possession of arms, ammunition, etc.; traveling without
a permit; sending prohibited goods; holding meetings other than those allowed; using seditious language;
spreading alarmist reports; overcharging for goods; wearing uniforms without due authority; going out of
doors between certain hours; injuring military animals or stores; being in possession, without a permit, of
horses, vehicles, cycles, etc.; hindering those in execution of military orders; trespassing on defense works.
Such offenses, together with several others, were specified in the Japanese regulations made in the Russo-
Japanese war." (Wheaton's International Law, War, seventh edition, 1944, p. 242.)

It is, therefore, evident that the sentence rendered by the Court of Special and Exclusive Criminal
Jurisdiction against the petitioner, imposing upon him the penalty of life imprisonment, was good and valid,
since it was within the admitted power or competence of the belligerent occupant to promulgate the law
penalizing the crime of which petitioner was convicted.

(3) The last question is the legal effect of the reoccupation of the Philippines and restoration of the
Commonwealth Government; that is whether or not, by the principle of postliminy, the punitive sentence
which petitioner is now serving fell through or ceased to be valid from that time.

In order to resolve this last question, it is not necessary to enter into an elaborate discussion on the matter.
It is sufficient to quote the opinion on the subject of several international jurists and our recent decision in
the case of Co Kim Cham vs. Valdez Tan Keh and Dizon, supra.

Hall, commenting on the effect of the principle of postliminy upon sentences of the tribunals continued or
created by the belligerent occupant, opines "that judicial acts done under this control, when they are not of
a political complexion, administrative acts so done, to the extent that they take effect during the continuance
of his control, and the various acts done during the same time by private persons under the sanction of
municipal law, remain good. . . . Political acts on the other hand fall through as of course, whether they
introduce any positive change into the organization of the country, or whether they only suspend the working
of that already in existence. The execution also of punitive sentences ceases as of course when they have
had reference to acts not criminal by the municipal law of the state, such for example as acts directed
against the security or control of the invader." (Hall's International Law, seventh edition, p. 518.)
Westlake, speaking of the duration of the validity of punitive sentences for offenses such as the one in
question, which is within the admitted power or competence of the belligerent occupant to punish, says that:
"To the extent to which the legal power of the occupant is admitted he can make law for the duration of his
occupation. Like any other legislator he is morally subject to the duty of giving sufficient notice of his
enactments or regulations, not indeed so as to be debarred from carrying out his will without notice, when
required by military necessity and so far as practically carrying out his will can be distinguished from
punishment, but always remembering that to punish for breach of a regulation a person who was justifiably
ignorant of it would be outrageous. But the law made by the occupant within his admitted power, whether
morally justifiable or not, will bind any member of the occupied population as against any other member of
it, and will bind as between them all and their national government, so far as it produces an effect during
the occupation. When the occupation comes to an end the authority of the national government is restored,
either by the progress of operations during the war or by the conclusion of a peace, no redress can be had
for what has been actually carried out but nothing further can follow from the occupant's legislation. A
prisoner detained under it must be released, and no civil right conferred by it can be further enforced. The
enemy's law depends on him for enforcement as well as for enactment. The invaded state is not subject to
the indignity of being obliged to execute his commands. (Westlake, International Law, Part II, War, pp. 97,
98.)

And Wheaton, who, as above stated, considers as war crimes such offenses as those penalized in
Ordinance No. 7 and Act No. 65, says: "In general, the cast of the occupant possess legal validity, and
under international law should not be abrogated by the subsequent government. But this rule does not
necessarily apply to acts that exceed the occupant's power (e.g., alienation of the domains of the State or
the sovereign), to sentences for 'war treason' and 'war crimes,' to acts of a political character, and to those
that beyond the period of occupation. When occupation ceases, no reparation is legally due for what has
already been carried out." (Wheaton's International Law, supra, p. 245.)

