G.R. No.

91107 June 19, 1991

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
MIKAEL MALMSTEDT, *defendant-appellant.
The Solicitor General for plaintiff-appellee.
Romulo, Mabanta, Buenaventura, Sayoc & De los Aneles for !efen!ant-
appellant.

PADILLA, J.:p
In an information dated 15 June 1989, accused-appellant Mikael Malmstedt
(hereinafter referred to as the accused) as char!ed "efore the #e!ional
$rial %ourt (#$%) of &a $rinidad, 'en!uet, 'ranch 1(, in %riminal %ase )o.
89-%#-(**+, for violation of ,ection -, .rt. II of #epu"lic .ct *-/5, as
amended, otherise knon as the 0an!erous 0ru!s .ct of 191/, as
amended. $he factual "ack!round of the case is as follos2
.ccused Mikael Malmstedt, a ,edish national, entered the 3hilippines for
the third time in 0ecem"er 1988 as a tourist. 4e had visited the countr5
sometime in 198/ and 1985.
In the evenin! of 1 Ma5 1989, accused left for 'a!uio %it5. 6pon his arrival
thereat in the mornin! of the folloin! da5, he took a "us to ,a!ada and
sta5ed in that place for to (/) da5s.
.t around 12(( o7clock in the mornin! of 11 Ma5 1989, accused ent to the
)an!ono!an "us stop in ,a!ada to catch the first availa"le trip to 'a!uio
%it5. 8rom 'a!uio %it5, accused planned to take a late afternoon trip to
.n!eles %it5, then proceed to Manila to catch his fli!ht out of the countr5,
scheduled on 1+ Ma5 1989. 8rom ,a!ada, accused took a ,k5line "us ith
"od5 num"er 8((5 and 3late num"er .9% 9(/.
1
.t a"out 82 (( o7clock in the mornin! of that same da5 (11 Ma5 1989),
%aptain .len 9asco, the %ommandin! :fficer of the 8irst #e!ional
%ommand ().#%:M) stationed at %amp 0an!a, ordered his men to set
up a temporar5 checkpoint at ;ilometer 1-, .cop, $u"la5, Mountain
3rovince, for the purpose of checkin! all vehicles comin! from the %ordillera
#e!ion. $he order to esta"lish a checkpoint in the said area as prompted
"5 persistent reports that vehicles comin! from ,a!ada ere transportin!
mari<uana and other prohi"ited dru!s. Moreover, information as received
"5 the %ommandin! :fficer of ).#%:M, that same mornin!, that a
%aucasian comin! from ,a!ada had in his possession prohi"ited dru!s.
2
$he !roup composed of seven (1) ).#%:M officers, in coordination ith
$u"la5 3olice ,tation, set up a checkpoint at the desi!nated area at a"out
1(2(( o7clock in the mornin! and inspected all vehicles comin! from the
%ordillera #e!ion.
.t a"out 12+( o7clock in the afternoon, the "us here accused as ridin!
as stopped. ,!t. 8ider and %I% =alutan "oarded the "us and announced
that the5 ere mem"ers of the ).#%:M and that the5 ould conduct an
inspection. $he to (/) ).#%:M officers started their inspection from the
front !oin! toards the rear of the "us. .ccused ho as the sole forei!ner
ridin! the "us as seated at the rear thereof.
0urin! the inspection, %I% =alutan noticed a "ul!e on accused7s aist.
,uspectin! the "ul!e on accused7s aist to "e a !un, the officer asked for
accused7s passport and other identification papers. >hen accused failed to
compl5, the officer re?uired him to "rin! out hatever it as that as "ul!in!
on his aist. $he "ul!in! o"<ect turned out to "e a pouch "a! and hen
accused opened the same "a!, as ordered, the officer noticed four (-)
suspicious-lookin! o"<ects rapped in "ron packin! tape, promptin! the
officer to open one of the rapped o"<ects. $he rapped o"<ects turned out
to contain hashish, a derivative of mari<uana.
$hereafter, accused as invited outside the "us for ?uestionin!. 'ut "efore
he ali!hted from the "us, accused stopped to !et to (/) travellin! "a!s from
the lu!!a!e carrier.
6pon steppin! out of the "us, the officers !ot the "a!s and opened them. .
tedd5 "ear as found in each "a!. 8eelin! the tedd5 "ears, the officer
noticed that there ere "ul!es inside the same hich did not feel like foam
stuffin!. It as onl5 after the officers had opened the "a!s that accused
finall5 presented his passport.
.ccused as then "rou!ht to the head?uarters of the ).#%:M at %amp
0an!a, &a $rinidad, 'en!uet for further investi!ation. .t the investi!ation
room, the officers opened the tedd5 "ears and the5 ere found to also
contain hashish. #epresentative samples ere taken from the hashish found
amon! the personal effects of accused and the same ere "rou!ht to the
3% %rime &a"orator5 for chemical anal5sis.
In the chemistr5 report, it as esta"lished that the o"<ects e@amined ere
hashish. a prohi"ited dru! hich is a derivative of mari<uana. $hus, an
information as filed a!ainst accused for violation of the 0an!erous 0ru!s
.ct.
0urin! the arrai!nment, accused entered a plea of Anot !uilt5.A 8or his
defense, he raised the issue of ille!al search of his personal effects. 4e also
claimed that the hashish as planted "5 the ).#%:M officers in his pouch
"a! and that the to (/) travellin! "a!s ere not oned "5 him, "ut ere
merel5 entrusted to him "5 an .ustralian couple hom he met in ,a!ada.
4e further claimed that the .ustralian couple intended to take the same "us
ith him "ut "ecause there ere no more seats availa"le in said "us, the5
decided to take the ne@t ride and asked accused to take char!e of the "a!s,
and that the5 ould meet each other at the 0an!a ,tation.
&ikeise, accused alle!ed that hen the ).#%:M officers demanded for
his passport and other Identification papers, he handed to one of the officers
his pouch "a! hich as han!in! on his neck containin!, amon! others, his
passport, return ticket to ,eden and other papers. $he officer in turn
handed it to his companion ho "rou!ht the "a! outside the "us. >hen said
officer came "ack, he char!ed the accused that there as hashish in the
"a!. 4e as told to !et off the "us and his picture as taken ith the pouch
"a! placed around his neck. $he trial court did not !ive credence to
accused7s defense.
$he claim of the accused that the hashish as planted "5 the ).#%:M
officers, as "elied "5 his failure to raise such defense at the earliest
opportunit5. >hen accused as investi!ated at the 3rovincial 8iscal7s :ffice,
he did not inform the 8iscal or his la5er that the hashish as planted "5 the
).#%:M officers in his "a!. It as onl5 to (/) months after said
investi!ation hen he told his la5er a"out said claim, den5in! onership of
the to (/) travellin! "a!s as ell as havin! hashish in his pouch "a!.
In a decision dated 1/ :cto"er 1989, the trial court found accused !uilt5
"e5ond reasona"le dou"t for violation of the 0an!erous 0ru!s .ct,
specificall5 ,ection -, .rt. II of #. *-/5, as amended.
3
$he dispositive
portion of the decision reads as follos2
>4B#B8:#B, findin! the !uilt of the accused Mikael
Malmstedt esta"lished "e5ond reasona"le dou"t, this
%ourt finds him =6I&$C of violation of ,ection -, .rticle 11
of #epu"lic .ct *-/5, as amended, and here"5 sentences
him to suffer the penalt5 of life imprisonment and to pa5 a
fine of $ent5 $housand 3esos (3/(,(((.((), ith
su"sidiar5 imprisonment in case of insolvenc5 and to pa5
the costs.
&et the hashish su"<ect of this case "e turned over to the
8irst )arcotics #e!ional 6nit at %amp 'adoD 0an!a, &a
$rinidad 'en!uet for proper disposition under ,ection /(,
.rticle I9 of #epu"lic .ct *-/5, as amended.
,: :#0B#B0.

,eekin! the reversal of the decision of the trial court findin! him !uilt5 of the
crime char!ed, accused ar!ues that the search of his personal effects as
ille!al "ecause it as made ithout a search arrant and, therefore, the
prohi"ited dru!s hich ere discovered durin! the ille!al search are not
admissi"le as evidence a!ainst him.
$he %onstitution !uarantees the ri!ht of the people to "e secure in their
persons, houses, papers and effects a!ainst unreasona"le searches and
seiEures.
!
4oever, here the search is made pursuant to a laful arrest,
there is no need to o"tain a search arrant. . laful arrest ithout a arrant
ma5 "e made "5 a peace officer or a private person under the folloin!
circumstances.
"
,ec. 5 Arrest "ithout "arrantD "hen la"ful. FF . peace
officer or a private person ma5, ithout a arrant, arrest a
person2
(a) >hen, in his presence, the person to "e arrested has
committed is actuall5 committin!, or is attemptin! to
commit an offenseD
(") >hen an offense has in fact <ust "een committed, and
he has personal knoled!e of facts indicatin! that the
person to "e arrested has committed itD and
(c) >hen the person to "e arrested is a prisoner ho has
escaped from a penal esta"lishment or place here he is
servin! final <ud!ment or temporaril5 confined hile his
case is pendin!, or has escaped hile "ein! transferred
from one confinement to another.
In cases fallin! under para!raphs (a) and (") hereof, the
person arrested ithout a arrant shall "e forthith
delivered to the nearest police station or <ail, and he shall
"e proceeded a!ainst in accordance ith #ule 11/,
,ection 1. (*a 11a).
.ccused as searched and arrested hile transportin! prohi"ited dru!s
(hashish). . crime as actuall5 "ein! committed "5 the accused and he as
cau!ht in flarante !elicto. $hus, the search made upon his personal effects
falls s?uarel5 under para!raph (1) of the fore!oin! provisions of la, hich
allo a arrantless search incident to a laful arrest.
7
>hile it is true that the ).#%:M officers ere not armed ith a search
arrant hen the search as made over the personal effects of accused,
hoever, under the circumstances of the case, there as sufficient pro"a"le
cause for said officers to "elieve that accused as then and there
committin! a crime.
3ro"a"le cause has "een defined as such facts and circumstances hich
could lead a reasona"le, discreet and prudent man to "elieve that an offense
has "een committed, and that the o"<ects sou!ht in connection ith the
offense are in the place sou!ht to "e searched.
#
$he re?uired pro"a"le
cause that ill <ustif5 a arrantless search and seiEure is not determined "5
an5 fi@ed formula "ut is resolved accordin! to the facts of each case.
9
>arrantless search of the personal effects of an accused has "een declared
"5 this %ourt as valid, "ecause of e@istence of pro"a"le cause, here the
smell of mari<uana emanated from a plastic "a! oned "5 the accused,
10
or
here the accused as actin! suspiciousl5,
11
and attempted to flee.
12
.side from the persistent reports received "5 the ).#%:M that vehicles
comin! from ,a!ada ere transportin! mari<uana and other prohi"ited
dru!s, their %ommandin! :fficer also received information that a %aucasian
comin! from ,a!ada on that particular da5 had prohi"ited dru!s in his
possession. ,aid information as received "5 the %ommandin! :fficer of
).#%:M the ver5 same mornin! that accused came don "5 "us from
,a!ada on his a5 to 'a!uio %it5.
>hen ).#%:M received the information, a fe hours "efore the
apprehension of herein accused, that a %aucasian travellin! from ,a!ada to
'a!uio %it5 as carr5in! ith him prohi"ited dru!s, there as no time to
o"tain a search arrant. In the Tanliben case,
13
the police authorities
conducted a surveillance at the 9ictor5 &iner $erminal located at '!5. ,an
)icolas, ,an 8ernando 3ampan!a, a!ainst persons en!a!ed in the traffic of
dan!erous dru!s, "ased on information supplied "5 some informers.
.ccused $an!li"en ho as actin! suspiciousl5 and pointed out "5 an
informer as apprehended and searched "5 the police authorities. It as
held that hen faced ith on-the-spot information, the police officers had to
act ?uickl5 and there as no time to secure a search arrant.
It must "e o"served that, at first, the ).#%:M officers merel5 conducted a
routine check of the "us (here accused as ridin!) and the passen!ers
therein, and no e@tensive search as initiall5 made. It as onl5 hen one of
the officers noticed a "ul!e on the aist of accused, durin! the course of the
inspection, that accused as re?uired to present his passport. $he failure of
accused to present his identification papers, hen ordered to do so, onl5
mana!ed to arouse the suspicion of the officer that accused as tr5in! to
hide his identit5. 8or is it not a re!ular norm for an innocent man, ho has
nothin! to hide from the authorities, to readil5 present his identification
papers hen re?uired to do soG
$he receipt of information "5 ).#%:M that a %aucasian comin! from
,a!ada had prohi"ited dru!s in his possession, plus the suspicious failure of
the accused to produce his passport, taken to!ether as a hole, led the
).#%:M officers to reasona"l5 "elieve that the accused as tr5in! to hide
somethin! ille!al from the authorities. 8rom these circumstances arose
a probable cause hich <ustified the arrantless search that as made on
the personal effects of the accused. In other ords, the acts of the ).#%:M
officers in re?uirin! the accused to open his pouch "a! and in openin! one
of the rapped o"<ects found inside said "a! (hich as discovered to
contain hashish) as ell as the to (/) travellin! "a!s containin! to (/)
tedd5 "ears ith hashish stuffed inside them, ere prompted "5 accused7s
on attempt to hide his identit5 "5 refusin! to present his passport, and "5
the information received "5 the ).#%:M that a %aucasian comin! from
,a!ada had prohi"ited dru!s in his possession. $o deprive the ).#%:M
a!ents of the a"ilit5 and facilit5 to act accordin!l5, includin!, to search even
ithout arrant, in the li!ht of such circumstances, ould "e to sanction
impotence and ineffectiveness in la enforcement, to the detriment of
societ5.
>4B#B8:#B, premises considered, the appealed <ud!ment of conviction
"5 the trial court is here"5 .88I#MB0. %osts a!ainst the accused-appellant.
,: :#0B#B0.
Melencio-#errera, $aras, %eliciano, Bi!in, Gri&o-A'uino, Me!ial!ea,
Reala!o an! Davi!e, (r., ((., concur.
Sarmiento, (., is on leave.



Se$%&%'e O$(n(on)

NAR*ASA, J., concurrin! and dissentin!2
$he ancient tradition that a man7s home is his castle, safe from intrusion
even "5 the kin!, has not onl5 found its niche in all our charters, from 19+5
to the presentD it has also received unvar5in! reco!nition and acceptance in
our case la.
1
$he present %onstitution
2
declares that H
$he ri!ht of the people to "e secure in their persons,
houses, papers, and effects a!ainst unreasona"le
searches and seiEures of hatever nature and for an5
purpose, shall "e inviola"le, and no search arrant or
arrant of arrest shall issue e@cept upon pro"a"le cause
to "e determined personall5 "5 the <ud!e after
e@amination under oath or affirmation of the complainant
and the itnesses he ma5 produce, and particularl5
descri"in! the place to "e searched, and the persons or
thin!) to "e seiEed.
It further ordains that an5 evidence o"tained in violation of said ri!ht, amon!
others, Ashall "e inadmissi"le for an5 purpose in an5 proceedin!.A
3
$he rule is that no person ma5 "e su"<ected "5 the police or other
!overnment authorit5 to a search of his "od5, or his personal effects or
"elon!in!s, or his residence e@cept "5 virtue of a search arrant or on the
occasion of a le!itimate arrest.

