L C A L C A L C A LINES LINES LINES Inside this issue: BIR issuances for the month of March 2 New Laws for the month of March 5 Jurisprudence 6 JLs Corner 12
Said offices must com- municate with the con- cerned taxpayers in- volved in the BTI within 5 working days from the date of the aforesaid trans- action, or from the date of discovery of the transac- tion.
The Assistant Commis- sioner of the responsible office shall send an Ac- cess to Records letter to the taxpayer. The sub- mission of the requested documents by the tax- payer within the pre- scribed deadline must be strictly enforced and failure of the taxpayer to comply should result in the institu- tion of the available sanc- tions, including the issu- ance of subpoena duces tecum.
For cases of requests for ruling involving transac- tions with an amount in excess of P 1,000,000.00, the BIR legal office receiv- ing the copy of the ruling request shall furnish a copy to the BIR office hav- ing jurisdiction over the taxpayer who filed the re- quest for a ruling. Said BIR office shall request for information on this transaction using the Access to Record form, and submit a report on the results of the evaluation to the BIR legal office han- dling the ruling request not later than 15 working days from receipt of the docu- ments.
REVENUE MEMORAN- DUM ORDER NO. 13- 2010
REVENUE MEMORANDUM ORDER NO. 13-2010 amends Revenue Memo- randum Order No. 6-2010 relative to the policies and guidelines on stamping of Income Tax Returns and the audited Financial Statements.
Item No. 2, Section III was amended to read as fol- lows:
2. The attachments to the income tax returns shall also be received in the same manner as above, but for the attached finan- cial statements the same shall be stamped received only on the page of the REVENUE MEMORANDUM ORDER NO. 11-2010
REVENUE MEMORANDUM ORDER NO. 11-2010 pre- scribes the policies and guidelines on the monitor- ing, review and determina- tion of the tax consequenc- es of Big-Ticket Items.
A transaction is considered as a Big-Ticket Item (BTI) based on the following:
a. If the amount involved exceeds P 200,000,000. This threshold amount is considered on a per single and unrelated event or transaction basis, and shall not take into account the summation or the total of several unrelated and multi- ple events or transactions. b. If it involves a request for ruling filed with the BIR where the amount of the transaction is over P 1,000,000.
The following offices shall be responsible for the moni- toring of BTI:
a. Large Taxpayers Ser- vice (LTS) Regular b. LTS Excise c. Enforcement Service
Audit Certificate, the Balance Sheet and the Income State- ment. Accordingly, the other pages of the finan- cial statements and its attachments need not anymore be stamped received.
REVENUE MEMORAN- DUM ORDER NO. 16- 2010
REVENUE MEMORAN- DUM ORDER NO. 16- 2010 prescribes the pol- icies and guidelines in determining the output Value-Added Tax (VAT) liabilities of motels and other similar establish- ments, except hotels, resorts and other estab- lishments which do not regularly allow short time (less than 24 hours) stay in their establishments.
Motels and other simi- lar establishments shall submit to the Revenue District Office (RDO) where they are regis- tered a Sworn Declara- tion within 10 days from issuance of the Order, and for each year there- after on or before Janu- ary 31 of each year.
The RDO concerned shall evaluate the in- BIR ISSUANCES Page 2 L C A LINES formation provided in the Sworn Declaration and compute the pre- scribed revenues per month of an establish- ment. An Occupancy Turnover Analysis Report (OTAR), containing a summary of the infor- mation gathered from the Sworn Declarations of all establishments in the District, and their pre- scribed revenues per month, shall be prepared by the RDO using the for- mat prescribed in the Or- der. This shall be com- pleted not later than the last day of February each year.
In accomplishing the OTAR, the following must be considered:
a. For peak periods cov- ering the months of January to February, April to June, and De- cember, the minimum turnover/day of a par- ticular establishment shall be set at a con- stant factor of 2. b. For lean periods cov- ering the other remain- ing months of the year, the minimum turnover / day shall be 1.5.