We have already held in our recent decision in the case of Co Kim Cham vs. Valdez Tan Keh and Dizon,
supra, that all judgments of political complexion of the courts during the Japanese regime, ceased to be
valid upon the reoccupation of the islands by virtue of the principle or right of postliminium. Applying that
doctrine to the present case, the sentence which convicted the petitioner of a crime of a political complexion
must be considered as having ceased to be valid ipso facto upon the reoccupation or liberation of the
Philippines by General Douglas MacArthur.

It may not be amiss to say in this connection that it is not necessary and proper to invoke the proclamation
of General Douglas MacArthur declaring null and void all laws, among them Act No. 65, of the so-called
Republic of the Philippines under which petitioner was convicted, in order to give retroactive effect to the
nullification of said penal act and invalidate sentence rendered against petitioner under said law, a sentence
which, before the proclamation, had already become null and of no effect.

We therefore hold that the punitive sentence under consideration, although good and valid during the
military occupation of the Philippines by the Japanese forces, ceased to be good and valid ipso facto upon
the reoccupation of these Island and the restoration therein of the Commonwealth Government.

In view of all the foregoing, the writ of habeas corpus prayed for is hereby granted and it is ordered that the
petitioner be released forthwith, without pronouncement as to costs. So ordered.

Jaranilla, Pablo and Bengzon, JJ., concur.

Moran, C.J., concurs in the result.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-6 November 29, 1945

ANICETO ALCANTARA, petitioner,

vs.
DIRECTOR OF PRISONS, respondent.

Buenaventura B. Martinez for petitioner.

Office of the Solicitor General Tañada for respondent.

FERIA, J.:

This is a petition for the issuance of a writ of habeas corpus and for the release of the petitioner on the
ground that the latter is unlawfully imprisoned and restrained of his liberty by the respondent Director of
Prison in the provincial jail at Vigan, Ilocos Sur.

Petitioner was convicted by the Court First Instance of Ilocos Sur (Criminal case No. 23) of the crime of
illegal discharge of firearms with less serious physical injuries. Upon appeal, the Court of Appeals of
Northern Luzon at Baguio modified said sentence (CA- G.R. No. 790)and sentence the petitioner to an
indeterminate penalty of from four months four months and twenty-one days of arresto mayor to three years,
nine months and three days of prison correccional. The sentence as modified became final on September
12, 1944, and June 23, 1945, petitioner commenced serving his sentence.

Petitioner now questions the validity of the decision of the Court of Appeals of Northern Luzon, on the sole
ground that said court was only a creation of the so-called Republic of the Philippines during the Japanese
military occupation of the Islands; that the Court of Appeals was not authorized by Commonwealth Act No.
3 to hold sessions in Baguio, and that only the two Justices constituted the majority which promulgated the
decision in question. The petitioner does not question the validity of said decision on the strength of the
Proclamation of General Douglas McArthur of October 23, 1944, which according to our decision in the
case of Co Kim Cham vs. Valdez Tan Keh and Dizon, G.R. No. L-5 (p. 113, ante), does not refer to judicial
processes.

In the said case of Co Kim Cham vs. Valdez Tan Keh and Dizon, this Court ruled that the so-called Republic
of the Philippines and the Philippine Executive Commission established in the Philippines during the
Japanese regime were governments de facto organized by the belligerent occupant by the judicial acts
thereof were good and valid and remained good and valid after the restoration of the Commonwealth
Government, except those a political complexion. In that the same case this Court held that the Court of
Appeals which was continued throughout the Japanese occupation, was the same Court of Appeals existed
prior to the Japanese occupation and was lately abolished by Executive Order No. 37. The division of the
Court of Appeals into several District Court of Appeals, and the reduction of the number of Justices sitting
in each division, the regime of the so-called Republic effected no substantial change in its nature and
jurisdiction.

Even assuming that the Court of Appeals of Northern Luzon was a new court created by the belligerent
occupant or the de facto governments established by him, the judgments of such court, like those of the
court which were continued during the Japanese occupation, were good and valid and remain good and
valid, and therefore enforceable now after the liberation or occupation of the Philippines, provided that such
judgments do not have a political complexion, as this court held in its decision in the
abovementioned case of Co Kim Cham vs. Valdez Tan Keh and Dizon supra, in accordance with the
authorities therein cited.