.n arrest is le!itimate, of course, if effected

"5 virtue of a arrant of arrest. Bven ithout a arrant, an arrest ma5 also
"e lafull5 made "5 a peace officer or a private person2
!
(a) hen, in his presence, the person to "e arrested has
committed is actuall5 committin!, or is attemptin! to
commit an offenseD
(") >hen an offense has in fact <ust "een committed, and
he has personal knoled!e of facts indicatin! that the
person to "e arrested has committed itD and
(c) >hen the person to "e arrested is a prisoner ho has
escaped from a penal esta"lishment or place here he is
servin! final <ud!ment or temporaril5 confined hile his
case is pendin!, or has escaped hile "ein! transferred
from one confinement to another.
In cases fallin! under para!raphs (a) and (") hereof, the
person arrested ithout a arrant shall "e forthith
delivered to the nearest police station or <ail, and he shall
"e proceeded a!ainst in accordance ith #ule 11/,
,ection 1.
In an5 of these instances of a laful arrest, the person arrested Ama5 "e
searched for dan!erous eapons or an5thin! hich ma5 "e used as proof of
the commission of an offense, ithout a search arrant.A
"
.nd it has "een
held that the search ma5 e@tend to the area Aithin his immediate
control,A i.e., the area from hich said person arrested mi!ht !ain
possession of a eapon or destructi"le evidence.
7
.part from Asearch incidental to an arrest,A a arrantless search has also
"een held to "e proper in cases of Asearch of a movin! vehicle,
#
and
AseiEure of evidence in plain vie.A
9
$his as the pronouncement in
Manipon, Jr. v. ,andi!an"a5an, 1-+ ,%#. /*1, /1*, hich dre attention
to Moreno v. Ao )hiD
10
Alvero v. Di*on,
11
$apa v. Mao,
12
and an
.merican precedent, 4arris v. 6.,.
13
If, on the other, a person is searche! "ithout a "arrant, or un!er
circumstances other than those +ustifyin an arrest "ithout "arrant in
accor!ance "ith la", supra, merel5 on suspicion that he is en!a!ed in some
felonious enterprise, and in order to discover if he has indeed committed a
crime, it is not onl5 the arrest hich is ille!al "ut also, the search on the
occasion thereof, as "ein! Athe fruit of the poisonous tree.
1
In that event,
an5 evidence taken, even if confirmator5 of the initial suspicion, is
inadmissi"le Afor an5 purpose in an5 proceedin!.A
1!
'ut the ri!ht a!ainst an
unreasona"le search and seiEure ma5 "e aived "5 the person arrested,
provided he kne of such ri!ht and knoin!l5 decided not to invoke it.
1"
$here is unanimit5 amon! the mem"ers of the %ourt upon the continuin!
validit5 of these esta"lished principles. 4oever, the %ourt is divided as
re!ards the ultimate conclusions hich ma5 properl5 "e derived from the
proven facts and conse?uentl5, the manner in hich the principles <ust cited
should appl5 thereto.
$he proofs of the prosecution and those of the defense are diametricall5 at
odds. >hat is certain, hoever, is that the soldiers had no arrant of arrest
hen the5 conducted a search of Malmstedt7s person and the thin!s in his
possession at the time. Indeed, the %ourt a 'uo acknoled!ed that the
soldiers could Anot "e e@pected to "e armed ith a arrant or arrest nor a
search arrant ever5time the5 esta"lish a temporar5 checkpoint . . . (and) no
<ud!e ould issue them one considerin! that searchin! ?uestions have to "e
asked "efore a arrant could "e issued.A B?uall5 plain is that prior to the
search, a arrantless arrest of Malmstedt could not validl5 have "een in
accordance ith the norms of the la. 8or Malmstedt had not committed, nor
as he actuall5 committin! or attemptin! to commit a crime, in the soldiers7
presence, nor did said soldiers have personal and competent knoled!e
that Malmstedt had in fact <ust committed a crime. .ll the5 had as a
suspicion that Malmstedt mi!ht have some prohi"ited dru! on him or in his
"a!sD all the5 had as, in the ords of the $rial %ourt, Athe hope of
interceptin! an5 dan!erous dru! "ein! transported,A or, as the :ffice of the
,olicitor =eneral asserts, Ainformation that most of the "uses comin! . . .
(from the %ordillera) ere transportin! mari<uana and other prohi"ited
dru!s.A
$his case, is remarka"l5 similar to $eo. v. Aminnu!in, decided on Jul5 *,
1988 also "5 the 8irst 0ivision.
17
$here, .minnudin as arrested ithout a
arrant "5 3% officers as he as disem"arkin! from an inter-island vessel.
$he officers ere aitin! for him "ecause he as, accordin! to an informer7s
report, then transportin! mari<uana. $he search of .minnudin7s "a!
confirmed the informer7s reportD the "a! indeed contained mari<uana. $he
%ourt nevertheless held that since the 3% officers had failed to procure a
search arrant althou!h the5 had sufficient time (to da5s) to do so and
therefore, the case presented no such ur!enc5 as to <ustif5 a arrantless
search, the search of .minnudin7s person and "a!, the seiEure of the
mari<uana and his su"se?uent arrest ere ille!alD and the mari<uana as
inadmissi"le in evidence in the criminal action su"se?uentl5 instituted
a!ainst .minnudin for violatin! the 0an!erous 0ru!s .ct.
$here are, on the other hand, other cases ad<udicated "5 this %ourt in hich
apparentl5 different conclusions ere reached. It is needful to devote a fe
ords to them so that the relevant constitutional and le!al propositions are
not misunderstood.
In $eople v. )lau!io (decision promul!ated on .pril 15, 1988),
1#
the
accused "oarded a A9ictor5 &inerA passen!er "us !oin! to :lon!apo from
'a!uio %it5. ,he placed the plastic "a! she as carr5in! at the "ack of the
seat then occupied "5 :"iIa, an I)3 mem"er Aon 0etached ,ervice ith the
.nti-)arcotics 6nit.A $his avoedl5 aroused :"iIa7s suspicion, and at the
first opportunit5, and ithout %laudio7s knoled!e, he surreptitiousl5 looked
into the plastic "a! and noted that it contained camote tops as ell as a
packa!e, and that there emanated from the packa!e the smell of mari<uana
ith hich he had "ecome familiar on account of his ork. ,o hen the "us
stopped at ,ta. #ita, and %laudio ali!hted, :"iIa accosted her, shoed her
his I0, identified himself as a policeman, and announced his intention to
search her "a! hich he said contained mari<uana "ecause of the distinctive
odor detected "5 him. I!norin! her plea H A3lease !o ith me, let us settle
this at homeA H he "rou!ht her to the police head?uarters., here
e@amination of the packa!e in %laudio7s "a! confirmed his suspicion that it
indeed contained mari<uana. $he %ourt held the arrantless arrest under the
circumstances to "e laful, the search <ustified, and the evidence thus
discovered admissi"le in evidence a!ainst the accused.
In $eople v. Tanliben (decision promul!ated on .pril *, 199(),
19
to police
officers and a baranay tano! ere conductin! a Asurveillance missionA at
the 9ictor5 &iner $erminal at ,an )icolas, ,an 8ernando, 3ampan!a,
Aaimed not onl5 a!ainst persons ho ma5 commit misdemeanors . . . (there)
"ut also on persons ho ma5 "e en!a!in! in the traffic of dan!erous dru!s
"ased on information supplied "5 informersD . . . the5 noticed a person
carr5in! a red travellin! "a! . . ho as actin! suspiciousl5DA the5 asked him
to open the "a!D the person did so onl5 after the5 identified themselves as
peace officersD found in the "a! ere mari<uana leaves rapped in plastic
ei!hin! one kilo!ram, more or lessD the person as then taken to the police
head?uarters at ,an 8ernando, 3ampan!a, here he as investi!atedD and
an information as thereafter filed a!ainst that person, $an!li"en, char!in!
him ith a violation of the 0an!erous 0ru!s .ct of 191/ (#. *-/5), as
amended. 6pon these facts it as ruled, citin )lau!io, supra, that there
as a valid arrantless arrest and a proper arrantless search incident
thereto.
$he facts in Tanliben ere pronounced to "e different from those in $eople
v. Aminnu!in, supra. AIn contrastA toAminnu!in here the %ourt perceived
no ur!enc5 as to preclude the application for and o"tention of a search
arrant, it as declared that the Tanliben case H
. . . presente! urency. . . ($he evidence revealed) that
there as an informer ho pointed to the accused-
appellant as carr5in! mari<uana . . . 8aced ith such on-
the-spot information, the police officers had to act ?uickl5.
$here as not enou!h time to secure a search arrant . . .
$o re?uire search arrants durin! on-the-spot
apprehensions of dru! pushers, ille!al possessors of
firearms, <ueten! collectors, smu!!lers of contra"and
!oods, ro""er, etc. ould make it e@tremel5 difficult, if not
impossi"le to contain the crimes ith hich these persons
are associated.
In Tanliben, therefore, there as in the %ourt7s vie sufficient
evidence on hand to ena"le the 3% officers to secure a search
arrant, had there "een time. 'ut "ecause there as actuall5 no
time to !et the arrant, and there ere Aon-the-spotA indications
that $an!li"en as then actuall5 committin! a crime, the search of
his person and his effects as considered valid.
$o other decisions presented su"stantiall5 similar circumstance
instances2 $osa!as v. ).A., et al., decided on .u!ust /, 199(,
20
and $eople
v. Moises Maspil, (r., et al., decided on .u!ust /(, 199(.
21
In the first case, 3osadas as seen to "e actin! suspiciousl5 "5 to
mem"ers of the I)3, 0avao Metrodiscom, and hen he as accosted "5 the
to, ho identified themselves as police officers, he suddenl5 fled. 4e as
pursued, overtaken and, notithstandin! his resistance, placed in custod5.
$he buri "a! 3osadas as then carr5in! as found to contain a revolver, for
hich he could produce no license or authorit5 to possess, four rounds of
live ammunition, and a tear !as !renade. 4e as prosecuted for ille!al
possession of firearms and ammunition and convicted after trial. $his %ourt
affirmed 3osadas7 conviction, holdin! that there as, in the premises,
pro"a"le cause for a search ithout arrant, i.e., the appellant as actin!
suspiciousl5 and attempted to flee ith the buri"a! he had ith him at the
time. $he %ourt cited ith approval the rulin! of the 6.,. 8ederal ,upreme
%ourt in(ohn ,. Terry v. State of -hio,
22
a 19*8 case, hich the ,olicitor
=eneral had invoked to <ustif5 the search.
In the case of Maspil, et al., a checkpoint as set up "5 elements of the 8irst
)arcotics #e!ional 6nit of the )arcotics %ommand at ,a5an!an, .tok,
'en!uet, to monitor, inspect and scrutiniEe vehicles on the hi!ha5 !oin!
toards 'a!uio %it5. $his as done "ecause of a confidential report "5
informers that Maspil and another person, 'a!kin!, ould "e transportin! a
lar!e ?uantit5 of mari<uana to 'a!uio %it5. In fact, the informers ere ith
the policemen mannin! the checkpoint. .s e@pected, at a"out / o7clock in
the earl5 mornin! of )ovem"er 1, 198*, a <eepne5 approached the
checkpoint, driven "5 Maspil, ith 'a!kin! as passen!er. $he officers
stopped the vehicle and sa that on it ere loaded / plastic sacks, a <ute
sack, and + "i! round tin cans. >hen opened, the sacks and cans ere
seen to contain hat appeared to "e mari<uana leaves. $he policemen
thereupon placed Maspil and 'a!kin! under arrest, and confiscated the
leaves hich, upon scientific e@amination, ere verified to "e mari<uana
leaves. $he %ourt upheld the validit5 of the search thus conducted, as "ein!
incidental to a laful arrantless arrest,
23
and declared that, as
in Tanliben, supra, Maspil and 'a!kin! had "een cau!ht in flarante
!elicto transportin! prohi"ited dru!s at the time of their arrest. .!ain, the
%ourt took occasion to distin!uish the case from Aminnu!in
2
in hich, as
aforestated, it appeared that the police officers ere aare of .minnudin7s
identit5, his pro<ected criminal enterprise and the vessel on hich he ould
"e arrivin!, and, e?uall5 as importantl5, had sufficient time and opportunit5
to o"tain a search arrant. In the case of Maspil and 'a!kin!, the %ourt
found that the officers concerned had no e@act description of the vehicle the
former ould "e usin! to transport mari<uana, and no inklin! of the definite
time of the suspects7 arrival, and pointed out that a <eepne5 on the road is
not the same as a passen!er "oat on the hi!h seas hose route and time of
arrival are more or less certain, and hich ordinaril5 cannot deviate from or
otherise alter its course, or select another destination.
2!
$he most recent decision treatin! of arrantless search and seiEure appears
to "e $eople v. .o #o ,in/ et al., =.#. )o. 88(11, decided on Januar5 /1,
1991 (per =anca5co, (.). In that case, an undercover or Adeep penetrationA
a!ent, $ia, mana!ed someho to !ain acceptance into a !roup of suspected
dru! smu!!lers, hich included 3eter &o and &im %hin! 4uat. $ia
accompanied 3eter &o to =uan!Ehou, %hina, here he sa him and other
person empt5 the contents of si@ (*) tins of tea and replace them ith hite
poder. :n their return to Manila ith the cans of su"stituted Atea,A the5
ere met at the airport "5 &im. .s the5 ere leavin! the airport in separate
vehicles, the5 ere intercepted "5 officers and operatives of the )arcotics
%ommand ().#%:M), ho had earlier "een tipped off "5 $ia, and placed
under arrest. .s search of the lu!!a!e "rou!ht in "5 $ia and 3eter &o,
loaded on the !roup7s vehicles, ?uickl5 disclosed the si@ (*) tin cans
containin! fift5-si@ (5*) "a!s of hite cr5stalline poder hich, upon
anal5sis, as identified as metamphetamine. $ia, &o and &im ere indicted
for violation of the 0an!erous 0ru!s .ct of 191/. $ia as dischar!ed as
state itness. &o and &im ere su"se?uentl5 convicted and sentenced to life
imprisonment. :ne of the ?uestions raised "5 them in this %ourt on appeal
as hether the arrantless search of their vehicles and personal effects
as le!al. $he %ourt, citin Manipon, (r. v.San!ianbayan, 1-+ ,%#. /*1
(198*),
2"
held le!al the search of the appellants7 movin! vehicles and the
seiEure therefrom of the dan!erous dru!, considerin! that there as
intelli!ence information, includin! clandestine reports "5 a planted sp5
actuall5 participatin! in the activit5, that the appellants ere "rin!in!
prohi"ited dru!s into the countr5D that the re?uirement of o"tainin! a search
arrant A"orders on the impossi"le in the case of smu!!lin! effected "5 the
use of a movin! vehicle that can transport contra"and from one place to
another ith impunit5,A and Ait is not practica"le to secure a arrant "ecause
the vehicle can "e ?uickl5 moved out of the localit5 or <urisdiction in hich
the arrant must "e sou!ht.
27
In all five cases, )lau!io, Tanliben, $osa!as, Maspil, an! .o #o
,in, facts e@isted hich ere found "5 the %ourt as <ustif5in! arantless
arrests. In )lau!io, the arrestin! officer had secretl5 ascertained that the
oman he as arrestin! as in fact in possession of mari<uanaD he had
personall5 seen that her "a! contained not onl5 ve!eta"les "ut also a
packa!e emittin! the odor of mari<uana. In Tanliben, the person arrested
and searched as actin! suspiciousl5, and had "een positivel5 pointed to as
carr5in! mari<uana. .nd in "oth cases, the accused ere a"out to "oard
passen!er "uses, makin! it ur!ent for the police officers concerned to take
?uick and decisive action. In $osa!as, the person arrested and searched
as actin! suspiciousl5, too, and hen accosted had attempted to flee from
the police officers. .nd in Maspil and .o #o ,in, there as definite
information of the precise identit5 of the persons en!a!ed in transportin!
prohi"ited dru!s at a particular time and place.
)o, as re!ards the precise issue at hand, hether or not the facts in the
case at "ar make out a le!itimate instance of a arrantless search and
seiEure, there is, as earlier pointed out, a re!retta"le diver!ence of vies
amon! the mem"ers of the %ourt.
%ontrar5 to the conclusion reached "5 the ma<orit5, I "elieve that the
appellant should "e a"solved on reasona"le dou"t. $here as in this case
no confidential report from, or positive identification "5 an informerD no
attempt to fleeD no "a! or packa!e emittin! tell-tale odorsD no other
reasona"l5 persuasive indications that Malmstedt as at the time in process
of perpetratin! the offense for hich he as su"se?uentl5 prosecuted.
4ence, hen the soldiers searched Malmstedt7s pouch and the "a!s in his
possession, the5 ere simpl5 Afishin!A for evidence. It matters not that the
search disclosed that the "a!s contained prohi"ited su"stances, confirmin!
their initial information and suspicion. $he search as not made "5 virtue of
a arrant or as an incident of a laful arrantless arrest, i.e., under
circumstances sufficient to en!ender a reasona"le "elief that some crime
as "ein! or a"out to "e committed, or ad<ust "een committed. $here as
no intelli!ent and intentional aiver of the ri!ht a!ainst unreasona"le
searches and seiEure. $he search as therefore ille!al, since the la
re?uires that there first "e a laful arrest of an individual "efore a search of
his "od5 and his "elon!in!s ma5 licitl5 "e made. $he process cannot "e
reversed, i.e., a search "e first undertaken, and then an arrest effected, on
the stren!th of the evidence 5ielded "5 the search. .n arrest made in that
case ould "e unlaful, and the search undertaken as an incident of such
an unlaful arrest, also unlaful.
$he fact that hen investi!ated at the head?uarters of the )arcotic
%ommand at %amp 0an!a, &a $rinidad, Malmstedt had, it is said, illin!l5
admitted that there ere as hashish inside the Atedd5 "earsA in the lu!!a!e
found in his possession H an admission su"se?uentl5 confirmed "5
la"orator5 e@amination H does not help the cause of the prosecution one
"it. )othin! in the record even remotel5 su!!ests that Malmstedt as
accorded the ri!hts !uaranteed "5 the %onstitution to all persons under
custodial investi!ation.
2#
4e as not informed, prior to "ein! interro!ated,
that he had the Ari!ht to remain silent and to have competent and
independent counsel prefera"l5 of his on choice,A and that if he could not
afford the services of counsel, he ould "e provided ith oneD not does it
appear at all that he aived those ri!hts Ain ritin! and in the presence of
counsel.A $he soldiers and the police officers simpl5 ent ahead ith the
investi!ation of Malmstedt, ithout counsel. $he admissions elicited from
Malmstedt under these circumstances, as the %onstitution clearl5 states, are
Ainadmissi"le in evidence a!ainst him.
29
$he prohi"ited dru!s supposedl5 discovered in Malmstedt7s "a!s, havin!
"een taken in violation of the constitutional ri!ht a!ainst unreasona"le
searches and seiEures, are inadmissi"le a!ainst him Afor an5 purpose in an5
proceedin!.A .lso pronounced as incompetent evidence a!ainst him are the
admissions supposedl5 made "5 him ithout his first "ein! accorded the
constitutional ri!hts of persons under custodial investi!ation. >ithout such
o"<ect evidence and admissions, nothin! remains of the case a!ainst
Malmstedt.
It ma5 "e conceded that, as the $rial %ourt points out, the evidence
presented "5 Malmstedt in his defense is fee"le, unorth5 of credence. $his
is "eside the pointD for conforma"l5 to the familiar a@iom, the ,tate must rel5
on the stren!th of its evidence and not on the eakness of the defense. $he
unfortunate fact is that althou!h the e@istence of the hashish is an o"<ective
ph5sical realit5 that cannot "ut "e conceded, there is in la no evidence to
demonstrate ith an5 de!ree of persuasion, much less "e5ond reasona"le
dou"t, that Malmstedt as en!a!ed in a criminal activit5. $his is the parado@
created "5 the disre!ard of the applica"le constitutional safe!uards. $he
tan!i"le "enefit is that the hashish in ?uestion has "een correctl5
confiscated and thus effectivel5 ithdran from private use.
>hat is here said should not "5 an5 means "e taken as a disapproval or a
dispara!ement of the efforts of the police and militar5 authorities to deter
and detect offenses, hether the5 "e possession of and traffic in prohi"ited
dru!s, or some other. $hose efforts o"viousl5 merit the support and
commendation of the %ourts and indeed of ever5 responsi"le citiEen. 'ut
those efforts must take account of the "asic ri!hts !ranted "5 the
%onstitution and the la to persons ho ma5 fall under suspicion of
en!a!in! in criminal acts. 0isre!ard of those ri!hts ma5 not "e <ustified "5
the o"<ective of ferretin! out and punishin! crime, no matter ho eminentl5
desira"le attainment of that o"<ective mi!ht "e. 0isre!ard of those ri!hts, as
this %ourt has earlier stressed, ma5 result in the escape of the !uilt5, and all
"ecause the Aconsta"le has "lundered,A renderin! the evidence inadmissi"le
even if truthful or otherise credi"le.
30
I therefore vote to reverse the $rial %ourt7s <ud!ment of :cto"er 1/, 1989
and to ac?uit the appellant on reasona"le dou"t.

+R,-, J., dissentin!2
I <oin Mr. Justice .ndres #. )arvasa in his dissent, hich I "elieve
represents the correct application to the facts of this case of the provisions of
the 'ill of #i!hts and the #ules of %ourt on searches and seiEures. It is
consistent ith m5 ponencia in 3eople v. .minnudin, 1*+ ,%#. -(/, and
also ith .lih v. %astro, 151 ,%#. /19, the latter "ein! a unanimous
decision of the %ourt en banc, and m5 dissents in 6mil v. #amos (on
arrantless arrests, 181 ,%#. +11, 9almonte v. 0e 9illa (on checkpoints),
118, ,%#. /11, 185 ,%#. **5, and =uaEon v. 0e 9illa (on AEonasA), 181
,%#. */+.
I rite this separate opinion merel5 to remark on an o"servation made
durin! the deli"eration on this case that some mem"ers of the %ourt seem to
"e coddlin! criminals instead of e@tendin! its protection to societ5, hich
deserves our hi!her concern. $he inference is that "ecause of our ron!
priorities, criminals are "ein! imprudentl5 let free, to violate our las a!ainD
and it is all our fault.
'elievin! m5self to "e amon! those alluded to, I ill sa5 ithout apolo!5 that
I do not consider a person a criminal, until he is convicted "5 final <ud!ment
after a fair trial "5 a competent and impartial court. 6ntil then, the
%onstitution "ids us to presume him innocent. 4e ma5 seem "oorish or
speak crudel5 or sport tattoos or dress eirdl5 or otherise fall short of our
on standards of propriet5 and decorum. )one of these makes him a
criminal althou!h he ma5 loo0 like a criminal.
It is so eas5 to condemn a person on the "asis of his appearance "ut it is
also so ron!.
:n the ?uestion "efore us, it seems to "e the inclination of some <ud!es to
ink at an ille!al search and seiEure as lon! as the suspect has "een
actuall5 found in possession of a prohi"ited article $hat fact ill retroactivel5
validate the violation of the 'ill of #i!hts for after all, as the5 ould
rationaliEe, the suspect is a criminal. >hat matters to them is the fact of
ille!al possession, not the fact of ille!al search and seiEure.
$his kind of thinkin! takes us "ack to the intolerant da5s of Moncado v.
3eople7s %ourt, 8( 3hil. 1, hich as discredited in ,tonehill v. 0iokno, /(
,%#. +8+, even "efore it as definitel5 re<ected "5 an e@press provision in
the 191+ %onstitution. $hat provision, hich has "een retained in the
present %onstitution, a!ain e@plicitl5 declares that an5 evidence ille!all5
o"tained Ashall "e inadmissi"le for an5 purpose in an5 proceedin!.A
$he fruit of the poisonous tree should not "e alloed to poison our s5stem of
criminal <ustice. In the case at "ar, the search as made at a checkpoint
esta"lished for the preposterous reason that the route as "ein! used "5
mari<uana dealers and on an individual ho had somethin! "ul!in! at his
aist that e@cited the soldier7s suspicion. >as that pro"a"le causeG
$he ponencia notes that the militar5 had advance information that a
%aucasian as comin! from the ,a!ada ith prohi"ited dru!s in his
possession. $his is hat the militar5 sa5s no, after the fact, to <ustif5 the
arrantless search. It is so eas5 to make such a claim, and I am surprised
that the ma<orit5 should readil5 accept it.
$he conclusion that there as pro"a"le cause ma5 have "een influenced "5
the su"se?uent discover5 that the accused as carr5in! a prohi"ited dru!.
$his is supposed to <ustif5 the soldier7s suspicion. In other ords, it as the
fact of ille!al possession that retroactively esta"lished the pro"a"le cause
that validated the ille!al search and seiEure. It as the fruit of the poisonous
tree that ashed clean the tree itself.
In :lmstead v. 6.,., /11 6.,. -+8, Justice 4olmes said si@t5-four 5ears a!o2
. . . It is desira"le that criminals should "e detected, and to
that end that all availa"le evidence should "e used. It is
also desira"le that the !overnment should not itself foster
and pa5 for other crimes, hen the5 are the means "5
hich the evidence is to "e o"tained. If it pa5s its officers
for havin! !ot evidence "5 crime, I do not see h5 it ma5
not as ell pa5 them for !ettin! it in the same a5, and I
can attach no importance to protestations of disapproval if
it knoin!l5 accepts and pa5s and announces that in the
future it ill pa5 for the fruits. >e have to choose, and for
m5 part I think it a less evil that some criminals should
escape than that the !overnment should pla5 an i!no"le
part.
If "5 deterrin! the !overnment from pla5in! Aan i!no"le part,A I am Acoddlin!
criminals,A I elcome the accusation and take pride in it. I ould rather err in
favor of the accused ho is impaled ith outlaed evidence than e@alt order
at the price of li"ert5.

