Digest Mo Lang Statcon

A. STATUTES STRICTLY CONSTRUED PENAL LAWS 1. Carungcong v people and Sato Facts: - Mediatrix G. Carungcong filed a complaint-affidavit for estafa against her brother-inlaw, William Sato, a Japanese national. -

Prior to the death of mediatrix’s mother, Manolita Carungcong Y Gonzales, specifically on or about November 24, 1992, manolita’s son-in-law and mediatrix’ brother-in-law, William Sato, through fraudulent misrepresentations, was able to secure the signature and thumbmark of my mother on a Special Power of Attorney.

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William sato’s daughter attests to the fact that manolita signed the document in the belief that they were in connection with her taxes, not knowing, since she was blind, that the same was in fact a Special Power of Attorney to sell her Tagaytay properties.

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A judicious and thorough examination of Article 332 of the Revised Penal Code convinces the trial court of the correctness of the contention of the defense. While it is true that the death of Zenaida Carungcong-Sato has extinguished the marriage of accused with her, it does not erase the fact that accused and Zenaidas mother, herein complainant, are still son[-inlaw] and mother-in-law and they remained son[-in-law] and mother-in-law even beyond the death of Zenaida. o

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A reading of the facts alleged in the Information reveals that Sato is being charged not with simple estafa but with the complex crime of estafa through falsification of public documents. In particular, the Information states that Sato, by means of deceit, intentionally defrauded Manolita committed as follows: (a) Sato presented a document to Manolita (who was already blind at that time) and induced her to sign and thumbmark the same; (b) he made Manolita believe that the said document was in connection with her taxes when it was in fact a special power of attorney (SPA) authorizing his minor daughter Wendy to sell, assign, transfer or otherwise dispose of Manolitas properties in Tagaytay City; (c) relying on Satos inducement and representation, Manolita signed and thumbmarked the SPA in favor of Wendy Mitsuko Sato, daughter of Sato; (d) using the document, he sold the properties to third parties but he neither delivered the proceeds to Manolita nor accounted for the same and (d) despite repeated demands, he failed and refused to deliver the proceeds, to the damage and prejudice of the estate of Manolita.

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The absolutory cause under Article 332 is meant to address specific crimes against property, namely, the simple crimes of theft, swindling and malicious mischief. Thus, all other crimes, whether simple or complex, are not affected by the absolutory cause provided by the said provision. In other words, to apply Article 332 to the complex crime of estafa through falsification of public document would be to mistakenly treat the crime of estafa as a separate simple crime, not as the component crime that it is in that situation.

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While there may be two component crimes (estafa and falsification of documents), both felonies are animated by and result from one and the same criminal intent for which there is only one criminal liability. That is the concept of a complex crime. In other words, while there are two crimes, they are treated only as one, subject to a single criminal liability.

Article 332(1) of the Revised Penal Code, is very explicit and states no proviso. No criminal, but only civil liability, shall result from the commission of the crime of theft, swindling or malicious mischief fcommitted or caused mutually by xxx 1) spouses, ascendants and descendants, or relatives by affinity in the same line.

Dissatisfied with the trial courts rulings, the intestate estate of Manolita, represented by Mediatrix, filed a petition for certiorari in the Court of Appeals which, however, in a decision dated August 9, 2007, dismissed it. Issue: Whether or not the respondent may be exempt from criminal liability invoking art 332 of the RPC

Held: No The coverage of Article 332 is strictly limited to the felonies mentioned therein. The plain, categorical and unmistakable language of the provision shows that it applies exclusively to the simple crimes of theft, swindling and malicious mischief. It does not apply where any of the crimes mentioned under Article 332 is complexed with another crime, such as theft through falsification or estafa through falsification.

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Under Article 48 of the Revised Penal Code, the formal plurality of crimes (concursus delictuorum or concurso de delitos) gives rise to a single criminal liability and requires the imposition of a single penalty o Although [a] complex crime quantitatively consists of two or more crimes, it is only one crime in law on which a single penalty is imposed and the two or more crimes constituting the same are more conveniently termed as component crimes. o In [a] complex crime, although two or more crimes are actually committed, they constitute only one crime in the eyes of the law as well as in the conscience of the offender. The offender has only onecriminal intent. Even in the case where an offense is a necessary means for committing the other, the evil intent of the offender is only one.[

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The falsification of a public, official or commercial document may be a means of committing estafa because, before the falsified document is actually utilized to defraud another, the crime of falsification has already been consummated, damage or intent to cause damage not being an element of the crime of falsification of a public, official or commercial document. In other words, the crime of falsification was committed prior to the consummation of the crime of estafa. Actually utilizing the falsified public, official or commercial document to defraud another is estafa. The damage to another is caused by the commission of estafa, not by the falsification of the document.[

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Applying the above principles to this case, the allegations in the Information show that the falsification of public document was consummated when Sato presented a ready-made SPA to Manolita who signed the same as a statement of her intention in connection with her taxes. While the falsification was consummated upon the execution of the SPA, the consummation of the estafa occurred only when Sato later utilized the SPA. Damage or prejudice to Manolita was caused not by the falsification of the SPA (as no damage was yet caused to the property rights of Manolita at the time she was made to sign the document) but by the subsequent use of the said document. That is why the falsification of the public document was used to facilitate and ensure (that is, as a necessary means for) the commission of the estafa.

2. ELVIRA YU OH V COURT OF APPEALS June 6, 2003; PONENTE: Austria-Martinez, J. FACTS: Elvira Yu Oh (petitioner) bought jewelry from Solid Gold International Traders (private respondent) but failed to pay purchase price. The company filed civil complaints against her

for specific performance with the Pasig Regional Trial Court. Joaquin Novales III, general manager of Solid Gold, and the petitioner entered into a compromise agreement where petitioner was to issue ninety-nine post-dated checks amounting to P50,000 each to be deposited every 15th and 30th of the month from October 1990 to November 16, 1994. Balance of over P1 million was to be paid in cash, lump sum, on November16, 1994 as well. Petioner issued 10 checks amounting to P50,000 each, drawn against her account in EquitableBanking Corporation. When Novales deposited the checks with Far East Bank and Trust Company, however, checks were dishonored as the account was already closed. On October 5, 1992, Novales filed 10 separate Informations. These were consolidated and raffled to Branch 99 of the Pasig RTC. And on December 22, 1993 RTC rendered a decision finding the accused guilty of ten counts of violation of B.P. Blg. 22, also known as the Bouncing Checks Law. She was sentenced to one year of imprisonment for each count and indemnification of P500. Petitioner appealed to the Court of Appeals but the CA found it to be of no merit and affirmed the RTC’s decision. Thus, the petition on certiorari of the decision of the court of appeals, affirming the conviction of Elvira Yu Oh by the RTC dated May 30 1996 which denied her motion for reconsideration. ISSUES: 1.) Did the court err in not granting retroactive effect to R.A. 7691 in view of Art. 22 of the RPC? 2.) Did the appellate court err in construing B.P. Blg. 22? 3.) Is the notice of dishonor to the drawer important in warranting a conviction? RULING: Assailed Decision and Resolution of the CA are REVERSED and SET ASIDE. Petitioner is acquitted of the ten counts for insufficiency of evidence but is ordered to pay P500,000 to the private respondent, with 12% interest per annum from the date of finality of judgment. REASONING: 1. NO. The court did not err in not granting retroactive effect to R.A. 7691. A penal law, is an act of the legislature that prohibits certain acts and establishes penalties for its violations. It also defines crime, treats of its nature and provides for its punishment. R.A. No. 7691 does not prohibit certain acts or provides penalties for its violation; neither does it treat of the nature of crimes and its punishment. Consequently, R.A. No. 7691 is not a penal law, and therefore, Art. 22 of the RPC does not apply in the present case. R.A. No. 7691 which took effect on June 15, 1994, amended B.P. Blg. 129, and vested on the Metropolitan, Municipal and Municipal Circuit Trial Courts jurisdiction to try cases punishable by imprisonment of not more than six (6) years. Since R.A. No. 7691 vests jurisdiction on courts, it is apparent that said law is substantive. Jurisdiction being a matter of substantive law, the established rule is that the statute in force at the time of the commencement of the action determines the jurisdiction of the court. R.A. No. 7691 was not yet in force at the time of the commencement of the cases in

the trial court. It took effect only during the pendency of the appeal before the Court of Appeals. There is therefore no merit in the claim of petitioner that R.A. No. 7691 should be retroactively applied to this case and the same be remanded to the MTC. The Court has held that a "law vesting additional jurisdiction in the court cannot be given retroactive effect”. 2. NO. The appellate court did not err in construing B.P. Blg. 22. Petitioner: That because penal statutes must be strictly construed and resolved in favor of the accused, the “insufficiency” of funds referred to in B.P. Blg. 22 must not be made to cover those accounts that are “closed” or declared to have “no funds.” Post-dated checks, not being drawn payable on demand but rather on a fixed date, should also be considered as ordinary and not special bills of exchange.  Lozano v Martinez: Thrust of the Bouncing Checks law is to prohibit the making of worthless checks and putting them in circulation as their effects directly affect public interest. Such intent is reiterated in Cueme v People and in Recuerdo v People.  Claim on “closed accounts” not being included in the coverage of the B.P. has no merit in view of the legislative intent of the law which is to protect the interest of the community at large.  People v Nitafan: The law does not distinguish but merely provides that any person who makes/draws and issues any check knowing that he does not have enough funds shall be punished. 3. YES. The notice of dishonor to the drawer is important. Petitioner: That no notice of dishonor had been given to her as drawer of the dishonored checks, pursuant to the requirement expressly provided in B.P. Blg. 22.  Elements for conviction of violation of B.P. Blg. 22: a) Accused makes, draws or issues any check to apply to account or for value. b) Accused knows at the time of issuance that he/she does not have sufficient funds in, or credit with, the drawee bank for payment of the check in full upon its presentment. c) The check is subsequently dishonored. 

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For liability to attach, it is not enough for prosecution to simply prove that the checks were subsequently dishonored. Prosecution must also prove awareness/knowledge of the accused at the time of issuance. Basis of Yu Oh’s awareness of the lack/insufficiency was a line in her Counter-Affidavit where she declares that she told the general manager that “the actual status of the checks that the same might not be able to cover the amount of the said checks so stated therein [sic].”

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Presumption (provided in Sec. 2, B.P. Blg. 22) of knowledge cannot arise if such notice of non-payment by the bank is not sent to the maker/drawer. Jurisprudence has shown that notice of dishonor is vital insomuch as Sec. 2, B.P. Blg. 22 provides the drawee or maker five days in which to come up with the needed money. Procedural due process demands that a notice is served in order to afford the accused the opportunity to aver prosecution. Also, it was shown through the general manager’s testimony that no personal demands were made on the petitioner prior to the complaints being filed. Novales also apparently knew of the possible insufficiency of funds. The Court has ruled before that when the complainant was informed by the drawer of such, there is no violation of B.P. Blg. 22.

3. Villasenor v. Oco- Perguerra Facts: On August 18, 2001, disaster struck. In the wee hours of the morning, the Quezon City Manor Hotel went ablaze resulting in the death of seventy-four (74) people and injuries to scores of others. Investigation into the tragedy revealed that the hotel was a veritable fire trap. Petitioners, together with other officials of the City Engineering Office of Quezon City, arepresently facing criminal charges before the 5th Division of the Sandiganbayan for the crime of multiple homicide through reckless imprudence and for violation of Section 3 (e) of R.A. No. 3019. They were also charged administratively with gross negligence, gross misconduct and conduct prejudicial to the interest of the service in connection with the Manor Hotel inferno. In two separate Orders dated August 29, 2001 and September 7, 2001 in the administrative case, petitioners Villaseñor and Mesa were preventively suspended for a period of six (6) months, effective upon receipt of the suspension order. On September 20, 2006, during the pendency of the criminal case, respondent special prosecutor Louella Mae Oco-Pesquerra �led a motion for suspension pendente lite of petitioners. Petitioners opposed the motion, contending that they had already been suspended for six (6) months relative to the administrative case, based on the same facts and circumstances. They posited that any preventive suspension that may be warranted in the criminal case was already absorbed by the preventive suspension in the administrative case because both the criminal and administrative cases were anchored on the same set of facts.

Issue: Petitioners have resorted to the present recourse, hoisting the lone issue of "WHETHER OR NOT THE PUBLIC RESPONDENT ACTED IN EXCESS OF JURISDICTION AND/OR WITH GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION IN ORDERING THE SUSPENSION PENDENTE LITE OF HEREIN PETITIONERS DESPITE THE FACT THAT THEY HAD ALREADY BEEN PREVIOUSLY SUSPENDED ADMINISTRATIVELY BASED ON THE SAME FACTS AND CIRCUMSTANCES. Statcon Issue: It is petitioners' contention that as a penal statute, the provision on preventive suspension should be strictly construed against the State and liberally in their favor. Provision: Section 13 of R.A. No. 3019 Suspension and loss of benefits . — Any incumbent public offcer against whom any criminal prosecution under a valid information under this Act or under Title 7, Book II of the Revised Penal Code or for any offense involving fraud upon the government or public funds or property, whether as a simple or as a complex offense and in whatever stage of the execution and mode of participation, is pending in court, shall be suspended from office. Held: We cannot agree. Section 13 of R.A. No. 3019 on preventive suspension is not a penal provision. It is procedural in nature. Hence, the strict construction rule finds no application. The Court expounded on this point in Buenaseda v Flavier: Penal statutes are strictly construed while procedural statutes are liberally construed (Crawford, Statutory Construction, Interpretation of Laws, pp. 460-461; Lacson v. Romero , 92 Phil. 456 [1953]). The test in determining if a statute is penal is whether a penalty is imposed for the punishment of a wrong to the public or for the redress of an injury to an individual (59 Corpuz Juris, Sec. 658; Crawford, Statutory Construction, pp. 496-497). A Code prescribing the procedure in criminal cases is not a penal statute and is to be interpreted liberally (People v. Adler, 140 N.Y. 331; 35 N.E. 644). SATUTES IN DEROGATION OF RIGHTS 1. Heirs of Suguitan vs. City of Mandaluyong Petitioner: Heirs of Alberto Suguitan Respondent: City of Mandaluyong Facts:  The respondent issued a resolution authorizing Mayor Banjamin Abalos to institute expropriation proceeding over the property of Alberto Suguitan for the expansion of Mandaluyong Medical Center. Alberto Suguitan refused the offer Mayor Abalos in

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buying his property. City of Mandaluyong filed a complaint for expropriation with the RTC of Pasig. The trial court denied the motion to dismiss filled by Alberto Suguitan and allowed the expropriation of the subject property. The petitioner asserted that the respondent may only exercise its delegated power of eminent domain by means of an ordinance as required by Section 19 of Republic Act No. 7160 and not by means of a mere resolution. Petition for review for reversal of the Order by the RTC of Pasig.