Obviously, the sentence which petitioner is now serving has no political complexion. He was charged with
and convicted of an offense punishable under the municipal law of the Commonwealth, the Revised Penal
Code. Therefore, the sentence of the Court of First Instance of Ilocos Sur, as modified by the Court of
Appeals of Northern Luzon, is valid and enforceable.

A punitive or penal sentence is said to of a political complexion when it penalizes either a new act not
defined in the municipal laws, or acts already penalized by the latter as a crime against the legitimate
government, but taken out of the territorial law and penalized as a new offenses committed against
belligerent occupant, incident to a state of a war and necessary for the control of the occupied territory and
the protection of the army of the occupier. They are acts penalized for public rather than private reasons,
acts which tend, directly or indirectly, to aid or favor the enemy and are directed against the welfare, safety
and security, of the belligerent occupant. As example, the crimes against national security
, such as treason, espionage, etc., and against public order, such as rebellion, sedition, etc., were crimes
against the Commonwealth or United States Government under the Revised Penal Code, which were made
crimes against the belligerent occupant.

In view of the foregoing, the petitioner for the writ of habeas corpus is denied.

Moran, C.J., Ozaeta, Paras, Jaranilla, Pablo and Bengzon, JJ., concur.
 Republic of the Philippines
SUPREME COURT
Manila

EN BANC

G.R. No. L-18463 October 4, 1922

THE PEOPLE OF THE PHILIPPINE ISLANDS, plaintiff-appellee,

vs.
GREGORIO PERFECTOR, defendant-appellant.

Alfonso E. Mendoza and the appellant in behalf of the latter.

Attorney-General Villa-Real for appellee.

MALCOLM, J.:

The important question is here squarely presented of whether article 256 of the Spanish Penal Code,
punishing "Any person who, by . . . writing, shall defame, abuse, or insult any Minister of the Crown or
other person in authority . . .," is still in force.

About August 20, 1920, the Secretary of the Philippine Senate, Fernando M. Guerrero, discovered that
certain documents which constituted the records of testimony given by witnesses in the investigation of
oil companies, had disappeared from his office. Shortly thereafter, the Philippine Senate, having been
called into special session by the Governor-General, the Secretary for the Senate informed that body
of the loss of the documents and of the steps taken by him to discover the guilty party. The day
following the convening of the Senate, September 7, 1920, the newspaper La Nacion, edited by Mr.
Gregorio Perfecto, published an article reading as follows:

Half a month has elapsed since the discovery, for the first time, of the scandalous robbery of
records which were kept and preserved in the iron safe of the Senate, yet up to this time there
is not the slightest indication that the author or authors of the crime will ever be discovered.

To find them, it would not, perhaps, be necessary to go out of the Sente itself, and the persons
in charge of the investigation of the case would not have to display great skill in order to
succeed in their undertaking, unless they should encounter the insuperable obstacle of offical
concealment.

In that case, every investigation to be made would be but a mere comedy and nothing more.

After all, the perpetration of the robbery, especially under the circumstances that have
surrounded it, does not surprise us at all.

The execution of the crime was but the natural effect of the environment of the place in which it
was committed.

How many of the present Senators can say without remorse in their conscience and with
serenity of mind, that they do not owe their victory to electoral robbery? How may?

The author or authors of the robbery of the records from the said iron safe of the Senate have,
perhaps, but followed the example of certain Senators who secured their election through fraud
and robbery.
The Philippine Senate, in its session of September 9, 1920, adopted a resolution authorizing its
committee on elections and privileges to report as to the action which should be taken with reference to
the article published in La Nacion. On September 15, 1920, the Senate adopted a resolution
authorizing the President of the Senate to indorse to the Attorney-General, for his study and
corresponding action, all the papers referring to the case of the newspaper La Nacion and its editor,
Mr. Gregorio Perfecto. As a result, an information was filed in the municipal court of the City of Manila
by an assistant city fiscal, in which the editorial in question was set out and in which it was alleged that
the same constituted a violation of article 256 of the Penal Code. The defendant Gregorio Perfecto was
found guilty in the municipal court and again in the Court of First Instance of Manila.