Se$%&%'e O$(n(on)
NAR*ASA, J., concurrin! and dissentin!2

U.S. Supreme Court
CHURCH OF LUKUMI BABALU AYE v. CITY OF
HIALEAH, 508 U.S. 520 (1993)
508 U.S. 520
CHURCH OF LUKUMI BABALU AYE, INC. v. CITY OF HIALEAH
CERTIORARI TO THE UNITED STATES COURT OF AEALS FOR
THE ELE!ENTH CIRCUIT
N". 91#9$8
A%&'() N"v(*+(% $, 1992
D(,-)() .'/( 11, 1993
Petitioner church and its congregants practice the Santeria religion, which
employs animal sacrifice as one of its principal forms of devotion. The
animals are killed by cutting their carotid arteries, and are cooked and eaten
following all Santeria rituals except healing and death rites. fter the church
leased land in respondent city and announced plans to establish a house of
worship and other facilities there, the city council held an emergency public
session and passed, among other enactments !esolution "#$%%, which noted
city residents& 'concern' over religious practices inconsistent with public
morals, peace, or safety, and declared the city&s 'commitment' to prohibiting
such practices( )rdinance "#$*+, which incorporates the ,lorida animal
cruelty laws and broadly punishes '-w.hoever . . . unnecessarily or cruelly . . .
kills any animal,' and has been interpreted to reach killings for religious
reasons( )rdinance "#$/0, which defines 'sacrifice' as 'to unnecessarily kill .
. . an animal in a . . . ritual . . . not for the primary purpose of food
consumption,' and prohibits the 'possess-ion., sacrifice, or slaughter' of an
animal if it is killed in 'any type of ritual' and there is an intent to use it for
food, but exempts 'any licensed -food. establishment' if the killing is
otherwise permitted by law( )rdinance "#$#1, which prohibits the sacrifice of
animals, and defines 'sacrifice' in the same manner as )rdinance "#$/0( and
)rdinance "#$#0 which defines 'slaughter' as 'the killing of animals for
food' and prohibits slaughter outside of areas 2oned for slaughterhouses, but
includes an exemption for 'small numbers of hogs and3or cattle' when
exempted by state law. Petitioners filed this suit under *0 U.S.C. 14"5,
alleging violations of their rights under, inter alia, the ,ree 6xercise Clause of
the ,irst mendment. lthough acknowledging that the foregoing
ordinances are not religiously neutral, the 7istrict Court ruled for the city,
concluding, among other things, that compelling governmental interests in
preventing public health risks and cruelty to animals fully 8ustified the
absolute prohibition on ritual sacrifice accomplished by the ordinances, and
that an exception to that prohibition for religious conduct would unduly
interfere with fulfillment of the governmental interest, because any more
narrow restrictions would -/+" U.S. /0+, /01. be unenforceable as a result
of the Santeria religion&s secret nature. The Court of ppeals affirmed.
Held:
The 8udgment is reversed.
45% ,.0d /"%, 9C 11 1441: reversed.
;UST<C6 =6>>67? delivered the opinion of the Court with respect to Parts
<, <<$1, <<$$5, <<$@, <<<, and <A, concluding that the laws in Buestion were
enacted contrary to free exercise principles, and they are void. Pp. /51$/*+,
/*0$/*#.
9a: Under the ,ree 6xercise Clause, a law that burdens religious
practice need not be 8ustified by a compelling governmental interest
if it is neutral and of general applicability. 6mployment 7iv., 7ept.
of Cuman !esources of )re. v. Smith, *4* U.S. "#0 . Cowever,
where such a law is not neutral or not of general application, it must
undergo the most rigorous of scrutinyD it must be 8ustified by a
compelling governmental interest, and must be narrowly tailored to
advance that interest. >eutrality and general applicability are
interrelated, and failure to satisfy one reBuirement is a likely
indication that the other has not been satisfied. Pp. /51$/50.
9b: The ordinances& texts and operation demonstrate that they are
not neutral, but have as their ob8ect the suppression of Santeria&s
central element, animal sacrifice. That this religious exercise has
been targeted is evidenced by !esolution "#$%%&s statements of
'concern' and 'commitment,' and by the use of the words
'sacrifice' and 'ritual' in )rdinances "#$*+, "#$/0, and "#$#1.
Eoreover, the latter ordinances& various prohibitions, definitions,
and exemptions demonstrate that they were 'gerrymandered' with
care to proscribe religious killings of animals by Santeria church
members but to exclude almost allother animal killings. They also
suppress much more religious conduct than is necessary to achieve
their stated ends. The legitimate governmental interests in
protecting the public health and preventing cruelty to animals could
be addressed by restrictions stopping far short of a flat prohibition
of all Santeria sacrificial practice, such as general regulations on the
disposal of organic garbage, on the care of animals regardless of
why they are kept, or on methods of slaughter. lthough )rdinance
"#$#0 appears to apply to substantial nonreligious conduct and not
to be overbroad, it must also be invalidated because it functions in
tandem with the other ordinances to suppress Santeria religious
worship. Pp. /55$/*+.
9c: 6ach of the ordinances pursues the city&s governmental interests
only against conduct motivated by religious belief, and thereby
violates the reBuirement that laws burdening religious practice
must be of general applicability. )rdinances "#$*+, "#$/0, and "#$
#1 are substantially underinclusive with regard to the city&s interest
in preventing cruelty -/+" U.S. /0+, /00. to animals, since they
are drafted with care to forbid few animal killings but those
occasioned by religious sacrifice, while many types of animal deaths
or kills for nonreligious reasons are either not prohibited or
approved by express provision. The city&s assertions that it is 'self$
evident' that killing for food is 'important,' that the eradication of
insects and pests is 'obviously 8ustified,' and that euthanasia of
excess animals 'makes sense' do not explain why religion alone
must bear the burden of the ordinances. These ordinances are also
substantially underinclusive with regard to the city&s public health
interests in preventing the disposal of animal carcasses in open
public places and the consumption of uninspected meat, since
neither interest is pursued by respondent with regard to conduct
that is not motivated by religious conviction. )rdinance "#$#0 is
underinclusive on its face, since it does not regulate nonreligious
slaughter for food in like manner, and respondent has not explained
why the commercial slaughter of 'small numbers' of cattle and hogs
does not implicate its professed desire to prevent cruelty to animals
and preserve the public health. Pp. /*0$/*%.
9d: The ordinances cannot withstand the strict scrutiny that is
reBuired upon their failure to meet the Smith standard. They are
not narrowly tailored to accomplish the asserted governmental
interests. ll four are overbroad or underinclusive in substantial
respects because the proffered ob8ectives are not pursued with
respect to analogous nonreligious conduct, and those interests
could be achieved by narrower ordinances that burdened religion to
a far lesser degree. Eoreover, where, as here, government restricts
only conduct protected by the ,irst mendment and fails to enact
feasible measures to restrict other conduct producing substantial
harm or alleged harm of the same sort, the governmental interests
given in 8ustification of the restriction cannot be regarded as
compelling. Pp. /*%$/*#.
=6>>67?, ;., delivered the opinion of the Court with respect to Parts <, <<<,
and <A, in which !6C>FU<ST, C.;., and GC<T6, ST6A6>S, SCH<,
S)UT6!, and TC)ES, ;;., 8oined, the opinion of the Court with respect to
Part <<$@, in which !6C>FU<ST, C.;., and GC<T6, ST6A6>S, SCH<, and
TC)ES, ;;., 8oined, the opinion of the Court with respect to Parts <<$$1
and <<$$5, in which !6C>FU<ST, C.;., and ST6A6>S, SCH<, and
TC)ES, ;;., 8oined, and an opinion with respect to Part <<$$0, in which
ST6A6>S, ;., 8oined. SCH<, ;., filed an opinion concurring in part and
concurring in the 8udgment, in which !6C>FU<ST, C.;., 8oined, post p. //#.
S)UT6!, ;., filed an opinion concurring in part and concurring in the
8udgment, post p. //4. @HC=EU>, ;., filed an opinion concurring in the
8udgment, in which )&C)>>)!, ;., 8oined, post, p. /##. -/+" U.S. /0+, /05.
7ouglas Haycock argued the cause for petitioners. Gith him on the briefs
were ;eanne @aker, Steven !. Shapiro, and ;orge . 7uarte.
!ichard I. Iarrett argued the cause for respondent. Gith him on the brief
were Stuart C. Singer and Steven E. Ioldsmith. J
- ,ootnote J . @riefs of amici curiae urging reversal were filed for mericans
United for Separation of Church and State et al. by 6dward EcIlynn
Iaffney, ;r., Steven T. Ec,arland, @radley P. ;acob, and Eichael G.
EcConnell( for the Council on !eligious ,reedom by Hee @oothby, !obert G.
>ixon, Galter 6. Carson, and !olland Truman( and for the !utherford
<nstitute by ;ohn G. Ghitehead.
@riefs of amici curiae urging affirmance were filed for the <nternational
Society for nimal !ights et al. by Cenry Eark Col2er( for People for the
6thical Treatment of nimals et al. by Iary H. ,rancione( and for the
Gashington Cumane Society by 6. 6dward @ruce.
@riefs of amici curiae were filed for the United States Catholic Conference by
Eark 6. Chopko and ;ohn . Hiekweg( for the Cumane Society of the United
States et al. by Peter @uscemi, Eaureen @eyers, !oger . =indler, and
6ugene Underwood, ;r.( for the <nstitute for nimal !ights Haw et al. by
Cenry Eark Col2er( and for the >ational ;ewish Commission on Haw and
Public ffairs by >athan Hewin and 7ennis !apps.
;UST<C6 =6>>67? delivered the opinion of the Court, except as to Part <<$
$0.,n
The principle that government may not enact laws that suppress religious
belief or practice is so well understood that few violations are recorded in our
opinions. Cf. Ec7aniel v. Paty, *5/ U.S. %1" 914#":( ,owler v. !hode <sland,
5*/ U.S. %# 914/5:. Concerned that -this -fundamental nonpersecution
principle. of the ,irst mendment was implicated here,. however, we
granted certiorari. /+5 U.S. 45/ 91440:. -/+" U.S. /0+, /0*.
)ur review confirms that the laws in Buestion were enacted by officials who
did not understand, failed to perceive, or chose to ignore the fact that their
official actions violated the >ation&s essential commitment to religious
freedom. The challenged laws had an impermissible ob8ect( and in all events,
the principle of general applicability was violated because the secular ends
asserted in defense of the laws were pursued only with respect to conduct
motivated by religious beliefs. Ge invalidate the challenged enactments, and
reverse the 8udgment of the Court of ppeals.
I
A
This case involves practices of the Santeria religion, which originated in the
14th century. Ghen hundreds of thousands of members of the ?oruba people
were brought as slaves from western frica to Cuba, their traditional frican
religion absorbed significant elements of !oman Catholicism. The resulting
syncretion, or fusion, is Santeria, 'the way of the saints.' The Cuban ?oruba
express their devotion to spirits, called orishas, through the iconography of
Catholic saints, Catholic symbols are often present at Santeria rites, and
Santeria devotees attend the Catholic sacraments. #05 ,.Supp. 1*%#, 1*%4$
1*#+ 9S7 ,la. 14"4:( 15 6ncyclopedia of !eligion %% 9E. 6liade ed. 14"#:( 1
6ncyclopedia of the merican !eligious 6xperience 1"5 9C. Hippy K P.
Gilliams eds. 14"":.
The Santeria faith teaches that every individual has a destiny from Iod, a
destiny fulfilled with the aid and energy of the orishas. The basis of the
Santeria religion is the nurture of a personal relation with the orishas, and
one of the principal forms of devotion is an animal sacrifice. 15 6ncyclopedia
of !eligion, supra, at %%. The sacrifice of animals as part of religious rituals
has ancient roots. See generally 10 id., at //*$//%. nimal sacrifice is
mentioned throughout the )ld Testament, see 1* 6ncyclopaedia ;udaica
%++, %++$%+/ -/+" U.S. /0+, /0/. 914#1:, and it played an important role in
the practice of ;udaism before destruction of the second Temple in
;erusalem, see id., at %+/$%10. <n modern <slam, there is an annual sacrifice
commemorating braham&s sacrifice of a ram in the stead of his son. See C.
Ilasse, Concise 6ncyclopedia of <slam 1#" 914"4:( # 6ncyclopedia of
!eligion, supra, at */%.
ccording to Santeria teaching, the orishas are powerful, but not immortal.
They depend for survival on the sacrifice. Sacrifices are performed at birth,
marriage, and death rites, for the cure of the sick, for the initiation of new
members and priests, and during an annual celebration. nimals sacrificed
in Santeria rituals include chickens, pigeons, doves, ducks, guinea pigs,
goats, sheep, and turtles. The animals are killed by the cutting of the carotid
arteries in the neck. The sacrificed animal is cooked and eaten, except after
healing and death rituals. See #05 ,.Supp., at 1*#1$1*#0( 15 6ncyclopedia of
!eligion, supra, at %%( E. Ion2ale2$Gippler, The Santeria 6xperience 1+/
914"0:.
Santeria adherents faced widespread persecution in Cuba, so the religion and
its rituals were practiced in secret. The open practice of Santeria and its rites
remains infreBuent. See #05 ,.Supp., at 1*#+( 15 6ncyclopedia of !eligion,
supra, at %#( E. Ion2ale2$Gippler, SanteriaD The !eligion 5$* 914"4:. The
religion was brought to this >ation most often by exiles from the Cuban
revolution. The 7istrict Court estimated that there are at least /+,+++
practitioners in South ,lorida today. See #05 ,.Supp., at 1*#+.
B
Petitioner Church of the Hukumi @abalu ye, <nc. 9Church:, is a not$for$
profit corporation organi2ed under ,lorida law in 14#5. The Church and its
congregants practice the Santeria religion. The president of the Church is
petitioner 6rnesto Pichardo, who is also the Church&s priest and holds the
religious title of <talero, the second highest in the Santeria faith. <n pril,
14"#, the Church leased -/+" U.S. /0+, /0%. land in the city of Cialeah,
,lorida, and announced plans to establish a house of worship as well as a
school, cultural center, and museum. Pichardo indicated that the Church&s
goal was to bring the practice of the Santeria faith, including its ritual of
animal sacrifice, into the open. The Church began the process of obtaining
utility service and receiving the necessary licensing, inspection, and 2oning
approvals. lthough the Church&s efforts at obtaining the necessary licenses
and permits were far from smooth, see #05 ,.Supp., at 1*##$1*#", it appears
that it received all needed approvals by early ugust, 14"#.
The prospect of a Santeria church in their midst was distressing to many
members of the Cialeah community, and the announcement of the plans to
open a Santeria church in Cialeah prompted the city council to hold an
emergency public session on ;une 4, 14"#. The resolutions and ordinances
passed at that and later meetings are set forth in the ppendix following this
opinion.
summary suffices here, beginning with the enactments passed at the ;une
4 meeting. ,irst, the city council adopted !esolution "#$%%, which noted the
'concern' expressed by residents of the city 'that certain religions may
propose to engage in practices which are inconsistent with public morals,
peace or safety,' and declared that '-t.he City reiterates its commitment to a
prohibition against any and all acts of any and all religious groups which are
inconsistent with public morals, peace or safety.' >ext, the council approved
an emergency ordinance, )rdinance "#$*+, which incorporated in full,
except as to penalty, ,lorida&s animal cruelty laws. ,la.Stat. ch. "0" 914"#:.
mong other things, the incorporated state law sub8ected to criminal
punishment '-w.hoever . . . unnecessarily or cruelly . . . kills any animal.'
"0".10.
The city council desired to undertake further legislative action, but ,lorida
law prohibited a municipality from enacting legislation relating to animal
cruelty that conflicted with -/+" U.S. /0+, /0#. state law. "0".0#9*:. To
obtain clarification, Cialeah&s city attorney reBuested an opinion from the
attorney general of ,lorida as to whether "0".10 prohibited 'a religious
group from sacrificing an animal in a religious ritual or practice,' and
whether the city could enact ordinances 'making religious animal sacrifice
unlawful.' The attorney general responded in mid$;uly. Ce concluded that
the 'ritual sacrifice of animals for purposes other than food consumption'
was not a 'necessary' killing, and so was prohibited by "0".10.
,la.)p.tty.Ien. "#$/%, nnual !eport of the tty.Ien. 1*%, 1*#, 1*4 914"":.
The attorney general appeared to define 'unnecessary' as 'done without any
useful motive, in a spirit of wanton cruelty or for the mere pleasure of
destruction without being in any sense beneficial or useful to the person
killing the animal.' <d., at 1*4, n. 11. Ce advised that religious animal
sacrifice was against state law, so that a city ordinance prohibiting it would
not be in conflict. <d., at 1/1.
The city council responded at first with a hortatory enactment, !esolution
"#$4+, that noted its residents& 'great concern regarding the possibility of
public ritualistic animal sacrifices' and the state$law prohibition. The
resolution declared the city policy 'to oppose the ritual sacrifices of animals'
within Cialeah, and announced that any person or organi2ation practicing
animal sacrifice 'will be prosecuted.'
<n September, 14"#, the city council adopted three substantive ordinances
addressing the issue of religious animal sacrifice. )rdinance "#$/0 defined
'sacrifice' as 'to unnecessarily kill, torment, torture, or mutilate an animal in
a public or private ritual or ceremony not for the primary purpose of food
consumption,' and prohibited owning or possessing an animal 'intending to
use such animal for food purposes.' <t restricted application of this
prohibition, however, to any individual or group that 'kills, slaughters or
sacrifices animals for any type of ritual, regardless of whether or not the flesh
or blood of the animal is to be consumed.' The ordinance -/+" U.S. /0+,
/0". contained an exemption for slaughtering by 'licensed
establishment-s.' of animals 'specifically raised for food purposes.'
7eclaring, moreover, that the city council has determined that the sacrificing
of animals within the city limits is contrary to the public health, safety,
welfare and morals of the community,' the city council adopted )rdinance
"#$#1. That ordinance defined sacrifice as had )rdinance "#$/0, and then
provided that '-i.t shall be unlawful for any person, persons, corporations or
associations to sacrifice any animal within the corporate limits of the City of
Cialeah, ,lorida.' The final )rdinance, "#$#0, defined 'slaughter' as 'the
killing of animals for food,' and prohibited slaughter outside of areas 2oned
for slaughterhouse use. The ordinance provided an exemption, however, for
the slaughter or processing for sale of 'small numbers of hogs and3or cattle
per week in accordance with an exemption provided by state law.' ll
ordinances and resolutions passed the city council by unanimous vote.
Aiolations of each of the four ordinances were punishable by fines not
exceeding L/++ or imprisonment not exceeding %+ days, or both.
,ollowing enactment of these ordinances, the Church and Pichardo filed this
action pursuant to *0 U.S.C. 14"5 in the United States 7istrict Court for the
Southern 7istrict of ,lorida. >amed as defendants were the city of Cialeah
and its mayor and members of its city council in their individual capacities.
lleging violations of petitioners& rights under, inter alia, the ,ree 6xercise
Clause, the complaint sought a declaratory 8udgment and in8unctive and
monetary relief. The 7istrict Court granted summary 8udgment to the
individual defendants, finding that they had absolute immunity for their
legislative acts and that the ordinances and resolutions adopted by the
council did not constitute an official policy of harassment, as alleged by
petitioners. %"" ,.Supp. 1/00 9S7 ,la. 14"":.
fter a 4$day bench trial on the remaining claims, the 7istrict Court ruled for
the city, finding no violation of -/+" U.S. /0+, /04. petitioners& rights under
the ,ree 6xercise Clause. #05 ,.Supp. 1*%# 9S7 ,la. 14"4:. 9The court
re8ected as well petitioners& other claims, which are not at issue here.:
lthough acknowledging that 'the ordinances are not religiously neutral,'
id., at 1*#%, and that the city&s concern about animal sacrifice was
'prompted' by the establishment of the Church in the city, id., at 1*#4, the
7istrict Court concluded that the purpose of the ordinances was not to
exclude the Church from the city, but to end the practice of animal sacrifice,
for whatever reason practiced, id., at 1*#4, 1*"5. The court also found that
the ordinances did not target religious conduct 'on their face,' though it
noted that, in any event, 'specifically regulating -religious. conduct' does not
violate the ,irst mendment 'when -the conduct. is deemed inconsistent
with public health and welfare.' <d., at 1*"5$1*"*. Thus, the court concluded
that, at most, the ordinances& effect on petitioners& religious conduct was
'incidental to -their. secular purpose and effect.' <d., at 1*"*.
The 7istrict Court proceeded to determine whether the governmental
interests underlying the ordinances were compelling and, if so, to balance
the 'governmental and religious interests.' The court noted that '-t.his
'balance depends upon the cost to the government of altering its activity to
allow the religious practice to continue unimpeded versus the cost to the
religious interest imposed by the government activity.' <bid., Buoting Iros2
v. City of Eiami @each, #01 ,.0d #04, #5* 9C 11 14"5:, cert. denied, *%4 U.S.
"0# 914"*:. The court found four compelling interests. ,irst, the court found
that animal sacrifices present a substantial health risk, both to participants
and the general public. ccording to the court, animals that are to be
sacrificed are often kept in unsanitary conditions and are uninspected, and
animal remains are found in public places. #05 ,.Supp., at 1*#*$1*#/, 1*"/.
Second, the court found emotional in8ury to children who witness the
sacrifice of animals. <d., at 1*#/$1*#%, 1*"/$1*"%. Third, the court found
compelling -/+" U.S. /0+, /5+. the city&s interest in protecting animals
from cruel and unnecessary killing. The court determined that the method of
killing used in Santeria sacrifice was 'unreliable and not humane, and that
the animals, before being sacrificed, are often kept in conditions that
produce a great deal of fear and stress in the animal.' <d., at 1*#0$1*#5, 1*"%.
,ourth, the 7istrict Court found compelling the city&s interest in restricting
the slaughter or sacrifice of animals to areas 2oned for slaughterhouse use.
<d., at 1*"%. This legal determination was not accompanied by factual
findings.
@alancing the competing governmental and religious interests, the 7istrict
Court concluded the compelling governmental interests 'fully 8ustify the
absolute prohibition on ritual sacrifice' accomplished by the ordinances. <d.,
at 1*"#. The court also concluded that an exception to the sacrifice
prohibition for religious conduct would 'Munduly interfere with fulfillment of
the governmental interest&' because any more narrow restrictions $ e.g.,
regulation of disposal of animal carcasses $ would be unenforceable as a
result of the secret nature of the Santeria religion. <d., at 1*"%$1*"#, and nn.
/#$/4. religious exemption from the city&s ordinances, concluded the court,
would defeat the city&s compelling interests in enforcing the prohibition. <d.,
at 1*"#.
The Court of ppeals for the 6leventh Circuit affirmed in a one$paragraph
per curiam opinion. ;udgt. order reported at 45% ,.0d /"% 91441:. Choosing
not to rely on the 7istrict Court&s recitation of a compelling interest in
promoting the welfare of children, the Court of ppeals stated simply that it
concluded the ordinances were consistent with the Constitution. pp. to Pet.
for Cert. 0. <t declined to address the effect of 6mployment 7iv., 7ept. of
Cuman !esources of )re. v. Smith, *4* U.S. "#0 9144+:, decided after the
7istrict Court&s opinion, because the 7istrict Court 'employed an arguably
stricter standard' than that applied in Smith. pp. to Pet. for Cert. 0, n. 1.
-/+" U.S. /0+, /51.
II
The ,ree 6xercise Clause of the ,irst mendment, which has been applied to
the States through the ,ourteenth mendment, see Cantwell v. Connecticut,
51+ U.S. 04%, 5+5 914*+:, provides that 'Congress shall make no law
respecting an establishment of religion, or prohibiting the free exercise
thereof. . . .' 96mphasis added.: The city does not argue that Santeria is not a
'religion' within the meaning of the ,irst mendment. >or could it.
lthough the practice of animal sacrifice may seem abhorrent to some,
'religious beliefs need not be acceptable, logical, consistent, or
comprehensible to others in order to merit ,irst mendment protection.'
Thomas v. !eview @d. of <ndiana 6mployment Security 7iv., */+ U.S. #+#,
#1* 914"1:. Iiven the historical association between animal sacrifice and
religious worship, see supra, at 0, petitioners& assertion that animal sacrifice
is an integral part of their religion 'cannot be deemed bi2arre or incredible.'
,ra2ee v. <llinois 7ept. of 6mployment Security, *"4 U.S. "04, "5* , n. 0
914"4:. >either the city nor the courts below, moreover, have Buestioned the
sincerity of petitioners& professed desire to conduct animal sacrifices for
religious reasons. Ge must consider petitioners& ,irst mendment claim.
<n addressing the constitutional protection for free exercise of religion, our
cases establish the general proposition that -a law that is neutral and of
general applicability need not be 8ustified by a compelling governmental
interest even if the law has the incidental effect of burdening a particular
religious practice.. 6mployment 7iv., 7ept. of Cuman !esources of )re. v.
Smith, supra. >eutrality and general applicability are -interrelated., and, as
becomes apparent in this case, failure to satisfy one reBuirement is a likely
indication that the other has not been satisfied. law failing to satisfy these
reBuirements must be 8ustified by a compelling governmental interest, and
must be narrowly tailored to -/+" U.S. /0+, /50. advance that interest.
These ordinances -fail to satisfy the Smith reBuirements.. Ge begin by
discussing neutrality.
A
<n our 6stablishment Clause cases, we have often stated the principle that
the ,irst mendment forbids an official purpose to disapprove of a particular
religion or of religion in general. See, e.g., @oard of 6d. of Gestside
Community Schools 97ist. %%: v. Eergens, *4% U.S. 00%, 0*" 9144+:
9plurality opinion:( School 7ist. of Irand !apids v. @all, *#5 U.S. 5#5, 5"4
914"/:( Gallace v. ;affree, *#0 U.S. 5", /% 914"/:( 6pperson v. rkansas, 545
U.S. 4#, 1+% $1+# 914%":( School 7ist. of bington v. Schempp, 5#* U.S. 0+5,
00/ 914%5:( 6verson v. @oard of 6d. of 6wing, 55+ U.S. 1, 1/ $1% 914*#:.
These cases, however, for the most part, have addressed governmental
efforts to benefit religion or particular religions, and so have dealt with a
Buestion different, at least in its formulation and emphasis, from the issue
here. Petitioners allege an attempt to disfavor their religion because of the