Based on the OTAR for a motel, the concerned RDO shall then notify the motel operator of the proposed additional output tax to be paid for each month. Upon receipt of the noti- fication from the RDO, the motel shall have the option of amending its VAT Returns for the months in question, and pay the corresponding additional output tax within ten (10) days from receipt of the no- tice. The amended VAT Return(s) shall take into account not only the ad- ditional gross sales from its room occupancy oper- ations but shall also cov- er the gross sales/ receipts from the other operations mandated under the National Inter- nal Revenue Code, as amended.
The RDO having jurisdic- tion over a motel that opts not to amend its VAT returns shall recom- mend to the Regional Director the issuance of a Mission Order for the conduct of surveil- lance activities or other appropriate enforcement measures on the con- cerned motel in order to determine its true and correct tax liabilities. Surveillance activities or other appropriate en- forcement measures may include the post- ing of BIR personnel on the premises of the concerned motel for a period of not less than 10 days to determine the volume of business transactions entered into by the establish- ment over a given period of time. Should the surveillance activity/ enforcement measure disclose the understate- ment of taxable gross sales by 30% or more of the motels correct taxable sales for the taxable quarter, the motel shall be consid- ered subject to the Oplan Kandado proce- dures prescribed in Revenue Memorandum Order No. 3-2009. The imposition of sanc- tions against a motel under the Oplan Kan- dado Program, shall not preclude the BIR from filing the appropriate tax evasion charges under the Run After Tax Evaders (RATE) Pro- gram, if evidence so requires, against the concerned motel or the responsible officers of the establishment.
tion in the taxpayers books and records and use any evidence availa- ble to contravene their accuracy. In this con- nection, the provisions of Revenue Administra- tive Memorandum Or- der No. 1-2000 shall be followed. The BIR shall rely on Revenue Memo- randum Circular No. 23- 2000 in making deficien- cy tax assessments based on the Best Evi- dence Obtainable. Fur- thermore, Section 6 (c) of the National Internal Revenue Code allows the BIR to prescribe the min- imum taxable base for which internal revenue taxes shall be deter- mined. The National Investiga- tion Division (NID) shall verify the existence of a taxpayers high value assets and/or conspicu- ous spending by ac- cessing the records of appropriate government and private entities, such as but not limited to the following:
a. Land Transportation Office; b. Bureau of Immigra- tion ; c. Airline and shipping companies ; d. Maritime Industry Au- thority; e. Civil and Aeronautics Board; f. Manila Electric Compa- ny; g. Land Registration Au- thority; h. Registries of Deeds; i. Resorts, membership clubs, or similar estab- lishments; j. Homeowners associa- tions; k. Real estate develop- ment companies; l. Credit card companies; m. Statement of Assets, Liabilities, and Net worth and/or Amnesty Returns filed under Re- public Act 9480. The Assistant Commis- sioner, Enforcement Ser- vice (ACIR, ES) shall es- tablish linkages with var- ious agencies for authori- ty to secure information/ documents on individual. He shall also access the BIRs Integrated Tax System (ITS) for infor- mation on the taxpayer such as:
a. Taxpayers Identifica- tion Number; b. Registered address; c. Registered business/ es; d. Returns filed; e. Amount of taxes paid.
The information gathered from the said entities shall then be evaluated vis--vis the data ex- tracted from the ITS. The economic use/beneficial ownership of properties shall be considered in the evaluation process. Thus, all properties registered under the name of his/her child or, whether emancipat- ed or a minor, or any other relative shall be considered as those of the taxpayer when the property is not proven Page 3 VOLUME III, ISSUE No. 3 BIR ISSUANCES REVENUE MEMORAN- DUM ORDER NO. 19- 2010
REVENUE MEMORANDUM ORDER NO. 19-2010 prescribes the policies and guidelines in the conduct of investiga- tions relative to the Taxpayers Lifestyle Check System (TLCS) to properly determine tax compliance of individu- als.