During the course of the trial in the Court of First Instance, after the prosecution had rested, the
defense moved for the dismissal of the case. On the subject of whether or not article 256 of the Penal
Code, under which the information was presented, is in force, the trial judge, the Honorable George R.
Harvey, said:

This antiquated provision was doubtless incorporated into the Penal Code of Spain for the
protection of the Ministers of the Crown and other representatives of the King against free
speech and action by Spanish subjects. A severe punishment was prescribed because it was
doubtless considered a much more serious offense to insult the King's representative than to
insult an ordinary individual. This provision, with almost all the other articles of that Code, was
extended to the Philippine Islands when under the dominion of Spain because the King's
subject in the Philippines might defame, abuse or insult the Ministers of the Crown or other
representatives of His Majesty. We now have no Ministers of the Crown or other persons in
authority in the Philippines representing the King of Spain, and said provision, with other
articles of the Penal Code, had apparently passed into "innocuous desuetude," but the
Supreme Corut of the Philippine Islands has, by a majority decision, held that said article 256 is
the law of the land to-day. . . .

The Helbig case is a precedent which, by the rule of stare decisis, is binding upon this court
until otherwise determined by proper authority.

In the decision rendered by the same judge, he concluded with the following language:

In the United States such publications are usually not punishable as criminal offense, and little
importance is attached to them, because they are generally the result of political controversy
and are usually regarded as more or less colored or exaggerated. Attacks of this character
upon a legislative body are not punishable, under the Libel Law. Although such publications are
reprehensible, yet this court feels some aversion to the application of the provision of law under
which this case was filed. Our Penal Code has come to us from the Spanish regime. Article 256
of that Code prescribes punishment for persons who use insulting language about Ministers of
the Crown or other "authority." The King of Spain doubtless left the need of such protection to
his ministers and others in authority in the Philippines as well as in Spain. Hence, the article
referred to was made applicable here. Notwithstanding the change of sovereignty, our
Supreme Court, in a majority decision, has held that this provision is still in force, and that one
who made an insulting remark about the President of the United States was punishable under
it. (U.S. vs. Helbig, supra.) If it applicable in that case, it would appear to be applicable in this
case. Hence, said article 256 must be enforced, without fear or favor, until it shall be repealed
or superseded by other legislation, or until the Supreme Court shall otherwise determine.

In view of the foregoing considerations, the court finds the defendant guilty as charged in the
information and under article 256 of their Penal Code sentences him to suffer two months and
one day of arresto mayor and the accessory penalties prescribed by law, and to pay the costs
of both instances.

The fifteen errors assigned by the defendant and appellant, reenforced by an extensive brief, and
eloquent oral argument made in his own behalf and by his learned counsel, all reduce themselves to
the pertinent and decisive question which was announced in the beginning of this decision.
It will be noted in the first place that the trial judge considered himself bound to follow the rule
announced in the case of United States vs. Helbig (R. G. No. 14705, 1 not published). In that case, the
accused was charged with having said, "To hell with the President and his proclamations, or words to
that effect," in violation of article 256 of the Penal Code. He was found guilty in a judgment rendered by
the Court of First Instance of Manila and again on appeal to the Supreme Court, with the writer of the
instant decision dissenting on two principal grounds: (1) That the accused was deprived of the
constitutional right of cross-examination, and (2) that article 256 of the Spanish Penal Code is no
longer in force. Subsequently, on a motion of reconsideration, the court, being of the opinion that the
Court of First Instance had committed a prejudicial error in depriving the accused of his right to cross-
examine a principal witness, set aside the judgment affirming the judgment appealed from and ordered
the return of the record to the court of origin for the celebration of a new trial. Whether such a trial was
actually had, is not known, but at least, the record in the Helbig case has never again been elevated to
this court.