religious ceremonies it commands, and the ,ree 6xercise Clause is
dispositive in our analysis.
-t a minimum, the protections of the ,ree 6xercise Clause pertain if the law
at issue discriminates against some or all religious beliefs or regulates or
prohibits conduct because it is undertaken for religious reasons.. See, e.g.,
@raunfeld v. @rown, 5%% U.S. /44, %+# 914%1: 9plurality opinion:( ,owler v.
!hode <sland, 5*/ U.S. %#, %4 $#+ 914/5:. <ndeed, it was -'historical
instances of religious persecution and intolerance that gave concern to those
who drafted the ,ree 6xercise Clause.'. @owen v. !oy, *#% U.S. %45, #+5
914"%: 9opinion of @urger, C.;.:. See ;. Story, Commentaries on the
Constitution of the United States 441$440 9abridged ed. 1"55: 9reprint 14"#:(
T. Cooley, Constitutional Himitations *%# 91"%": 9reprint 14#0:( EcIowan v.
Earyland, 5%% U.S. *0+, *%* , and n. 0 914%1: 9opinion of ,rankfurter, ;.:(
7ouglas v. ;eannette, 514 U.S. 1/#, 1#4 914*5: 9;ackson, ;., concurring in
result:( -/+" U.S. /0+, /55. 7avis v. @eason, 155 U.S. 555, 5*0 91"4+:.
These principles, though not often at issue in our ,ree 6xercise Clause cases,
have played a role in some. <n Ec7aniel v. Paty, *5/ U.S. %1" 914#":, for
example, we invalidated a state law that disBualified members of the clergy
from holding certain public offices, because it 'impose-d. special disabilities
on the basis of . . . religious status,' 6mployment 7iv., 7ept. of Cuman
!esources of )re. v. Smith, *4* U.S., at "## . )n the same principle, in
,owler v. !hode <sland, supra, we found that a municipal ordinance was
applied in an unconstitutional manner when interpreted to prohibit
preaching in a public park by a ;ehovah&s Gitness, but to permit preaching
during the course of a Catholic mass or Protestant church service. See also
>iemotko v. Earyland, 5*+ U.S. 0%", 0#0 $0#5 914/1:. Cf. Harson v. Aalente,
*/% U.S. 00" 914"0: 9state statute that treated some religious denominations
more favorably than others violated the 6stablishment Clause:.
1
lthough a law targeting religious beliefs as such is never permissible,
Ec7aniel v. Paty, supra, at %0% 9plurality opinion:( Cantwell v. Connecticut,
supra, at 5+5$5+*, if the ob8ect of a law is to infringe upon or restrict
practices because of their religious motivation, the law is not neutral, see
6mployment 7iv., 7ept. of Cuman !esources of )regon v. Smith, supra, at
"#"$"#4, and it is invalid unless it is 8ustified by a compelling interest and is
narrowly tailored to advance that interest. There are, of course, many ways of
demonstrating that the ob8ect or purpose of a law is the suppression of
religion or religious conduct. To determine the ob8ect of a law, we must begin
with its text, for the minimum reBuirement of neutrality is that a law not
discriminate on its face. law lacks facial neutrality if it refers to a religious
practice without a secular meaning discernable from the language or context.
Petitioners contend that three of the ordinances fail this test of facial
neutrality because they use the words -/+" U.S. /0+, /5*. 'sacrifice' and
'ritual,' words with strong religious connotations. @rief for Petitioners 1%$1#.
Ge agree that these words are consistent with the claim of facial
discrimination, but the argument is not conclusive. The words 'sacrifice' and
'ritual' have a religious origin, but current use admits also of secular
meanings. See Gebster&s Third >ew <nternational 7ictionary 14%1, 144%
914#1:. See also 10 6ncyclopedia of !eligion, at //% 9'-T.he word sacrifice
ultimately became very much a secular term in common usage':. The
ordinances, furthermore, define 'sacrifice' in secular terms, without
referring to religious practices.
Ge re8ect the contention advanced by the city, see @rief for !espondent 1/,
that our inBuiry must end with the text of the laws at issue. ,acial neutrality
is not determinative. The ,ree 6xercise Clause, like the 6stablishment
Clause, extends beyond facial discrimination. The Clause 'forbids subtle
departures from neutrality,' Iillette v. United States, *+1 U.S. *5#, */0
914#1:, and 'covert suppression of particular religious beliefs,' @owen v. !oy,
supra, at #+5 9opinion of @urger, C.;.:. )fficial action that targets religious
conduct for distinctive treatment cannot be shielded by mere compliance
with the reBuirement of facial neutrality. The ,ree 6xercise Clause protects
against governmental hostility which is masked as well as overt. 'The Court
must survey meticulously the circumstances of governmental categories to
eliminate, as it were, religious gerrymanders.' Gal2 v. Tax Comm&n of >ew
?ork City, 54# U.S. %%*, %4% 914#+: 9Carlan, ;., concurring:.
The record in this case compels the conclusion that suppression of the
central element of the Santeria worship service was the ob8ect of the
ordinances. ,irst, though use of the words 'sacrifice' and 'ritual' does not
compel a finding of improper targeting of the Santeria religion, the choice of
these words is support for our conclusion. There are further respects in
which the text of the city council&s enactments discloses the improper
attempt to target Santeria. -/+" U.S. /0+, /5/. !esolution "#$%%, adopted
;une 4, 14"#, recited that 'residents and citi2ens of the City of Cialeah have
expressed their concern that certain religions may propose to engage in
practices which are inconsistent with public morals, peace or safety,' and
'reiterate-d.' the city&s commitment to prohibit 'any and all -such. acts of
any and all religious groups.' >o one suggests, and, on this record, it cannot
be maintained, that city officials had in mind a religion other than Santeria.
<t becomes evident that these ordinances target Santeria sacrifice when the
ordinances& operation is considered. part from the text, the effect of a law in
its real operation is strong evidence of its ob8ect. To be sure, adverse impact
will not always lead to a finding of impermissible targeting. ,or example, a
social harm may have been a legitimate concern of government for reasons
Buite apart from discrimination. EcIowan v. Earyland, 5%% U.S., at **0 .
See, e.g., !eynolds v. United States, 4" U.S. 1*/ 91"#4:( 7avis v. @eason, 155
U.S. 555 91"4+:. See also 6ly, Hegislative and dministrative Eotivation in
Constitutional Haw, #4 ?ale H.;. 10+/, 1514 914#+:. The sub8ect at hand does
implicate, of course, multiple concerns unrelated to religious animosity, for
example, the suffering or mistreatment visited upon the sacrificed animals
and health ha2ards from improper disposal. @ut the ordinances, when
considered together, disclose an ob8ect remote from these legitimate
concerns. The design of these laws accomplishes, instead, a 'religious
gerrymander,' Gal2 v. Tax Comm&n of >ew ?ork City, supra, at %4% 9Carlan,
;., concurring:, an impermissible attempt to target petitioners and their
religious practices.
<t is a necessary conclusion that almost the only conduct sub8ect to
)rdinances "#$*+, "#$/0, and "#$#1 is the religious exercise of Santeria
church members. The texts show that they were drafted in tandem to achieve
this result. Ge begin with )rdinance "#$#1. <t prohibits the sacrifice of
animals, but defines sacrifice as 'to unnecessarily kill . . . an animal in a
public or private ritual or ceremony not for the -/+" U.S. /0+, /5%. primary
purpose of food consumption.' The definition excludes almost all killings of
animals except for religious sacrifice, and the primary purpose reBuirement
narrows the proscribed category even further, in particular by exempting
kosher slaughter, see #05 ,.Supp., at 1*"+. Ge need not discuss whether this
differential treatment of two religions is, itself, an independent
constitutional violation. Cf. Harson v. Aalente, */% U.S., at 0** $0*%. <t
suffices to recite this feature of the law as support for our conclusion that
Santeria alone was the exclusive legislative concern. The net result of the
gerrymander is that few, if any, killings of animals are prohibited other than
Santeria sacrifice, which is proscribed because it occurs during a ritual or
ceremony and its primary purpose is to make an offering to the orishas, not
food consumption. <ndeed, careful drafting ensured that, although Santeria
sacrifice is prohibited, killings that are no more necessary or humane in
almost all other circumstances are unpunished.
)perating in similar fashion is )rdinance "#$/0, which prohibits the
'possess-ion., sacrifice, or slaughter' of an animal with the 'inten-t. to use
such animal for food purposes.' This prohibition, extending to the keeping of
an animal, as well as the killing itself, applies if the animal is killed in 'any
type of ritual' and there is an intent to use the animal for food, whether or
not it is in fact consumed for food. The ordinance exempts, however, 'any
licensed -food. establishment' with regard to 'any animals which are
specifically raised for food purposes,' if the activity is permitted by 2oning
and other laws. This exception, too, seems intended to cover =osher
slaughter. gain, the burden of the ordinance, in practical terms, falls on
Santeria adherents, but almost no othersD if the killing is $ unlike most
Santeria sacrifices $ unaccompanied by the intent to use the animal for food,
then it is not prohibited by )rdinance "#$/0( if the killing is specifically for
food, but does not occur during the course of 'any type of ritual,' it again
falls outside the prohibition( and -/+" U.S. /0+, /5#. if the killing is for
food and occurs during the course of a ritual, it is still exempted if it occurs
in a properly 2oned and licensed establishment and involves animals
'specifically raised for food purposes.' pattern of exemptions parallels the
pattern of narrow prohibitions. 6ach contributes to the gerrymander.
)rdinance "#$*+ incorporates the ,lorida animal cruelty statute, ,la.Stat.
"0".10 914"#:. <ts prohibition is broad on its face, punishing '-w.hoever . . .
unnecessarily . . . kills any animal.' The city claims that this ordinance is the
epitome of a neutral prohibition. @rief for !espondent 15$1*. The problem,
however, is the interpretation given to the ordinance by respondent and the
,lorida attorney general. =illings for religious reasons are deemed
unnecessary, whereas most other killings fall outside the prohibition. The
city, on what seems to be a per se basis, deems hunting, slaughter of animals
for food, eradication of insects and pests, and euthanasia as necessary. See
id., at 00. There is no indication in the record that respondent has concluded
that hunting or fishing for sport is unnecessary. <ndeed, one of the few
reported ,lorida cases decided under "0".10 concludes that the use of live
rabbits to train greyhounds is not unnecessary. See =iper v. State, 51+ So.0d
*0 9,la. pp.:, cert. denied, 50" So.0d "*/ 9,la. 14#/:. ,urther, because it
reBuires an evaluation of the particular 8ustification for the killing, this
ordinance represents a system of 'individuali2ed governmental assessment
of the reasons for the relevant conduct,' 6mployment 7iv., 7ept. of Cuman
!esources of )regon v. Smith, *4* U.S., at ""* . s we noted in Smith, in
circumstances in which individuali2ed exemptions from a general
reBuirement are available, the government 'may not refuse to extend that
system to cases of Mreligious hardship& without compelling reason.' ibid.
Buoting @owen v. !oy, *#% U.S., at #+" 9opinion of @urger, C.;.:.
!espondent&s application of the ordinance&s test of necessity devalues
religious reasons for killing by 8udging them to be of lesser import than
nonreligious -/+" U.S. /0+, /5". reasons. Thus, religious practice is being
singled out for discriminatory treatment. @owen v. !oy, *#% U.S., at #00 ,
and n. 1# 9ST6A6>S, ;., concurring in part and concurring in result:, id., at
#+" 9opinion of @urger, C.;.:( United States v. Hee, *// U.S. 0/0, 0%* , n. 5
914"0: 9ST6A6>S, ;., concurring in 8udgment:.
Ge also find significant evidence of the ordinances& improper targeting of
Santeria sacrifice in the fact that they proscribe more religious conduct than
is necessary to achieve their stated ends. <t is not unreasonable to infer, at
least when there are no persuasive indications to the contrary, that a law
which visits 'gratuitous restrictions' on religious conduct, EcIowan v.
Earyland, 5%% U.S., at /0+ 9opinion of ,rankfurter, ;.:, seeks not to
effectuate the stated governmental interests, but to suppress the conduct
because of its religious motivation.
The -legitimate governmental interests in protecting the public health and
preventing cruelty to animals could be addressed by restrictions stopping far
short of a flat prohibition of all Santeria sacrificial practice.. J <f improper
disposal, not the sacrifice itself, is the harm to be prevented, the city could
have imposed a general regulation on the disposal of organic garbage. <t did
not do so. <ndeed, counsel for the city conceded at oral argument that, under
the ordinances, Santeria sacrifices would be illegal even if they occurred in
licensed, inspected, and 2oned slaughterhouses. Tr. of )ral rg. */. See also
id., at *0, *". Thus, these broad ordinances prohibit Santeria sacrifice even
when it does not threaten the city&s -/+" U.S. /0+, /54. interest in the
public health. The 7istrict Court accepted the argument that narrower
regulation would be unenforceable because of the secrecy in the Santeria
rituals and the lack of any central religious authority to reBuire compliance
with secular disposal regulations. See #05 ,.Supp., at 1*"%$1*"#, and nn. /"$
/4. <t is difficult to understand, however, how a prohibition of the sacrifices
themselves, which occur in private, is enforceable if a ban on improper
disposal, which occurs in public, is not. The neutrality of a law is suspect if
,irst mendment freedoms are curtailed to prevent isolated collateral harms
not themselves prohibited by direct regulation. See, e.g., Schneider v. State,
5+" U.S. 1*#, 1%0 91454:.
Under similar analysis, narrower regulation would achieve the city&s interest
in preventing cruelty to animals. Gith regard to the city&s interest in
ensuring the adeBuate care of animals, regulation of conditions and
treatment, regardless of why an animal is kept, is the logical response to the
city&s concern, not a prohibition on possession for the purpose of sacrifice.
The same is true for the city&s interest in prohibiting cruel methods of killing.
Under federal and ,lorida law and )rdinance "#$*+, which incorporates
,lorida law in this regard, killing an animal by the 'simultaneous and
instantaneous severance of the carotid arteries with a sharp instrument' $
the method used in kosher slaughter $ is approved as humane. See # U.S.C.
14+09b:( ,la.Stat. "0".059#:9b: 91441:( )rdinance "#$*+, 1. The 7istrict
Court found that, though Santeria sacrifice also results in severance of the
carotid arteries, the method used during sacrifice is less reliable, and
therefore not humane. See #05 ,.Supp., at 1*#0$1*#5. <f the city has a real
concern that other methods are less humane, however, the sub8ect of the
regulation should be the method of slaughter itself, not a religious
classification that is said to bear some general relation to it.
)rdinance "#$#0 $ unlike the three other ordinances $ does appear to apply
to substantial nonreligious conduct, and -/+" U.S. /0+, /*+. not to be
overbroad. ,or our purposes here, however, the four substantive ordinances
may be treated as a group for neutrality purposes. )rdinance "#$#0 was
passed the same day as )rdinance "#$#1, and was enacted, as were the three
others, in direct response to the opening of the Church. <t would be
implausible to suggest that the three other ordinances, but not )rdinance
"#$#0, had as their ob8ect the suppression of religion. Ge need not decide
whether the )rdinance "#$#0 could survive constitutional scrutiny if it
existed separately( it must be invalidated because it functions, with the rest
of the enactments in Buestion, to suppress Santeria religious worship.
2
<n determining if the ob8ect of a law is a neutral one under the ,ree 6xercise
Clause, we can also find guidance in our eBual protection cases. s ;ustice
Carlan noted in the related context of the 6stablishment Clause,
'-n.eutrality in its application reBuires an eBual protection mode of
analysis.' Gal2 v. Tax Comm&n of >ew ?ork City, 54# U.S., at %4%
9concurring opinion:. Cere, as in eBual protection cases, we may determine
the city council&s ob8ect from both direct and circumstantial evidence.
rlington Ceights v. Eetropolitan Cousing 7evelopment Corp., *04 U.S.
0/0, 0%% 914##:. !elevant evidence includes, among other things, the
historical background of the decision under challenge, the specific series of
events leading to the enactment or official policy in Buestion, and the
legislative or administrative history, including contemporaneous statements
made by members of the decisionmaking body. <d., at 0%#$0%". These
ob8ective factors bear on the Buestion of discriminatory ob8ect. Personnel
dministrator of Eass. v. ,eeney, **0 U.S. 0/%, 0#4 , n. 0* 914#4:.
That the ordinances were enacted 'Mbecause of,& not merely Min spite of,&'
their suppression of Santeria religious practice, id., at 0#4, is revealed by the
events preceding enactment thier. lthough respondent claimed at oral
argument -/+" U.S. /0+, /*1. that it had experienced significant problems
resulting from the sacrifice of animals within the city before the announced
opening of the Church, Tr. of )ral rg. 0#, *%, the city council made no
attempt to address the supposed problem before its meeting in ;une, 14"#,
8ust weeks after the Church announced plans to open. The minutes and taped
excerpts of the ;une 4 session, both of which are in the record, evidence
significant hostility exhibited by residents, members of the city council, and
other city officials toward the Santeria religion and its practice of animal
sacrifice. The public crowd that attended the ;une 4 meetings interrupted
statements by council members critical of Santeria with cheers and the brief
comments of Pichardo with taunts. Ghen Councilman Eartine2, a supporter
of the ordinances, stated that, in prerevolution Cuba, 'people were put in 8ail
for practicing this religion,' the audience applauded. Taped excerpts of
Cialeah City Council Eeeting, ;une 4, 14"#.
)ther statements by members of the city council were in a similar vein. ,or
example, Councilman Eartine2, after noting his belief that Santeria was
outlawed in Cuba, BuestionedD '<f we could not practice this -religion. in our
homeland -Cuba., why bring it to this countryN' Councilman Cardoso said
that Santeria devotees at the Church 'are in violation of everything this
country stands for.' Councilman Ee8ides indicated that he was 'totally
against the sacrificing of animals,' and distinguished kosher slaughter
because it had a 'real purpose.' The '@ible says we are allowed to sacrifice an
animal for consumption,' he continued, 'but for any other purposes, < don&t
believe that the @ible allows that.' The president of the city council,
Councilman 6chevarria, askedD 'Ghat can we do to prevent the Church from
openingN'
Aarious Cialeah city officials made comparable comments. The chaplain of
the Cialeah Police 7epartment told the city council that Santeria was a sin,
'foolishness,' 'an abomination to the Hord,' and the worship of 'demons.'
Ce advised -/+" U.S. /0+, /*0. the city councilD 'Ge need to be helping
people and sharing with them the truth that is found in ;esus Christ.' Ce
concludedD '< would exhort you . . . not to permit this Church to exist.' The
city attorney commented that !esolution "#$%% indicatedD 'This community
will not tolerate religious practices which are abhorrent to its citi2ens. . . .'
ibid. Similar comments were made by the deputy city attorney. This history
discloses the ob8ect of the ordinances to target animal sacrifice by Santeria
worshippers because of its religious motivation.
3
<n sum, the neutrality inBuiry leads to one conclusionD the ordinances had as
their ob8ect the suppression of religion. The pattern we have recited discloses
animosity to Santeria adherents and their religious practices( the ordinances,
by their own terms, target this religious exercise( the texts of the ordinances
were gerrymandered with care to proscribe religious killings of animals but
to exclude almost all secular killings( and the ordinances suppress much
more religious conduct than is necessary in order to achieve the legitimate
ends asserted in their defense. These ordinances are not neutral, and the
court below committed clear error in failing to reach this conclusion.
B
Ge turn next to a second reBuirement of the ,ree 6xercise Clause, the rule
that laws burdening religious practice must be of general applicability.
6mployment 7iv., 7ept. of Cuman !esources of )re. v. Smith, *4* U.S., at
"#4 $""1. ll laws are selective to some extent, but categories of selection are
of paramount concern when a law has the incidental effect of burdening
religious practice. The ,ree 6xercise Clause 'protect-s. religious observers
against uneBual treatment,' Cobbie v. Unemployment ppeals Comm&n of
,la., *"+ U.S. 15%, 1*" 914"#: 9ST6A6>S, ;., concurring in 8udgment:, and
ineBuality results when a legislature decides that -/+" U.S. /0+, /*5. the
governmental interests it seeks to advance are worthy of being pursued only
against conduct with a religious motivation.
The principle that government, in pursuit of legitimate interests, cannot in a
-selective manner impose burdens only on conduct motivated by religious
belief. is essential to the protection of the rights guaranteed by the ,ree
6xercise Clause. The principle underlying the general applicability
reBuirement has parallels in our ,irst mendment 8urisprudence. See, e.g.,
Cohen v. Cowles Eedia Co., /+1 U.S. %% %%4$%#+( 91441:( University of
Pennsylvania v. 66)C, *45 U.S. 1"0, 0+1 9144+:( Einneapolis Star K
Tribune Co. v. Einnesota Comm&r of !evenue, *%+ U.S. /#/, /"/ 914"5:(
Harson v. Aalente, */% U.S., at 0*/ $0*%( Presbyterian Church in U.S. v. Eary
6li2abeth @lue Cull Eemorial Presbyterian Church, 545 U.S. **+, **4
914%4:. <n this case, we -need not define with precision the standard used to
evaluate whether a prohibition is of general application, for these ordinances
fall well below the minimum standard necessary to protect ,irst mendment
rights..
!espondent claims that )rdinances "#$*+, "#$/0, and "#$#1 advance two
interestsD protecting the public health and preventing cruelty to animals. The
ordinances are underinclusive for those ends. They fail to prohibit
nonreligious conduct that endangers these interests in a similar or greater
degree than Santeria sacrifice does. The underinclusion is substantial, not
inconseBuential. -7espite the city&s proffered interest in preventing cruelty to
animals, the ordinances are drafted with care to forbid few killings but those
occasioned by religious sacrifice.. Eany types of animal deaths or kills for
nonreligious reasons are either not prohibited or approved by express
provision. ,or example, fishing $ which occurs in Cialeah, see . =hedouri K
,. =hedouri, South ,lorida <nside )ut /# 91441: $ is legal. 6xtermination of
mice and rats within a home is also permitted. ,lorida law incorporated by
)rdinance "#$*+ -/+" U.S. /0+, /**. sanctions euthanasia of 'stray,
neglected, abandoned, or unwanted animals,' ,la.Stat. "0".+/" 914"#:(
destruction of animals 8udicially removed from their owners 'for
humanitarian reasons' or when the animal 'is of no commercial value,'
"0".+#59*:9c:90:( the infliction of pain or suffering 'in the interest of
medical science,' "0".+0( the placing of poison in one&s yard or enclosure,
"0".+"( and the use of a live animal 'to pursue or take wildlife or to
participate in any hunting,' "0".1009%:9b:, and 'to hunt wild hogs,'
"0".1009%:9e:.
The city concedes that 'neither the State of ,lorida nor the City has enacted a
generally applicable ban on the killing of animals.' @rief for !espondent 01.
<t asserts, however, that animal sacrifice is 'different' from the animal
killings that are permitted by law. <bid. ccording to the city, it is 'self$
evident' that killing animals for food is 'important'( the eradication of
insects and pests is 'obviously 8ustified'( and the euthanasia of excess
animals 'makes sense.' <d., at 00. These ipse dixits do not explain why
religion alone must bear the burden of the ordinances, when many of these
secular killings fall within the city&s interest in preventing the cruel treatment
of animals.
The -ordinances are also underinclusive with regard to the city&s interest in
public health., which is threatened by the disposal of animal carcasses in
open public places and the consumption of uninspected meat, see @rief for
!espondent 50, citing #05 ,.Supp., at 1*#*$1*#/, 1*"/. >either interest is
pursued by respondent with regard to conduct that is not motivated by
religious conviction. The health risks posed by the improper disposal of
animal carcasses are the same whether Santeria sacrifice or some
nonreligious killing preceded it. The city does not, however, prohibit hunters
from bringing their kill to their houses, nor does it regulate disposal after
their activity. 7espite substantial testimony at trial that the same public
health ha2ards result from improper disposal of garbage by restaurants, see
11 !ecord /%%, -/+" U.S. /0+, /*/. /4+$/41, restaurants are outside the
scope of the ordinances. <mproper disposal is a general problem that causes
substantial health risks, #05 ,.Supp., at 1*"/, but which respondent
addresses only when it results from religious exercise.
The ordinances are underinclusive as well with regard to the health risk
posed by consumption of uninspected meat. Under the city&s ordinances,
hunters may eat their kill and fishermen may eat their catch without
undergoing governmental inspection. Hikewise, state law reBuires inspection
of meat that is sold, but exempts meat from animals raised for the use of the
owner and 'members of his household and nonpaying guests and
employees.' ,la.Stat. /"/.""91:9a: 91441:. The asserted interest in inspected
meat is not pursued in contexts similar to that of religious animal sacrifice.
)rdinance "#$#0, which prohibits the slaughter of animals outside of areas
2oned for slaughterhouses, is underinclusive on its face. The ordinance
includes an exemption for 'any person, group, or organi2ation' that
'slaughters or processes for sale, small numbers of hogs and3or cattle per
week in accordance with an exemption provided by state law.' See ,la.Stat.
"0".0*95: 91441:. !espondent has not explained why commercial operations
that slaughter 'small numbers' of hogs and cattle do not implicate its
professed desire to prevent cruelty to animals and preserve the public health.
lthough the city has classified Santeria sacrifice as slaughter, sub8ecting it
to this ordinance, it does not regulate other killings for food in like manner.
Ge conclude, in sum, that each of Cialeah&s ordinances pursues the city&s
governmental interests only against conduct motivated by religious belief.
The ordinances 'ha-ve. every appearance of a prohibition that society is
prepared to impose upon -Santeria worshippers., but not upon itself.'
,lorida Star v. @.;.,., *41 U.S. /0*, /*0 914"4: 9SCH<, ;., concurring in
part and concurring in -/+" U.S. /0+, /*%. 8udgment:. This precise evil is