 Issue: Whether a resolution is a sufficient antecedent for the filling of expropriation proceedings with the RTC. Ruling: No. Petition is granted and the decision of RTC of Pasig is reversed and set aside. An examination of the applicable law will show that an ordinance is necessary to authorize the filing of a complaint with the proper court since, beginning at this point, the power of eminent domain is already being exercised. “Private property shall not be taken for public use without just compensation.” The due process and equal protection clauses act as additional safeguards against the arbitrary exercise of this governmental power. Since exercise of the power of eminent domain affects an individual’s right to private property, a constitutionally-protected right necessary for the preservation and enhancement of personal dignity and intimately connected with the rights to life and liberty the need for its circumspect operation cannot be overemphasized. The exercise of the rights of eminent domain, whether directly by the State, or by its authorized agents, is necessarily in derogation of private rights, and the rule in that case is that the authority must be strictly construed. No species of property is held by individuals with greater tenacity, and none is guarded by the constitution and the laws more sedulously, than the right to the freehold of inhabitants. When the legislature interferes with that right, and, for greater public purposes, appropriates the land of an individual without his consent, the plain meaning of the law should not be enlarged by doubt[ful] interpretation. The statutory power of taking property from the owner without his consent is one of the most delicate exercise of governmental authority. It is to be watched with jealous scrutiny. Important as the power may be to the government, the inviolable sanctity which all free constitutions attach to the right of property of the citizens, constrains the strict observance of substantial provisions of the law which are prescribed as mode of the exercise of the power, and to protect it from abuse.... The power of eminent domain is essentially legislative in nature. It is firmly settled, however, that such power may validly delegated to local government units, other public entities and public utilities, although the scope of this delegated legislative power is necessarily narrower than that of the delegating authority and may only be exercised in

strict compliance with the terms of the delegating law. The basis of the exercise of the power of eminent domain by local government units is Section 19 of RA 7160: A local government unit may, through its chief executive and acting pursuant to an ordinance, exercise the power of eminent domain for public use, or purpose or welfare for the benefit of the poor and the landless, upon payment of just compensation, pursuant to the provisions of the Constitution and pertinent laws: Provided, however, That the power of eminent domain may not be exercised unless a valid and definite offer has been previously made to the owner, and such offer was not accepted: Provided, further, That the local government unit may immediately take possession of the property upon the filing of the expropriation proceedings and upon making a deposit with the proper court of at least fifteen percent (15%) of the fair market value of the property based on the current tax declaration of the property to be expropriated: Provided, finally, That, the amount to be paid for the expropriated property shall be determined by the proper court, based on the fair market value at the time of the taking of the property. - The City of Mandaluyong seeks to exercise the power of eminent domain over petitioners’ property by means of resolution, in contravention of the first requisite. The law is clear and free from ambiguity. Section 19 of the Code requires an ordinance, not resolution, for exercise of the power of eminent domain. - 1st requisite: An ordinance is enacted by the local legislative council authorizing the local chief executive, in behalf of the local government unit, to exercise the power of eminent domain or pursue expropriation proceedings over a particular property. - An ordinance promulgated by the local legislative body authorizing its local chief executive to exercise the power of eminent domain is necessary prior to the filing by the latter of the complaint with the proper court, and not only after the court has determined the amount of just compensation to which the defendant is entitled. In inconsistency between the Code (Section 19 of RA 7160) and the IRR (Article 36, Rule VI): The law itself surely prevails over said rule which merely seeks to implement it. It is automatic that the clear letter of the law is controlling and cannot be amended by mere administrative rule issued for its implementing. Besides, what the discrepancy seems to indicate is a mere oversight in the wording of the implementing rules, since Article 32, Rule VI thereof, also requires that, in exercising the power of eminent domain, the chief executive of the LGU must act pursuant to an ordinance. While we remain conscious of the constitutional policy of promoting local autonomy, we cannot grant judicial sanction to local government unit’s exercise of its delegated power of eminent domain in contravention of the very law giving it such power. 2. PHILACOR CREDIT CORPORATION vs. COMMISSIONER OF INTERNAL REVENUE FACTS:  Philacor is a domestic corporation organized under Philippine laws and is engaged in the business of retail financing. Through retail financing, a

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prospective buyer of a home appliance — with neither cash nor any credit card — may purchase appliances on installment basis from an appliance dealer. After Philacor conducts a credit investigation and approves the buyer's application, the buyer executes a unilateral promissory note in favor of the appliance dealer. The same promissory note is subsequently assigned by the appliance dealer to Philacor Philacor received Pre-Assessment Notices covering the alleged deficiency income, percentage and DSTs, including increments Philacor protested the PANs, with a request for reconsideration and reinvestigation. It alleged that the assessed deficiency income tax was erroneously computed when it failed to take into account the reversing entries of the revenue accounts and income adjustments, such as repossessions, write-offs and legal accounts. Similarly, the Bureau of Internal Revenue (BIR) failed to take into account the reversing entries of repossessions, legal accounts, and write-offs when it computed the percentage tax; thus, the total income reported, that the BIR arrived at, was not equal to the actual receipts of payment from the customers. As for the deficiency DST, Philacor claims that the accredited appliance dealers were required by law to affix the documentary stamps on all promissory notes purchased until the enactment of Republic Act No. 7660, otherwise known as An Act Rationalizing Further the Structure and Administration of the Documentary Stamp Tax, 9 which took effect on January 15, 1994 The CTA rendered its decision and concluded that Philacor failed to declare part of its income making it liable for deficiency income and percentage tax. The CTA also ruled that Philacor is liable for the DST on the issuance of the promissory notes and their subsequent transfer or assignment. The CTA partially granted Philacor's motion in the resolution of April 6, 2004, 15 wherein it cancelled the assessment for deficiency income tax and deficiency percentage tax. These assessments were withdrawn because the CTA found that Philacor had correctly declared its income; the discrepancy of P2,180,564.00 had been properly accounted for as proper adjustments to Philacor's net revenues. Nevertheless, the CTA Division sustained the assessment for deficiency DST in the amount of P673,633.88. Philacor filed a petition for review before the CTA en bacn and the CTA en banc affirmed the resolution of the CTA division. It reiterated that Philacor is liable for the DST due on two transactions — the issuance of promissory notes and their subsequent assignment in favor of Philacor. With respect to the issuance of the promissory notes, Philacor is liable as the transferee which "accepted"

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the promissory notes from the appliance dealer in accordance with Section 180 of Presidential Decree No. 1158, as amended (1986 Tax Code) o citing Section 42 19 of Regulations No. 26, 20 the CTA en banc held that a person "using" a promissory note is one of the persons who can be held liable to pay the DST. Since the subject promissory notes do not bear documentary stamps, Philacor can be held liable for DST o As for the assignment of the promissory notes, the CTA en banc held that each and every transaction involving promissory notes is subject to the DST under Section 173 of the 1986 Tax Code Ggmyg

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Whether or not Philacor is liable for the documentary stamp tax on the issuance of the promissory notes?  RULING: NO. Philacor, as an assignee or transferee of the promissory notes, is not liable for the assignment or transfer of promissory notes as this transaction is not taxed under the law. Neither party questions that the issuances of promissory notes are transactions which are taxable under the DST  Section 180. Stamp tax on promissory notes, bills of exchange, drafts, certificates of deposit, debt instruments used for deposit substitutes and others not payable on sight or demand. — On all bills of exchange (between points within the Philippines), drafts, or certificates of deposits, debt instruments used for deposit substitutes or orders for the payment of any sum of money otherwise than at sight or on demand, on all promissory notes, whether negotiable or non-negotiable except bank notes issued for circulation, and on each renewal of any such note, there shall be collected a documentary stamp tax of twenty centavos on each two hundred pesos, or fractional part thereof, of the face value of any such bill of exchange, draft certificate of deposit, debt instrument, or note.  Under the undisputed facts and the above law, the issue that emerges is: who is liable for the tax? o Section 173 of the 1997 National Internal Revenue Code (1997 NIRC) names those who are primarily liable for the DST and those who would be secondarily liable: Section 173.Stamp taxes upon documents, instruments, and papers. — Upon documents, instruments, and papers, and upon acceptances, assignments, sales, and transfers of the obligation, right, or property

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incident thereto, there shall be levied, collected and paid for, and in respect of the transaction so had or accomplished, the corresponding documentary stamp taxes prescribed in the following sections of this Title, by the person making, signing, issuing, accepting, or transferring the same, and at the same time such act is done or transaction had: Provided, that wherever one party to the taxable document enjoys exemption from the tax herein imposed, the other party thereto who is not exempt shall be the one directly liable for the tax Philacor did not make, sign, issue, accept or transfer the promissory notes. The acts of making, signing, issuing and transferring are unambiguous. The buyers of the appliances made, signed and issued the documents subject to tax, while the appliance dealer transferred these documents to Philacor which likewise indisputably received or "accepted" them. Acceptance," however, is an act that is not even applicable to promissory notes, but only to bills of exchange. Under Section 132 of the Negotiable Instruments Law (which provides for how acceptance should be made), the act of acceptance refers solely to bills of exchange. Its object is to bind the drawee of a bill and make him an actual and bound party to the instrument Further, in a ruling adopted by the BIR as early as 1955, acceptance has already been given a narrow definition with respect to incoming foreign bills of exchange, not the common usage of the word "accepting" as in receiving: The word "accepting" appearing in Section 210 of the National Internal Revenue Code has reference to incoming foreign bills of exchange which are accepted in the Philippines by the drawees thereof. o This ruling, to our mind, further clarifies that a party to a taxable transaction who "accepts" any documents or instruments in the plain and ordinary meaning of the act (such as the shipper in the cited case) does not become primarily liable for the tax. In the same way, Philacor cannot be made primarily liable for the DST on the issuance of the subject promissory notes, just because it had "accepted" the promissory notes in the plain and ordinary meaning.

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Revenue Regulations No. 9-2000 26 interprets the law more widely so that all parties to a transaction are primarily liable for the DST, and not only the person making, signing, issuing, accepting or transferring the same becomes liable as the law provides. It provides: SEC. 2. Nature of the Documentary Stamp Tax and Persons Liable for the Tax –

(a) In General. — The documentary stamp taxes under Title VII of the Code is a tax on certain transactions. It is imposed against "the person making, signing, issuing, accepting, or transferring" the document or facility evidencing the aforesaid transactions. Thus, in general, it may be imposed on the transaction itself or upon the document underlying such act. Any of the parties thereto shall be liable for the full amount of the tax due: Provided, however, that as between themselves, the said parties may agree on who shall be liable or how they may share on the cost of the tax. (b) Exception. — Whenever one of the parties to the taxable transaction is exempt from the tax imposed under Title VII of the Code, the other party thereto who is not exempt shall be the one directly liable for the tax. o

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But even under these terms, the liability of Philacor is not a foregone conclusion as from the face of the promissory note itself, Philacor is not a party to the issuance of the promissory notes, but merely to their assignment. On the face of the documents, the parties to the issuance of the promissory notes would be the buyer of the appliance, as the maker, and the appliance dealer, as the payee. Nor can the CIR justify his position that Philacor is liable for the tax by citing Section 42 of Regulations No. 26, which was issued by the Department of Finance on March 26, 1924: Section 42. Responsibility for payment of tax on promissory notes . — The person who signs or issues a promissory note and any person transferring or using a promissory note can be held responsible for the payment of the documentary stamp tax. The rule uses the word "can" which is permissive, rather than the word "shall," which would make the liability of the persons named definite and unconditional. In this sense, a person using a promissory note can be made liable for the DST if he or she is: (1) among those persons enumerated under the law. Such interpretation would avoid any conflict between Section 173 of the 1997 NIRC and Section 42 of Regulations No. 26 and would make it unnecessary for us to strike down the latter as having gone beyond the law it seeks to interpret. However, we cannot interpret Section 42 of Regulations No. 26 to mean that anyone who "uses" the document, regardless of whether

such person is a party to the transaction, should be liable, as this reading would go beyond Section 173 of the 1986 Tax Code — the law that the rule seeks to implement. Implementing rules and regulations cannot amend a law for they are intended to carry out, not supplant or modify, the law. 31 To allow Regulations No. 26 to extend the liability for DST to persons who are not even mentioned in the relevant provisions of any of our Tax Codes, particularly the 1986 Tax Code (the relevant law at the time of the subject transactions) would be a clear breach of the rule that a statute must always be superior to its implementing regulations. 

As Philacor correctly points out, there are provisions in the 1997 NIRC that specifically impose the DST on the transfer and/or assignment of documents evidencing particular transactions. We can safely conclude that where the law did not specify that such transfer and/or assignment is to be taxed, there would be no basis to recognize an imposition

3. CIR v KUDOS Fatcs: - On April 15, 1999, respondent Kudos Metal Corporation filed its Annual Income Tax Return (ITR) for the taxable year 1998. - Pursuant to a Letter of Authority dated September 7, 1999, the Bureau of Internal Revenue (BIR) served upon respondent three Notices of Presentation of Records. - Respondent failed to comply with these notices, hence, the BIR issued a Subpeona Duces Tecum dated September 21, 2006, receipt of which was acknowledged by respondents President, Mr. Chan Ching Bio, in a letter dated October 20, 2000. - Respondent filed three waiver of the defense of prescription. - On August 25, 2003, the BIR issued a Preliminary Assessment Notice for the taxable year 1998 against the respondent. This was followed by a Formal Letter of Demand with Assessment Notices for taxable year 1998, dated September 26, 2003 which was received by respondent on November 12, 2003. - Respondent challenged the assessments by filing its Protest on Various Tax Assessments on December 3, 2003 and its Legal Arguments and Documents in Support of Protests against Various Assessments on February 2, 2004. - Believing that the governments right to assess taxes had prescribed, respondent filed on August 27, 2004 a Petition for Review with the CTA - On October 4, 2005, the CTA Second Division issued a Resolution canceling the assessment notices issued against respondent for having been issued beyond the prescriptive period.

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It found the first Waiver of the Statute of Limitations incomplete and defective for failure to comply with the provisions of Revenue Memorandum Order (RMO) No. 20-90. o The waiver failed to indicate the date of acceptance. Such date of acceptance is necessary to determine whether the acceptance was made within the prescriptive period o the fact of receipt by the taxpayer of his file copy was not indicated on the original copy. The requirement to furnish the taxpayer with a copy of the waiver is not only to give notice of the existence of the document but also of the acceptance by the BIR and the perfection of the agreement.  The subject waiver is therefore incomplete and defective. As such, the three-year prescriptive period was not tolled or extended and continued to run. Section 203 of the National Internal Revenue Code of 1997 (NIRC) mandates the government to assess internal revenue taxes within three years from the last day prescribed by law for the filing of the tax return or the actual date of filing of such return, whichever comes later. Hence, an assessment notice issued after the three-year prescriptive period is no longer valid and effective.

Issue: Whether or not the doctrine of estoppel can be applied in this case Held: No We find no merit in petitioners claim that respondent is now estopped from claiming prescription since by executing the waivers, it was the one which asked for additional time to submit the required documents. The doctrine of estoppel cannot be applied in this case as an exception to the statute of limitations on the assessment of taxes considering that there is a detailed procedure for the proper execution of the waiver, which the BIR must strictly follow. The BIR cannot hide behind the doctrine of estoppel to cover its failure to comply with RMO 20-90 and RDAO 05-01, which the BIR itself issued. As stated earlier, the BIR failed to verify whether a notarized written authority was given by the respondent to its accountant, and to indicate the date of acceptance and the receipt by the respondent of the waivers. Having caused the defects in the waivers, the BIR must bear the consequence. It cannot shift the blame to the taxpayer. To stress, a waiver of the statute of limitations, being a derogation of the taxpayers right to security against prolonged and unscrupulous investigations, must be carefully and strictly construed.