There may perchance exist some doubt as to the authority of the decision in the Helbig case, in view of
the circumstances above described. This much, however, is certain: The facts of the Helbig case and
the case before us, which we may term the Perfecto case, are different, for in the first case there was
an oral defamation, while in the second there is a written defamation. Not only this, but a new point
which, under the facts, could not have been considered in the Helbig case, is, in the Perfecto case,
urged upon the court. And, finally, as is apparent to all, the appellate court is not restrained, as was the
trial court, by strict adherence to a former decision. We much prefer to resolve the question before us
unhindered by references to the Helbig decision.

This is one of those cases on which a variety of opinions all leading to the same result can be had. A
majority of the court are of the opinion that the Philippine Libel Law, Act No. 277, has had the effect of
repealing so much of article 256 of the Penal Code as relates to written defamation, abuse, or insult,
and that under the information and the facts, the defendant is neither guilty of a violation of article 256
of the Penal Code, nor of the Libel Law. The view of the Chief Justice is that the accused should be
acquitted for the reason that the facts alleged in the information do not constitute a violation of article
156 of the Penal Code. Three members of the court believe that article 256 was abrogated completely
by the change from Spanish to American sovereignty over the Philippines and is inconsistent with
democratic principles of government.

Without prejudice to the right of any member of the court to explain his position, we will discuss the two
main points just mentioned.

1. Effect of the Philippine Libel Law, Act No. 277, on article 256 of the Spanish Penal Code. —
The Libel Law, Act No. 277, was enacted by the Philippine Commission shortly after
organization of this legislative body. Section 1 defines libel as a "malicious defamation,
expressed either in writing, printing, or by signs or pictures, or the like, or public theatrical
exhibitions, tending to blacken the memory of one who is dead or to impeach the honesty,
virtue, or reputation, or publish the alleged or natural deffects of one who is alive, and thereby
expose him to public hatred, contempt or ridicule." Section 13 provides that "All laws and parts
of laws now in force, so far as the same may be in conflict herewith, are hereby repealed. . . ."

That parts of laws in force in 1901 when the Libel Law took effect, were in conflict therewith, and that
the Libel Law abrogated certain portion of the Spanish Penal Code, cannot be gainsaid. Title X of Book
II of the Penal Code, covering the subjects of calumny and insults, must have been particularly affected
by the Libel Law. Indeed, in the early case of Pardo de Tavera vs. Garcia Valdez ([1902], 1. Phil., 468),
the Supreme Court spoke of the Libel Law as "reforming the preexisting Spanish law on the subject
of calumnia and injuria." Recently, specific attention was given to the effect of the Libel Law on the
provisions of the Penal Code, dealing with calumny and insults, and it was found that those provisions
of the Penal Code on the subject of calumny and insults in which the elements of writing an publicity
entered, were abrogated by the Libel Law. (People vs. Castro [1922], p. 842, ante.)

The Libel Law must have had the same result on other provisions of the Penal Code, as for instance
article 256.
The facts here are that the editor of a newspaper published an article, naturally in writing, which may
have had the tendency to impeach the honesty, virtue, or reputation of members of the Philippine
Senate, thereby possibly exposing them to public hatred, contempt, or ridicule, which is exactly libel, as
defined by the Libel Law. Sir J. F. Stephen is authority for the statement that a libel is indictable when
defaming a "body of persons definite and small enough for individual members to be recognized as
such, in or by means of anything capable of being a libel." (Digest of Criminal Law, art. 267.) But in the
United States, while it may be proper to prosecute criminally the author of a libel charging a legislator
with corruption, criticisms, no matter how severe, on a legislature, are within the range of the liberty of
the press, unless the intention and effect be seditious. (3 Wharton's Criminal Law, p. 2131.) With these
facts and legal principles in mind, recall that article 256 begins: Any person who, by . . . writing, shall
defame, abuse, or insult any Minister of the Crown or other person in authority," etc.