what the reBuirement of general applicability is designed to prevent.
III
- law burdening religious practice that is not neutral or not of general
application must undergo the most rigorous of scrutiny.. To satisfy the
commands of the ,irst mendment, a law restrictive of religious practice
must advance 'Minterests of the highest order,&' and must be narrowly
tailored in pursuit of those interests. Ec7aniel v. Paty, *5/ U.S., at %0" ,
Buoting Gisconsin v. ?oder, *+% U.S. 0+/, 01/ 914#0:. The compelling
interest standard that we apply once a law fails to meet the Smith
reBuirements is not 'water-ed. . . . down' but 'really means what it says.'
6mployment 7iv., 7ept. of Cuman !esources of )re. v. Smith, *4* U.S., at
""" . law that targets religious conduct for distinctive treatment or
advances legitimate governmental interests only against conduct with a
religious motivation will survive strict scrutiny only in rare cases. <t follows
from what we have already said that these ordinances cannot withstand this
scrutiny.
,irst, even were the governmental interests compelling, the ordinances are
not drawn in narrow terms to accomplish those interests. s we have
discussed, see supra, at /5"$/*+, /*5$/*%, all four ordinances are overbroad
or underinclusive in substantial respects. The proffered ob8ectives are not
pursued with respect to analogous nonreligious conduct, and those interests
could be achieved by narrower ordinances that burdened religion to a far
lesser degree. The absence of narrow tailoring suffices to establish the
invalidity of the ordinances. See rkansas Griters& Pro8ect, <nc. v. !agland,
*"1 U.S. 001, 050 914"#:.
!espondent has not demonstrated, moreover, that, in the context of these
ordinances, its governmental interests are compelling. Ghere government
restricts only conduct protected by the ,irst mendment and fails to enact
feasible -/+" U.S. /0+, /*#. measures to restrict other conduct producing
substantial harm or alleged harm of the same sort, the interest given in
8ustification of the restriction is not compelling. <t is established in our strict
scrutiny 8urisprudence that 'a law cannot be regarded as protecting an
interest 'of the highest order' . . . when it leaves appreciable damage to that
supposedly vital interest unprohibited.' ,lorida Star v. @.;.,., supra, at /*1$
/*0 9SCH<, ;., concurring in part and concurring in 8udgment: 9citation
omitted:. See Simon K Schuster, <nc. v. Eembers of >.?. State Crime Aictims
@d., /+0 U.S. 1+/, 114 $10+ 91441:. Cf. ,lorida Star v. @.;.,., supra, at /*+$
/*1( Smith v. 7aily Eail Publishing Co., **5 U.S. 4#, 1+* $1+/ 914#4:( id., at
11+ 9!6C>FU<ST, ;., concurring in 8udgment:. s we show above, see
supra, at /*5$/*%, the ordinances are underinclusive to a substantial extent
with respect to each of the interests that respondent has asserted, and it is
only conduct motivated by religious conviction that bears the weight of the
governmental restrictions. There can be no serious claim that those interests
8ustify the ordinances.
I!
The ,ree 6xercise Clause commits government itself to religious tolerance,
and upon even slight suspicion that proposals for state intervention stem
from animosity to religion or distrust of its practices, all officials must pause
to remember their own high duty to the Constitution and to the rights it
secures. Those in office must be resolute in resisting importunate demands
and must ensure that the sole reasons for imposing the burdens of law and
regulation are secular. Hegislators may not devise mechanisms, overt or
disguised, designed to persecute or oppress a religion or its practices. The
laws here in Buestion were enacted contrary to these constitutional
principles, and they are void.
!eversed.
,n -/+" U.S. /0+, /05. TC6 CC<6, ;UST<C6, ;UST<C6 SCH<, and
;UST<C6 TC)ES 8oin all but Part <<$$0 of this opinion. ;UST<C6 GC<T6
8oins all but Part <<$ of this opinion. ;UST<C6 S)UT6! 8oins only Parts 1,
<<<, and <A of this opinion. -/+" U.S. /0+, /*".
PP6>7<O T) )P<><)> ), TC6 C)U!T
City of Cialeah, ,lorida, !esolution >o. "#$%%, adopted ;une 4, 14"#,
providesD
'GC6!6S, residents and citi2ens of the City of Cialeah have
expressed their concern that certain religions may propose to
engage in practices which are inconsistent with public morals,
peace or safety, and
'GC6!6S, the ,lorida Constitution, rticle <, 7eclaration of
!ights, Section 5, !eligious ,reedom, specifically states that
religious freedom shall not 8ustify practices inconsistent with public
morals, peace or safety.
'>)G, TC6!6,)!6, @6 <T !6S)HA67 @? TC6 E?)! >7
C<T? C)U>C<H ), TC6 C<T? ), C<H6C, ,H)!<7, thatD
'1. The City reiterates its commitment to a prohibition against any
and all acts of any and all religious groups which are inconsistent
with public morals, peace or safety.
City of Cialeah, ,lorida, )rdinance >o. "#$*+, adopted ;une 4, 14"#,
providesD
'GC6!6S, the citi2ens of the City of Cialeah, ,lorida, have
expressed great concern over the potential for animal sacrifices
being conducted in the City of Cialeah( and
'GC6!6S, Section "0".0#, ,lorida Statutes, provides that
Mnothing contained in this section shall prevent any county or
municipality from enacting any ordinance relating to animal control
or cruelty to animals which is identical to the provisions of this
Chapter . . . except as to penalty.&
'>)G, TC6!6,)!6, @6 <T )!7<>67 @? TC6 E?)! >7
C<T? C)U>C<H ), TC6 C<T? ), C<H6C, ,H)!<7, thatD -/+"
U.S. /0+, /*4.
'Section 1. The Eayor and City Council of the City of Cialeah,
,lorida, hereby adopt ,lorida Statute, Chapter "0" $ 'Cruelty to
nimals' 9copy attached hereto and made a part hereof:, in its
entirety 9relating to animal control or cruelty to animals:, except as
to penalty.
'Section 0. !epeal of )rdinances in Conflict.
'll ordinances or parts of ordinances in conflict herewith are
hereby repealed to the extent of such conflict.
'Section 5. Penalties.
'ny person, firm or corporation convicted of violating the
provisions of this ordinance shall be punished by a fine, not
exceeding L/++.++, or by a 8ail sentence, not exceeding sixty 9%+:
days, or both, in the discretion of the Court.
'Section *. <nclusion in Code.
'The provisions of this )rdinance shall be included and
incorporated in the Code of the City of Cialeah, as an addition or
amendment thereto, and the sections of this )rdinance shall be
renumbered to conform to the uniform numbering system of the
Code.
'Section /. Severability Clause.
'<f any phrase, clause, sentence, paragraph or section of this
)rdinance shall be declared invalid or unconstitutional by the 8udge
or decree of a court of competent 8urisdiction, such invalidity or
unconstitutionality shall not affect any of the remaining phrases,
clauses, sentences, paragraphs or sections of this ordinance.
'Section %. 6ffective 7ate.
'This )rdinance shall become effective when passed by the City
Council of the City of Cialeah and signed by the Eayor of the City of
Cialeah.'
City of Cialeah !esolution >o. "#$4+, adopted ugust 11, 14"#, providesD
'GC6!6S, the residents and citi2ens of the City of Cialeah,
,lorida, have expressed great concern regarding -/+" U.S. /0+,
//+. the possibility of public ritualistic animal sacrifices in the City
of Cialeah, ,lorida( and
'GC6!6S, the City of Cialeah, ,lorida, has received an opinion
from the ttorney Ieneral of the State of ,lorida concluding that
public ritualistic animal sacrifices is -sic. a violation of the ,lorida
State Statute on Cruelty to nimals( and
'GC6!6S, the ttorney Ieneral further held that the sacrificial
killing of animals other than for the primary purpose of food
consumption is prohibited under state law( and
'GC6!6S, the City of Cialeah, ,lorida, has enacted an ordinance
mirroring state law prohibiting cruelty to animals.
'>)G, TC6!6,)!6, @6 <T !6S)HA67 @? TC6 E?)! >7
C<T? C)U>C<H ), TC6 C<T? ), C<H6C, ,H)!<7, thatD
'Section 1. <t is the policy of the Eayor and City Council of the City
of Cialeah, ,lorida, to oppose the ritual sacrifices of animals within
the City of Cialeah, ,Horida -sic.. ny individual or organi2ation
that seeks to practice animal sacrifice in violation of state and local
law will be prosecuted.'
City of Cialeah, ,lorida, )rdinance >o. "#$/0, adopted September ", 14"#,
providesD
'GC6!6S, the residents and citi2ens of the City of Cialeah,
,lorida, have expressed great concern regarding the possibility of
public ritualistic animal sacrifices within the City of Cialeah,
,lorida( and
'GC6!6S, the City of Cialeah, ,lorida, has received an opinion
from the ttorney Ieneral of the State of ,lorida, concluding that
public ritualistic animal sacrifice, other than for the primary
purpose of food consumption, is a violation of state law( and -/+"
U.S. /0+, //1.
'GC6!6S, the City of Cialeah, ,lorida, has enacted an ordinance
9)rdinance >o. "#$*+:, mirroring the state law prohibiting cruelty
to animals.
'GC6!6S, the City of Cialeah, ,lorida, now wishes to specifically
prohibit the possession of animals for slaughter or sacrifice within
the City of Cialeah, ,lorida.
'>)G, TC6!6,)!6, @6 <T )!7<>67 @? TC6 E?)! >7
C<T? C)U>C<H ), TC6 C<T? ), C<H6C, ,H)!<7, thatD
'Section 1. Chapter % of the Code of )rdinances of the City of
Cialeah, ,lorida, is hereby amended by adding thereto two 90: new
Sections %$" '7efinitions' and %$4 'Prohibition gainst Possession
)f nimals ,or Slaughter )r Sacrifice,' which is to read as followsD
'Section %$". 7efinitions
'1. nimal $ any living dumb creature.
'0. Sacrifice $ to unnecessarily kill, torment, torture, or mutilate an
animal in a public or private ritual or ceremony not for the primary
purpose of food consumption.
'5. Slaughter $ the killing of animals for food.
'Section %$4. Prohibition gainst Possession of nimals for
Slaughter )r Sacrifice.
'1. >o person shall own, keep or otherwise possess, sacrifice, or
slaughter any sheep, goat, pig, cow or the young of such species,
poultry, rabbit, dog, cat, or any other animal, intending to use such
animal for food purposes.
'0. This section is applicable to any group or individual that kills,
slaughters or sacrifices animals for any type of ritual, regardless of
whether or not the flesh or blood of the animal is to be consumed.
'5. >othing in this ordinance is to be interpreted as prohibiting any
licensed establishment from slaughtering for food purposes any
animals which are specifically -/+" U.S. /0+, //0. raised for food
purposes where such activity is properly 2oned and3or permitted
under state and local law and under rules promulgated by the
,lorida 7epartment of griculture.
'Section 0. !epeal of )rdinance in Conflict.
'll ordinances or parts of ordinances in conflict herewith are
hereby repealed to the extent of such conflict.
'Section 5. Penalties.
'ny person, firm or corporation convicted of violating the
provisions of this ordinance shall be punished by a fine, not
exceeding L/++.++, or by a 8ail sentence, not exceeding sixty 9%+:
days, or both, in the discretion of the Court.
'Section *. <nclusion in Code.
'The provisions of this )rdinance shall be included and
incorporated in the Code of the City of Cialeah, as an addition or
amendment thereto, and the sections of this )rdinance shall be
renumbered to conform to the uniform numbering system of the
Code.
'Section /. Severability Clause.
'<f any phrase, clause, sentence, paragraph or section of this
)rdinance shall be declared invalid or unconstitutional by the
8udgement or decree of a court of competent 8urisdiction, such
invalidity or unconstitutionality shall not effect any of the
remaining phrases, clauses, sentences, paragraphs or sections of
this ordinance.
'Section %. 6ffective 7ate.
'This )rdinance shall become effective when passed by the City
Council of the City of Cialeah and signed by the Eayor of the City of
Cialeah.'
City of Cialeah, ,lorida, )rdinance >o. "#$#1, adopted September 00, 14"#,
providesD
'GC6!6S, the City Council of the City of Cialeah, ,lorida, has
determined that the sacrificing of animals -/+" U.S. /0+, //5.
within the city limits is contrary to the public health, safety, welfare
and morals of the community( and
'GC6!6S, the City Council of the City of Cialeah, ,lorida, desires
to have Bualified societies or corporations organi2ed under the laws
of the State of ,lorida, to be authori2ed to investigate and prosecute
any violation9s: of the ordinance herein after set forth, and for the
registration of the agents of said societies.
'>)G, TC6!6,)!6, @6 <T )!7<>67 @? TC6 E?)! >7
C<T? C)U>C<H ), TC6 C<T? ), C<H6C, ,H)!<7, thatD
'Section 1. ,or the purpose of this ordinance, the word sacrifice
shall meanD to unnecessarily kill, torment, torture, or mutilate an
animal in a public or private ritual or ceremony not for the primary
purpose of food consumption.
'Section 0. ,or the purpose of this ordinance, the word animal shall
meanD any living dumb creature.
'Section 5. <t shall be unlawful for any person, persons,
corporations or associations to sacrifice any animal within the
corporate limits of the City of Cialeah, ,lorida.
'Section *. ll societies or associations for the prevention of cruelty
to animals organi2ed under the laws of the State of ,lorida, seeking
to register with the City of Cialeah for purposes of investigating and
assisting in the prosecution of violations and provisions -sic. of this
)rdinance, shall apply to the City Council for authori2ation to so
register and shall be registered with the )ffice of the Eayor of the
City of Cialeah, ,lorida, following approval by the City Council at a
public hearing in accordance with rules and regulations 9i.e.,
criteria: established by the City Council by resolution, and shall
thereafter, be empowered to assist in the prosecution of any
violation of this )rdinance. -/+" U.S. /0+, //*.
'Section /. ny society or association for the prevention of cruelty
to animals registered with the Eayor of the City of Cialeah, ,lorida,
in accordance with the provisions of Section * hereinabove, may
appoint agents for the purposes of investigating and assisting in the
prosecution of violations and provisions -sic. of this )rdinance, or
any other laws of the City of Cialeah, ,lorida, for the purpose of
protecting animals and preventing any act prohibited hereunder.
'Section %. !epeal of )rdinances in Conflict.
'll ordinances or parts of ordinances in conflict herewith are
hereby repealed to the extent of such conflict.
'Section #. Penalties.
'ny person, firm or corporation convicted of violating the
provisions of this ordinance shall be punished by a fine, not
exceeding L/++.++, or by a 8ail sentence, not exceeding sixty 9%+:
days, or both, in the discretion of the Court.
'Section ". <nclusion in Code.
'The provisions of this )rdinance shall be included and
incorporated in the Code of the City of Cialeah, as an addition or
amendment thereto, and the sections of this )rdinance shall be
renumbered to conform to the uniform numbering system of the
Code.
'Section 4. Severability Clause.
'<f any phrase, clause, sentence, paragraph or section of this
)rdinance shall be declared invalid or unconstitutional by the
8udgment or decree of a court of competent 8urisdiction, such
invalidity or unconstitutionality shall not effect any of the
remaining phrases, clauses, sentences, paragraphs or sections of
this )rdinance.
'Section 1+. 6ffective 7ate.
'This )rdinance shall become effective when passed by the City
Council of the City of Cialeah and signed by the Eayor of the City of
Cialeah.' -/+" U.S. /0+, ///.
City of Cialeah, ,lorida, )rdinance >o. "#$#0, adopted September 00, 14"#,
providesD
'GC6!6S, the City Council of the City of Cialeah, ,lorida, has
determined that the slaughtering of animals on the premises other
than those properly 2oned as a slaughter house, is contrary to the
public health, safety and welfare of the citi2ens of Cialeah, ,lorida.
'>)G, TC6!6,)!6, @6 <T )!7<>67 @? TC6 E?)! >7
C<T? C)U>C<H ), TC6 C<T? ), C<H6C, ,H)!<7, thatD
'Section 1. ,or the purpose of this )rdinance, the word slaughter
shall meanD the killing of animals for food.
'Section 0. ,or the purpose of this )rdinance, the word animal shall
meanD any living dumb creature.
'Section 5. <t shall be unlawful for any person, persons,
corporations or associations to slaughter any animal on any
premises in the City of Cialeah, ,lorida, except those properly
2oned as a slaughter house, and meeting all the health, safety and
sanitation codes prescribed by the City for the operation of a
slaughter house.
'Section *. ll societies or associations for the prevention of cruelty
to animals organi2ed under the laws of the State of ,lorida, seeking
to register with the City of Cialeah for purposes of investigating and
assisting in the prosecution of violations and provisions -sic. of this
)rdinance, shall apply to the City Council for authori2ation to so
register and shall be registered with the )ffice of the Eayor of the
City of Cialeah, ,lorida, following approval by the City Council at a
public hearing in accordance with rules and regulations 9i.e.,
criteria: established by the City Council by resolution, and shall
thereafter, be empowered to assist in the prosecution of any
violations of this )rdinance. -/+" U.S. /0+, //%.
'Section /. ny society or association for the prevention of cruelty
to animals registered with the Eayor of the City of Cialeah, ,lorida,
in accordance with the provisions of Section * hereinabove, may
appoint agents for the purposes of investigating and assisting in the
prosecution of violations and provisions -sic. of this )rdinance, or
any other laws of the City of Cialeah, ,lorida, for the purpose of
protecting animals and preventing any act prohibited hereunder.
'Section %. This )rdinance shall not apply to any person, group, or
organi2ation that slaughters, or processes for sale, small numbers of
hogs and3or cattle per week in accordance with an exemption
provided by state law.
'Section #. !epeal of )rdinances in Conflict.
'll ordinances or parts of ordinances in conflict herewith are
hereby repealed to the extent of such conflict.
'Section ". Penalties.
'ny person, firm or corporation convicted of violating the
provisions of this ordinance shall be punished by a fine, not
exceeding L/++.++, or by a 8ail sentence, not exceeding sixty 9%+:
days, or both, in the discretion of the Court.
'Section 4. <nclusion in Code.
'The provisions of this )rdinance shall be included and
incorporated in the Code of the City of Cialeah, as an addition or
amendment thereto, and the sections of this )rdinance shall be
renumbered to conform to the uniform numbering system of the
Code.
'Section 1+. Severability Clause.
'<f any phrase, clause, sentence, paragraph or section of this
)rdinance shall be declared invalid or unconstitutional by the
8udgment or decree of a court of competent 8urisdiction, such
invalidity or unconstitutionality shall not effect any of the
remaining phrases, clauses, sentences, paragraphs or sections of
this ordinance. -/+" U.S. /0+, //#.
'Section 11. 6ffective 7ate.
'This )rdinance shall become effective when passed by the City
Council of the City of Cialeah and signed by the Eayor of the City of
Cialeah.
- ,ootnote J . !espondent advances the additional governmental interest in
prohibiting the slaughter or sacrifice of animals in areas of the city not 2oned
for slaughterhouses, see @rief for !espondent 0"$51, and the 7istrict court
found this interest to be compelling, see #05 ,.Supp. 1*%#, 1*"% 9S7 ,la.
14"4:. This interest cannot 8ustify )rdinances "#$*+, "#$/0, and "#$#1, for
they apply to conduct without regard to where it occurs. )rdinance "#$#0
does impose a locational restriction, but this asserted governmental interest
is a mere restatement of the prohibition itself, not a 8ustification for it. <n our
discussion, therefore we put aside this asserted interest.
;UST<C6 SCH<, with whom TC6 CC<6, ;UST<C6 8oins, concurring in
part and concurring in the 8udgment.
The Court analy2es the 'neutrality' and the 'general applicability' of the
Cialeah ordinances in separate sections 9Parts <<$ and <<$@, respectively:,
and allocates various invalidating factors to one or the other of those
sections. <f it were necessary to make a clear distinction between the two
terms, < would draw a line somewhat different from the Court&s. @ut < think it
is not necessary, and would frankly acknowledge that the terms are not only
'interrelated,' ante /51, but substantially overlap.
The terms 'neutrality' and 'general applicability' are not to be found within
the ,irst mendment itself, of course, but are used in 6mployment 7iv.,
7ept. of Cuman !esources of )re. v. Smith, *4* U.S. "#0 9144+:, and earlier
cases to describe those characteristics which cause a law that prohibits an
activity a particular individual wishes to engage in for religious reasons
nonetheless not to constitute a 'law . . . prohibiting the free exercise' of
religion within the meaning of the ,irst mendment. <n my view, the defect
of lack of neutrality applies primarily to those laws that by their terms
impose disabilities on the basis of religion 9e.g., a law excluding members of
a certain sect from public benefits, cf. Ec7aniel v. Paty, *5/ U.S. %1"
914#"::, see @owen v. !oy, *#% U.S. %45, #+5 $#+* 914"%: 9opinion of @urger,
C.;.:( whereas the defect of lack of general applicability applies primarily to
those laws which, though neutral in their terms, through their design,
construction, or enforcement target the practices of a particular religion for
discriminatory treatment, see ,owler v. !hode <sland, 5*/ U.S. %# 914/5:.
@ut certainly a law that is not of general applicability 9in the sense -/+" U.S.
/0+, //". < have described: can be considered 'nonneutral'( and certainly
no law that is nonneutral 9in the relevant sense: can be thought to be of
general applicability. @ecause < agree with most of the invalidating factors set
forth in Part << of the Court&s opinion, and because it seems to me a matter of
no conseBuence under which rubric 9'neutrality,' Part <<$, or 'general
applicability,' Part <<$@: each invalidating factor is discussed, < 8oin the
8udgment of the Court and all of its opinion except 0 section 0 of Part <<$.
< do not 8oin that section, because it departs from the opinion&s general focus
on the ob8ect of the laws at issue to consider the sub8ective motivation of the
lawmakers, i.e., whether the Cialeah City Council actually intended to
disfavor the religion of Santeria. s < have noted elsewhere, it is virtually
impossible to determine the singular 'motive' of a collective legislative body,
see, e.g., 6dwards v. guillard, *"0 U.S. /#", %5% $%54 914"#: 9dissenting
opinion:, and this Court has a long tradition of refraining from such
inBuiries, see, e.g., ,letcher v. Peck, % Cranch "#, 15+$151 91"1+: 9Earshall,
C.;.:( United States v. )&@rien, 541 U.S. 5%#, 5"5 $5"* 914%":.
Perhaps there are contexts in which determination of legislative motive must
be undertaken. See, e.g., United States v. Hovett, 50" U.S. 5+5 914*%:. @ut <
do not think that is true of analysis under the ,irst mendment 9or the
,ourteenth, to the extent it incorporates the ,irst:. See 6dwards v. guillard,
supra, at %54 9SCH<, ;., dissenting:. The ,irst mendment does not refer
to the purposes for which legislators enact laws, but to the effects of the laws
enactedD 'Congress shall make no law . . . prohibiting the free exercise -of
religion.. . . .' This does not put us in the business of invalidating laws by
reason of the evil motives of their authors. Cad the Cialeah City Council set
out resolutely to suppress the practices of Santeria, but ineptly adopted
ordinances that failed to do so, < do not see how those laws could be said to
'prohibi-t. the free exercise' of religion. -/+" U.S. /0+, //4. >or, in my
view, does it matter that a legislature consists entirely of the purehearted, if
the law it enacts in fact singles out a religious practice for special burdens.
Cad the ordinances here been passed with no motive on the part of any
councilman except the ardent desire to prevent cruelty to animals 9as might
in fact have been the case:, they would nonetheless be invalid.
;UST<C6 S)UT6!, concurring in part and concurring in the 8udgment.
This case turns on a principle about which there is no disagreement, that the
,ree 6xercise Clause bars government action aimed at suppressing religious
belief or practice. The Court holds that Cialeah&s animal sacrifice laws violate
that principle, and < concur in that holding without reservation.
@ecause prohibiting religious exercise is the ob8ect of the laws at hand, this
case does not present the more difficult issue addressed in our last free
exercise case, 6mployment 7iv., 7ept. of Cuman !esources of )re. v. Smith,
*4* U.S. "#0 9144+:, which announced the rule that a 'neutral, generally
applicable' law does not run afoul of the ,ree 6xercise Clause even when it
prohibits religious exercise in effect. The Court today refers to that rule in
dicta, and, despite my general agreement with the Court&s opinion, < do not
8oin Part <<, where the dicta appear, for < have doubts about whether the
Smith rule merits adherence. < write separately to explain why the Smith rule
is not germane to this case, and to express my view that, in a case presenting
the issue, the Court should reexamine the rule Smith declared.
I
ccording to Smith, if prohibiting the exercise of religion results from
enforcing a 'neutral, generally applicable' law, the ,ree 6xercise Clause has
not been offended. <d., at "#"$""+. < call this the Smith rule to distinguish it
from the noncontroversial principle, also expressed in Smith, though -/+"
U.S. /0+, /%+. established long before, that the ,ree 6xercise Clause is
offended when prohibiting religious exercise results from a law that is not
neutral or generally applicable. <t is this noncontroversial principle, that the
,ree 6xercise Clause reBuires neutrality and general applicability, that is at
issue here. @ut before turning to the relationship of Smith to this case, it will
help to get the terms in order, for the significance of the Smith rule is not
only in its statement that the ,ree 6xercise Clause reBuires no more than
'neutrality' and 'general applicability,' but also in its adoption of a
particular, narrow conception of free exercise neutrality.
That the ,ree 6xercise Clause contains a 'reBuirement for governmental
neutrality,' Gisconsin v. ?oder, *+% U.S. 0+/, 00+ 914#0:, is hardly a novel
proposition( though the term does not appear in the ,irst mendment, our
cases have used it as shorthand to describe, at least in part, what the Clause
commands. See, e.g., ;immy Swaggart Einistries v. @oard of 6Buali2ation of
Cal., *45 U.S. 5#", 5"* 9144+:( Thomas v. !eview @d. of <ndiana
6mployment Security 7iv., */+ U.S. #+#, #1# 914"1:( ?oder, supra, at 00+(
Committee for Public 6d. K !eligious Hiberty v. >yBuist, *15 U.S. #/%, #40
$#45 914#5:( School 7ist. of bington v. Schempp, 5#* U.S. 0+5, 000 914%5:(
see also Ec7aniel v. Paty, *5/ U.S. %1", %0# $%04 914#": 9plurality opinion:
9invalidating a non$neutral law without using the term:. >or is there
anything unusual about the notion that the ,ree 6xercise Clause reBuires
general applicability, though the Court, until today, has not used exactly that
term in stating a reason for invalidation. See ,owler v. !hode <sland, 5*/
U.S. %# 914/5:( cf. Einneapolis Star K Tribune Co. v. Einnesota Comm&r of