As to the alleged delay of the respondent to furnish the BIR of the required documents, this cannot be taken against respondent. Neither can the BIR use this as an excuse for issuing the assessments beyond the three-year period because with or without the required documents, the CIR has the power to make assessments based on the best evidence obtainable. 4.) MAPULO MINING ASSOCIATION and E.V. CHAVEZ & ASSOCIATES, represented by ANTONIO M. CHAVEZ, petitioners, vs. HON. FERNANDO LOPEZ, in his official capacity as the SECRETARY OF AGRICULTURE AND NATURAL RESOURCES; HON. FERNANDO S. BUSUEGO, JR., in his official capacity as the DIRECTOR OF MINES; and PROJECTS & VENTURES, INC., respondents. This is a petition under Section 61 of the Mining Act (C.A. NO. 137), as amended by R.A. No. 4388, for review of the 24 March 1969 decision of then Secretary of the Department of Agriculture and Natural Resources (DANR), Hon. Fernando Lopez, in DANR Case No. 3359 entitled Mapulo Mining Association and E.V. Chavez & Associates versus Projects & Ventures, Inc., 1 affirming the 5 July 1968 Order of the Director of the Bureau of Mines, Hon. Fernando S. Busuego, Jr., which dismissed petitioners' adverse claim against private respondent's Application For Lease of Mining Claims over certain mineral lands located at Taysan, Batangas, principally on the ground that said claim was filed one (1) day after the expiration of the period within which to do so pursuant to Section 72 of the Mining Act. FACTS:  In 1940, Eliseo Chavez and his wife, Lucia B. Mercado, located a limestone mining claim (then known as the San Jose Placer Claim) over a piece of registered private land situated at Barrio Mapulo, Taysan, Batangas with an area of 12.4469 hectares. The said land is covered by Original Certificate of Title (OCT) No. RO-174(0-510). On 6-12 and 18-27 March 1943, the lease survey of the placer claim was undertaken by then Assistant Mineral Land Surveyor of the Bureau of Mines, Mr. Julian Lagman; on 5 July 1943, then Director of Mines, Hon. Quirico A. Abadilla, approved the survey plan (Pla-163) prepared by the former. Under a temporary permit to extract minerals issued to them by the Director of Mines on 3 February 1943, spouses extracted and mined limestone from the land.  Subsequently, the Mineral Lands and Administrative Division of the Bureau of Mines declared as abandoned this claim of Mr. Chavez due to his failure to comply with requirements. Thereafter, the Mapulo Mining Association, petitioner herein, relocated the area through Antonio Chavez on 16-22 December 1963 and registered it as the Mapulo Placer Mining Area with the Office of the Mining Recorder (Register of Deeds) of Batangas on 22 January 1964.  On 4 February 1964, the Mapulo Mining Association filed an application for a mining lease, which was docketed as PLA-V-1136.  On 26-30 November 1963 and 1-4 December 1963, petitioner E.V. Chavez & Associates located mining claims known as "Chavez I" and "Chavez II" inside private

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agricultural lands belonging to several individuals. On 5 December 1963, the corresponding declarations of location were registered in the Office of the Mining Recorder of Batangas. An application for mining lease over the claims was filed on 25 August 1967. Upon the other hand, on 6-10 June 1966, private respondent Projects & Ventures, Inc. (PROVEN) located mining claims known as "BAT 40, 41, 60, 22, 23, 38, 37, 44, 57, 61, 62, 63, 64, 39, 42. 58, 59, 43, and 24" over an area embraced by petitioners' mining claims. On 2 August 1967, petitioners filed with the Bureau of Mines an application for an order of lease survey of the "Mapulo Placer Claim," "Chavez I" and "Chavez II" mining claims. This application was denied on the ground that said claims are in conflict with the claims of the private respondent. On 29 August 1967, petitioners filed an Adverse Claim and/or Opposition to the Issuance of Mining Lease dated 28 August 1967. Private respondent, on 20 October 1967, filed a Motion to Dismiss petitioners' adverse claim on the ground that the same was filed one (1) day late. On 20 November 1967, petitioners opposed the motion to dismiss contending that: (1) Section 72 of the Mining Act, as amended, requiring the publication of the notice of mining lease application in the provincial newspaper, has not yet been complied with and so, therefore, there is no publication deadline to speak of; (2) the issues of the Official Gazette dated 7, 14 and 21 August 1967, where private respondent's notice of application was inserted, were actually released to the public only on 5, 19 and 29 September 1967, respectively; (3) private respondent's mining claims were located in violation of Sections 28(d) and 60 of the Mining Act as the same had already been previously located by other parties; and (4) private respondent's declarations of location are fraudulent as they are mere table locations, no actual location having been performed. On 5 July 1968, the Director of Mines dismissed petitioners' adverse claim on the ground that: (1) the publication of private respondent's notice of filing of applications for lease in a provincial newspaper is not necessary; (2) with respect to the publication in the Official Gazette, what is controlling is not the date of the actual release but rather the date appearing thereon; and (3) petitioners are guilty of laches in filing their adverse claim only on 29 August 1967. On 25 July 1968, petitioners moved for a reconsideration of the Order but the same was later denied.

ISSUES: 1.) Whether or not there was valid and sufficient publication of the notice of private respondent's application for a mining lease over its claims; and

2.) Assuming that there was, whether or not petitioners' Adverse Claim and/or Opposition to such application was seasonably filed. RULING: The petition is GRANTED. The Decision of the then Secretary of Agriculture and Natural Resources of 24 March 1969 in DANR Case No. 3359 affirming the Order of the then Director of the Bureau of Mines of 5 July 1968 in Mines Administrative Case No. V-417 is SET ASIDE and the Adverse Claim and/or Opposition filed by petitioners is REINSTATED. REASONING: 1.) The Court agrees with the petitioner stating that there was no publication of the notice in a newspaper published in the municipality or province in which the mining claim was located. Section 72 of the Mining Act provides, inter alia, that: Upon receipt of the application, and provided that the requirements of this Act have been substantially complied with, the Director of the Bureau of Mines shall publish a notice that such application has been made, once a week for a period of three consecutive weeks, in the Official Gazette and in two newspapers, one published in Manila either in English or Spanish, and the other published in the municipality or province in which the mining claim is located, if there is such newspaper, otherwise, in the newspaper published in the nearest municipality or province. . . . There was no publication, however, of the notice in a newspaper published in the municipality or province in which the mining claim was located, i.e., in Batangas. It is not denied that at that time, there were two (2) weekly newspapers in Batangas, namely the People's Courier and The Batangas Reporter. All that respondent Director of Mines could say in his challenged Order of 5 July 1968 is that "We are not aware of the publication in Batangas of such newspapers." This non-awareness does not mean that the newspapers do not in fact exists; besides, the petitioners presented him with certifications issued by the Circulation Manager of the People's Courier (Exh. "5") and the Editor of The Batangas Reporter (Exh. "4") attesting to the existence of said periodicals. And even granting for the sake of argument that these two (2) local newspapers do not exist, the fact remains that there was still no publication of the notice in a newspaper published in the nearest municipality or province. Petitioners maintain that publication in a newspaper published in the municipality or province where the claims are located, if there be such a newspaper, or in a newspaper published in the nearest municipality or province, is mandatory. The Court agrees with petitioners that the publication requirements prescribed in Section 72 of the Mining Act are mandatory and that substantial compliance therewith is not enough. Such mandatory character is obvious from the Section itself. It is evident that the newspaper first mentioned refers to a periodical published in Manila and circulated in the Philippines while the second refers to a local newspaper. Publication in one does not mean that the applicant can dispense with publication in the other. Otherwise, it would have been absurd, nay ridiculous, for the law to require publication in both

newspapers in addition to publication in the Official Gazette. The legislature certainly abhors absurdity. Corollarily, courts should not give a statute a meaning that would lead to absurdity. 39 Besides, Section 72 imposes upon the Director of Mines the duty, "[u]pon receipt of the application, and provided that the requirements of this Act have been complied with," to publish the notice in the Official Gazette and in the said two (2) newspapers. The language of the mandate is undeniably clear and unequivocal. It should be taken to mean exactly what it says: . . . It is the rule in statutory construction that if the words and phrases of a statute are not obscure or ambiguous, its meaning and the intention of the legislature must be determined from the language employed, and, where there is no ambiguity in the words, there is no room for construction (Black on Interpretation of Laws, sec. 51). The courts may not speculate as to the probable intent of the legislature apart from the words (Hondoras vs. Soto, 8 Am. St., Rep. 744). The reason for the rule is that the legislature must be presumed to know the meaning of words, to have used words advisedly and to have expressed its intent by the use of such words as are found in the statute (50 Am. Jur. p. 212). Considering then that there was no publication in a newspaper published in the municipality or province where the subject claims are located — Batangas — despite the existence of two (2) weekly newspapers therein, it is clear that there was non-compliance with Section 72 of the Mining Act and that public respondents acted with grave abuse of discretion in holding that the publication in the Philippines Herald, El Debate and the Official Gazette was sufficient.

telecommunications businesses transacted under this franchise by the grantee, its successors or assigns, and the said percentage shall be in lieu of all taxes on this franchise or earnings thereof:

STATUTES GRANTING PRIVILIGES

Petitioner’s claim: The BIR Commissioner excepts. He submits that the exempting "in lieu of all taxes" clause covers direct taxes only, adding that for indirect taxes to be included in the exemption, the intention to include must be specific and unmistakable. He thus faults the Court of Appeals for erroneously declaring PLDT exempt from payment of VAT and other indirect taxes on its importations. To the Commissioner, PLDT's claimed entitlement to tax refund/credit is without basis inasmuch as the 3% franchise tax being imposed on PLDT is not a substitute for or in lieu of indirect taxes.

1. CIR v. PLDT Facts: PLDT is a grantee of a franchise under Republic Act (R.A.) No. 7082 to install, operate and maintain a telecommunications system throughout the Philippines. For equipment, machineries and spare parts it imported for its business. PLDT paid the following (a) compensating tax,advance sales tax and other internal revenue taxes. For similar importations, PLDT paid value-added tax (VAT). On March 15, 1994, PLDT addressed a letter to the BIR seeking a confirmatory ruling on its tax exemption privilege under Section 12 of R.A. 7082, which reads: Provision: Sec. 12.The grantee . . . shall be liable to pay the same taxes on their real estate, buildings, and personal property, exclusive of this franchise, as other persons or corporations are now or hereafter may be required by law to pay. In addition thereto, the grantee, . . . shall pay a franchise tax equivalent to three percent (3%) of all gross receipts of the telephone or other

The BIR responded : The "in lieu of all taxes" provision under Section 12 of RA 7082 clearly exempts PLDT from all taxes including the 10% value-added tax (VAT) prescribed by Section 101 (a) of the same Code on its importations of equipment, machineries and spare parts necessary in the conduct of its business covered by the franchise, except the aforementioned enumerated taxes for which PLDT is expressly made liable. In view thereof, this Office . . . hereby holds that PLDT, is exempt from VAT on its importation of equipment, machineries and spare parts . . .needed in its franchise operations. Armed with the foregoing BIR ruling, PLDT filed on December 2, 1994 a claim for tax credit/refund of the VAT, compensating taxes, advance sales taxes and other taxes it had been paying "in connection with its importation of various equipment, machineries and spare parts needed for its operations". CTA granted PLDT’s petition.

Issue: WON "in lieu of all taxes " clause found in Section 12 of PLDT's franchise (R.A. 7082) covers all taxes, whether direct or indirect. Held: NO. TAX EXEMPTIONS; STATUTES GRANTING TAX EXEMPTIONS MUST BE CONSTRUED STRICTLY AGAINST THE TAXPAYER AND LIBERALLY IN FAVOR OF THE TAXING AUTHORITY. — Time and again, the Court has stated that taxation is the rule, exemption is the exception. Accordingly, statutes granting tax exemptions must be construed in strictissimi juris against the taxpayer and liberally in favour of the taxing authority. To him, therefore, who claims a refund or exemption from tax payments rests the burden of justifying the exemption by words too plain to be mistaken and too categorical to be misinterpreted. . . . It cannot be

overemphasized that tax exemption represents a loss of revenue to the government and must, therefore, not rest on vague inference. When claimed, it must be strictly construed against the taxpayer who must prove that he falls under the exception. And, if an exemption is found to exist, it must not be enlarged by construction, since the reasonable presumption is that the state has granted in express terms all it intended to grant at all, and that, unless the privilege is limited to the very terms of the statute the favor would be extended beyond dispute in ordinary cases.

to the case since it affects public interest (involves taxes) and affects the powers of the legislative. DOCTRINE: Locus Standi or Legal Standing to file a petition as taxpayers and member of the House of Representatives FACTS: •

[T]he clause "in lieu of all taxes" in Section 12 of RA 7082 is immediately followed by the limiting or qualifying clause "on this franchise or earnings thereof", suggesting that the exemption is limited to taxes imposed directly on PLDT since taxes pertaining to PLDT's franchise or earnings are its direct liability. Accordingly, indirect taxes, not being taxes on PLDT's franchise or earnings, are outside the purview of the "in lieu" provision. If we were to adhere to the appellate court's interpretation of the law that the "in lieu of all taxes " clause encompasses the totality of all taxes collectible under the Revenue Code, then, the immediately following limiting clause "on this franchise and its earnings" would be nothing more than a pure jargon bereft of effect and meaning whatsoever. Needless to stress, this kind of interpretation cannot be accorded a governing sway following the familiar legal maxim redendo singula singulis meaning, take the words distributively and apply the reference. Under this principle, each word or phrase must be given its proper connection in order to give it proper force and effect, rendering none of them useless or superfluous.

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• 2. DEL MAR vs. PAGCOR G.R. No. 138298 / November 29, 2000 • NATURE:

Two consolidated petitions concerning the franchise granted to PAGCOR

SUMMARY: PAGCOR requested legal advice from the Secretary of Justice if it’s authorized under its charter to operate jai-alai games (a form of sport). The Secretary of Justice said that PAGCOR has the authority; hence PAGCOR has the power under its charter to operate. Petitioner del Mar filed a petition for prohibition preventing PAGCOR from managing jai-alai since its illegal and devoid of any basis either from the Constitution or PAGCOR’s own Charter. However, PAGCOR still entered in an agreement with BELLE and FILGAME, hence, del Mar filed a Petition for Certiorari questioning the validity of the agreement. Members of the House of Representative also filed a petition stating that operation of PAGCOR of jai-alai is illegal because it is not included in its scope. Respondents then questioned the locus standi or legal standing of petitioners filing as taxpayers and members of the House of representatives. As stated by the Court, they have legal standing

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PAGCOR requested for legal advice from the Secretary of Justice as to whether or not it is authorized by its Charter to operate and manage jai-alai frontons in the country in relation to Section 1 and 10 of P.D. No. 1869. The Secretary of Justice opined that the authority of PAGCOR to operate and maintain games of chance or gambling extends to jai-alai which is a form of sport or game played for bets and that the Charter of PAGCOR amounts to a legislative franchise for the purpose. On May 6, 1999, petitioner del Mar filed a Petition for Prohibition to prevent PAGCOR from managing and/or operating the jai-alai or Basque pelota games on the ground that the act is patently illegal and devoid of any basis either from the Constitution or PAGCOR’s own Charter. On June 17, 1999 however, PAGCOR entered into an agreement with BELLE and FILGAME wherein the latter parties would provide all the required facilities and requirements for the establishment and operation of jai-alai. On August 10, 1999, del Mar then filed a Supplemental Petition for Certiorari questioning the validity of the agreement stating that PAGCOR is without jurisdiction, authority, legislative franchise, or authority to enter into such agreement for the operation and establishment of jai-alai games. A little earlier (July 1, 1999), Federico S. Sandoval II and Michael T. Defensor filed a Petition for Injunction. A Petition in Intervention was filed by Juan Miguel Zubiri alleging that the operation by PAGCOR of jai-alai is illegal because it is not included in PAGCOR’s scope. Petitoners del Mar, Sandoval, Defensor, and intervenor Zubiri are suing as taxpayers and in their capacity as the members of the House of Representatives. Respondent questions the locus standi or the standing of the petitioners to file the petition at bar as taxpayers and as legislators because the operation of jai-alai does not involve the disbursement of public funds.