An individuals taxable income may be estab- lished by using direct evidence, whenever available. Indirect meth- ods can be used, howev- er, when one or more of the following conditions, among others, prevail:
a. The taxpayer main- tains no books and rec- ords. b. The taxpayers books and records are not available. c. The taxpayers books and records are inade- quate. d. The taxpayer with- holds books and records from investigation/ verification by authorized Revenue Officers.
The fact that the tax- payers books and rec- ords reflect the figures on the income and business tax returns, however, does not pre- vent the use of the indirect method of proof. The Revenue Of- ficer can still look beyond the self-serving declara- Page 4 L C A LINES
to have been acquired under any of the means enumerated un- der the New Civil Code of the Philippines and the tax thereon has been properly paid, and/or the child or relative has no independent means suffi- cient for the acquisition of the properties.
If the taxpayers net worth has increased in a given year or he has acquired substan- tial assets and incurred substantial spending disproportionate to his declared income, and was verified from the ITS that he has not filed an Income Tax Return for that period, then such fact constitutes a prima facie evidence of fraud and/or substantial un- der-declaration of taxes warranting the issuance of a Letter of Authority to investigate the tax- payer.
The ACIR, ES shall coor- dinate with the Infor- mation Systems Group for the development of an Electronic Data Ware- house wherein all infor- mation gathered in the TLCS shall be stored for reference and use. The Special Investigation Di- vision of the Regional Offices and other BIR audit offices shall also be authorized to imple- ment the TLCS upon the approval of the Commissioner of Internal Revenue.
REVENUE MEMORAN- DUM CIRCULAR NO. 12-2010
REVENUE MEMORANDUM CIRCULAR NO. 12-2010 circularizes the full text Joint Rules and Regu- lations Implementing Articles 60, 61 and 144 of Republic Act (RA) No. 9520, otherwise known as the Philippine Cooperative Code of 2008 in relation to the National Internal Reve- nue Code, as amend- ed, which was signed by the Department of Finance, Bureau of Inter- nal Revenue and Cooper- ative Development Au- thority last February 5, 2010.
The following are speci- fied in the Joint Rules and Regulations:
a. Tax exemptions of duly registered Cooper- atives which transact business with members only; b. Taxability/exemption of duly registered Coop- eratives which transact business with members and non-members; c. Taxability of unrelated income of Cooperatives; d. Taxability of Coopera- tives to other internal revenue taxes; e. Taxability of mem- bers/share holders of Cooperatives; f. Documents to be at- tached to the letter- application for the issu- ance of Certificate of Tax Exemption/Ruling; g. Validity of Certificate of Tax Exemption/Ruling; h. Application for renew- al of Certificate of Tax Exemption/Ruling; i. Examination of books of accounts and other accounting records of the Cooperatives; j. Compromise settle- ment of any tax liability unpaid by Cooperatives.
REVENUE MEMORAN- DUM CIRCULAR NO. 16-2010
REVENUE MEMORANDUM CIRCULAR NO. 16-2010 requires the taxpayers to disclose their elec- tion to avail of the Optional Standard De- duction (OSD) for taxa- ble year 2009. Taxpayers who are elect- ing to avail the OSD are required to check the appropriate box in the Income Tax return filed for the first quarter of taxable year 2009, whether such taxpayer is adopting the calendar or fiscal year. One the elec- tion is made, the same type of deduction must be consistently applied for all the succeeding quarterly returns and in the final Income Tax re- turn for the taxable year. Failure to indicate the election to avail of the OSD shall be considered as having availed of the itemized deductions allowed under Section 34 of the Tax Code, as amended. Any tax- payer who is required but fails to file the Income Tax return for the first quarter shall be considered as having availed of the itemized deductions option for taxable year 2009. Pro- vided, however, that newly registered taxpay- ers shall disclose their election to avail of the OSD in their initial quar- terly Income Tax return, which is required to be filed for taxable year 2009.