The Libel Law is a complete and comprehensive law on the subject of libel. The well-known rule of
statutory construction is, that where the later statute clearly covers the old subject-matter of antecedent
acts, and it plainly appears to have been the purpose of the legislature to give expression in it to the
whole law on the subject, previous laws are held to be repealed by necessary implication. (1 Lewis'
Sutherland Statutory Construction, p. 465.) For identical reasons, it is evident that Act No. 277 had the
effect so much of this article as punishes defamation, abuse, or insults by writing.

Act No. 292 of the Philippine Commission, the Treason and Sedition Law, may also have affected
article 256, but as to this point, it is not necessary to make a pronouncement.

2. Effect of the change from Spanish to Amercian sevoreignty over the Philippine son article
256 of the Spanish Penal Code. — Appellant's main proposition in the lower court and again
energetically pressed in the appellate court was that article 256 of the Spanish Penal Code is
not now in force because abrogated by the change from Spanish to American sovereignty over
the Philippines and because inconsistent with democratic principles of government. This view
was indirectly favored by the trial judge, and, as before stated, is the opinion of three members
of this court.

Article 256 is found in Chapter V of title III of Book II of the Spanish Penal Code. Title I of Book II
punishes the crimes of treason, crimes that endanger the peace or independence of the state, crimes
against international law, and the crime of piracy. Title II of the same book punishes the crimes of lese
majeste, crimes against the Cortes and its members and against the council of ministers, crimes
against the form of government, and crimes committed on the occasion of the exercise of rights
guaranteed by the fundamental laws of the state, including crime against religion and worship. Title III
of the same Book, in which article 256 is found, punishes the crimes of rebellion, sedition, assaults
upon persons in authority, and their agents, and contempts, insults, injurias, and threats against
persons in authority, and insults, injurias, and threats against their agents and other public officers, the
last being the title to Chapter V. The first two articles in Chapter V define and punish the offense of
contempt committed by any one who shall be word or deed defame, abuse, insult, or threathen a
minister of the crown, or any person in authority. The with an article condemning challenges to fight
duels intervening, comes article 256, now being weighed in the balance. It reads as follows: "Any
person who, by word, deed, or writing, shall defame, abuse, or insult any Minister of the Crown or other
person in authority, while engaged in the performance of official duties, or by reason of such
performance, provided that the offensive minister or person, or the offensive writing be not addressed
to him, shall suffer the penalty of arresto mayor," — that is, the defamation, abuse, or insult of
any Minister of the Crown of the Monarchy of Spain (for there could not be a Minister of the Crown in
the United States of America), or other person in authority in the Monarchy of Spain.

It cannot admit of doubt that all those provisions of the Spanish Penal Code having to do with such
subjects as treason, lese majeste, religion and worship, rebellion, sedition, and contempts of ministers
of the crown, are not longer in force. Our present task, therefore, is a determination of whether article
256 has met the same fate, or, more specifically stated, whether it is in the nature of a municipal law or
political law, and is consistent with the Constitution and laws of the United States and the
characteristics and institutions of the American Government.
It is a general principle of the public law that on acquisition of territory the previous political relations of
the ceded region are totally abrogated. "Political" is here used to denominate the laws regulating the
relations sustained by the inhabitants to the sovereign. (American Insurance Co. vs. Canter [1828], 1
Pet., 511; Chicago, Rock Island and Pacific Railway Co. vs. McGlinn [1885], 114 U.S., 542;
Roa vs. Collector of Customs [1912], 23 Phil., 315.) Mr. Justice Field of the United States Supreme
Court stated the obvious when in the course of his opinion in the case of Chicago, Rock Island and
Pacific Railway Co. vs. McGlinn, supra, he said: "As a matter of course, all laws, ordinances and
regulations in conflict with the political character, institutions and Constitution of the new government
are at once displaced. Thus, upon a cession of political jurisdiction and legislative power — and the
latter is involved in the former — to the United States, the laws of the country in support of an
established religion or abridging the freedom of the press, or authorizing cruel and unusual
punishments, and he like, would at once cease to be of obligatory force without any declaration to that
effect." To quote again from the United States Supreme Court: "It cannot be admitted that the King of
Spain could, by treaty or otherwise, impart to the United States any of his royal prerogatives; and much
less can it be admitted that they have capacity to receive or power to exercise them. Every nation
acquiring territory, by treaty or otherwise, must hold it subject to the Constitution and laws of its own
government, and not according to those of the government ceding it." (Pollard vs. Hagan [1845], 3
Hos., 210.)