ISSUES & RATIO: 1. WON petitioners have a locus standi or legal standing to file the petition – YES. As stated by the Court, Respondent’s stance is without an “oven ready” legal support. A party suing as taxpayer must specifically prove that he has sufficient interest in preventing

the illegal expenditure of money raised by taxation. In essence, taxpayers are allowed to sue where there is a claim of illegal disbursement of public funds, or that public money is being deflected to any improper purpose, or where petitioners seek to restrain respondent from wasting public funds through the enforcement of an invalid or unconstitutional law. The record shown under their agreement is barren of evidence that the operation and management of jai-alai by the PAGCOR involves expenditure of public money. The Court also holds that as members of the House of Representatives, petitioners have legal standing to file the petition at bar. The operation of jai-alai constitutes an infringement by PAGCOR of the legislature’s exclusive power to grant franchise. Hence, powers of Congress are being impared, so as the powers of each of its members.

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DECISION: Petitioners have legal standing to file the petition

NOTES: The states issue is only a “procedural issue” questioning when can taxpayers file a suit. The substantive issue concerns whether PAGCOR’s legislative franchise includes the right to manage and operate jai-alai. It was ruled that PAGCOR DOES NOT HAVE THE RIGHT to operate jai-alai because: • It was not stated under its scope. • In accordance with its historical creation, there is a separate Executive Order which controls the operating of Jai-Alai (controlled by the Romualdezes) in Manila. PACGOR’s franchise was never given a franchise to operate jai-alai. • Tax treatment between jai-alai operations and gambling casinos are distinct from each other. • PAGCOR is engaged in the business affected with public interest.

3. REPUBLIC OF THE PHILIPPINES vs. KERRY LAO ONG FACTS: 

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Respondent Ong filed a petition for naturalization. He is a Chinese citizen registered as a resident alien and possesses an alien certificate of registration and a nativeborn certificate of residence from the Bureau of Immigration. He has been continuously and permanently residing in the Philippines from birth up to present. He married Griselda Yap who is also a Chinese citizen. They have four children who were all born and raised in the Philippines. Ong alleged in his petition that he has been a “businessman business manager" since 1989, earning an average annual income of P150,000.00. However, when

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he testified, he said that he has been a businessman since he graduated from college in 1978. He did not specify or describe the nature of his business He presented a health certificate to prove that he is of sound physical and mental health and has no criminal record or pending criminal charges. The trial court held : From the evidence presented by [respondent], this Court believes and so holds that [respondent] possesses all the qualifications and none of the disqualifications provided for by law to become a citizen of the Philippines. The Republic, through the SolGen, appealed to the CA : o faulted the trial court for granting Ong's petition despite his failure to prove that he possesses a known lucrative trade, profession or lawful occupation as required under Section 2, fourth paragraph of the Revised Naturalization Law o respondent Ong did not prove his allegation that he is a businessman/business manager earning an average income of P150,000.00 o Considering that he has four minor children (all attending exclusive private schools), he has declared no other property and/or bank deposits, and he has not declared owning a family home, his alleged income cannot be considered lucrative. o respondent Ong is not qualified as he does not possess a definite and existing business or trade The appellate court dismissed the Republic’s appeal: o It may appear that the respondent has no lucrative employment. However, it is of judicial notice that the value of the peso has taken a considerable plunge in value since that time up to the present. If we consider the income earned at that time, the ages of the children of the respondent, the employment of his wife, we can say that there is an appreciable Petitioner’s arguments: o The only pieces of evidence presented by Ong to prove that he qualifies under Section 2, fourth paragraph of the Revised Naturalization Law, are his tax returns for the years 1994 to 1997, which show that Ong earns from P60,000.00 to P128,000.00 annually. This declared income is far from the legal requirement of lucrative income. It is not sufficient to provide for the needs of a family of six, with four children of school age

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none of these tax returns describes the source of Ong's income, much less can they describe the lawful nature Respondent’s arguments: Ong submits that his tax returns support the conclusion that he is engaged in lucrative trade

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ISSUE: Whether respondent Ong has proved that he has some lucrative trade, profession or lawful occupation in accordance with Sec. 2, paragraph 4, of the Revised Naturalization Law  RULING: NO. Respondent Ong failed to prove that he possesses the qualification of a known lucrative trade provided in Section 2, fourth paragraph, of the Revised Naturalization Law 

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The courts must always be mindful that naturalization proceedings are imbued with the highest public interest. Naturalization laws should be rigidly enforced and strictly construed in favor of the government and against the applicant. The burden of proof rests upon the applicant to show full and complete compliance with the requirements of law. the controversy revolves around respondent Ong's compliance with the qualification found in Section 2, fourth paragraph of the Revised Naturalization Law

 Section 2. Qualifications – Subject to section four of this Act, any person having the following qualifications may become a citizen of the Philippines by naturalization: Fourth. He must own real estate in the Philippines worth not less than five thousand pesos, Philippine currency, or must have some known lucrative trade, profession, or lawful occupation; 

The qualification of "some known lucrative trade, profession, or lawful occupation" means "not only that the person having the employment gets enough for his ordinary necessities in life. It must be shown that the employment gives one an income such that there is an appreciable margin of his income over his expenses as to be able to provide for an adequate support in the event of unemployment, sickness, or disability to work and thus avoid one's becoming the object of charity or a public charge." His income should permit "him and the members of his family to live with reasonable comfort, in accordance with the prevailing standard of living, and

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consistently with the demands of human dignity, at this stage of our civilization.” It has been held that in determining the existence of a lucrative income, the courts should consider only the applicant's income; his or her spouse's income should not be included in the assessment. The spouse's additional income is immaterial "for under the law the petitioner should be the one to possess 'some known lucrative trade, profession or lawful occupation' to qualify him to become a Filipino citizen." The applicant's qualifications must be determined as of the time of the filing of his petition The Court finds the appellate court’s decision erroneous: o First, it should not have included the spouse's income in its assessment of Ong's lucrative income. o Second, it failed to consider the following circumstances which have a bearing on Ong's expenses vis-à-vis his income: (a) that Ong does not own real property; (b) that his proven average gross annual income around the time of his application, which was only P106,000.00, had to provide for the education of his four minor children; and (c) that Ong's children were all studying in exclusive private schools in Cebu City. o Third, the CA did not explain how it arrived at the conclusion that Ong's income had an appreciable margin over his known expenses.

EXCEPTIONS AND PROVISIOS 1. CIR v CENVOCO Facts: - Private respondent Central Vegetable Oil Manufacturing Co.,Inc.(CENVOCO) is a manufacturer of edible oil and coconut, copra meal cake and such other coconut related oil subject to the miller tax of 3%. - In1986, CENVOCO purchased a specified number of containers and packaging materials for its edible oil from its suppliers, and paid the sales tax due thereon. - After an investigation by the Revenue Examiner, CENVOCO was assessed for deficiency miller's tax in the total amount of P1,575,514.70. - CENVOCO wrote petition era letter requesting for reconsideration, contending that the final provision of Section168 of the Tax Code does not apply to sales tax paid on containers and packaging materials, hence, the amount paid therefor should have been credited against the miller's tax assessed against it. - Petitioner, through a letter, reiterated the validity of its assessment.

- Dissatisfied, CENVOCO filed a petition for review with the Court of Tax Appeals, which came out with a decision in favor of CENVOCO. Petitioner appealed to the Court of Appeals. - The assailed decision was affirmed in toto. Issue: Whether or not petitioner can invoke section 168 of the Tax Code to exempt it from the deficiency miller’s tax Held: No - The law relied upon by the BIR Commissioner as the basis for not allowing CENVOCO's tax credit is just a proviso of Section 168 of the old Tax Code. - The restriction in said proviso, however, is limited only to sales, miller's or excise taxes paid "On raw materials used in the milling process." - The Court ruled that under the rules of statutory construction, exceptions as a general rule, should be strictly but reasonably construed. They extend only so far as their language fairly warrants, and all doubts should be resolved in favor of the general provisions rather than the exception. - The exception provided for in section 168 of the old Tax Code should be strictly construed. - The Court also ruled that it is a basic rule of interpretation that words and phrases used in the statute in the absence of a clear legislative intent to the contrary, should be given their plain, ordinary and common usage or meaning. Cans and tetrapaks are not used in the manufacture of CENVOCO's finished products which are coconut, edible oil or copra meal cake. Such finished products are packed in cans and tetrapaks. There is no error in allowing the sales taxes paid on the containers and packaging materials of the milled products should be credited against the miller's tax due thereon. 2. GEOLINGUISTICS, INC. vs. GATEWAY ELECTRONICS CORPORATION

execute the RTC decision pending appeal: Gateway was guilty of fraud, the appeal was interposed to delay the case, imminent danger of gateway's insolvency and that the counterbond could be the subject of execution. The RTC granted the motion for execution of judgement pending appeal on the ground that gateway admitted its principal obligation to the petitioner and the case had been pending for a long time. The surety LEPANTO filed a motion to set aside the order of the RTC and to quash the writ of execution but it was denied, a writ of execution was issued and was implemnted by the sheriff. Both respondents filed a separate Rule 65 petitions before the Court of Appeals. In the petition for certiorari, prohibition and mandamus (with urgent prayer for the issuance of a temporary restraining order and/or writ of preliminary injunction . Respondent Gateway's petition was initially dismissed by the appellate court, but upon motion for reconsideration, the appellate court ordered its reinstatement and the issuance of a temporary restraining order (TRO) against the enforcement of the RTC's Decision Respondent surety's petition for certiorari, sought the nullification of the RTC orders , the quashal of the writ of execution, the issuance of a TRO and a writ of preliminary injunction to enjoin the implementation of the writ of execution and the return of the garnished amount to respondent surety. The court of appeals granted both the Respondents petitions and denied the motion for reconsideration filed by the respondent Hence petitition for certiorari by the respondent. ISSUE: whether or not there is a sufficient ground exists warranting the discretionary execution of the RTC decision.

FACTS: Petitioner Geologistics, Inc., formerly known as LEP International Philippines, Inc., is a domestic corporation engaged in the business of freight forwarding and customs brokerage who instituted an action for the recovery of sum of money against respondent Gateway Electronic Corporation (respondent Gateway) before the RTC. Respondent First Lepanto-Taisho Insurance Corporation (respondent surety) filed a counter-bond in the amount of P5 million to secure the payment of any judgment that petitioner could recover from respondent Gateway. The RTC rendered a decision ordering the defendant to pay the plaintiff Geologistics. Petitioner filed a motion for execution pending appeal which was opposed by respondent Gateway. The motion alleged the following "good reasons" to

HELD: There is none. The rule on execution pending appeal, which is now termed discretionary execution under Rule 39, Section 2 of the Rules of Court, must be strictly construed being an exception to the general rule. Discretionary execution of appealed judgments may be allowed upon concurrence of the following requisites: (a) there must be a motion by the prevailing party with notice to the adverse party; (b) there must be a good reason for execution pending appeal; and (c) the good reason must be stated in a special order. The yardstick remains the presence or the absence of good reasons consisting of exceptional circumstances of such

urgency as to outweigh the injury or damage that the losing party may suffer, should the appealed judgment be reversed later. Since the execution of a judgment pending appeal is an exception to the general rule, the existence of good reasons is essential. In granting petitioner's motion for execution pending appeal, the RTC gave weight to the fact that the case had been pending since 1997 and the alleged admission of liability on the part of respondent Gateway, The grounds cited by the RTC in allowing the discretionary execution of its decision cannot be considered "good reasons." The alleged admission by respondent Gateway of its liability is more apparent than real because the issue of liability is precisely the reason the case was elevated on appeal. The exact amount of respondent Gateway's liability to petitioner remains under dispute even if, as claimed by petitioner, the evidence on record indicates that respondent Gateway's obligation is almost a certainty. Precisely the appeal process must be allowed to take its course all the way to the finality of judgment to determine once and for all the incidents of the suit.

B. STATUTES LIBERALLY CONSTRUED 1. RE: APPLICATION FOR SURVIVORSHIP PENSION BENEFITS UNDER REPUBLIC ACT NO. 9946 OF MRS. PACITA A. GRUBA, SURVIVING SPOUSE OF THE LATE MANUEL K. GRUBA, FORMER CTA ASSOCIATE JUDGE. Facts: This case involves a judge, Manuel K. Gruba, of the Court of Tax Appeals 1 who died while in service. He died at the age of 55 years, two (2) months, and six (6) days. He died prior to the enactment of Republic Act No. 9946, which substantially amended the benefits provided in Republic Act No. 910. The surviving spouse of Judge Gruba, Mrs. Pacita A. Gruba (Mrs. Gruba), applied for retirement/gratuity benefits under Republic Act No. 910. In a Resolution dated September 24, 1996, this Court approved the application filed by Mrs. Gruba. The five-year lump sum retirement benefit under Republic Act No. 910 was remitted to the Government Service Insurance System effective June 26, 1996. On January 13, 2010, Congress amended Republic Act No. 910 and passed Republic Act No. 9946. Republic Act No. 9946 provided for more benefits, including survivorship pension benefits, among others. The law also provides a retroactivity provision which states:

SEC. 3-B. The benefits under this Act shall be granted to all those who have retired prior to the effectivity of this Act: Provided, That the benefits shall be applicable only to the members of the Judiciary: Provided, further, That the benefits to be granted shall be prospective. Issue: (1) whether Republic Act No. 9946 applies to Judge Gruba; (2) whether the heirs of Judge Gruba are entitled to the 10-year lump sum gratuity benefits under Republic Act No. 9946; and (3) whether Mrs. Gruba is entitled to survivorship pension benefits under the same law. Held: First two issues in favor of the heirs of Judge Gruba. However, we deny theapplication for survivorship pension benefits of Mrs. Gruba. Retirement laws, in particular, are liberally construed in favor of the retiree because their objective is to provide for the retiree's sustenance and, hopefully, even comfort, when he no longer has the capability to earn a livelihood. The liberal approach aims to achieve the humanitarian purposes of the law in order that efficiency, security, and well-being of government employees may be enhanced. Indeed, retirement laws are liberally construed and administered in favor of the persons intended to be benefited, and all doubts are resolved in favour of the retiree to achieve their humanitarian purpose. When Mrs. Gruba applied for benefits under Republic Act No. 9946, she was not claiming additional gratuity benefits. She was invoking the second paragraph of Section 3 of Republic Act No. 910 as amended by Republic Act No. 9946, thus: aSIUpon the death of a Justice or Judge of any court in the Judiciary, if such Justice or Judge has retired, or was eligible to retire optionally at the time of death, the surviving legitimate spouse shall be entitled to receive all the retirement benefits that the deceased Justice or Judge would have received had the Justice or Judge not died. The surviving spouse shall continue to receive such retirement benefits until the surviving spouse's death or remarriage. According to Section 3 of Republic Act No. 9946, survivorship pension benefits are given to surviving spouses of retired judges or justices or surviving spouses of judges or justices who are eligible to retire optionally. This means that for the spouse to qualify for survivorship pension, the deceased judge or justice must (1) be at least 60 years old, (2) have rendered at least fifteen years in the Judiciary or in any other branch of government, and in the case of eligibility for optional retirement, (3) have served the last three years continuously in the Judiciary.