!evenue, *%+ U.S. /#/, /"/ 914"5:( Harson v. Aalente, */% U.S. 00", 0*/
$0*% 914"0:. 1 -/+" U.S. /0+, /%1.
Ghile general applicability is, for the most part, self$explanatory, free
exercise neutrality is not self$revealing. Cf. Hee v. Geisman, /+/ U.S. /##,
%0# 91440: 9S)UT6!, ;., concurring: 9considering 6stablishment Clause
neutrality:. law that is religion neutral on its face or in its purpose may lack
neutrality in its effect by forbidding something that religion reBuires or
reBuiring something that religion forbids. Cf. EcConnell K Posner, n
6conomic pproach to <ssues of !eligious ,reedom, /% U.Chi.H.!ev. 1, 5/
914"4: 9' regulation is not neutral in an economic sense if, whatever its
normal scope or its intentions, it arbitrarily imposes greater costs on
religious than on comparable nonreligious activities':. secular law,
applicable to all, that prohibits consumption of alcohol, for example, will
affect members of religions that reBuire the use of wine differently from
members of other religions and nonbelievers, disproportionately burdening
the practice of, say, Catholicism or ;udaism. Githout an exemption for
sacramental wine, Prohibition may fail the test of religion neutrality. 0
<t does not necessarily follow from that observation, of course, that the ,irst
mendment reBuires an exemption from Prohibition( that depends on the
meaning of neutrality as the ,ree 6xercise Clause embraces it. The point here
is the unremarkable one that our common notion of neutrality is broad
enough to cover not merely what might be called formal neutrality, which, as
a free exercise reBuirement, would -/+" U.S. /0+, /%0. only bar laws with
an ob8ect to discriminate against religion, but also what might be called
substantive neutrality, which, in addition to demanding a secular ob8ect,
would generally reBuire government to accommodate religious differences by
exempting religious practices from formally neutral laws. See generally
Haycock, ,ormal, Substantive, and 7isaggregated >eutrality Toward
!eligion, 54 7ePaul H.!ev. 445 9144+:. <f the ,ree 6xercise Clause secures
only protection against deliberate discrimination, a formal reBuirement will
exhaust the Clause&s neutrality command( if the ,ree 6xercise Clause, rather,
safeguards a right to engage in religious activity free from unnecessary
governmental interference, the Clause reBuires substantive, as well as
formal, neutrality. 5
Though Smith used the term 'neutrality' without a modifier, the rule it
announced plainly assumes that free exercise neutrality is of the formal sort.
7istinguishing between laws whose 'ob8ect' is to prohibit religious exercise
and those that prohibit religious exercise as an 'incidental effect,' Smith
placed only the former within the reaches of the ,ree 6xercise Clause( the
latter, laws that satisfy formal neutrality, Smith would sub8ect to no free
exercise scrutiny at all, even when they prohibit religious exercise in
application. *4* U.S., at "#" . The four ;ustices who re8ected the Smith rule,
by contrast, read the ,ree 6xercise Clause as embracing what < have termed
substantive neutrality. The enforcement of a law 'neutral on its face,' they
said, may 'nonetheless offend -the ,ree 6xercise Clause&s. reBuirement for
-/+" U.S. /0+, /%5. government neutrality if it unduly burdens the free
exercise of religion.' <d., at "4% 9opinion of )&C)>>)!, ;., 8oined by
@rennan, Earshall, and @HC=EU>, ;;.: 9internal Buotation marks and
citations omitted:. The rule these ;ustices saw as flowing from free exercise
neutrality, in contrast to the Smith rule, 'reBuir-es. the government to 8ustify
any substantial burden on religiously motivated conduct by a compelling
state interest and by means narrowly tailored to achieve that interest.' <d., at
"4* 9emphasis added:.
The proposition for which the Smith rule stands, then, is that formal
neutrality, along with general applicability, are sufficient conditions for
constitutionality under the ,ree 6xercise Clause. That proposition is not at
issue in this case, however, for Cialeah&s animal sacrifice ordinances are not
neutral under any definition, any more than they are generally applicable.
This case, rather, involves the noncontroversial principle, repeated in Smith,
that formal neutrality and general applicability are necessary conditions for
free exercise constitutionality. <t is only 'this fundamental nonpersecution
principle of the ,irst mendment -that is. implicated here,' ante, at /05, and
it is to that principle that the Court adverts when it holds that Cialeah&s
ordinances 'fail to satisfy the Smith reBuirements,' ante, at /05. <n applying
that principle, the Court does not tread on troublesome ground.
<n considering, for example, whether Cialeah&s animal sacrifice laws violate
free exercise neutrality, the Court rightly observes that, '-a.t a minimum, the
protections of the ,ree 6xercise Clause pertain if the law at issue
discriminates against some or all religious beliefs or regulates or prohibits
conduct because it is undertaken for religious reasons,' ibid., and correctly
finds Cialeah&s laws to fail those standards. The Buestion whether the
protections of the ,ree 6xercise Clause also pertain if the law at issue,
though nondiscriminatory in its ob8ect, has the effect nonetheless of placing
a burden on religious exercise is not before the Court -/+" U.S. /0+, /%*.
today, and the Court&s intimations on the matter are therefore dicta.
The Court also rightly finds Cialeah&s laws to fail the test of general
applicability, and as the Court 'need not define with precision the standard
used to evaluate whether a prohibition is of general application, for these
ordinances fall well below the minimum standard necessary to protect ,irst
mendment rights,' ante, at /*5, it need not discuss the rules that apply to
prohibitions found to be generally applicable. The Buestion whether 'there
are areas of conduct protected by the ,ree 6xercise Clause of the ,irst
mendment and thus beyond the power of the State to control, even under
regulations of general applicability,' ?oder, *+% U.S., at 00+ , is not before
the Court in this case, and, again, suggestions on that score are dicta.
II
<n being so readily susceptible to resolution by applying the ,ree 6xercise
Clause&s 'fundamental nonpersecution principle,' ante, at /05, this is far
from a representative free$exercise case. Ghile, as the Court observes, the
Cialeah City Council has provided a rare example of a law actually aimed at
suppressing religious exercise, ibid., Smith was typical of our free exercise
cases, involving as it did a formally neutral, generally applicable law. The
rule Smith announced, however, was decidedly untypical of the cases
involving the same type of law. @ecause Smith left those prior cases standing,
we are left with a free$exercise 8urisprudence in tension with itself, a tension
that should be addressed, and that may legitimately be addressed, by
reexamining the Smith rule in the next case that would turn upon its
application.
A
<n developing standards to 8udge the enforceability of formally neutral,
generally applicable laws against the mandates of the ,ree 6xercise Clause,
the Court has addressed -/+" U.S. /0+, /%/. the concepts of neutrality and
general applicability by indicating, in language hard to read as not
foreclosing the Smith rule, that the ,ree 6xercise Clause embraces more than
mere formal neutrality, and that formal neutrality and general applicability
are not sufficient conditions for free exercise constitutionalityD
'<n a variety of ways, we have said that M-a. regulation neutral on its
face may, in its application, nonetheless offend the constitutional
reBuirement for governmental neutrality if it unduly burdens the
free exercise of religion.&' Thomas, */+ U.S., at #1# 9Buoting ?oder,
*+% U.S., at 00+ :
'-T.o agree that religiously grounded conduct must often be sub8ect
to the broad police power of the State is not to deny that there are
areas of conduct protected by the ,ree 6xercise Clause of the ,irst
mendment, and thus beyond the power of the State to control,
even under regulations of general applicability.' <bid.
>ot long before the Smith decision, indeed, the Court specifically re8ected
the argument that 'neutral and uniform' reBuirements for governmental
benefits need satisfy only a reasonableness standard, in part because '-s.uch
a test has no basis in precedent.' Cobbie v. Unemployment ppeals Comm&n
of ,lorida, *"+ U.S. 15%, 1*1 914"#: 9internal Buotation marks and citations
omitted:. !ather, we have said, '-o.ur cases have established that M-t.he free
exercise inBuiry asks whether government has placed a substantial burden
on the observation of a central religious belief or practice and, if so, whether
a compelling governmental interest 8ustifies the burden.&' Swaggart
Einistries, *45 U.S., at 5"* $5"/ 9Buoting Cernande2 v. Commissioner, *4+
U.S. %"+, %44 914"4::.
Thus, we have applied the same rigorous scrutiny to burdens on religious
exercise resulting from the enforcement of formally neutral, generally
applicable laws as we have applied to burdens caused by laws that single out
religious -/+" U.S. /0+, /%%. exerciseD 'Monly those interests of the highest
order and those not otherwise served can overbalance legitimate claims to
the free exercise of religion.&' Ec7aniel v. Paty, *5/ U.S., at %0" 9plurality
opinion: 9Buoting ?oder, supra, at 01/:. Compare Ec7aniel, supra, at %0"$
%04 9plurality opinion: 9applying that test to a law aimed at religious
conduct: with ?oder, supra, at 01/$004 9applying that test to a formally
neutral, general law:. )ther cases in which the Court has applied heightened
scrutiny to the enforcement of formally neutral, generally applicable laws
that burden religious exercise include Cernande2 v. Commissioner, supra, at
%44( ,ra2ee v. <llinois 7ept. of 6mployment Security, *"4 U.S. "04, "5/
914"4:( Cobbie v. Unemployment ppeals Comm&n, supra, at 1*1( @ob ;ones
Univ. v. United States, *%1 U.S. /#*, %+* 914"5:( United States v. Hee, *//
U.S. 0/0, 0/# $0/" 914"0:( Thomas, supra, at #1"( Sherbert v. Aerner, 5#*
U.S. 54", *+5 914%5:( and Cantwell v. Connecticut, 51+ U.S. 04%, 5+* $5+#
914*+:.
Though Smith sought to distinguish the free$exercise cases in which the
Court mandated exemptions from secular laws of general application, see
*4* U.S., at ""1 $""/, < am not persuaded. Gisconsin v. ?oder and Cantwell
v. Connecticut, according to Smith, were not true free$exercise cases, but
'hybrid-s.' involving 'the ,ree 6xercise Clause in con8unction with other
constitutional protections, such as freedom of speech and of the press, or the
right of parents . . . to direct the education of their children.' Smith, supra, at
""1, ""0. >either opinion, however, leaves any doubt that 'fundamental
claims of religious freedom -were. at stake.' ?oder, supra, at 001. See also
Cantwell, supra, at 5+5$5+#. * -/+" U.S. /0+, /%#. nd the distinction
Smith draws strikes me as ultimately untenable. <f a hybrid claim is simply
one in which another constitutional right is implicated, then the hybrid
exception would probably be so vast as to swallow the Smith rule, and,
indeed, the hybrid exception would cover the situation exemplified by Smith,
since free speech and associational rights are certainly implicated in the
peyote ritual. @ut if a hybrid claim is one in which a litigant would actually
obtain an exemption from a formally neutral, generally applicable law under
another constitutional provision, then there would have been no reason for
the Court in what Smith calls the hybrid cases to have mentioned the ,ree
6xercise Clause at all.
Smith sought to confine the remaining free exercise exemption victories,
which involved unemployment compensation -/+" U.S. /0+, /%". systems,
see ,ra2ee, supra( Cobbie v. Unemployment ppeals Comm&n of ,la. *"+
U.S. 15% 914"#:( Thomas v. !eview @d. of <ndiana 6mployment Security 7iv.,
*/+ U.S. #+# 914"1:( supra( and Sherbert, supra, as 'stand-ing. for the
proposition that where the State has in place a system of individual
exemptions, it may not refuse to extend that system to cases of 'religious
hardship' without compelling reason.' *4* U.S., at ""* . @ut prior to Smith,
the Court had already refused to accept that explanation of the
unemployment compensation cases. See Cobbie, supra, at 1*0, n. #( @owen
v. !oy, *#% U.S., at #1/ $#1% 9opinion of @HC=EU>, ;.:( id., at #0#$#50
9opinion of )&C)>>)!, ;., 8oined by @rennan and Earshall, ;;.:( id., at #55
9GC<T6, ;., dissenting:. nd, again, the distinction fails to exclude SmithD
'<f Smith is viewed as a hypothetical criminal prosecution for peyote use,
there would be an individual governmental assessment of the defendants&
motives and actions in the form of a criminal trial.' EcConnell, ,ree 6xercise
!evisionism and the Smith 7ecision, /# U.Chi.H.!ev. 11+4 110* 9144+:.
Smith also distinguished the unemployment compensation cases on the
ground that they did not involve 'an across$the$board criminal prohibition
on a particular form of conduct.' *4* U.S., at ""* . @ut even Chief ;ustice
@urger&s plurality opinion in @owen v. !oy, on which Smith drew for its
analysis of the unemployment compensation cases, would have applied its
reasonableness test only to 'denial of government benefits' and not to
'governmental action or legislation that criminali2es religiously inspired
activity or inescapably compels conduct that some find ob8ectionable for
religious reasons,' @owen v. !oy, supra, at #+% 9opinion of @urger, C.;.,
8oined by Powell and !6C>FU<ST, ;;.:( to the latter category of
governmental action, it would have applied the test employed in ?oder,
which involved an across$the$board criminal prohibition and which Chief
;ustice @urger&s opinion treated as an ordinary free$exercise -/+" U.S. /0+,
/%4. case. See @owen v. !oy, *#% U.S. at #+%$#+#( id., at #+/, n. 1/( ?oder,
*+% U.S., at 01" ( see also Ec7aniel v. Paty, *5/ U.S., at %0" , n. " 9noting
cases in which courts considered claims for exemptions from general
criminal prohibitions, cases the Court thought were 'illustrative of the
general nature of free exercise protections and the delicate balancing
reBuired by our decisions in -Sherbert and ?oder,. when an important state
interest is shown':.
s for the cases on which Smith primarily relied as establishing the rule it
embraced, !eynolds v. United States, 4" U.S. 1*/ 91"#4:, and Einersville
School 7ist. v. Iobitis, 51+ U.S. /"% 914*+:, see Smith, supra, at "#4, their
subseBuent treatment by the Court would seem to reBuire re8ection of the
Smith rule. !eynolds, which, in upholding the polygamy conviction of a
Eormon, stressed the evils it saw as associated with polygamy, see 4" U.S.,
at 1%% 9'polygamy leads to the patriarchal principle, and . . . fetters the
people in stationary despotism':( id., at 1%/, 1%", has been read as consistent
with the principle that religious conduct may be regulated by general or
targeting law only if the conduct 'pose-s. some substantial threat to public
safety, peace or order.' Sherbert v. Aerner, 5#* U.S., at *+5 ( see also United
States v. Hee, *// U.S., at 0/# $0/"( @ob ;ones University, *%1 U.S., at %+5 (
?oder, supra, at 05+. nd Iobitis, after three ;ustices who originally 8oined
the opinion renounced it for disregarding the government&s constitutional
obligation 'to accommodate itself to the religious views of minorities,' ;ones
v. )pelika, 51% U.S. /"*, %0* 914*0: 9opinion of @lack, 7ouglas, and Eurphy,
;;.:, was explicitly overruled in Gest Airginia @d. of 6d. v. @arnette, 514 U.S.
%0*, %*0 914*5:( see also id., at %*5$** 9@lack and 7ouglas, ;;., concurring:.
Since holding in 14*+ that the ,ree 6xercise Clause applies to the States, see
Cantwell v. Connecticut, 51+ U.S. 04% , the Court repeatedly has stated that
the Clause sets strict limits on the government&s power to burden religious
exercise, whether it is a law&s ob8ect to do so or its -/+" U.S. /0+, /#+.
unanticipated effect. Smith responded to these statements by suggesting that
the Court did not really mean what it said, detecting in at least the most
recent opinions a lack of commitment to the compelling interest test in the
context of formally neutral laws. Smith, supra, at ""*$""/. @ut even if the
Court&s commitment were that palid, it would argue only for moderating the
language of the test, not for eliminating constitutional scrutiny altogether. <n
any event, < would have trouble concluding that the Court has not meant
what it has said in more than a do2en cases over several decades, particularly
when, in the same period, it repeatedly applied the compelling$interest test
to reBuire exemptions, even in a case decided the year before Smith. See
,ra2ee v. <llinois 7ept. of 6mployment Security, *"4 U.S. "04 914"4:. / <n
sum, it seems to me difficult to escape -/+" U.S. /0+, /#1. the conclusion
that, whatever Smith&s virtues, they do not include a comfortable fit with
settled law.
B
The Smith rule, in my view, may be reexamined consistently with principles
of stare decisis. To begin with, the Smith rule was not sub8ect to 'full$dress
argument' prior to its announcement. Eapp v. )hio, 5%# U.S. %*5, %#% $%##
914%1: 9Carlan, ;., dissenting:. The State of )regon, in Smith, contended that
its refusal to exempt religious peyote use survived the strict scrutiny reBuired
by 'settled free exercise principles,' inasmuch as the State had 'a compelling
interest in regulating' the practice of peyote use and could not
'accommodate the religious practice without -/+" U.S. /0+, /#0.
compromising its interest.' @rief for Petitioners in Smith, ).T. 14"4, >o. ""$
1015, p. /( see also id. at /$5%( !eply @rief for Petitioners in Smith, pp. %$0+.
!espondents 8oined issue on the outcome of strict scrutiny on the facts
before the Court, see @rief for !espondents in Smith, pp. 1*$*1, and neither
party sBuarely addressed the proposition the Court was to embrace, that the
,ree 6xercise Clause was irrelevant to the dispute. Sound 8udicial
decisionmaking reBuires 'both a vigorous prosecution and a vigorous
defense' of the issues in dispute, Christiansburg Iarment Co. v. 66)C, *5*
U.S. *10, *14 914#":, and a constitutional rule announced sua sponte is
entitled to less deference than one addressed on full briefing and argument.
Cf. Hadner v. United States, 5/" U.S. 1%4, 1#5 914/": 9declining to address
'an important and complex' issue concerning the scope of collateral attack
upon criminal sentences because it had received 'only meagre argument'
from the parties, and the Court thought it 'should have the benefit of a full
argument before dealing with the Buestion':.
The Smith rule&s vitality as precedent is limited further by the seeming want
of any need of it in resolving the Buestion presented in that case. ;UST<C6
)&C)>>)! reached the same result as the ma8ority by applying, as the
parties had reBuested, 'our established free exercise 8urisprudence,' *4*
U.S., at 4+5 , and the ma8ority never determined that the case could not be
resolved on the narrower ground, going instead straight to the broader
constitutional rule. @ut the Court&s better practice, one supported by the
same principles of restraint that underlie the rule of stare decisis, is not to
'Mformulate a rule of constitutional law broader than is reBuired by the
precise facts to which it is to be applied.&' shwander v. TA, 04# U.S. 0"",
5*# 9145%: 9@randeis, ;., concurring: 9Buoting Hiverpool, >ew ?ork K
Philadelphia S.S. Co. v. Commissioners of 6migration, 115 U.S. 55, 54
91""/::. Ghile < am not suggesting that the Smith Court lacked the power to
announce its rule, < think a rule of law unnecessary to the outcome of a case,
especially one not put -/+" U.S. /0+, /#5. into play by the parties,
approaches without more the sort of 'dicta . . . which may be followed if
sufficiently persuasive but which are not controlling.' Cumphrey&s 6xecutor
v. United States, 04/ U.S. %+0, %0# 9145/:( see also =astigar v. United States,
*+% U.S. **1, */* $*// 914#0:.
< do not, of course, mean to imply that a broad constitutional rule announced
without full briefing and argument necessarily lacks precedential weight.
)ver time, such a decision may become 'part of the tissue of the law,'
!adovich v. >ational ,ootball Heague, 5/0 U.S. **/, *// 914/#: 9,rankfurter,
;., dissenting:, and may be sub8ect to reliance in a way that new and
unexpected decisions are not. Cf. Planned Parenthood of Southeastern
Pennsylvania v. Casey, /+/ U.S. "55, "/* $"// 91440:. Smith, however, is not
such a case. @y the same token, by pointing out Smith&s recent vintage, < do
not mean to suggest that novelty alone is enough to 8ustify reconsideration.
'-S.tare decisis,' as ;ustice ,rankfurter wrote, 'is a principle of policy, and
not a mechanical formula,' Celvering v. Callock, 5+4 U.S. 1+%, 114 914*+:,
and the decision whether to adhere to a prior decision, particularly a
constitutional decision, is a complex and difficult one that does not lend
itself to resolution by application of simple, categorical rules, but that must
account for a variety of often competing considerations.
The considerations of full briefing, necessity, and novelty thus do not
exhaust the legitimate reasons for reexamining prior decisions, or even for
reexamining the Smith rule. )ne important further consideration warrants
mention here, however, because it demands the reexamination < have in
mind. Smith presents not the usual Buestion of whether to follow a
constitutional rule, but the Buestion of which constitutional rule to follow,
for Smith refrained from overruling prior free exercise cases that contain a
free exercise rule fundamentally at odds with the rule Smith declared. Smith,
indeed, announced its rule by relying -/+" U.S. /0+, /#*. sBuarely upon the
precedent of prior cases. See *4* U.S., at "#" 9')ur decisions reveal that
the . . . reading' of the ,ree 6xercise Clause contained in the Smith rule 'is
the correct one':. Since that precedent is nonetheless at odds with the Smith
rule, as < have discussed above, the result is an intolerable tension in free
exercise law which may be resolved, consistently with principles of stare
decisis, in a case in which the tension is presented and its resolution pivotal.
Ghile the tension on which < rely exists within the body of our extant case
law, a rereading of that case law will not, of course, mark the limits of any
enBuiry directed to reexamining the Smith rule, which should be reviewed in
light not only of the precedent on which it was rested, but also of the text of
the ,ree 6xercise Clause and its origins. s for text, Smith did not assert that
the plain language of the ,ree 6xercise Clause compelled its rule, but only
that the rule was 'a permissible reading' of the Clause. ibid. Suffice it to say
that a respectable argument may be made that the pre$Smith law comes
closer to fulfilling the language of the ,ree 6xercise Clause than the rule
Smith announced. '-T.he ,ree 6xercise Clause . . ., by its terms, gives special
protection to the exercise of religion,' Thomas, */+ U.S., at #15 , specifying
an activity and then flatly protecting it against government prohibition. The
Clause draws no distinction between laws whose ob8ect is to prohibit
religious exercise and laws with that effect, on its face seemingly applying to
both.
>or did Smith consider the original meaning of the ,ree 6xercise Clause,
though overlooking the opportunity was no uniBue transgression. Save in a
handful of passing remarks, the Court has not explored the history of the
Clause since its early attempts in 1"#4 and 1"4+, see !eynolds v. United
States, 4" U.S., at 1%0 $1%%, and 7avis v. @eason, 155 U.S. 555, 5*0 91"4+:,
attempts that recent scholarship makes clear were incomplete. See generally
EcConnell, The )rigins and Cistorical Understanding of ,ree 6xercise of
!eligion, -/+" U.S. /0+, /#/. 1+5 Carv.H.!ev. 1*+4 9144+:. % The curious
absence of history from our free exercise decisions creates a stark contrast
with our cases under the 6stablishment Clause, where historical analysis has
been so prominent. #
This is not the place to explore the history that a century of free exercise
opinions have overlooked, and it is enough to note that, when the
opportunity to reexamine Smith presents itself, we may consider recent
scholarship raising serious Buestions about the Smith rule&s consonance with
the original understanding and purpose of the ,ree 6xercise Clause. See
EcConnell, The )rigins and Cistorical Understanding of ,ree 6xercise of
!eligion, supra( 7urham, !eligious Hiberty and the Call of Conscience, *0
7ePaul H.!ev. #1, #4$"/ 91440:( see also )ffice of Hegal Policy, U.S. 7ept. of
;ustice, !eport to the ttorney Ieneral, !eligious Hiberty under the ,ree
6xercise Clause 5"$*0 914"%: 9predating Smith:. There appears to be a
strong argument -/+" U.S. /0+, /#%. from the Clause&s development in the
,irst Congress, from its origins in the post$!evolution state constitutions
and pre$!evolution colonial charters, and from the philosophy of rights to
which the ,ramers adhered, that the Clause was originally understood to
preserve a right to engage in activities necessary to fulfill one&s duty to one&s
Iod, unless those activities threatened the rights of others or the serious
needs of the State. <f, as this scholarship suggests, the ,ree 6xercise Clause&s
original 'purpose -was. to secure religious liberty in the individual by
prohibiting any invasions thereof by civil authority,' School 7ist. of bington
v. Schempp, 5#* U.S., at 005 , then there would be powerful reason to
interpret the Clause to accord with its natural reading, as applying to all laws
prohibiting religious exercise in fact, not 8ust those aimed at its prohibition,
and to hold the neutrality needed to implement such a purpose to be the
substantive neutrality of our pre$Smith cases, not the formal neutrality
sufficient for constitutionality under Smith. " -/+" U.S. /0+, /##.
The scholarship on the original understanding of the ,ree 6xercise Clause is,
to be sure, not uniform. See, e.g., Camburger, Constitutional !ight of
!eligious 6xemptionD n Cistorical Perspective, %+ Ieo.Gash.H.!ev. 41/
91440:( @radley, @eguiledD ,ree 6xercise 6xemptions and the Siren Song of
Hiberalism, 0+ Cofstra H.!ev. 0*/ 91441:. nd there are differences of
opinion as to the weight appropriately accorded original meaning. @ut
whether or not one considers the original designs of the Clause binding, the
interpretive significance of those designs surely ranks in the hierarchy of
issues to be explored in resolving the tension inherent in free exercise law as
it stands today.
III
The extent to which the ,ree 6xercise Clause reBuires government to refrain
from impeding religious exercise defines nothing less than the respective
relationships in our constitutional democracy of the individual to
government and to Iod. '>eutral, generally applicable' laws, drafted as they
are from the perspective of the nonadherent, have the unavoidable potential
of putting the believer to a choice between Iod and government. )ur cases
now present competing answers to the Buestion when government, while
pursuing secular ends, may compel disobedience to what one believes
religion commands. The case before us is rightly decided without resolving
the existing tension, which remains for another day when it may be sBuarely
faced.
#epu"lic of the 3hilippines
S,PREME +O,RT
Manila
$4I#0 0I9I,I:)