On American occupation of the Philippines, by instructions of the President to the Military Commander
dated May 28, 1898, and by proclamation of the latter, the municipal laws of the conquered territory
affecting private rights of person and property and providing for the punishment of crime were
nominally continued in force in so far as they were compatible with the new order of things. But
President McKinley, in his instructions to General Merritt, was careful to say: "The first effect of the
military occupation of the enemy's territory is the severance of the former political relation of the
inhabitants and the establishment of a new political power." From that day to this, the ordinarily it has
been taken for granted that the provisions under consideration were still effective. To paraphrase the
language of the United States Supreme Court in Weems vs. United States ([1910], 217 U. S., 349),
there was not and could not be, except as precise questions were presented, a careful consideration of
the codal provisions and a determination of the extent to which they accorded with or were repugnant
to the "'great principles of liberty and law' which had been 'made the basis of our governmental
system.' " But when the question has been squarely raised, the appellate court has been forced on
occasion to hold certain portions of the Spanish codes repugnant t democratic institutions and
American constitutional principles. (U.S. vs. Sweet [1901], 1 Phil., 18; U.S. vs. Balcorta [1913], 25 Phil.,
273; U.S. vs. Balcorta [1913], 25 Phil., 533; Weems vs. U.S., supra.)

The nature of the government which has been set up in the Philippines under American sovereignty
was outlined by President McKinley in that Magna Charta of Philippine liberty, his instructions to the
Commission, of April 7, 1900. In part, the President said:

In all the forms of government and administrative provisions which they are authorized to
prescribe, the Commission should bear in mind that he government which they are establishing
is designed not for our satisfaction or for the expression of our theoretical views, but for the
happiness, peace, and prosperity of the people of the Philippine Islands, and the measures
adopted should be made to conform to their customs, their habits, and even their prejudices, to
the fullest extent consistent with the accomplishment of the indispensable requisites of just and
effective government. At the same time the Commission should bear in mind, and the people of
the Islands should be made plainly to understand, that there are certain great principles of
government which have been made the basis of our governmental system, which we deem
essential to the rule of law and the maintenance of individual freedom, and of which they have,
unfortunately, been denied the experience possessed by us; that there are also certain
practical rules of government which we have found to be essential to the preservation of these
great principles of liberty and law, and that these principles and these rules of government must
be established and maintained in their islands for the sake of their liberty and happiness,
however much they may conflict with the customs or laws of procedure with which they are
familiar. It is evident that the most enligthened thought of the Philippine Islands fully
appreciates the importance of these principles and rules, and they will inevitably within a short
time command universal assent.
The courts have naturally taken the same view. Mr. Justice Elliott, speaking for our Supreme Court, in
the case of United States vs. Bull ([1910], 15 Phil., 7), said: "The President and Congress framed the
government on the model with which American are familiar, and which has proven best adapted for the
advancement of the public interests and the protection of individual rights and privileges."

Therefore, it has come with somewhat of a shock to hear the statement made that the happiness,
peace, and prosperity of the people of the Philippine Islands and their customs, habits, and prejudices,
to follow the language of President McKinley, demand obeisance to authority, and royal protection for
that authority.