Mrs. Gruba could have been entitled to survivorship pension benefits if her late husband were eligible to optionally retire at the time of his death. However, we are faced with a situation where the justice complied only with two of three requirements for optional retirement. He was only 55 years old, and the law required the age of 60 for eligibility for optional retirement. 2. OBRA vs. SSS Petitioner: Maria Buena Obra Respondent: Social Security System (Jollar Industrial Sales and Servicex, Inc.) Facts:  Petitioner filed her claim for death benefits, when his husband Juanito Buena Obra died from heart attack while driving a dump truck inside his work compound, under the SSS law and started receiving pension in Nov. 1988 then she found out in 1998 there are other benefits under the Law on Employees’ Compensation (P.D. 626). She completed the necessary documents for filling her claim for funeral benefits under the P.D. 626 but the SSS denied her claim.  The petitioner failed to substantiate that the cause of her husband’s death was work related. Filed an appeal to the Court of Appeals.  The appellate court ruled that the petitioner’s cause of action had prescribed. Issue: Whether the claim of petitioner had already prescribed. Whether the cause of her husband’s death was work related. Ruling: No. In the issue of prescriptive period it is governed by P.D. No. 626, or the Law on Employees’ Compensation. Art. 201 of P.D. No. 626 and Sec. 6, Rule VII of the 1987 Amended Rule of Employees’ Compensation. "No claim for compensation shall be given due course unless said claim is filed with the System within three years from the time the cause of action accrued." This is the general rule. The exceptions are found in Board Resolution 93-08-0068 and ECC Rules of Procedure for the Filing and Disposition of Employees' Compensation Claims. Board Resolution 93-08-0068 issued on 5 August 1993, states: "A claim for employee's compensation must be filed with System (SSS/GSIS) within three (3) years from the time the cause of action accrued, provided however, that any claim filed within the System for any contingency that may be held compensable under the Employee's Compensation Program (ECP) shall be considered as the EC claim itself. The three-year prescriptive period shall be reckoned from the onset of disability, or date of death. In case of presumptive death, the three (3) years limitation shall be counted from the date the missing person was officially declared to be presumptively dead." Section 4(b), Rule 3 of the ECC Rules of Procedure for the Filing and Disposition of Employees' Compensation Claims, reads:

"RULE 3. FILING OF CLAIM Section 4. When to file. (a) Benefit claims shall be filed with the GSIS or the SSS within three (3) years from the date of the occurrence of the contingency (sickness, injury, disability or death). (b) Claims filed beyond the 3-year prescriptive period may still be given due course, provided that: 1. A claim was filed for Medicare, retirement with disability, burial, death claims, or life (disability) insurance, with the GSIS within three (3)years from the occurrence of the contingency. 2. In the case of the private sector employees, a claim for Medicare, sickness, burial, disability or death was filed within three (3) years from the occurrence of the contingency. 3. In any of the foregoing cases, the employees' compensation claim shall be filed with the GSIS or the SSS within a reasonable time as provided by law.” The petitioner claim for death benefits under the SSS law should be considered as the Employees' Compensation claim itself. This is but logical and reasonable because the claim for death benefits which petitioner filed with the SSS is of the same nature as her claim before the ECC. The SSS is the same agency with which Employees' Compensation claims are filed. As correctly contended by the petitioner, when she filed her claim for death benefits with the SSS under the SSS law, she had already notified the SSS of her employees' compensation claim, because the SSS is the very same agency where claims for payment of sickness/disability/death benefits under P.D. No. 626 are filed. The petitioner was able to file her claim for death benefits under the SSS law within the three-year prescriptive period also she has been receiving her pension under the SSS law since Nov. 1988. The evidence shows that the System failed to process her compensation claim. Under the circumstances, the petitioner cannot be made to suffer for the lapse committed by the System. It is the avowed policy of the State to construe social legislations liberally in favour of the beneficiaries. 13 This court has time and again upheld the policy of liberality of the law in favor of labor. Presidential Decree No. 626 itself, in its Art. 166 reads: "ART. 166. Policy . — The State shall promote and develop a tax-exempt employees' compensation program whereby employees and their dependents, in the event of workconnected disability or death, may promptly secure adequate income benefit, and medical or related benefits." Furthermore, Art. 4 of P.D. No. 442, as amended, otherwise known as the Labor Code of the Philippines, which P.D. No. 626 forms a part of, reads as follows: "ART. 4. Construction in favor of labor. — All doubts in the implementation and interpretation of the provisions of this Code, including its implementing rules and regulations, shall be resolved in favor of labor." Yes. The cause of her husband’s death was work related the petitioner's husband's heart disease falls under the second condition of ECC Resolution No. 432 dated July 20, 1977

which states that the strain of work that brought about the acute attack must be of sufficient severity and must be followed within 24 hours by the clinical signs of a cardiac insult to constitute causal relationship. Petitioner's husband was driving a dump truck within the company premises where they were stacking gravel and sand when he suffered the heart attack. He had to be taken down from the truck and brought to the workers' quarters where he expired at 10:30 a.m., just a few minutes after the heart attack, which is much less than the 24 hours required by ECC Resolution No. 432. This is a clear indication that severe strain of work brought about the acute attack that caused his death. “(b) The strain of work that brings about an acute attack must be of sufficient severity and must be followed within 24 hours by the clinical signs of a cardiac insult to constitute causal relationship.” Heavy exertion or emotional stress can trigger a heart attack. The petitioner’s husband is under a lot of stress in the workplace. He had to be taken down from the truck and brought to the workers' quarters where he expired at 10:30 a.m., just a few minutes after the heart attack, which is much less than the 24 hours required by ECC Resolution No. 432. This is a clear indication that severe strain of work brought about the acute attack that caused his death. The petition is granted. Decision of the Court of Appeals and the Resolution are set aside. The SSS is directed to pay the petitioner the death/funeral benefits under existing law. P.D. No. 626, as amended, is a social legislation whose primordial purpose is to provide meaningful protection to the working class against the hazards of disability, illness and other contingencies resulting in the loss of income. Thus, as the official agents charged by law to implement social justice guaranteed by the Constitution, the ECC and the SSS should adopt a liberal attitude in favor of the employee in deciding claims for compensability especially where there is some basis in the facts for inferring a work connection with the illness or injury, as the case may be. It is only this kind of interpretation that can give meaning and substance to the compassionate spirit of the law as embodied in Article 4 of the New Labor Code which states that all doubts in the implementation and interpretation of the provisions of the Labor Code including its implementing rules and regulations should be resolved in favor of labor. 3. IN RE: PETITION FOR ADOPTION OF MICHELLE P. LIM, MONINA P. LIM IN RE: PETITION FOR ADOPTION OF MICHAEL JUDE P. LIM, MONINA P. LIM G.R. Nos. 168992-93 May 21, 2009 Topic: As a general rule, a petition for adoption shall be filed jointly by the husband and wife. Facts: Petitioner is an optometrist by profession, married Primo Lim. They were childless. Minor children, whose parents were unknown, were entrusted to them by a certain Lcia Ayuban. Being so eager to have a child of their own, petitioner and Lim registered the children

to make it appear that they were the children’s parents. The children were named Michelle P. Lim (Michelle) and Michael Jude P. Lim (Michael). The spouses reared and cared for the children as if they were their own. Unfortunately, Primo died. Petitioner married Angelo Olario, an American citizen. Thereafter, petitioner decided to adopt the children by availing of the amnesty given under RA 8552 to those individuals who simulated the birth of a child. Thus, petitioner filed separate petitions for the adoption of Michelle and Michael before the trial court. At the time of the filing of the petitions for adoption, Michelle was 25 years old and already married, while Michael was 18 years old. Michelle’s husband gave his consent to the adoption of Michelle. Olario likewise gave his consent. Trial court dismissed the petitions. Issue: Whether petitioner, who has remarried, adopt singly. Held: No. Joint adoption by husband and wife. The law is explicit. Section 7, Article III of RA 8552 reads: SEC. 7. Who May Adopt. - The following may adopt: xxx Husband and wife shall jointly adopt, except in the following cases: (i) if one spouse seeks to adopt the legitimate son/daughter of the other; or (ii) if one spouse seeks to adopt his/her own illegitimate son/daughter: Provided, however, That the other spouse has signified his/her consent thereto; or (iii) if the spouses are legally separated from each other. In case husband and wife jointly adopt, or one spouse adopts the illegitimate son/daughter of the other, joint parental authority shall be exercised by the spouses. The use of the word "shall" in the above-quoted provision means that joint adoption by the husband and the wife is mandatory. This is in consonance with the concept of joint parental authority over the child which is the ideal situation. As the child to be adopted is elevated to the level of a legitimate child, it is but natural to require the spouses to adopt jointly. The rule also insures harmony between the spouses.

Petitioner, having remarried at the time the petitions for adoption were filed, must jointly adopt. Since the petitions for adoption were filed only by petitioner herself, without joining her husband, Olario, the trial court was correct in denying the petitions for adoption on this ground. Neither does petitioner fall under any of the three exceptions enumerated in Section 7. The fact that Olario gave his consent to the adoption as shown in his Affidavit of Consent does not suffice. There are certain requirements that Olario must comply being an American citizen. He must meet the qualifications set forth in Section 7 of RA 8552 such as: (1) he must prove that his country has diplomatic relations with the Republic of the Philippines; (2) he must have been living in the Philippines for at least three continuous years prior to the filing of the application for adoption; (3) he must maintain such residency until the adoption decree is entered; (4) he has legal capacity to adopt in his own country; and (5) the adoptee is allowed to enter the adopter’s country as the latter’s adopted child. None of these qualifications were shown and proved during the trial. Effects of adoption Petitioner contends that joint parental authority is not anymore necessary since the children have been emancipated having reached the age of majority. This is untenable. It is true that when the child reaches the age of emancipation — that is, when he attains the age of majority or 18 years of age — emancipation terminates parental authority over the person and property of the child, who shall then be qualified and responsible for all acts of civil life. However, parental authority is merely just one of the effects of legal adoption. Article V of RA 8552 enumerates the effects of adoption. Adoption has, thus, the following effects: (1) sever all legal ties between the biological parent(s) and the adoptee, except when the biological parent is the spouse of the adopter; (2) deem the adoptee as a legitimate child of the adopter; and (3) give adopter and adoptee reciprocal rights and obligations arising from the relationship of parent and child, including but not limited to: a. the right of the adopter to choose the name the child is to be known; and b. the right of the adopter and adoptee to be legal and compulsory heirs of each other. Therefore, even if emancipation terminates parental authority, the adoptee is still considered a legitimate child of the adopter with all the rights of a legitimate child such as: (1) to bear the surname of the father and the mother;

(2) to receive support from their parents; and (3) to be entitled to the legitime and other successional rights. Conversely, the adoptive parents shall, with respect to the adopted child, enjoy all the benefits to which biological parents are entitled such as support and successional rights.

4. THE COCA-COLA EXPORT CORPORATION vs. CLARITA P. GACAYAN

G.R. No. 149433, June 22, 2011, LEONARDO-DE CASTRO, J. 2. Labor Law c. Framework 4.1 Social Justice vis-a-vis Management prerogative SUMMARY: This is a Motion for Reconsideration filed by Coca-Cola assailing a prior decision of the Supreme Court which found that Gacayan was illegally dismissed. Coca-Cola fired Clarita alleging loss of trust and confidence. Allegedly, Clarita tampered with her meal receipts which served as her request for reimbursement. The Labor Arbiter and the NLRC found just cause in the dismissal. The CA reversed the NLRC holding that there was an illegal dismissal and that the penalty was too severe. The Supreme Court initially agreed with the CA. However, in this MR, the Supreme Court reversed its prior position and held that (see doctrine) DOCTRINE: While the Constitution is committed to the policy of social justice and the protection of the working class, it should not be expected that every labor dispute will be automatically decided in favor of labor. Management also has its own rights which, as such, are entitled to respect and enforcement in the interest of simple fair play. FACTS: ● Respondent, Clarita Gacayan, is a Senior Financial Accountant (SFA) of Petitioner, Coca-Cola. ● Employees of Coca-Cola enjoyed the benefit of reimbursement with respect to meal and transportation expenses incurred during overtime work. ● Gacayan submitted three receipts which were allegedly altered and tampered with in support of her reimbursement. Some dates were adjusted.

● Petitioner sent Respondent several memoranda requiring her to explain why her reimbursement should not be considered as fraudulent. Respondent replied denying personal knowledge with the said alterations. ● Petitioner conducted a series of hearings and investigation on the case but the Respondent only attended the first hearing. ● Petitioner dismissed Respondent for fraudulently submitting tampered receipts in gross violation of the company’s rules and regulations. ● Gacayan filed a complaint with the NLRC. The Labor Arbiter dismissed the complaint. The NLRC sustained the Decision of the Labor Arbiter. However, the CA reversed the Decision of the NLRC. ● The SC initially sustained the Decision of the CA citing that the dismissal of the Respondent was not grounded among any of the just causes enumerated in Art 282 of the Labor Code. ● Furthermore, the termination letter neither mentioned its alleged loss of trust and confidence in respondent Gacayan, nor discussed the alleged sensitive and delicate position of respondent Gacayan requiring the utmost trust of petitioner company. ● Moreover, the penalty imposed was too harsh considering the attendant circumstances. Gacayan was working with Coca-Cola for 9 ½ years and there was no prior mark in her record. The Constitution urges moderation on the sanction that may be applied. The provisions of the Labor Code are to be construed liberally in favor of labor. ISSUES w/ HOLDING & RATIO: [1] W/N there is just cause for dismissing Gacayan - YES ● Well settled in jurisprudence [Etcuban, Jr. v. Sulpicio Lines, Inc.] is the rule that loss of trust and confidence constitutes just cause in dismissing an employee. It is premised on the fact that the employee concerned holds a position where a person is entrusted with confidence on delicate matters. ● Moreover, the act complained of must be "work-related" that would show the employee concerned to be unfit to continue working for the employer. ● Herein, Gacayan is the SFA of Coca-Cola. Respondent handled delicate and confidential matters and was privy to strategic and operational decisionmaking requiring the Petitioner’s utmost trust and confidence.