The election to avail of the OSD or itemized de- duction, as signified in the return, shall be irrev- ocable for taxable year 2009 upon filing thereof. Any subsequent amend- ment of such Income Tax return filed for the first/initial quarter of taxable year 2009 shall not affect the irrevoca- ble character of the elec- tion to avail of the OSD or itemized deduction, as the case may be.
REVENUE MEMORAN- DUM CIRCULAR NO. 18-2010
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To see the full text of the law, go to: http:// www.senate.gov.ph/ r epubl i c_act s/r a% 2010021.pdf
REPUBLIC ACT 10026
An Act Granting In- come Tax Exemption to Local Water Districts by amending Section 27 (C) of the NIRC of 1997, as amended, and adding Sections 289-A to the Code for the pur- pose
March 11, 2010
FEATURES :
Grants tax exemption to local water districts and condonation of past years deficiency income tax as- sessments. the President subject to rules and regulations on the necessity and rele- vance that may be prom- ulgated upon enactment of the law.
Penalizes officers/ employees of the Bureau of Internal revenue for unlawful divulgence of information obtained from banks and financial institutions pursuant to Section 6 (F) of the NIRC to persons other than the requesting foreign tax authority.
Seeks to provide for sanctions for officers of banks and financial insti- tutions for willful refusal to supply information and strict obligation of the requesting foreign tax authority to maintain confidentiality of the in- formation received.
REVENUE MEMORAN- DUM CIRCULAR NO. 18-2010 issued on March 8, 2010 clarifies the coverage and taxa- bility of amusement places under Section 125(b) of the National Internal Revenue Code (NIRC) of 1997, as amended. Amusement places, which offer the same pleasurable diversion en- tertainment and function (like night and day clubs and cabarets), now in- clude videoke bars, kara- oke bars, karaoke televi- sions, karaoke boxes and music lounges. As such, the proprietors, lessees or operators of the said establishments are deemed also subject to the 18% amusement tax under Section 125(b) of the NIRC of 1997, as amended, and not to the 12% VAT on gross re- ceipts.
REPUBLIC ACT 10021
Exchange of Infor- mation on Tax Mat- ters Act of 2009
March 5, 2010
FEATURES:
Authorizes the Com- missioner to inquire into bank deposits and other related information held by financial institutions to supply information to a requesting foreign tax authority pursuant to a convention or agree- ment to which the Phi- lippines is a signatory, subject to specific re- quirements as to the relevance of the tax information requested.
Allows the request- ing foreign tax authority to examine the income tax returns of taxpayers upon order of NEW LAWS FOR THE MONTH OF MARCH NEW LAWS FOR THE MONTH OF MARCH Page 6 VOLUME III, ISSUE No. 3
To see the full text of the law, go to: http:// www. o p . g o v . p h / d i r e c t i v e s / RA10026.pdf
REPUBLIC ACT 10028 Expanded Breastfeed- ing Promotion Act of 2009 March 16, 2010
FEATURES: All private enterprises as well as government agencies, including gov- ernment-owned and con- trolled corporations are required to put up a lacta- tion stations A l s o ma n d a t e s lactation period for nursing employees who are granted break inter- vals in addition to the regular time-off for meals to express milk . The additional period shall not be less than a total of 40 minutes for every eight- hour working period.
To see the full text of the law, go to: http:// www . o p . g o v . p h / d i r e c t i v e s / RA10028.pdf
REPUBLIC ACT 10029 Philippine Psychology Act of 2009 March 16, 2010
FEATURES: Individuals planning to offer psychological services must now pass a state licensure exami- nation before they can practice in the country h t t p : / / www. o p . g o v . p h / d i r e c t i v e s / RA10029.pdf
It further emphasized JURISPRUDENCE PEOPLE OF THE PHIL- IPPINES vs. VICTORIO PAGKA- LINAWAN
G.R. No. 184805 March 3, 2010
FACTS: A confidential informant arrived and reported the illegal activ- ities of a certain Berto,. The Police immediately formed a buy-bust team. The team recovered from him two (2) sachets of shabu . The appropriate markings were made on them. Berto was identi- fied later on as Victorio Pagkalinawan (Berto). The white crystalline sub- stance recovered from Berto was found positive to the test for Me- thylamphetamine Hydro- chloride, also known as shabu, a dangerous drug.