G.R. No. 9930# No.e/0e& 13, 1992
STATE IN*ESTMENT HO,SE, IN+., petitioner,
vs.
+O,RT OF APPEALS %n1 SA2INA *DA. DE
+,EN+A, respondents.

MELO, J.:
$he 0ecision and .mended 0ecision of the %ourt of .ppeals in %.-
=.#. %9 /-++9, "oth reversin! and affirmin! in part the 0ecision of
'ranch 9( of the #e!ional $rial %ourt of JueEon %it5 in A,a"ina 9da.
de %uenca vs. ,tate Investment 4ouse, Inc.A (%ivil %ase )o. J-
-/55/), for declaration of nullit5 of the foreclosure sale ith an
alternative pra5er for redemption of the foreclosed propert5, are
assailed in the instant petition on ?uestions of la.
.s ma5 "e !leaned from the pleadin!s of the parties, the antecedent
facts are as follos2
:n 8e"ruar5 1+, 1919, private respondent ,a"ina 9da. de %uenca
(%uenca) o"tained a loan from petitioner ,tate Investment 4ouse,
Inc. (,I4I) under a promissor5 note for 31*(,(((.((, secured "5 a
mort!a!e on %uenca7s propert5 at $andan! ,ora, JueEon %it5.
:n )ovem"er 15, 1919, %uenca o"tained another loan of
35((,(((.((. $his loan as secured "5 a real estate mort!a!e
e@ecuted "5 %uenca on another propert5 located alon! $imo!,
JueEon %it5, ith para!raph * of the contract e@pressl5 !ivin! ,I4I
the option of e@tra-<udiciall5 foreclosin! the mort!a!ed propert5 in
the event of %uenca7s default in the pa5ment of her inde"tedness.
%uenca7s unpaid "alance of 31/(,(((.(( under the first loan as
deducted from the proceeds of the second loan. $he mort!a!e on
her propert5 at $andan! ,ora, JueEon %it5 as cancelled.
'ecause of %uenca7s failure to pa5 on the maturit5 date of the loan,
her account as restructured and rolled over telve times throu!h
the e@ecution of various promissor5 notes. :n )ovem"er /9, 198/,
the maturit5 date of the telfth promissor5 note, ,I4I claimed that
%uenca7s o"li!ations, inclusive of interest, service char!es, and
penalties, reached a total of 3*/1,-8+.51. $he loan as not an5more
restructured and ,I4I, on 0ecem"er / and 15, 198/, made ritten
demands on %uenca for the pa5ment of her outstandin! o"li!ation.
%uenca did not heed ,I4I7s demands for pa5ment. ,I4I thus initiated
e@tra-<udicial foreclosure of %uenca7s mort!a!ed propert5 for hich
the correspondin! notice of sheriff7s sale as issued on 8e"ruar5 /+,
198+, settin! the auction sale on March //, 198+. $he scheduled
foreclosure sale as, hoever, deferred "5 ,I4I on account of
%uenca7s re?uest to "e !iven time to pa5 the loan. .lthou!h %uenca
did make some pa5ments, these ere not enou!h to full5 pa5 her
outstandin! o"li!ation and as of Jul5 /8, 198+, ,I4I claimed that
%uenca7s outstandin! loan amounted to 3*+1,19+.8*. %onse?uentl5,
,I4I proceeded ith the auction sale on .u!ust 8, 198+ here it as
declared the hi!hest "idder for 31-/,181.55, %uenca7s outstandin!
de"t at that time per ,I4I7s computation.
$he certificate of sale as re!istered ith the #e!ister of 0eeds of
JueEon %it5 on Auust 12, 3456.
:n Jul5 1(, 198-, ,I4I received a letter (B@hi"it 5-, p. 18, 9ol. I,
#ecord) from %uenca re?uestin! that she "e furnished a ,tatement
of .ccount A"efore and after the foreclosureKauction saleA for her to
"e a"le to redeem the foreclosed propert5 from ,I4I. $his as
folloed "5 another letter (B@hi"it 5--.D also B@hi"it J, p. /(, 9ol. I,
#ecord) from %uenca on Jul5 11, 198- herein she si!nified her
intention to redeem the propert5 for 35((,(((.((, pa5a"le in the
folloin! manner2
1. 31((,(((.(( pa5a"le ithin thirt5 (+() da5s upon
receipt of (,I4I7s) approval of this proposal.
/. $he "alance of 3-((,(((.(( shall "e paid in ei!ht
(8) monthl5 installments. Bach installment pa5ment
shall "e due on the +(th da5 of each month, the first
monthl5 pa5ment to "e reckoned from the date the
amount stated in )o. 1 has "een paid.
In a letter dated .u!ust 1*, 198- (B@hi"it ;, p. // 9ol. I, #ecord),
,I4I re<ected %uenca7s offer to redeem, reasonin! that she should
pa5 her total outstandin! o"li!ation amountin! at that time to
381(,1+9.+*.
:n .u!ust /+, 198-, %uenca, throu!h counsel, sent another letter to
,I4I (B@hi"it 5--'D also B@hi"it &, pp. /+-/-, 9ol. I, #ecord) and
reiterated her offer to redeem the propert5 "5 statin!2
. . . e are no finall5 offerin! and tenderin! to 5ou
the full sum of 3-/*,81-.1/ as the redemption price
of the propert5. $his sum of 3-/*,81-.1/ is the
difference "eteen the redemption price of 381(,
1+9.+* hich 5ou fi@ed in 5our letter of 1* .u!ust
198-, and the sum of 3--1,+1/.1* hich is the
a!!re!ate of the pa5ment hich our client made to
5ou on account of her loan of 35((,(((.((. . .
>ithout, hoever, aitin! for ,I4I7s repl5, %uenca, on Auust 12,
3452, filed a complaint ith the #e!ional $rial %ourt of JueEon %it5
seekin! annulment of the foreclosure sale on the !round that she
had not defaulted in the pa5ment of her loan to ,I4I. .lternativel5,
%uenca pra5ed that the trial court fi@ the redemption price in the
event it is found that she is still inde"ted to ,I4I.
.fter the e@piration of the one-5ear redemption period, the #e!ister
of 0eeds issued a ne title on the foreclosed propert5 in ,I4I7s
name.
:n :cto"er 19, 1989, Jud!e ."raham 3. 9era, presidin! <ud!e of
'ranch 9( of the #e!ional $rial %ourt of the )ational %apital Judicial
#e!ion stationed in JueEon %it5, promul!ated his decision declarin!
the foreclosure sale, as ell as ,I4I7s title o"tained in such sale, null
and void.
In its decision, the trial court made the folloin! essential findin!s2
(a) that the filin! of the petition for e@tra<udicial foreclosure as valid
"ecause as of the date of the filin! thereof, %uenca as still inde"ted
to ,I4I in the sum of 3///,89(.-1 "ased on the trial court7s on
computationD and (") that the foreclosure sale held on .u!ust 8,
198+ as not valid "ecause at that time, %uenca no lon!er oed an5
amount to ,I4I, as in fact from the computations made "5 the trial
court, %uenca had made an overpa5ment to ,I4I in the amount of
3/1,(5-.1-.
$he dispositive portion of the trial court7s decision stated2
.%%:#0I)=&C, <ud!ment is
here"5 rendered2
(a) 0eclarin! plaintiff to have full5 paid her
o"li!ations under the promissor5 notes, marked
B@hs. 1 and -, and all of those derivin! their "ein!
from B@h. -D
(") 0eclarin! the sale of the mort!a!ed propert5 of
plaintiff under the foreclosure proceedin!s and of the
resultant %ertificate of ,ale e@ecuted and issued "5
the foreclosin! ,heriff "5 reason of such foreclosure
to "e null and voidD
(c) 0irectin! the #e!ister of 0eeds of JueEon %it5 to
cancel $ransfer %ertificate of $itle )o. +/5+1/ (B@h.
)) in the name of ,I4I, and to reinstate $ransfer
%ertificate of $itle )o. $-1/*18 (B@h. ') in the name
of plaintiffD
(d) 0irectin! defendant ,I4I to refund to plaintiff the
sum of 3/1,(5-.1-, hich as the overpa5ment she
made on account of her loans ith ,I4I, ith interest
at 1/L per annum from the date of the filin! of the
complaint until the same is full5 paidD
(e) 0irectin! the defendant ,I4I to pa5 to plaintiff the
sums of 35(,(((.(( as moral dama!esD 35(,(((.((
as e@emplar5 dama!esD and 35(,(((.((, as
attorne57s feesD
(f) 0irectin! defendant ,I4I to pa5 Mplaintiff the sum
of 3*/,9(+.18 as a refund of the penalties hich it
had collected from plaintiff, ith interest thereon at
*L per annum from date of this decision until the
same is full5 paidD
(!) 0irectin! plaintiff to pa5 to defendant ,I4I the
sum of 31-,*-5.((, in reim"ursement of ,I4I7s
e@penses in the foreclosure of the mort!a!ed
propert5, hich includes attorne57s fees, ith interest
thereon at *L per annum from date of the decision
until it is full5 paid, hich amount shall, hoever, "e
offset "5 an e?uivalent amount for the amounts due
from ,I4I to plaintiffD and
(h) 0irectin! defendant ,I4I to pa5 the costs of this
suit.
.ll other claims hich the parties ma5 have a!ainst
each other are here"5 denied and dismissed.
,I4I appealed the decision to the court of .ppeals in %.-=.#. %9
)o. /-++9. In its :ri!inal 0ecision, the %ourt of .ppeals (%ampos
M3N, &antin, ,empio-0i5, (() rectified several errors committed "5 the
trial court in its computation of %uenca7s account ith ,I4I, "ut
nevertheless affirmed the trial court7s findin! that at the time of the
foreclosure sale, %uenca had alread5 paid in full her inde"tedness
so that the foreclosure sale and the transmission of title to ,I4I ere
null and void.
'oth parties asked for a reconsideration of the appellate %ourt7s
rulin!.
,I4I7s Motion for #econsideration contended that on the "asis of the
computations made "5 the trial court and as corrected "5 the %ourt
of .ppeals in its decision, the net result shoed that as of the date of
the foreclosure sale on .u!ust 8, 198+, %uenca as still inde"ted to
,I4I, and such "ein! the case, the foreclosure sale as valid.
In her Motion for #econsideration, %uenca asked the appellate court
to reconsider its findin! that she had o"tained a third loan from ,I4I
for 3*1,5((.((. ,he further asked that she "e credited to amounts
hich ere disalloed "5 respondent court.
:n .pril +(, 1991, respondent court promul!ated its .mended
0ecision, reversed its earlier rulin! and held that in accordance ith
its on computations, %uenca as still inde"ted to ,I4I in the
amount of 3/19,9*+.-/ as of the date of the foreclosure sale. $he
dispositive portion of this .mended 0ecision reads2
$he decision of this court is here"5 modified as
follos2
a) 3laintiff-appellee is ordered to pa5 defendant-
appellant the sum of 3/19,9*+.-/, consistin! of the
unpaid "alance of her outstandin! o"li!ation ithin
+( da5s from receipt of this .mended 0ecision ith
pa5ment of interest at the le!al rate from date of this
decision until final <ud!ment.
") $he foreclosure proceedin!s and the resultant
%ertificate of ,ale e@ecuted and issued "5 the
foreclosin! sheriff "5 reason of such foreclosure are
rendered null and void.
c) $ransfer %ertificate of $itle )o. +/-+1/ issued in
the name of ,I4I is declared null and void and the
#e!ister of 0eeds of JueEon %it5 is ordered to
reinstate $ransfer %ertificate of $itle )o. 1/*518 in
the name of plaintiff.
d) )o pronouncement as to pa5ment of dama!es
and attorne57s fees.
,: :#0B#B0. (p. -9, Rollo.)
0issatisfied, ,I4I filed the instant petition and as clarified in pa!es -
and 5 of the petition, the appeal is limited to the folloin! aspects2
(i) $he ori!inal 0ecision in %...-=.#. %9 )o. /-++9,
A,a"ina 9da de %uenca, plaintiff-appellee v. ,tate
Investment 4ouse, Inc., defendant-appellant,A
promul!ated "5 respondent %ourt on /8 8e"ruar5
1991, onl5 insofar as the decision voided the
foreclosure sale of the mort!a!ed propert5 and
,I4I7s title ac?uired "5 virtue of such foreclosure
sale, the challen!ed part of the dispositive portion
readin! as follos2
(") 0eclarin! the sale of the
mort!a!ed propert5 of plaintiff under
the foreclosure proceedin!s and of
the resultant %ertificate of ,ale
e@ecuted and issued "5 the
foreclosin! ,heriff "5 reason of such
foreclosure to "e null and voidD
(c) 0irectin! the #e!ister of 0eeds
of JueEon %it5 to cancel $ransfer
%ertificate of $itle )o. +/5+1/
(B@hi"it )) in the name of ,I4I, and
to reinstate $ransfer %ertificate of
$itle )o. $-1/*18 (B@hi"it ') in the
name of the plaintiff.
(ii) .nd the .mended 0ecision in the same appealed
case, promul!ated on +( .pril 1991, onl5 insofar as
it ad<udicated as follos2
(a) 3laintiff-appellee is ordered to
pa5 defendant-appellant the sum of
3/19,9*+.-/, consistin! of the
unpaid "alance of her outstandin!
o"li!ation ithin +( da5s from
receipt of this .mended 0ecision
ith pa5ment of interest at the le!al
rate from date of this decision until
final <ud!ment.
(") $he foreclosure proceedin!s and
the resultant %ertificate of ,ale
e@ecuted and issued "5 the
foreclosin! ,heriff "5 reason of such
foreclosure are rendered null and
void.
(c) $ransfer %ertificate of $itle )o.
+/-+1/ issued in the name of ,I4I
is declared null and void and the
#e!ister of 0eeds of JueEon %it5 is
ordered to reinstate $ransfer
%ertificate of $itle )o. 1/*518 in the
name of plaintiff.
(") 3etitioner is not appealin! the rest of the
dispositive portions of the 0ecision and .mended
0ecision.
,I4I presents the folloin! as !rounds for its petition2
M.I) =#:6)0 :8 $4B 3B$I$I:)
#B,3:)0B)$ %:6#$ M.)I8B,$&C B##B0
.)0 MI,.33&IB0 $4B &.> >4B) I$ #B86,B0
$: 0B%&.#B $4B 8:#B%&:,6#B
3#:%BB0I)=, 9.&I0 0B,3I$B I$, :>)
0B$B#MI).$I:) $4.$ #B,3:)0B)$ %6B)%.
>., $#6&C .)0 =B)6I)B&C I)0B'$B0 $:
3B$I$I:)B# >4B) $4B 8:#B%&:,6#B
3#:%BB0I)=, >B#B I),$I$6$B0.
.&$B#).$I9B =#:6)0
,4:6&0 $4B ,63#BMB %:6#$ .88I#M $4B
9:I0I)= :8 $4B 8:#B%&:,6#B ,.&B .)0 :8
3B$I$I:)B#7, $I$&B, 3B$I$I:)B# I, B)$I$&B0,
I) &.> .)0 BJ6I$C $: $4B 3.CMB)$ :8
&B=.& I)$B#B,$ :) $4B 3#I)%I3.& ,6M :8
3/19,9*+.-/ ($4B ,6M .0J60=B0 I)
3B$I$I:)B#7, 8.9:# 'C #B,3:)0B)$
%:6#$) %:M36$B0 8#:M $4B 0.$B :8 $4B
8:#B%&:,6#B ,.&B 63 $: $4B 0.$B :8
.%$6.& 3.CMB)$ :8 $4B 3#I)%I3.& ,6M. (pp.
15-1*, Rollo)
:n Jul5 /5 1991, shortl5 after she filed her %omment, %uenca
consi!ned ith this %ourt Metro 'ank %ashier7s %heck )o. %%-
111-+ in the sum of 3/19,9*+.-/, representin! the amount ordered
"5 the %ourt of .ppeals (in its .mended 0ecision) to "e paid to ,I4I.
$hereafter, ,I4I filed its #epl5 on .u!ust 15, 1991, to hich a
#e<oinder as filed "5 %uenca on .u!ust /1, 1991.
.s correctl5 formulated "5 ,I4I, the principal issue in this case is the
effect upon the validit5 of the e@tra-<udicial foreclosure proceedin!s
of a <udicial determination that the de"tor-mort!a!or (%uenca), at the
time of the foreclosure, as still inde"ted and in default in the
pa5ment of the o"li!ations to the creditor-mort!a!ee (,I4I).
%uenca7s loan ith ,I4I as restructured and rolled over telve (1/)
times, ith the last promissor5 note indicatin! the maturit5 date of
)ovem"er /9, 198/. $he recomputation (attached to the .mended
0ecision) of the %ourt of .ppeals shos, hoever, that on the said
date %uenca still had an outstandin! inde"tedness of 3-1*,188,(8.
,I4I, in its letters to %uenca dated 0ecem"er / and 15, 198/
(B@hi"its +* and +*-., pp. -+5 and -+*, 9ol. I, #ecord) demanded
the pa5ment of this unpaid amount. %uenca, hoever, failed to make
an5 pa5ments and thus, even at that point in time, as alread5
de"tor in default under .rticle 11*8 of the )e %ivil %ode.
$he e@tra-<udicial foreclosure instituted "5 ,I4I in 8e"ruar5 198+
as, therefore, valid as at that time, %uenca7s loan "ein! then
alread5 almost three (+) months overdue ('onnevie vs. %ourt of
.ppeals, 1/5 ,%#. 1// M198+N). .side from the fact that %uenca
as alread5 in default, the #eal Bstate Mort!a!e e@ecuted "5 the
parties e@pressl5 !ranted ,I4I the option to foreclose hen it
provided that2
*. In the event that the Mort!a!orK0e"tor herein,
should fail or refuse to pa5 an5 of the sums of
mone5 secured "5 this mort!a!e, or an5 part
thereof, in accordance ith the terms and conditions
herein set forth or those stipulated in the correlative
promissor5 note(s), or should heKit fail to perform an5
of the conditions stipulated herein, or those in the
promissor5 note(s), then and in such case the
Mort!a!ee shall have the ri!ht, at its election, to
foreclose this mort!a!e. . .
,I4I, hoever, deferred the auction sale hen %uenca su"se?uentl5
asked for more time to pa5 her o"li!ation. %uenca7s account,
hoever, as not restructured and she herself !ave ,I4I permission
to proceed ith the auction sale on .u!ust 8, 198+ should she not
"e a"le to pa5 her account "5 then (B@hi"it -1, p. -51 9ol. I,
#ecord). .s of that date, the %ourt of .ppeals computed %uenca7s
unpaid account ith ,I4I to "e 3/19,9*+.-/. It is orth notin! that
this computation is not challen!ed or ?uestioned "5 either ,I4I or
%uenca and >e find no reason to distur" the same.
$he o"vious implication is that, at the time of the foreclosure sale on
.u!ust 8, 198+, %uenca had defaulted in the pa5ment of
3/19,9*+.-/. $hus, ,I4I had the option under the afore?uoted
provision of the #eal Bstate Mort!a!e, to foreclose on the mort!a!ed
propert5. ,I4I cannot "e faulted for havin! chosen that option.
$he %ourt of .ppeals, therefore, erred in concludin! that despite
%uenca7s default, the foreclosure sale and the resultant issuance of
the certificate of sale "5 the foreclosin! ,heriff ere null and void.
8oreclosure is valid here the de"tor is in default in the pa5ment of
his o"li!ation (%f, 'icol ,avin!s and &oan .ssociation vs. %ourt of
.ppeals, 111 ,%#. *+( M1989N). In a real estate mort!a!e hen the
principal o"li!ation is not paid hen due, the mort!a!ee has the ri!ht
to foreclose the mort!a!e and to have the propert5 seiEed and sold
ith the vie of appl5in! the proceeds to the pa5ment of the
o"li!ation (%ommodit5 8inancin! %o., Inc., vs. JimeneE, 91 ,%#. 51
M1919N). :nce the proceeds have "een applied to the pa5ment of the
o"li!ation, the de"tor cannot an5more "e re?uired to pa5, unless, of
course, there is a deficienc5 "eteen the amount of the loan and the
foreclosure sale price, "ecause the o"li!ation has alread5 "een
e@tin!uished.
>e no come to the second issue posed "5 the parties2 ith the
auction sale havin! "een done on .u!ust 8, 199/ and the certificate
of foreclosure sale havin! "een validl5 re!istered ith the #e!ister of
0eeds of JueEon %it5 on Auust 12, 3456, as %uenca a"le to
redeem the propert5 in the manner and ithin the period provided "5
laG
>ith the afore?uoted provision of the #eal Bstate Mort!a!e havin!
e@pressl5 authoriEed ,I4I to e@tra-<udiciall5 foreclose the mort!a!e
in case of %uenca7s failure to compl5 ith her o"li!ation to pa5, the
la !overnin! the foreclosure is #epu"lic .ct )o. +1+5 (.n .ct $o
#e!ulate $he ,ale of 3ropert5 6nder ,pecial 3oers Inserted In :r
.nne@ed $o #eal Bstate Mort!a!es), as amended "5 #epu"lic .ct
)o. -118 (See &una vs. Bncarnacion, 91 3hil. 5+1 M195/N). ,ection *
of the said .ct states2
,ec. *. In all cases in hich an e@tra<udicial sale is
made under the special poer herein "efore referred
to, the de"tor, his successors in interest or an5
<udicial creditor or <ud!ment creditor of said de"tor,
or an5 person havin! a lien on the propert5
su"se?uent to the mort!a!e or deed of trust under
hich the propert5 is sold, may re!eem the same at
any time "ithin the term of one year from an! after
the !ate of the sale . . . (Bmphasis supplied.)
In a lon! line of cases, >e have consistentl5 held that this one-5ear
redemption period should "e counted not from the date of
foreclosure sale, "ut from the time the certificate of sale is re!istered
ith the #e!ister of 0eeds (.!"ulos vs. .l"erto, 5 ,%#. 19( M19*/ND
,alaEar vs. Meneses, 8 ,%#. -95 M19*+ND #e5es vs. )o"le<as, /1
,%#. 1(/1 M191(ND Juimson vs. 3hilippine )ational 'ank, +* ,%#.
/* M191(N). In this case, therefore, the one-5ear redemption period
should "e reckoned from the time the certificate of sale as
re!istered on Auust 12, 3456('ernardeE vs. #e5es, /(1 ,%#. *-8
M1991N).
6nder .rticle 1+ of the )e %ivil %ode, a 5ear is understood to "e of
three hundred si@t5-five (+*5) da5s. $hus, e@cludin! the first da5 and
countin! from .u!ust /5, 198+ (under para!raph + of .rticle 1+ of
the )e %ivil %ode), and "earin! in mind that 198- as a leap 5ear,
%uenca had onl5 until Auust 16, 3452, the +*5th da5 after
re!istration of the sale on .u!ust /-, 198+, ithin hich to redeem
the foreclosed propert5 in accordance ith la. It as thus alread5
"e5ond the redemption period hen %uenca filed her suit "elo
on Auust 12, 3452.
It should "e stressed in this re!ard that it is not proper to count, as
%uenca su"mits in her #e<oinder, the period on the "asis of +( da5s
per month. $he la speaks of a Aone 5earA period ithin hich to
redeem, not telve months as in the case of redemption "5 a
<ud!ment de"tor under ,ection +( of #ule +9. .ppl5in! .rticle 1+ of
the %ivil %ode, the period of one 5ear ithin hich to redeem in the
case at "ar is to count +*5 da5s from .u!ust /-, 198+.
%onse?uentl5, the last da5 to redeem ould "e and indeed fell
on Auust 16, 3452, said 5ear "ein! a leap 5ear (%f =o vs. 0iEon, et
al., =.#. )o. 15915-1*, ,ept. 18, 199/).
%uenca, hoever, as not a"le to e@ercise her ri!ht of redemption
on or "efore .u!ust /+, 198-. .lthou!h she rote to ,I4I tice on
Jul5 11 and .u!ust /+, 198- and offered to redeem her propert5,
these offers ere not accompanied "5 simultaneous bona fi!e tender
or deliver5 of the redemption price to ,I4I. In Belisario vs.
7nterme!iate Appellate )ourt (1*5 ,%#. 1(1 M1988N), this %ourt,
throu!h Justice Medialdea, held2
$he !eneral rule in redemption is that in makin! a
repurchase, it is not sufficient that a person offerin!
to redeem make manifestation of his desire to
repurchaseD this statement of intention must "e
accompanied "5 an actual and simultaneous tender
of pa5ment, hich constitutes the le!al use of
e@ercise of the ri!ht to repurchase (.n!ao vs.
%lavano, 11 3hil. 15/). &ikeise, in several cases
decided "5 this %ourt (8ructo vs. 8uentes, 15 3hil.
+*/D #etes vs. ,uelto, /( 3hil. +9-D #osales vs.
#e5es, et al., 98 3hil. 915) here the ri!ht to
repurchase as held to have "een properl5
e@ercised, there as definite findin! of tender of
pa5ment havin! "een made "5 the vendor. $he
tender of pa5ment must "e for the full amount of the
repurchase price, otherise the offer to redeem ill
"e held ineffectual. (#um"aoa vs. .rEa!a, 8- 3hil.
81/). 'ona fide redemption necessaril5 imports a
reasona"le and valid tender of the entire repurchase
price. $here is no co!ent reason for re?uirin! the
vendee to accept pa5ment "5 installments from the
redemptioner, as it ould ultimatel5 result in an
indefinite e@tension of the redemption period
(%one<ero, et al. vs. %ourt of .ppeals, et al., &-
/181/, .pril /9, 19**, 1* ,%#. 115, 18().
$he rule that tender of pa5ment of the repurchase
price is necessar5 to e@ercise in the ri!ht of
redemption finds support in civil la. .rticle 1*1* of
the %ivil %ode of the 3hilippines, in the a"sence of
an applica"le provision in %ommonealth .ct )o.
1-1, furnishes the !uide, to it2 $he vendor cannot
avail himself of the ri!ht to repurchase ithout
returnin! to the vendee the price of the sale . . . (65
&ee vs. %ourt of .ppeals, &-/81/*, )ovem"er /8,
1915, *8 ,%#. 19*, /(-). (at pp. 1(1-1(8.)
%uenca7s use of the phrase Aofferin! and tenderin!A in her letter
dated .u!ust /+, 198- does not compl5 ith the rulin!
in Belisario. $here is no shoin! hatsoever here that the
redemption price as delivered to ,I4I. #edemption is not a matter
of intent "ut involves makin! the proper pa5ment or tender of the
price of the land ithin the specified period (0e la Merced vs. 0e
=uEman, 1*( ,%#. 81 M1988N).
)either is %uenca correct in contendin! that ,I4I in effect e@tended
the redemption period hen it stated in its letter dated .u!ust 1*,
198- that %uenca had until .u!ust /-, 198- ithin hich to pa5 its
outstandin! account in full. In &aEo vs. #epu"lic ,uret5 O Insurance
%o., Inc., (+1 ,%#. +/9 M191(N). >e held that it is onl5 here, "5
voluntar5 a!reement of the parties, consistin! of e@tensions of the
redemption period, folloed "5 commitment "5 the de"tor to pa5 the
redemption price at a fi@ed date, ill the concept of le!al redemption
"e converted "5 the parties into one of conventional redemption such
that it !enerates "indin! contracts hen approved "5 the creditor. In
the instant case, hoever, there is no shoin! that %uenca a!reed
to pa5 the redemption price on or "efore .u!ust /-, 198-, as set "5
,I4I. :n the contrar5, %uenca7s filin! of her complaint on .u!ust /-,
198- principall5 seekin! to declare the nullit5 of the foreclosure sale
is indicative of her refusal to pa5 the redemption price on the
deadline mistakenl5 set "5 ,I4I.
%uenca7s complaint filed on Auust 12, 3452 (the +*5th da5 from the
re!istration of the certificate of sale, havin! fallen on Auust 16,
3452), did not have the effect of a formal offer to redeem.
In Belisario (supra), >e further e@plained.
$his case is different from 8y .ee vs. )ourt of
Appeals, supra here the action to compel
redemption as filed after the lapse of the period of
redemption. $hus, the %ourt held in said case, to it2
It is clear that the mere sendin! of
letters "5 vendor ,imeon e@pressin!
his desire to repurchase the
propert5 ithout an accompan5in!
tender of redemption price fell short
of the re?uirements of la. 4avin!
failed to properl5 e@ercise his ri!ht
of redemption ithin the statutor5
five-5ear period, the ri!ht is lost
and the same can no loner be
revive! by the filin of an action to
compel re!emption after the lapse
of the perio!.
$he same factual antecedent o"tained in )one+ero,
et al. vs. )ourt of Appeals, supra, here the
complaint seekin! to "e declared entitled to redeem
as filed after the e@piration of the statutor5 period
of redemption. >hat as proper for determination
then in said cases as hether or not the ri!ht of
redemption sans <udicial action as validl5
e@ercised. In said cases, the %ourt applied the
!eneral rule that "ona fide redemption necessaril5
imports a reasona"le and valid tender of the entire
purchase price. (at p. 1(9D emphasis added.)
$hus, it is onl5 hen the complaint to enforce a repurchase is
filed "ithin the period of redemption ill it "e e?uivalent to an offer to
redeem and have the effect of preservin! the ri!ht of redemption
(Belisario, supra, citin#eoveros vs. ."el and ,andoval, -8 :.=.
5+18). >here, as in this case, the complaint for redemption as filed
after the redemption period e@pired, the complaint is a useless
e@ercise hich can not defeat the purchaser7s ri!ht to have the title
of the propert5 transferred in his name. %uenca7s reliance on the
rulin! in #ulan*a vs. )ourt of Appeals (1-1 ,%#. 11 M1981N) is
ithout an5 "asis. $he doctrine laid don in #ulan*a finds no
applica"ilit5 to the instant case for unlike the complaint filed "5
%uenca in the case at "ar, the action for redemption in #ulan*aas
filed "ithin the period of redemption.
Moreover, it "ears notin! that %uenca sent letters (dated Jul5 11 and
.u!ust /+, 198-) to ,I4I ithin the redemption period in hich she
offered to redeem her propert5. In her letter dated Jul5 11, 198-, she
offered to pa5 her inde"tedness accordin! to an installment plan
hich, if carefull5 anal5Eed, had the effect of e@tendin! the period of
redemption "e5ond one 5ear contrar5 to the polic5 of the la
(Belisario, supra). In her other letter dated .u!ust /+, 198-, she
offered to pa5 the amount 3-/*,81-.1/ in full settlement of her
o"li!ation, althrou!h, as >e earlier stated, this amount as never
properl5 delivered to ,I4I in accordance ith la. $here is thus no
proof at that time that %uenca possessed the a"ilit5 to pa5 the
redemption amount she as offerin!. $his is especiall5 true in the
li!ht of the fact that in her first letter she merel5 offered to pa5 in
installments.
If onl5 to prove the veracit5 of her claim that at that time she as
capa"le of pa5in! ,I4I the full amount of hat she thou!ht as a
reasona"le redemption price, the least that %uenca could have done
as to consi!n pa5ment in court simultaneous ith her filin! of the
action to redeem on .u!ust /-, 199/. In so statin!, >e do not here
depart from our consistent rulin! that a formal offer to redeem,
accompanied "5 a "ona fide tender of the redemption price, althou!h
proper, is not essential here the ri!ht to redeem is e@ercised
throu!h the filin! of a <udicial action ($olentino vs. %ourt of
.ppeals, 1(* ,%#. 51+ M1981ND $ioseco vs. %ourt of .ppeals, 1-+
,%#. 1(5 M198*ND 4ul!anEa, supra/ Beliserio, supra). .s earlier
stated, this rule onl5 holds here the action to redeem is filed ithin
the redemption period. >here, as in the instant case, the action is
filed after the statutor5 period has e@pired, the determination of
hether the plaintiff consi!ned the redemption price ith the court
simultaneous ith the filin! of the action is necessar5 to see if the
ri!ht of redemption sans <udicial action as validl5 e@ercised
(Beliserio, supra).
%uenca7s consi!nation ith this %ourt of the amount ordered "5 the
%ourt of .ppeals to "e paid to ,I4I onl5 ei!ht (8) 5ears after her
action to redeem as filed in 198- is a "elated move hich merel5
shos that in 198- she had no a"ilit5 to pa5 ,I4I the redemption
price. 4er filin! of the action as a mere devise and scheme to "u5
time to raise the amount needed to redeem her propert5.
In )one+ero, et al. vs. )ourt of Appeals, et al. (1* ,%#. 115 M19**N),
>e precisel5 stated that Aa "u5er can not "e e@pected to entertain an
offer of redemption ithout attendant evidence that the redemptioner
can, and is illin! to accomplish the repurchase immediatel5. .
different rule ould leave the "u5er open to harassment "5
speculators or crackpots, as ell as to unnecessar5 prolon!ation of
the redemption period, contrar5 to the polic5 of the la. . . . :f
course, consi!nation of the price ould remove all controvers5 as to
the redemptioner7s a"ilit5 to pa5 at the proper time. (at pp. 181-18/.)A
>e further stated in Basbas vs. 9ntena (/8 ,%#. **5, *11 M19*9N)
that2
. . . the ri!ht of le!al redemption must "e e@ercised
ithin specified time limits2 and the statutor5 periods
ould "e rendered meanin!less and of eas5 evasion
unless the redemptioner is re?uired to make an
actual tender in !ood faith of hat he "elieved to "e
the reasona"le price of the land sou!ht to "e
redeemed. $he e@istence of the ri!ht of redemption
operates to depress the market value of the land
until the period e@pires, and to render that period
indefinite "5 permittin! the tenant to file a suit for
redemption, ith either part5 una"le to foresee hen
final <ud!ment ill terminate the action, ould render
nu!ator5 the period of to 5ears fi@ed "5 the statute
for makin! the redemption and virtuall5 paral5Ee an5
efforts of the landoner to realiEe the value of his
land. )o "u5er can "e e@pected to ac?uire it ithout
an5 certaint5 as to the amount for hich it ma5 "e
redeemed, so that he can recover at least his
investment in case of redemption. In the meantime,
the landoner7s needs and o"li!ations cannot "e
met. It is dou"tful if an5 such result as intended "5
the statute, a"sent clear ordin! to that effect.
$he situation "ecomes orse hen as shon "5 the
evidence in this case, the redemptioner has no funds
and must appl5 for them to the &and .uthorit5,
hich, in turn, must depend on the availa"ilit5 of
funds from the &and 'ank. It then "ecomes
practicall5 certain that the landoner ill not "e a"le
to realiEe the value of his propert5 for an indefinite
time "e5ond the to 5ears redemption period. (at pp.
*11-*1/.)
>4B#B8:#B, the appealed portions of the :ri!inal 0ecision and
the .mended 0ecision are #B9B#,B0 and ,B$ .,I0B and ne
<ud!ment is here"5 entered2
1) 0eclarin! valid and effective the e@tra<udicial foreclosure of the
mort!a!e of respondent ,a"ina 9da. de %uenca7s propert5 in $imo!,
JueEon %it5 on .u!ust 8, 198+D and
/) 6pholdin! and confirmin! the cancellation of $ransfer %ertificate
of $itle )o. 1/*518 of the #e!ister of 0eeds of JueEon %it5 in the
name of ,a"ina 9da. de %uenca, as ell as its replacement "5
$ransfer %ertificate of $itle )o. +/-+1/ in the name of ,tate
Investment 4ouse, Inc.
)either part5 is to recover dama!es or costs.
,: :#0B#B0.
Gutierre*, (r., Bi!in, Davi!e, (r. an! Romero, ((., concur.
#epu"lic of the 3hilippines
S,PREME +O,RT
Manila
B) '.)%