● Ironically, while she was tasked with ensuring financial reportorial/regulatory compliance of the company, she repeatedly submitted tampered or altered receipts, in gross violation of the rules and regulations of petitioner company. ● She cannot mistakenly file a claim for overtime meal allowance reimbursement for a day she knew she was not entitled to, as she did not actually render overtime work. She altered dates and items in the receipt and fraudulently claimed that a co-worker agreed to split the bill with her on one occasion. ● Gacayan failed to refute the charges brought to bear against her and merely pointed fingers at others she believed to be responsible for the alterations. ● Lest it be forgotten, the Labor Arbiter and the NLRC found just cause for her termination. Moreover, the CA never absolved her of her crimes but only recognized that the penalty levied upon her was too severe for her crime. (optional??) [2] W/N her right to due process was infringed - NO ● Due process is not violated where a person is not heard because he has chosen, for whatever reason, not to be heard. ● The law requires that the employer serve two written notices before the employee to be terminated prior to termination. ● Herein, she was served multiple repeated notices and invited to attend multiple hearings. She only attended the first one. ● Finally, it was only after the evidence was received and her fraudulent participation ascertained that Coca-Cola decided to terminate her services. Conclusion and actual relevant part beyond the main issues: In fine, Coca-Cola sufficiently proved that the dismissal of Gacayan was for just cause and made in accordance with law. Moreover, the respondent was afforded due process. To allow respondent Gacayan to be reinstated to her former position with payment of backwages would tend rather to reward dishonesty and ennoble breach of trust by employees to the prejudice of the employer. While the Constitution is committed to the policy of social justice and the protection of the working class, it should not be expected that every labor dispute will be automatically decided in favor of labor. Management also has its own rights which, as such, are entitled to respect and enforcement in the interest of simple fair play.

RULING: WHEREFORE, in view of the foregoing, we GRANT the Motion for Reconsideration filed by petitioner The Coca-Cola Export Corporation and RECONSIDER our Decision dated December 15, 2010. The assailed Decision dated May 30, 2001 and Resolution dated August 9, 2001 of the Court of Appeals in CA-G.R. SP No. 49192 are REVERSED and SET ASIDE. The Resolutions dated April 14, 1998 and June 19, 1998 of the National Labor Relations Commission are hereby AFFIRMED.

5. REGIONAL AGRARIAN REFORM ADJUCTION BOARD vs. COURT OF APPEALS G.R. No. 165155 | 13 April 2010POLITICAL LAW – NATIONAL ECONOMY AND PATRIMONY - ACQUISITION, OWNERSHIP ANDTRANSFER OF PUBLIC AND PRIVATE LANDS DOCTRINE: Rules of Procedure in agrarian cases should be liberally construed for as long as the purpose is sufficiently met and no violation of due process takes place. FACTS:  Respondents, co-owners of several parcels of land primarily devoted to rice production, filed a complaint for ejectment against petitioners for non-payment of rentals before the DARAB. They averred that petitioners were agricultural lessees while the petitioners themselves contend that they are farmer-beneficiaries under PD 27. 

When the complaint for ejectment was filed, the actual tillers on the land were the successors-in-interest of two of the named defendants (Pedro and Avelino) as they had died at the time of filing, and the same participated in the proceedings despite no formal substitution of party litigants.

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The Regional Adjudicator directed the petitioners to surrender possession of the land to the respondents as they could only retain their status as agricultural lessees if they complied with their statutory obligation to pay the required leasehold rentals.

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Upon appeal, the Regional Adjudicator issued, in its May 6, 2003 Order, a writ of execution against the non-appealing defendants and deceased defendants.

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Dissatisfied, both respondents and petitioners moved for reconsideration of the order. The respondents argued that the appeal should not have been given due course because it did not adhere to Section 2, Rule XIII of the DARAB Rules of Procedure. On the other hand, the petitionersincluded in the writ of execution contended that said Order was hastily executed. 

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In its August 5, 2003 Order, the Regional Adjudicator allowed the appeal of the heirs of the two decedents and nullified the writ of execution as regards to them.

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Respondents moved for reconsideration but was denied in the November 13, 2003 Order which also ordered the sheriff to restore the farm holdings of the heirs of the deceased in view of the quashal of the writ of execution.

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Thus, respondents filed a petition for certiorari with CA, arguing that both notices of appeal by the petitioners were infirm for failure to state the grounds for appeal and for containing forged signatures.

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CA held that the notice of appeal bearing the signatures of the deceased contained forgeries, brushing aside the heirs’ explanations that they merely signed the decedents’ names to show intention to appeal the decision. The said notices of appeal also failed to specifically allege the grounds relied upon.

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Petitioners, in their petition for certiorari, claim that the stringent application of the rules denied them substantial justice. Respondents maintain that there should be strict adherence to the technical rules of procedure because DARAB rules frown upon dilatory appeals.

ISSUE: Whether or not the notices of appeal are mere scraps of paper for failure to state the grounds relied upon for appeal and are null and void for containing two falsified signatures? HELD: No. Under Section 2 of the DARAB Rules of Procedure, it is provided that the rules should be liberally construed to carry out the objectives of the agrarian reform program and to promote just, expeditious and inexpensive settlement of agrarian cases. The defects found in the two notices of appeal also are not of such nature that would cause a denial of the right to appeal as the defects are inconsequential. There is nothing sacred about the forms of pleadings for the sole purpose is to facilitate the application of justice to the claims of contending parties so pleadings and procedural rules should be construed liberally. In a DARAB case, the notice of appeal serves only to inform the officer that rendered the appealed decision of the timeliness of the appeal, the general reason for such appeal and to prepare the records for transmission to DARAB. As such, the notices of appeal substantially complied with what is required under the DARAB rules as the petitioners were appealing the

decision on the grounds of questions of fact and law. While the notices omitted to state that the decision would cause grave and irreparable injury, requiring a literal application of the rules when its purpose has already been served is a superfluity. The Regional Adjudicator has no power to determine if the appeal was intended for delay as such matters are for the appellate body to determine after it has studied the appeal memorandum. This principle is applicable to agrarian disputes by virtue of Section 8, Rule XIII of the DARAB rules. Since the Board is the one which has the power to punish, it is also the one which has the power to decide if there has been a violation. When an appeal is timely filed, it becomes a ministerial duty to approve the same. PRESCRIPTION 1. COMMISSIONER OF INTERNAL REVENUE v. BASF COATING + INKS PHILS., INC., BASF COATING + INKS PHILS., INC was a corporation which was duly organized under and by virtue of the laws of the Republic of the Philippines on August 1, 1990 with a term of existence of fifty (50) years., Majority of the members of the Board of Directors and the stockholders representing more than two-thirds (2/3) of the entire subscribed and outstanding capital stock of herein respondent corporation, resolved to dissolve the corporation by shortening its corporate term to March 31, 2001. Subsequently, respondent moved out of its address in Las Piñas City and transferred to Carmelray Industrial Park, Canlubang, Calamba, Laguna. On June 26, 2001, respondent submitted two (2) letters to the Bureau of Internal Revenue (BIR) Revenue District Officer of Revenue District Office (RDO) No. 53, Region 8, in Alabang, Muntinlupa City. The first letter, dated April 26, 2001, was a notice of respondent's dissolution, in compliance with the requirements of Section 52(c) of the National Internal Revenue Code.4 On the other hand, the second letter, dated June 22, 2001, was a manifestation indicating the submission of various documents supporting respondent's dissolution, among which was BIR Form No. 1905, which refers to an update of information contained in its tax registration.5 Thereafter, in a Formal Assessment Notice (FA N) dated January 17, 2003, petitioner assessed respondent the aggregate amount of P18,671,343.14 representing deficiencies in income tax, value added tax, withholding tax on compensation, expanded withholding tax and documentary stamp tax, including increments, for the taxable year 1999. The FAN was sent by registered mail on January 24, 2003 to respondent's former address in Las Piñas City. On March 5, 2004, the Chief of the Collection Section of BIR Revenue Region No. 7, RDO No. 39, South Quezon City, issued a First Notice Before Issuance of Warrant of Distraint and Levy, which was sent to the residence of one of respondent's directors.7

On March 19, 2004, respondent filed a protest letter citing lack of due process and prescription as grounds. On April 16, 2004, respondent filed a supplemental letter of protest. Subsequently, on June 14, 2004, respondent submitted a letter wherein it attached documents to prove the defenses raised in its protest letters. The CTA En Banc held that petitioner's right to assess respondent for deficiency taxes for the taxable year 1999 has already prescribed and that the FAN issued to respondent never attained finality because respondent did not receive it. Petitioner’s claim: Insofar as respondent's alleged deficiency taxes for the taxable year 1999 are concerned, the running of the three-year prescriptive period to assess, under Sections 203 and 222 of the National Internal Revenue Act of 1997 (Tax Reform Act of 1997) was suspended when respondent failed to notify petitioner, in writing, of its change of address, pursuant to the provisions of Section 223 of the same Act and Section 11 of BIR Revenue Regulation No. 12-85. Provision/s: Sec 203 of the National Internal Revenue Act Sec. 203. Period of Limitation Upon Assessment and Collection.– Except as provided in Section 222,internal revenue taxes shall be assessed within three (3) years after the last day prescribed by law for the filing of the return, and no proceeding in court without assessment for the collection of such taxes shall be begun after the expiration of such period: Provided, That in a case where a return is filed beyond the period prescribed by law, the three (3)-year period shall be counted from the day the return was filed. For purposes of this Section, a return filed before the last day prescribed by law for the filing thereof shall be considered as filed on such last day. Sec. 223. Suspension of Running of Statute of Limitations. — The running of the Statute of Limitations provided in Sections 203 and 222 on the making of assessment and the beginning of distraint or levy a proceeding in court for collection, in respect of any deficiency, shall be suspended for the period during which the Commissioner is prohibited from making the assessment or beginning distraint or levy or a proceeding in court and for sixty (60) days thereafter; when the taxpayer requests for a reinvestigation which is granted by the Commissioner; when the taxpayer cannot be located in the address given by him in the return filed upon which a tax is being assessed or collected: Provided, that, if the taxpayer informs the Commissioner of any change in address, the running of the Statute of Limitations will not be suspended; when the warrant of distraint or levy is duly served upon the taxpayer, his authorized representative, or a member of his household with sufficient discretion, and no property could be located; and when the taxpayer is out of the Philippines.

In addition, Section 11 of BIR Revenue Regulation No. 12-85 states: Sec. 11. Change of Address. — In case of change of address, the taxpayer must give a written notice thereof to the Revenue District Officer or the district having jurisdiction over his former legal residence and/or place of business, copy furnished the Revenue District Officer having jurisdiction over his new legal residence or place of business, the Revenue Computer Center and the Receivable Accounts Division, BIR, National Office, Quezon City, and in case of failure to do so, any communication referred to in these regulations previously sent to his former legal residence or business address as appear in is tax return for the period involved shall be considered valid and binding for purposes of the period within which to reply. Held: Pettion DISMISSED. It is true that, under Section 223 of the Tax Reform Act of 1997, the running of the Statute of Limitations provided under the provisions of Sections 203 and 222 of the same Act shall be suspended when the taxpayer cannot be located in the address given by him in the return filed upon which a tax is being assessed or collected. In addition, Section 11 of Revenue Regulation No. 12-85 states that, in case of change of address, the taxpayer is required to give a written notice thereof to the Revenue District Officer or the district having jurisdiction over his former legal residence and/or place of business. However, this Court agrees with both the CTA Special First Division and the CTA En Banc in their ruling that the abovementioned provisions on the suspension of the three-year period to assess apply only if the BIR Commissioner is not aware of the whereabouts of the taxpayer. Prescription in the assessment and in the collection of taxes is provided by the Legislature for the benefit of both the Government and the taxpayer; for the Government for the purpose of expediting the collection of taxes, so that the agency charged with the assessment and collection may not tarry too long or indefinitely to the prejudice of the interests of the Government, which needs taxes to run it; and for the taxpayer so that within a reasonable time after filing his return, he may know the amount of the assessment he is required to pay, whether or not such assessment is well founded and reasonable so that he may either pay the amount of the assessment or contest its validity in court . . . . It would surely be prejudicial to the interest of the taxpayer for the Government collecting agency to unduly delay the assessment and the collection because by the time the collecting agency finally gets around to making the assessment or making the collection, the taxpayer may then have lost his papers and books to support his claim and contest that of the Government, and what is more, the tax is in the meantime accumulating interest which the taxpayer eventually has to pay.

Likewise, in Republic of the Philippines v. Ablaza, this Court elucidated that the prescriptive period for the filing of actions for collection of taxes is justified by the need to protect lawabiding citizens from possible harassment. Also, in Bank of the Philippine Islands v. Commissioner of Internal Revenue, it was held that the statute of limitations on the assessment and collection of taxes is principally intended to afford protection to the taxpayer against unreasonable investigations as the indefinite extension of the period for assessment deprives the taxpayer of the assurance that he will no longer be subjected to further investigation for taxes after the expiration of a reasonable period of time. Thus, in Commissioner of Internal Revenue v. B.F. Goodrich Phils., Inc., this Court ruled that the legal provisions on prescription should be liberally construed to protect taxpayers and that, as a corollary, the exceptions to the rule on prescription should be strictly construed. 2. SYHUNLIONG vs. RIVERA Petitioner: Ramon A. Syhunliong Respondent: Teresita D. Rivera Facts:  The petitioner is the President of BANFF Realty and Development Corporation and likewise owns construction, restaurant, and hospital businesses.  The Respondent is the Accounting Manager of BANFF, who worked for 3 years then filed a resignation but continued working of the same year to complete the turnover of papers to Jennifer Lumapas, who succeeded her.  The respondent filed a complaint against the petitioner before the National Labor Relations Commissions for unpaid salaries, 13th to 16th month and incentives, gratuities and tax refund a total of Php 698,150.48  The petitioner filled a complaint for libel against the respondent because of the text messages the respondent sent to one of BANFF’s official cellular phone held by Lumapas.  Petitioner seeks for the reversal of the CA’s decision and resolution. Issue:  Whether Rivera’s text message falls within the ambit of a qualified privileged communication.  Whether the prescription of the crime had set in. Ruling: Yes. The petition was denied. Rivera’s text message falls within the ambit of a qualified privileged communication since she “was speaking in response to duty (to protect her own interest) and not out of intent to injure the reputation of Syhunliong. Also there was no unnecessary publicity of the message beyond that of conveying it to the party concerned. Lamapas was the one who told Rivera about the delay so Rivera expressed her grievances to Lumapas and she was the best person at that time that could help expedite

the release of Rivera’s claims. Supreme Court ruled that it should be noted that the libellous material must be viewed as a whole. In order to ascertain the meaning of the published article the whole of the article must be considered, each phrase must be construed in the light of the entire publication. The prescription had set in. There is no merit in the instant petition of Syhunliong against Rivera since it was filled more than one year after the allegedly libellous message was sent to Lumapas. Its institution was made beyond the prescriptive period provided for in Article 90 of the RPC. The Court finds no persuasive reason why Rivera should be deprived of the benefits accruing from the prescription of the crime ascribed to her. The plea of prescription should be set up before the accused pleads to the charge, as otherwise the defense would be deemed waived, but the rule is not absolute especially when it conflicts with a substantive provisions of the law, such as that refers to prescription of crimes. The Supreme Court has only power to promulgate rules concerning pleadings, practice, and procedure, and the admission to the practice of law, and cannot cover substantive rights, the rule we considering cannot be interpreted or given such scope or extent that would come into conflict or defeat an express provision of our substantive law. PRESCRIPTION OF THE CRIME IS ALREADY A COMPELLING REASON FOR THE REASON OF THE COURT TO ORDER THE DISMISSAL OF THE LIBEL INFORMATION, BUT THE COURT STILL STRESSES THAT THE TEXT MESSAGE WHICH RIVERA SENT TO LUMAPAS FALLS WITHIN THE PURVIEW OF A QUALIFIED PRIVELEGED COMMUNICATION. Even if the court were to sustain Syhunliong’s stance that Rivera availed of the wrong remedy when she restored to filling a petition for certiorari before the CA to assail the RTC orders denying the motion to quash, the result would only prove circuitous. Even if the trial proceeds and an adverse decision is rendered against Rivera, she can appeal the same, but the CA and the Supreme Court would still be compelled to order the dismissal of the information on account of prescription of the crime.