ISSUE: Whether or not a buy-bust operation is a form of entrapment, therefore legal.
RULING: A buy-bust operation is a form of en- trapment and is therefore legal.
Instigation is the means by which the accused is lured into the commission of the offense charged in order to prosecute him. On the other hand, en- trapment is the employ- ment of such ways and means for the purpose of trapping or capturing a lawbreaker.
One form of entrapment is the buy-bust operation. It is legal and has been proved to be an effective method of apprehending drug peddlers, provided due regard to constitu- tional and legal safe- guards is undertaken.
In order to determine the validity of a buy-bust op- eration, this Court has consistently applied the objective test. In Peo- ple v. Doria, the Court stressed that in applying the objective test, the details of the purported transaction during the buy-bust operation must be clearly and adequate- ly shown, i.e., the initial contact between the po- seur-buyer and the pusher, the offer to pur- chase, and the promise or payment of the con- sideration until the con- summation of the sale by the delivery of the illegal drug subject of the sale.
in her capacity as PEZA Director General, advised Mercado of the termina- tion of her appointment effective on the closing hours of the day. On even date, the PEZA Board convened in an executive session and passed a Resolution ap- pointing Wilhelm G. Ortaliz (Ortaliz), a CESO eligible, as Deputy Direc- tor General for Policy and Planning effective imme- diately.
Mercado thereupon filed with the Regional Trial Court (RTC) of Pasay City a petition for prohi- bition, quo warranto and damages with prelimi- nary prohibitory / mandatory injunction and/or temporary re- straining order question- ing the PEZA Board Res- olution appointing Ortaliz as Deputy Director Gen- eral for Policy and Plan- ning.
ISSUE: Whether or not the appointment of Ortaliz is illegal.
RULING: The appoint- Page 7 L C A LINES JURISPRUDENCE what is known as a decoy solicitation, is not prohibited by law and does not render the buy- bust operation invalid.
PEZA BOARD OF DI- RECTORS and LILIA B. DE LIMA vs. GLORIA J. MERCADO
G.R. No. 172144 March 9, 2010
FACTS: Gloria J. Mercado (Mercado) was appointed as Group Manager for Pol- icy and Planning of PEZA. Her appointment was temporary in nature.
Mercado was promoted to the position of Deputy Director General for Policy and Planning. Her ap- pointment indicated the same as on permanent basis, but with the follow- ing annotation: NO SE- CURITY OF TENURE UN- LESS HE/SHE OBTAINS CESO (Career Executive Service Officer) OR CSEE (Career Service Executive Eligibility) ELIGIBILITY.
Lilia B. de Lima (de Lima), that the manner by which the initial contact was made, whether or not through an inform- ant, the offer to pur- chase the drug, the pay- ment of the buy-bust money, and the delivery of the illegal drug, whether to the informant alone or the police of- ficer, must be subject of strict scrutiny by courts to insure that law- abiding citizens are not unlawfully induced to commit an offense.
In the instant case, the evidence clearly shows that the police officers used entrapment, not instigation, to capture Berto in the act of selling a dangerous drug. The facts categorically show a typical buy-bust opera- tion as a form of entrap- ment. The police offic- ers conduct was within the acceptable standards for the fair and honora- ble administration of jus- tice.
The acts of the informant and the poseur-buyer in pretending that they were in need of shabu instigated or induced Berto to violate the Anti- Drugs Law, the police officers act of soliciting drugs from Berto during a buy-bust operation, or Page 8 VOLUME III, ISSUE No. 3 ment of Ortaliz is not illegal.