According to our view, article 256 of the Spanish Penal Code was enacted by the Government of Spain
to protect Spanish officials who were the representatives of the King. With the change of sovereignty, a
new government, and a new theory of government, as set up in the Philippines. It was in no sense a
continuation of the old, although merely for convenience certain of the existing institutions and laws
were continued. The demands which the new government made, and makes, on the individual citizen
are likewise different. No longer is there a Minister of the Crown or a person in authority of such
exalted position that the citizen must speak of him only with bated breath. "In the eye of our
Constitution and laws, every man is a sovereign, a ruler and a freeman, and has equal rights with
every other man. We have no rank or station, except that of respectability and intelligence as opposed
to indecency and ignorance, and the door to this rank stands open to every man to freely enter and
abide therein, if he is qualified, and whether he is qualified or not depends upon the life and character
and attainments and conduct of each person for himself. Every man may lawfully do what he will, so
long as it is not malum in se or malum prohibitum or does not infringe upon the qually sacred rights of
others." (State vs. Shepherd [1903], 177 Mo., 205; 99 A. S. R., 624.)

It is true that in England, from which so many of the laws and institutions of the United States are
derived, there were once statutes of scandalum magnatum, under which words which would not be
actionable if spoken of an ordinary subject were made actionable if spoken of a peer of the realm or of
any of the great officers of the Crown, without proof of any special damage. The Crown of England,
unfortunately, took a view less tolerant that that of other sovereigns, as for instance, the Emperors
Augustus, Caesar, and Tiberius. These English statutes have, however, long since, become obsolete,
while in the United States, the offense of scandalum magnatum is not known. In the early days of the
American Republic, a sedition law was enacted, making it an offense to libel the Government, the
Congress, or the President of the United States, but the law met with so much popular disapproval,
that it was soon repealed. "In this country no distinction as to persons is recognized, and in practice a
person holding a high office is regarded as a target at whom any person may let fly his poisonous
words. High official position, instead of affording immunity from slanderous and libelous charges,
seems rather to be regarded as making his character free plunder for any one who desires to create a
senation by attacking it." (Newell, Slander and Libel, 3d ed., p. 245; Sillars vs. Collier [1890], 151
Mass., 50; 6 L.R.A., 680.)

Article 256 of the Penal Code is contrary to the genius and fundamental principles of the American
character and system of government. The gulf which separates this article from the spirit which inspires
all penal legislation of American origin, is as wide as that which separates a monarchy from a
democratic Republic like that of the United States. This article was crowded out by implication as soon
as the United States established its authority in the Philippine Islands. Penalties out of all proportion to
the gravity of the offense, grounded in a distorted monarchical conception of the nature of political
authority, as opposed to the American conception of the protection of the interests of the public, have
been obliterated by the present system of government in the Islands. 1awph!l.net

From an entirely different point of view, it must be noted that this article punishes contempts against
executive officials, although its terms are broad enough to cover the entire official class. Punishment
for contempt of non-judicial officers has no place in a government based upon American principles.
Our official class is not, as in monarchies, an agent of some authority greater than the people but it is
an agent and servant of the people themselves. These officials are only entitled to respect and
obedience when they are acting within the scope of their authority and jurisdiction. The American
system of government is calculated to enforce respect and obedience where such respect and
obedience is due, but never does it place around the individual who happens to occupy an official
position by mandate of the people any official halo, which calls for drastic punishment for
contemptuous remarks.

The crime of lese majeste disappeared in the Philippines with the ratification of the Treaty of Paris.
Ministers of the Crown have no place under the American flag.

To summarize, the result is, that all the members of the court are of the opinion, although for different
reasons, that the judgment should be reversed and the defendant and appellant acquitted, with
costs de officio. So ordered.

Ostrand and Johns, JJ., concur.

Separate Opinions

ARAULLO, C.J., concurring:

I concur with the dispositive part of the foregoing decision, that is, with the acquittal of the accused, for
the sole reason that the facts alleged in the information do not constitute a violation of article 256 of the
Penal Code; for although that article is in force with respect to calumny, injuria, or insult, by deed or
word, against an authority in the performance of his duties or by reason thereof, outside of his
presence, it is repealed by the Libel Law in so far as it refers to calumny, injuria, or insult committed
against an authority by writing or printing, as was that inserted in the said information.