ninety, entitled 'An Act providing a Code of Procedure in Civil Actions and Special Proceedings in the Philippine Islands,' is hereby amended to read as follows: "' 1. Those who have been duly licensed under the laws and orders of the Islands under the sovereignty of Spain or of the United States and are in good and regular standing as members of the bar of the Philippine Islands at the time of the adoption of this code: Provided, That any person who, prior to the passage of this Act, or at any time thereafter, shall have held, under the authority of the United States, the position of justice of the Supreme Court, judge of the Court of First Instance, or judge or associate judge of the Court of Land Registration, of the Philippine Islands, or the position of Attorney-General, Solicitor-General, Assistant Attorney-General, assistant attorney in the office of the Attorney-General, prosecuting attorney for the city of Manila, assistant prosecuting attorney for the city of Manila, city attorney of Manila, assistant city attorney of Manila, provincial fiscal, attorney for the Moro Province, or assistant attorney for the Moro Province, may be licensed to practice law in the courts of the Philippine Islands without an examination, upon motion before the Supreme Court and establishing such fact to the satisfaction of said court.'"  

MANDATORY AND DIRECTORY STATUTES 1. ART 5 OF THE NEW CIVIL CODE 2. In re application of MARIO GUARIÑA for admission to the bar. FACTS:  Relying upon the provisions of section 2 of Act No. 1597, the applicant in this case seeks admission to the bar, without taking the prescribed examination, on the ground that he holds the office of provincial fiscal for the Province of Batanes  Section 2 of Act No. 1597, enacted February 28, 1907, is as follows: "SEC. 2. Paragraph one of section thirteen of Act Numbered One hundred and

It is contended that this mandatory construction is imperatively required in order to give effect to the apparent intention of the legislator, and to the candidate's claim de jure to have the power exercised. It must be confessed that were the inquiry limited strictly to the provisions of local law touching this matter, the contentions of the applicant would have great weight. For it is well settled that in statutory interpretation the word "may" should be read "shall" where such construction is necessary to give effect to the apparent intention of the legislator

ISSUE: Whether or not, taken as a whole and viewed in the light of surrounding circumstances, it can be said that a purpose existed on the part of the legislator to enact a law mandatory in its character

RULING:  Whether the word "may" in a statute is to be construed as mandatory and imposing a duty, or merely as permissive and conferring discretion, is to be

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determined in each case from the apparent intention of the statute as gathered from the context, as well as from the language of the particular provision. Applying these canons of construction to the statute under consideration, and limiting ourselves strictly to the provisions of local law touching the admission of candidates to the bar, we might, as we have said, be inclined to give the statute the mandatory effect which applicant claims should be placed upon it. But we are of opinion that such a construction is precluded by the provisions of the Act of Congress enacted July 1, 1902, which confirm and secure to this court the jurisdiction therefore conferred upon it. Prior to the passage of this Act the power and jurisdiction of this court in relation to the admission of candidates to the bar of the Philippine Islands had been fixed by the provisions of the Organic Act (No. 136) and the Code of Civil Procedure (Act No. 190); and as we understand these provisions this court was vested thereby with authority, and charged with a duty to pass upon the "moral character" and the "qualifications and ability" of all candidates for admission to the bar. Manifestly, the jurisdiction thus conferred upon this court by the Commission and confirmed to it by the Act of Congress would be limited and restricted, and in a case such as that under consideration wholly destroyed, by giving the word "may," as used in the above citation from Act No. 1597, a mandatory rather than a permissive effect. But any Act of the Commission which has the effect of setting at naught in whole or in part the Act of Congress of July 1, 1902, or of any Act of Congress prescribing, defining or limiting the power conferred upon the Commission is to that extent invalid and void, as transcending its rightful limits and authority. In construing a statute enacted by the Philippine Commission we deem it our duty not to give it a construction which would be repugnant to an Act of Congress, if the language of the statute is fairly susceptible of another construction not in conflict with the higher law. In doing so, we think we should not hesitate to disregard contentions touching the apparent intention of the legislator which would lead to the conclusion that the Commission intended to enact a law in violation of the Act of Congress. In construing a doubtful or ambiguous statute, the courts will presume that it was the intention of the legislature to enact a valid, sensible, and just law, and one which should change the prior law no further than may be necessary to effectuate the specific purpose of the act in question. The construction should be in harmony with this assumption whenever possible."

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"Hence it follows that the courts will not so construe the law as to make it conflict with the constitution, but will rather put such an interpretation upon it as will avoid conflict with the constitution and give it full force and effect, if this can be done without extravagance. If there is doubt or uncertainty as to the meaning of the legislature, if the words or provisions of the statute are obscure, or if the enactment is fairly susceptible of two or more constructions, that interpretation will be adopted which will avoid the effect of unconstitutionality, even though it may be necessary, for this purpose, to disregard the more usual or apparent import of the language employed." Without undue straining of the language used in the statute under consideration, the word "may" may be construed as either mandatory or permissive in its effect. But to construe it as mandatory would bring it in direct conflict with the Act of Congress, and we conclude therefore, despite the contentions of the applicant as to the apparent intention of the legislator, that it should be given its permissive and not its mandatory effect, and that the true intention of the legislator was to leave it within the discretion of the court to admit to the bar without examination the officials mentioned in the Act in any case wherein the court is otherwise satisfied that they possess the necessary qualifications. In the case under consideration, however, it affirmatively appears that the applicant was not and never had been a practicing attorney in this or any other jurisdiction prior to the date of his appointment as provincial fiscal, and it further affirmatively appears that he was deficient in the required qualifications at the time when he last applied for admission to the bar.

3. ADASA VS. ABALOS

February 19, 2007 Facts: Respondent Cecille Abalos alleged in the complaints and affidavits that petitioner Bernadette Adasa was encashed two checks issued in the name of the respondent through deceit without knowledge of respondent Abalos. Adasa failed to pay to the proceeds of the checks despite demands of Abalos. Adasa filed a counter-affidavit admitting that she received and encashed the checks and alleged further in a supplemental affidavit that Bebie Correa instead received the 2 checks and that she left the country. The Office of the City Prosecutor (OCP) of Iligan City issued a resolution finding probable cause against Adasa and ordered for filing of two

separate informations for Estafa through falsification of commercial document by a private individual. This petition only concerns one of the two (Criminal Case #8782) criminal cases (8781 & 8782) that were docketed. Petitioner Adasa filed a motion upon the trial court in order for the OCP to conduct a reinvestigation, in which the OCP has reaffirmed its finding of probable cause. Adasa has entered a not guilty plea during her arrangement on October 1, 2001 and later filed a petition for review before the DOJ where it reversed and set aside the resolution of the OCP and ordering it to withdraw the information for estafa. Respondent Abalos filed a motion for reconsideration arguing that the DOJ should have dismissed the petition for review outright contending that Sec 7 of DOJ Circular no 70 mandates that “If an information has been filed in court pursuant to the appealed resolution the petition shall not be given due course if the accused had already been arraigned” the aggrieved party cannot file a petition for review as the secretary of Justice shall deny it outright. The trial court has granted the petitioner’s “motion to withdraw information” and dismissed the criminal case, on February 2003. Respondent filed a petition for certiorari before the CA on the DOJ resolution and it reversed the sad resolution. The appellate court emphasized that DOJ Circular 70 Sec 7 used the phrase “shall not.” Petitioner then filed a petition for certiorari contending that section 12 of the same DOJ Circular used the word “may” that would give discretion to the Secretary of Justice to entertain an appeal, thus this petition. Issue: WON the overall language and the intent of DOJ Circular no 70 is directory that it would give discretion to the Secretary of Justice to entertain an appeal even if the accused has been arraigned. Held: No. the court held that CA is correct, the DOJ cannot give an appeal/petition for review due course and must dismiss such actions if the accused has already been arraigned. Therefore in Sec 12 if the ground for the dismissal is the arraignment of the accused, it must go back and act upon through Section 7. If Sec 12 is given a directory application it would render earlier mandatory provisions invalid/negligible

and would undermine the main objectives of the said circular which is “for the expeditious and efficient administration of justice.” 4. PHILIPPINE REGISTERED ELECTRICAL PRACTITIONER, INC. vs. JULIO FRANCIA, JR.

Facts: Petitioner is an organization composed of professional electrical engineers, associate electrical engineers, assistant electrical engineers, and master electricians. It is represented in this case by several of its officers and members. They assailed the constitutionality of Resolution No. 1, Series of 1986 issued by the Board of Electrical Engineering (BEE), adopting guidelines for the implementation of Continuing Professional Education (CPE) Program for Electrical Engineers. It requires every electrical engineer to earn credit units of CPE before his license could be renewed.||| Petitioner questioned the authority of the BEE to issue the subject Resolution, and the constitutionality of said Resolution. Sec. 3 of RA 184 mandated the Board to recommend proper measures for the maintenance of good ethics and standards in the practice of electrical engineering in the Philippines. The same is supported by Sec. 6(a) of PD 223. Petitioner argues that PRC and BEE have only visitation powers as stated in the said provision. The RTC as affirmed by the CA, decided that the board had the authority to promulgate the questioned resolution pursuant to Section 3, RA no.184. That the latter law is not limited to the power of inspection and visitation as petitioner contends. It includes the power to formulate policies and programs as may be necessary to improve the practice of a profession. Issue: whether the Board of Electrical Engineers in the light of the provisions of R.A. No. 184, had the authority to issue the questioned resolution. Held: Yes, The Court found that BEE had the authority to issue the resolution. The court found that the objective of the resolution is to upgrade the knowledge and skills of electrical engineers. And that Section 3 of RA no 184 mandates the Board to recommend to the PRC the adoption of “measures as may be deemed proper for the maintenance of good ethics and standars on the practice of electrical engineering in the Philippines…”. Moreover, Section 6(a) of PD no 223 gives various professional boards the power “to look from time to time into conditions affecting the practice of the profession….” It said that the members of a Board may personally or through subordinate employees of the Commission conduct ocular inspection or visit

industrial, mechanical, electrical or chemical plants or works, hospitals, clinics and other engineering works. . ." On this point, petitioner now insists that the authority of the Board is limited to the conduct of ocular inspections. But nothing in said provision in any way imposes such an interpretation. The Board in fact may even do away with ocular inspections, as can be gleaned from the use of the word "may," implying that the conduct of ocular inspections is merely directory and not mandatory. For sure, conducting ocular inspections is only one way of ensuring compliance with laws and rules relative to the professional practice of electrical engineering. But it certainly is not the only way. 5. GAUDENCIO GUERRERO v. REGIONAL TRIAL COURT OFILOCOS NORTE, BR. XVI, JUDGE LUIS B. BELLO, JR., PRESIDING,AND PEDRO G. HERNANDO, Facts: Filed by petitioner, GAUDENCIO GUERRERO, as an accion publiciana against private respondent, this case assumed another dimension when it was dismissed by respondent Judge on the ground that the parties being brothers-in-law the complaint should have alleged that earnest efforts were first exerted towards a compromise. Admittedly, the complaint does not allege that the parties exerted earnest efforts towards a compromise and that the same failed. However, private respondent Pedro G. Hernando apparently overlooked this alleged defect since he did not file any motion to dismiss nor attack the complaint on this ground in his answer. It was only on 7 December 1992, at the pre-trial conference, that the relationship of petitioner Gaudencio Guerrero and respondent Hernando was noted by respondent Judge Luis B. Bello, Jr., they being married to half-sisters hence are brothers-in-law, and on the basis thereof respondent Judge gave petitioner five (5) days "to file his motion and amended complaint" to allege that the parties were very close relatives, their respective wives being sisters, and that the complaint to be maintained should allege that earnest efforts towards a compromise were exerted but failed. Apparently, respondent Judge considered this deficiency a jurisdictional defect. Petitioner’s claim: Guerrero appeals by way of this petition for review the dismissal by the court a quo. (a) whether brothers by affinity are considered members of the same family contemplated in Art. 217, par. (4), and Art. 222 of the New Civil Code, as well as under Sec. 1, par. (j), Rule 16, of the Rules of Court requiring earnest efforts towards a compromise before a suit between them may be instituted and maintained; and, Held: Petition granted.The Constitution protects the sanctity of the family and endeavors to strengthen it as a basic autonomous social institution. 2 This is also embodied in Art. 149, 3 and given flesh in Art. 151, of the Family Code, which provides:

Art. 151. No suit between members of the same family shall prosper unless it should appear from the verified complaint or petition that earnest efforts toward a compromise have been made, but that the same have failed. If it is shown that no such efforts were in fact made, the case must be dismissed. This rule shall not apply to cases which may not be the subject of compromise under the Civil Code. Considering that Art. 151 herein-quoted starts with the negative word "No," the requirement is mandatory that the complaint or petition, which must be verified, should allege that earnest efforts towards a compromise have been made but that the same failed, so that "[i]f it is shown that no such efforts were in fact made, the case must be dismissed." Further, Art. 151 is contemplated by Sec. 1, par. (j), Rule 16, of the Rules of Court which provides as a ground for a motion to dismiss "(t)hat the suit is between members of the same family and no earnest efforts towards a compromise have been made." The Code Commission, which drafted the precursor provision in the Civil Code, explains the reason for the requirement that earnest efforts at compromise be first exerted before a complaint is given due course — This rule is introduced because it is difficult to imagine a sadder and more tragic spectacle than a litigation between members of the same family. It is necessary that every effort should be made toward a compromise before a litigation is allowed to breed hate and passion in the family. It is known that a lawsuit between close relatives generates deeper bitterness than between strangers . . . A litigation in a family is to be lamented far more than a lawsuit between strangers. .. But the instant case presents no occasion for the application of the above-quoted provisions. As early as two decades ago, we already ruled in Gayon v. Gayon that the enumeration of "brothers and sisters" as members of the same family does not comprehend "sisters-in-law." In that case, then Chief Justice Concepcion emphasized that "sisters-in-law" (hence, also "brothers-in-law") are not listed under Art. 217 of the New Civil Code as members of the same family. Since Art. 150 of the Family Code repeats essentially the same enumeration of "members of the family," we find no reason to alter existing jurisprudence on the matter. Consequently, the court a quo erred in ruling that petitioner Guerrero, being a brother-in-law of private respondent Hernando, was required to exert earnest efforts towards a compromise before filing the present suit.