Section 27 (1), of the Civil Service Law pro- vides:
(1) Permanent sta- tus. A permanent appointment shall be issued to a per- son who meets all the requirements for the position to which he is being appointed, includ- ing the appropri- ate eligibility pre- scribed, in accord- ance with the provi- sions of law, rules and standards promulgated in pur- suance thereof. (emphasis and un- derscoring supplied)
In the CES under which the position of PEZA Deputy Director General for Policy and Planning is classified, the acquisi- tion of security of ten- ure which presupposes a permanent appoint- ment is governed by the Rules and Regulations promulgated by the CES Board.
For an examinee or an incumbent to be a member of the CES and be entitled to security of tenure, she/he must pass the CES examina- tions, be conferred CES eligibility, comply with the other requirements pre- scribed by the CES Board, and be appointed to a CES rank by the Presi- dent.
Admittedly, before and up to the time of the termi- nation of her appoint- ment, Mercado did not go through the four stages of CES eligibility examina- tions.
Since, it is admitted that Mercado, who acquired an MNSA degree in 1993, had not undergone the second, third and fourth stages of the CES eligibil- ity examinations prior to her appointment or during her incumbency as Depu- ty Director General up to the time her appointment was terminated, she was not a CES eligible, as in- deed certified to by the CES Board. Not being a CES eligible, she had no security of tenure, hence, the termination by the PEZA Board of her ap- pointment, as well as the appointment in her stead of CES eligible by Ortaliz, were not illegal.
Removing the CES eligibil- ity requirement for the Deputy Director General position could not have been the intention of the framers of the law. It bears noting that the po- sition is a high-ranking one which requires spe- cialized knowledge and experience in certain are- as including law, econom- ics, public administration and similar fields, hence, to remove it from the CES would be absurd.
The Civil Service Commis- sion CESB in fact has cer- tified that the position requires the appropriate CES eligibility. It is set- tled that the construction given to a statute by an administrative agency charged with the interpre- tation and application of that statute is entitled to great respect and should be accorded great weight by the courts.
LAND BANK OF THE PHILIPPINES vs. CORAZON M. VILLEGAS G.R. No. 180384 ------------------------ LAND BANK OF THE PHILIPPINES vs. HEIRS OF CATALINO V. NOEL and PROCULA P. SY G.R. No. 180891 March 26, 2010
FACTS: Land Bank of the Philippines (LBP) filed cases for determination of just compensation against Corazon M. Villegas (Villegas) in Civil Case and heirs of Catalino V. Noel and Procula P. Sy (heirs) before the Region- al Trial Court (RTC) of Dumaguete City, Branch 32, sitting as a Special Agrarian Court for the province of Negros Orien- tal. Villegas property as well as the heirs property happened to be outside the regular territorial ju- risdiction of RTC Branch 32 of Dumaguete City.
ISSUE: Whether or not an RTC, acting as Special Agrarian Court, has juris- diction over just compen- sation cases involving ag- ricultural lands located outside its regular juris- diction but within the province where it is desig- nated as an agrarian court under the Compre- hensive Agrarian Reform Law of 1998.
RULING: The RTC acting as Special Agrarian Court, has jurisdiction over just compensation cases in- volving agricultural lands located outside its regular jurisdiction but within the province where it is desig- nated as an agrarian court under the Compre- hensive Agrarian Reform Law of 1998.
Jurisdiction is the courts authority to hear and determine a case. The courts jurisdiction over the nature and sub- ject matter of an action is conferred by law. In this case, the law that confers jurisdiction on Special Agrarian Courts designat- ed by the Supreme Court in every province is Re- public Act (R.A.) 6657 or the Comprehensive Agrar- ian Reform Law of 1988. Sections 56 and 57 are the relevant provisions: SEC. 56. Special Agrarian Court. - The Supreme Court shall designate at least one (1) branch of the Re- gional Trial Court (RTC) within each province to act as a Special Agrarian Court.