6. LOKIN vs. COMELEC

FACTS:       

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COMELEC issued resolution giving due course to CIBAC’s Manifestation of Intent to participate in the party-list election. Respondents, President and chairman Villanueva submitted the certified Certificate of Nomination of CIBAC to the COMELEC Law Department. nd Pia Derla submitted a 2 Certificate of Nominees including Lokin, Jr (petitioner) as party-list nominees as she affixed her signature as “acting secretary-general” of CIBAC. The nomination of petitioners was unauthorized Respondents filed with the COMELEC a “Petition to expunge from the records and/or for disqualification,” seeking to nullify the certificate filed by Derla. Respondents contented that Derla had misrepresented herself as “acting secretary-general”, and not even a member of CIBAC. Resolution filed by the COMELEC First division granted the petition and ordered the Certificate filed by Derla to be expunge from the records, and declared respondents’ group as the true nominees of CIBAC. COMELEC en banc affirmed the Division’s findings as the commission reiterated that Derla was unable to prove her authority to file a certificate, whereas respondents presented evidence that Villanueva deputized CIBAC secretary to submit the Certificate of Nomination pursuant to CIBAC’s Constitution and bylaws. The COMELEC en banc affirmed the said Resolution, prompting Lokin Jr. (petitioner) to file Petition for Certiorari for grave abuse of discretion on the part of the COMELEC in issuing the said Resolution. The petitioner wants to be recognized as the legitimate nominees and representative of CIBAC party-list.

ISSUES: (1) WON the authority of Secretary of CIBAC to file the part’s Certificate of Nomination is an intracorporate matter, exclusively cognizable by special commercial courts, and over which the COMELEC has no jurisdiction; (2) WON the COMELEC erred in granting the Petition for Disqualification and recognizing respondents as the properly authorized nominees of CIBAC party-list. HELD: (1) The COMELEC has jurisdiction over cases pertaining to party leadership and the nomination of party-list representatives. The present dispute stemmed from an intra-corporate matter, their submissions even recognize the COMELEC’s constitutional power to enforce and administer all laws relative to the conduct of an election, plebiscite, initiative, referendum, and recall. More specifically, as one of its constitutional functions, the COMELEC is also tasked to "register, after sufficient publication, political parties, organizations, or coalitions which, in addition to other requirements, must present their platform or program of government.” Section 2, Article IX-C of the Constitution, "include the ascertainment of the identity of the political party and its legitimate officers responsible for its acts." The Court also declared that the COMELEC’s power to register political parties necessarily involved the determination of the persons who must act on its behalf. Thus, the COMELEC may resolve an intra-

party leadership dispute, in a proper case brought before it, as an incident of its power to register political parties. (2) No error because it is indicated clearly in the law that Sec. 9. Qualifications of Party-List Nominees. No person shall be nominated as party-list representative unless he is a natural-born citizen of the Philippines, a registered voter, a resident of the Philippines for a period of not less than one (1)year immediately preceding the day of the election, able to read and write, a bona fide member of the party or organization which he seeks to represent for at least ninety (90) days preceding the day of the election, and is at least twenty-five (25) years of age on the day of the election. Pia Derla, who is not even a member of CIBAC, is thus a virtual stranger to the party-list, and clearly not qualified to attest to petitioners as CIBAC nominees, or certify their nomination to the COMELEC. Petitioners cannot use their registration with the SEC as a substitute for the evidentiary requirement to show that the nominees, including Derla, are bona fide members of the party. Petitioners Planas and Lokin, Jr. have not even presented evidence proving the affiliation of the so-called Board of Trustees to the CIBAC Sectoral Party that is registered with COMELEC.

7. BOARDWALK BUSINESS VENTURES, INC., petitioner, vs. ELVIRA A. VILLAREAL (deceased) substituted by Reynaldo P. Villareal, Jr.-spouse, Shekinah Marie Villareal-Azuguedaughter, Reynaldo A. Villareal III-son, Shahani A. Villareal- daughter, and Billy Ray A. Villareal-son, respondents. FACTS:  Petitioner Boardwalk Business Ventures, Inc. (Boardwalk) is a duly organized and existing domestic corporation engaged in the selling of ready-to-wear (RTW) merchandise.  Respondent Elvira A. Villareal (Villareal) is one of Boardwalk's distributors of RTW merchandise.  Boardwalk filed an Amended Complaint 5 for replevin against Villareal covering a 1995 Toyota Tamaraw FX, for the latter's alleged failure to pay a car loan obtained from the former.  Ruling of the Metropolitan Trial Court: WHEREFORE, premises considered, judgment is hereby rendered in favor of the plaintiff and against the defendant adjudging that the former has the right to the possession of the subject motor vehicle and for the latter to pay the costs of the suit. Villareal moved for reconsideration but failed 

Ruling of the Regional Trial Court: WHEREFORE, the appeal is granted. The assailed judgment of the lower court is reversed and set aside. Defendant Villareal has the right of

possession to and the value of subject vehicle described in the complaint. Hence, plaintiff is directed to deliver the subject vehicle to defendant or its value in case delivery cannot be made. The complaint and counterclaim are both dismissed

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 Boardwalk filed a Motion for Reconsideration, but the same was denied by the RTC in a December 14, 2006 Order, which Boardwalk received on January 19, 2007. On February 5, 2007, Boardwalk through counsel filed with the Manila RTC a Motion for Extension of Time to File Petition for Review, praying that it be granted 30 days, or until March 7, 2007, to file its Petition for Review. It paid the docket and other legal fees therefor at the Office of the Clerk of Court of the Manila RTC. On even date, Boardwalk also filed a Notice of Appeal with the RTC which the said court denied for being a wrong mode of appeal. On March 7, 2007, Boardwalk filed through mail its Petition for Review with the CA. 

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Ruling of the Court of Appeals: The CA held that Boardwalk erred in filing its Motion for Extension and paying the docket fees therefor with the RTC. It should have done so with the CA as required by Section 1 25 of Rule 42 of the Rules of Court. It held that as a result of Boardwalk's erroneous filing and payment of docket fees, it was as if no Motion for Extension was filed, and the subsequent March 7, 2007 filing of its Petition with the appellate court was thus late and beyond the reglementary 15-day period provided for under Rule 42. The CA added that Boardwalk's prayer for a 30-day extension in its Motion for Extension was irregular, because the maximum period that may be granted is only 15 days pursuant to Section 1 of Rule 42. A further extension of 15 days should only be granted for the most compelling reason which is not obtaining in the present case Petitioner’s Arguments: Boardwalk invokes the principle that litigations should be decided on the merits and not on technicalities; that litigants should be afforded the amplest opportunity for the proper and just disposition of their causes, free from the constraints of technicalities. It claims that it should not be faulted for the error committed by its counsel's clerk in wrongly filing the Motion for Extension and paying the docket fees with the RTC Clerk of Court. It prays that the Court review the merits of its case.

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As for the defective Verification and Certification of non-forum shopping, Boardwalk contends that these are formal, not jurisdictional, requisites which could as well be treated with leniency. Its subsequent submission of the proper secretary's certificate should thus have cured the defect. It adds that the same treatment should be accorded its subsequent payment of the docket fees with the CA Cashier and submission of the required annexes and pleadings in support of its Petition. It prays the Court to consider these as substantial compliance with the Rules.

ISSUE: Whether or not the rules to effect substantial justice in accordance with Rule 1, Section 6 of the 1997 Rules of Civil Procedure be liberally construed; specifically, the assailed resolutions ordering the outright dismissal of the petition for review due to procedural lapses, in total disregard of the substantial issues clearly raised thereat, are contrary to existing rules, law, jurisprudence, and the principle of equity and substantial justice RULING: NO   

Petitioner's case is not unique, and there is no compelling reason to accord it the privilege it now seeks. The right to appeal is neither a natural right nor [is it a component] of due process. It is a mere statutory privilege, and may be exercised only in the manner and in accordance with the provisions of law. In this case, petitioner must comply with the following requirements laid down in Rule 42 of the Rules of Court: Section 1. How appeal taken; time for filing. — A party desiring to appeal from a decision of the Regional Trial Court rendered in the exercise of its appellate jurisdiction may file a verified petition for review with the Court of Appeals, paying at the same time to the clerk of said court the corresponding docket and other lawful fees, . . . . The petition shall be filed and served within fifteen (15) days from notice of the decision sought to be reviewed or of the denial of petitioner's motion for new trial or reconsideration . . . . Upon proper motion . . ., the Court of Appeals may grant an additional period of fifteen (15) days only within which to file the

petition for review. No further extension shall be granted except for the most compelling reason and in no case to exceed fifteen (15) days.

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Section 1, Rule 42 of the Rules of Court specifically states that payment of the docket fees and other lawful fees should be made to the clerk of the CA. A plain reading of the Rules leaves no room for interpretation; it is categorical and explicit. It was thus grave error on the part of the petitioner to have misinterpreted the same and consequently mistakenly remitted its payment to the RTC clerk. Petitioner's subsequent payment to the clerk of the CA of the docket fees and other lawful fees did not cure the defect

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Petitioner sought an extension of 30 days within which to file its Petition for Review with the CA. This is not allowed. Section 1 of Rule 42 allows an extension of only 15 days. "No further extension shall be granted except for the most compelling reason . . . ." Petitioner never cited any compelling reason.

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Section 8 of Rule 42 provides that the appeal is deemed perfected as to the petitioner "upon the timely filing of a petition for review and the payment of the corresponding docket and other lawful fees." Undisputably, petitioner's appeal was not perfected because of its failure to timely file the Petition and to pay the docket and other lawful fees before the proper court which is the CA

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To stress, the right to appeal is statutory and one who seeks to avail of it must comply with the statute or rules. The requirements for perfecting an appeal within the reglementary period specified in the law must be strictly followed as they are considered indispensable interdictions against needless delays.

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the perfection of an appeal in the manner and within the period set by law is not only mandatory but jurisdictional as well, hence failure to perfect the same renders the judgment final and executory.

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It must be emphasized that since petitioner's right of appeal is a mere statutory privilege, it was bound to a strict observance of the periods of appeal, which requirements are not merely mandatory, but jurisdictional.

Sec. 2. Form and contents. — The petition shall be . . . accompanied by . . . copies . . . of the pleadings and other material portions of the record as would support the allegations of the petition. The petitioner shall also submit together with the petition a certification under oath that he has not theretofore commenced any other action involving the same issues in the Supreme Court, the Court of Appeals or different divisions thereof, or any other tribunal or agency; if there is such other action or proceeding, he must state the status of the same; and if he should thereafter learn that a similar action or proceeding has been filed or is pending before the Supreme Court, the Court of Appeals, or different divisions thereof, or any other tribunal or agency, he undertakes to promptly inform the aforesaid courts and other tribunal or agency thereof within 5 days therefrom 

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The Rules also require that the Petition must be verified or accompanied by an affidavit by which the affiant attests under oath that he "has read the pleading and that the allegations therein are true and correct of his personal knowledge or based on authentic records." Section 3 of Rule 42 provides that non-compliance "with any of the foregoing requirements regarding the payment of the docket and other lawful fees, . . . and the contents of and the documents which should accompany the petition shall be sufficient ground for the dismissal thereof."

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Records show that petitioner failed to comply with the foregoing rules

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Concededly, this Court in several cases exercised leniency and relaxed the Rules. However, in this case, petitioner committed multiple violations of the Rules which should sufficiently militate against its plea for leniency. As will be shown below, petitioner failed to perfect its appeal by not filing the Petition within the reglementary period and paying the docket and other lawful fees before the proper court. These requirements are mandatory and jurisdictional.

8. QUIZON V COMELEC Facts:  -Petitioner Quizon and Respondent Puno were congressional candidates during the May 14, 2007 national and local elections.  -Quizon filed a Petition for Disqualification and Cancellation of Certificate of Candidacy against Puno.  -Quizon alleged that Puno is not qualified to run as candidate in Antipolo City for failure to meet the residency requirement prior to the day of election;  -Puno’s claim in his Certificate of Candidacy (COC) that he is a resident of 1906 Don Celso Tuazon, Valley Golf Brgy. De la Paz, Antipolo City for four years and six months before May 14, 2007 constitutes a material misrepresentation since he was in fact a resident of Quezon City  -On April 24, 2007, Quizon filed a Supplement to the petition claiming that Puno cannot validly be a candidate for a congressional seat in the First District of Antipolo City since he indicated in his COC that he was running in the First District of the Province of Rizal which is a different legislative district.  -Quizon filed a motion for reconsideration with the COMELEC En Banc which remains unresolved up to this date.  -On June 5, 2007, Quizon filed this Petition for Mandamus alleging that the COMELEC had not rendered a judgment on the above-mentioned petitions and that the unreasonable delay in rendering judgment deprived him of his right to be declared as the winner and assume the position of member of the House of Representatives  -Puno argues that the petition for mandamus was mooted by the July 31, 2007Resolution of the COMELEC Second Division. He also alleged that the petition must be dismissed for the act sought to be performed is a discretionary and not a ministerial duty.  -COMELEC Second Division DISMISSED the instant Petition for Disqualification and Cancellation of the Certificate of Candidacy of respondent Roberto V. Puno.  -The COMELEC then continued to state that the respondent is a resident of the 1st District of Antipolo City, and is thus qualified to runs as Member of the House of Representatives of the same district.  -The Office of the Solicitor General agrees that the petition for mandamus was mooted by the July 31, 2007 Resolution of the COMELEC Second Division. Any question regarding Puno qualifications now pertains to the House of Representatives Electoral Tribunal (HRET) Issue:

Whether or not the Petition for Disqualification and Cancellation of the Certificate of Candidacy of Roberto V. Puno valid?

Ruling : No -The instant Petition is hereby DISMISSED for lack of merit. -Respondent is a resident of the 1st District of Antipolo City, and is thus qualified to run as a Member of the House of Representatives of the same district. Section 78 of the Omnibus Election Code 11 provides that petitions to deny due course or cancel a certificate of candidacy should be resolved, after due notice and hearing, not later than fifteen days before the election. In construing this provision together with Section 6 of R.A. No. 6646 or The Electoral Reforms Law of 1987, 12 this Court declared in Salcedo II v.COMELEC 13 that the fifteen-day period in Section 78 is merely directory. Thus: If the petition is filed within the statutory period and the candidate is subsequently declared by final judgment to be disqualified before the election, he shall not be voted for, and the votes cast for him shall not be counted. If for any reason a candidate is not declared by final judgment before an election to be disqualified and he is voted for and receives the winning number of votes in such election, the Court or the Comelec shall continue with the trial and hearing of the action, inquiry, or protest and, upon motion of the complainant or any intervenor, may during the pendency thereof order the suspension of the proclamation of such candidate whenever the evidence of his guilt is strong. The fifteen-day period in section 78 for deciding the petition is merely directory.