The Supreme Court may designate more branches to con- stitute such additional Special Agrarian Courts as may be nec- essary to cope with the number of agrari- an cases in each prov- ince. In the designa- tion, the Supreme Court shall give pref- erence to the Regional Trial Courts which have been assigned to handle agrarian cases or whose presiding judges were former judges of the defunct Court of Agrarian Re- lations.
The Regional Trial Court (RTC) judges assigned to said courts shall exer- cise said special juris- diction in addition to the regular jurisdiction of their respective courts.
SEC. 57. Special Juris- diction. - The Special Agrarian Courts shall have original and ex- clusive jurisdiction over all petitions for the determination of just compensation to landowners, and the prosecution of all criminal offenses un- der this Act. The Rules of Court shall apply to all proceedings before the Special Agrarian Courts unless modified by this Act.
The Special Agrarian Courts shall decide all appropriate cases un- der their special juris- diction within thirty (30) days from sub- mission of the case for decision.
A branch of an RTC desig- nated as a Special Agrari- an Court for a province has the original and ex- clusive jurisdiction over all petitions for the de- termination of just com- pensation in that prov- ince. Special Agrarian Courts have original and exclusive jurisdiction over two categories of cases: (1) all petitions for the determination of just compensation to landown- ers, and (2) the prosecu- tion of all criminal offens- es under R.A. 6657.
By special jurisdiction, Special Agrarian Courts exercise power in addition to or over and above the ordinary jurisdiction of the RTC, such as taking cog- nizance of suits involving agricultural lands located outside their regular terri- torial jurisdiction, so long as they are within the province where they sit as Special Agrarian Courts.
R.A. 6657 requires the designation by the Su- preme Court before an RTC Branch can func- tion as a Special Agrari- an Court. The Supreme Court has not designat- ed the single sala courts of RTC, Branch 64 of Guihulngan City and RTC, Branch 63 of Bay- awan City as Special Agrarian Courts. Con- sequently, they cannot hear just compensation cases just because the lands subject of such cases happen to be within their territorial jurisdiction. Since RTC, Branch 32 of Dumaguete City is the designated Special Agrarian Court for the province of Negros Ori- ental, it has jurisdiction over all cases for deter- mination of just com- pensation involving ag- ricultural lands within that province, regard- less of whether or not those properties are outside its regular terri- torial jurisdiction. WHITE DIAMOND TRADING CORPORA- TION and/or JERRY L C A LINES Page 9 UY and JESSIE UY vs. NATIONAL LABOR RE- LATIONS COMMIS- SION, NORLITO ES- COTO, MARY GRACE PASTORIL and MARIA MYRNA OMELA G.R. No. 186019 March 29, 2010
FACTS: White Diamond Trading Corporation (WDTC) is engaged in buying and selling second hand motor vehicles; Jer- ry Uy (Jerry) is its owner and Jessie Uy (Jessie) its President. The company employed Maria Myrna Omela (Omela) in 1999 as assistant secretary, Mary Jane Pastoril (Pastoril) in 2000 as secretary, and Norlito Escoto (Escoto) in 2001 as salesman.
In February 2004, Escoto consummated the sale of a Toyota Town Ace to Teodoro Aquino (Aquino) for P200,000.00. Aquino tried but failed to haggle for a lower price. While the purchase price indi- cated in the original copy of the receipt issued to Aquino was P200,000.00, it was only P190,000.00 in the du- plicate copy that re- mained with the compa- ny. The receipt was is- sued by Omela to Aquino after he gave Omela P200,000.00 in cash, which amount Aquino counted in the presence of Pastoril. Pastoril then took out the deed of sale and handed it to Aquino. The deed showed that the consideration for the sale to be P190,000.00.
March 2004, the compa- ny terminated the em- ployment of Escoto, Omela and Pastoril. The three employees filed a complaint for illegal dis- missal against WDTC and its two top officers.
ISSUE: Whether or not the CA erred in affirming the NLRC decision finding that Pastoril had been illegally dismissed.
RULING: The CA erred in affirming the NLRC decision finding that Pas- toril had been illegally dismissed.
Pastoril was as actively involved as Escoto and Omela in the sale of the Toyota Town Ace that resulted in a loss to the company. All three par- ticipated in making WDTC believe that Aqui- no bought the Toyota Town Ace for P190,000.00 when in fact, Aquino paid P200,000.00 for the ve- hicle. Escoto undisputably closed the sale, while Omela received the pur- chase price of P200,000.00 from Aqui- no, Omela then gave Aquino a receipt indicat- ing P200,000.00 as the purchase price, although the duplicate copy of the receipt (left with the company) showed the price of P190,000.00. Pastoril thereafter handed Aquino the deed of sale, likewise indicating P190,000.00 as consider- ation for the sale.
Pastorils involvement in the questionable transac- tion was much more than handing over to Aquino his copy of the deed of sale. The payment of the purchase price, the issu- ance of the receipt and the handing of the deed of sale to Aquino were not separate isolated acts. They occurred in one continuous logical se- quence with the play- ers in close proximity with one another.
FLORDELIZA EMILIO vs. BILMA RAPAL
G.R. No. 181855 VOLUME III, ISSUE No. 3 Page 10
March 30, 2010
FACTS: Flordeliza Emilio (Emilio), was the regis- tered owner of a parcel of land whereon she built a house.
Bilma Rapal (Rapal) had been leasing a portion of the house.
In early 1996, Emilio bor- rowed P10,000 from Ra- pal. By Emilios claim, she accepted Rapals offer to extend her an addition- al P60,000.00 loan upon the condition that the lat- ter would not pay the monthly rentals from Feb- ruary 1996 until Decem- ber 1998, as the total amount of P70,000.00 would serve as advance rentals.
A Sale and Transfer of Rights over a Portion of a Parcel of Land was exe- cuted by Emilio whereby she sold to Rapal 27 sq. m. of her lot, together with the house construct- ed thereon, for a consid- eration of P90,000.00.
Emilio later claimed that she signed the deed, without its contents hav- ing been explained to her. She thus filed a complaint with the Regional Trial Court (RTC), for refor- mation of document, al- leging that the deed of sale and transfer must be reformed, there being no intention on her part to sell the property.
ISSUE: Whether or not the action for reformation of instrument should prosper.
RULING: The action for reformation of instrument should not prosper.
For an action for refor- mation of instrument to prosper, the following requisites must concur: (1) there must have been a meeting of the minds of the parties to the con- tract; (2) the instrument does not express the true intention of the parties; and (3) the failure of the instrument to express the true intention of the par- ties is due to mistake, fraud, inequitable conduct or accident.
The Supreme Court (SC) was not convinced in her claim that she did not un- derstand the contents of the deed, given that in her pleadings which are in English, Emilio stated un- der oath that she read and understood the same; and that she testified in court in English as borne by the Transcript of Sten- ographic Notes, and her request/demand letters addressed to the Baran- gay Captain were also written in English. There being no proof of any mistake, fraud, inequita- ble conduct or accident, and no proof either that that the instrument did not express the true in- tention of the parties, the action of Emilio must fail.
Notarized documents, like the deed in question, en- joy the presumption of regularity which can be overturned only by clear, convincing and more than merely preponderant evi- dence which Emilio failed to discharge.
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VOLUME III, ISSUE No. 3 Page 12 Volume III Issue 3 March 2010 LAGUNDI-CARONAN AND ASSOCIATES J L s C O R N E R
THE WILL A man went to his lawyer and said, "I would like to make a will but I don't know exactly how to go about it." The lawyer said, "No problem, leave it all to me." The man looked somewhat upset and said, "Well, I knew you were going to take the biggest slice, but I would like to leave a litle to my children too!"