2%& M%''e& No. !!3 June 17, 1993
MA,RI+IO +. ,LEP, petitioner,
vs.
THE LEGAL +LINI+, IN+., respondent.
# B ,: & 6 $ I : )

REGALADO, J.:
3etitioner pra5s this %ourt Ato order the respondent to cease and
desist from issuin! advertisements similar to or of the same tenor as
that of anne@es A.A and A'A (of said petition) and to perpetuall5
prohi"it persons or entities from makin! advertisements pertainin! to
the e@ercise of the la profession other than those alloed "5 la.A
$he advertisements complained of "5 herein petitioner are as
follos2
Anne: A
,B%#B$ M.##I.=BG
35*(.(( for a valid marria!e.
Info on 0I9:#%B. .',B)%B.
.))6&MB)$. 9I,..
$4B 3lease call2 5/1-(1*1 &B=.& 5/11/+/,
5///(-1 %&I)I%, I)%. 82+( amH *2(( pm 1-8lr.
9ictoria 'ld!., 6) .ve., Mla.
Anne: B
=6.M 0I9:#%B.
0:) 3.#;I),:)
an .ttorne5 in =uam, is !ivin! 8#BB '::;, on
=uam 0ivorce throu!h $he &e!al %linic "e!innin!
Monda5 to 8rida5 durin! office hours.
=uam divorce. .nnulment of Marria!e. Immi!ration
3ro"lems, 9isa B@t. JuotaK)on-?uota #es. O
,pecial #etiree7s 9isa. 0eclaration of ."sence.
#emarria!e to 8ilipina 8iancees. .doption.
Investment in the 3hil. 6,K8orei!n 9isa for 8ilipina
,pouseK%hildren. %all Marivic.
$4B 18 9ictoria 'ld!. -/9 6) .ve., &B=.& Brmita,
Manila nr. 6, Bm"ass5 %&I)I%, I)%.
1
$el. 5/1-1/+/D
5/1-1/51D 5//-/(-1D 5/1-(1*1
It is the su"mission of petitioner that the advertisements a"ove
reproduced are champterous, unethical, demeanin! of the la
profession, and destructive of the confidence of the communit5 in the
inte!rit5 of the mem"ers of the "ar and that, as a mem"er of the
le!al profession, he is ashamed and offended "5 the said
advertisements, hence the reliefs sou!ht in his petition as
herein"efore ?uoted.
In its anser to the petition, respondent admits the fact of pu"lication
of said advertisement at its instance, "ut claims that it is not en!a!ed
in the practice of la "ut in the renderin! of Ale!al support servicesA
throu!h parale!als ith the use of modern computers and electronic
machines. #espondent further ar!ues that assumin! that the
services advertised are le!al services, the act of advertisin! these
services should "e alloed supposedl5
in the li!ht of the case of (ohn R. Bates an! ;an -<Steen vs. State
Bar of Ari*ona,
2
reportedl5 decided "5 the 6nited ,tates ,upreme %ourt
on June 1, 1911.
%onsiderin! the critical implications on the le!al profession of the
issues raised herein, e re?uired the (1) Inte!rated 'ar of the
3hilippines (I'3), (/) 3hilippine 'ar .ssociation (3'.), (+) 3hilippine
&a5ers7 .ssociation (3&.), (-) 6.3. >omens &a5ers7 %ircle
(>I&:%I), (5) >omen &a5ers .ssociation of the 3hilippines
(>&.3), and (*) 8ederacion International de ."o!adas (8I0.) to
su"mit their respective position papers on the controvers5 and,
thereafter, their memoranda.
3
$he said "ar associations readil5
responded and e@tended their valua"le services and cooperation of hich
this %ourt takes note ith appreciation and !ratitude.
$he main issues posed for resolution "efore the %ourt are hether or
not the services offered "5 respondent, $he &e!al %linic, Inc., as
advertised "5 it constitutes practice of la and, in either case,
hether the same can properl5 "e the su"<ect of the advertisements
herein complained of.
'efore proceedin! ith an in-depth anal5sis of the merits of this
case, e deem it proper and enli!htenin! to present hereunder
e@cerpts from the respective position papers adopted "5 the
aforementioned "ar associations and the memoranda su"mitted "5
them on the issues involved in this "ar matter.
1. 7nterate! Bar of the $hilippines2
@@@ @@@ @@@
)otithstandin! the su"tle manner "5 hich
respondent endeavored to distin!uish the to
terms, i.e., Ale!al support servicesA vis-a-vis Ale!al
servicesA, common sense ould readil5 dictate that
the same are essentiall5 ithout su"stantial
distinction. 8or ho could den5 that document
search, evidence !atherin!, assistance to la5man in
need of "asic institutional services from !overnment
or non-!overnment a!encies like "irth, marria!e,
propert5, or "usiness re!istration, o"tainin!
documents like clearance, passports, local or forei!n
visas, constitutes practice of laG
@@@ @@@ @@@
$he Inte!rated 'ar of the 3hilippines (I'3) does not
ish to make issue ith respondent7s forei!n
citations. ,uffice it to state that the I'3 has made its
position manifest, to it, that it stron!l5 opposes the
vie espoused "5 respondent (to the effect that
toda5 it is alri!ht to advertise one7s le!al services).
$he I'3 accordin!l5 declares in no uncertain terms
its opposition to respondent7s act of esta"lishin! a
Ale!al clinicA and of concomitantl5 advertisin! the
same throu!h nespaper pu"lications.
$he I'3 ould therefore invoke the administrative
supervision of this 4onora"le %ourt to perpetuall5
restrain respondent from undertakin! hi!hl5
unethical activities in the field of la practice as
aforedescri"ed.

@@@ @@@ @@@
.. $he use of the name A$he &e!al %linic, Inc.A !ives
the impression that respondent corporation is "ein!
operated "5 la5ers and that it renders le!al
services.
>hile the respondent repeatedl5 denies that it offers
le!al services to the pu"lic, the advertisements in
?uestion !ive the impression that respondent is
offerin! le!al services. $he 3etition in fact simpl5
assumes this to "e so, as earlier mentioned,
apparentl5 "ecause this (is) the effect that the
advertisements have on the readin! pu"lic.
$he impression created "5 the advertisements in
?uestion can "e traced, first of all, to the ver5 name
"ein! used "5 respondent H A$he &e!al %linic, Inc.A
,uch a name, it is respectfull5 su"mitted connotes
the renderin! of le!al services for le!al pro"lems,
<ust like a medical clinic connotes medical services
for medical pro"lems. More importantl5, the term
A&e!al %linicA connotes la5ers, as the term medical
clinic connotes doctors.
8urthermore, the respondent7s name, as pu"lished
in the advertisements su"<ect of the present case,
appears ith (the) scale(s) of <ustice, hich all the
more reinforces the impression that it is "ein!
operated "5 mem"ers of the "ar and that it offers
le!al services. In addition, the advertisements in
?uestion appear ith a picture and name of a person
"ein! represented as a la5er from =uam, and this
practicall5 removes hatever dou"t ma5 still remain
as to the nature of the service or services "ein!
offered.
It thus "ecomes irrelevant hether respondent is
merel5 offerin! Ale!al support servicesA as claimed
"5 it, or hether it offers le!al services as an5 la5er
activel5 en!a!ed in la practice does. .nd it
"ecomes unnecessar5 to make a distinction
"eteen Ale!al servicesA and Ale!al support
services,A as the respondent ould have it. $he
advertisements in ?uestion leave no room for dou"t
in the minds of the readin! pu"lic that le!al services
are "ein! offered "5 la5ers, hether true or not.
'. $he advertisements in ?uestion are meant to
induce the performance of acts contrar5 to la,
morals, pu"lic order and pu"lic polic5.
It ma5 "e conceded that, as the respondent claims,
the advertisements in ?uestion are onl5 meant to
inform the !eneral pu"lic of the services "ein!
offered "5 it. ,aid advertisements, hoever,
emphasiEe to =uam divorce, and an5 la student
ou!ht to kno that under the 8amil5 %ode, there is
onl5 one instance hen a forei!n divorce is
reco!niEed, and that is2
.rticle /*. . . .
>here a marria!e "eteen a
8ilipino citiEen and a forei!ner is
validl5 cele"rated and a !ivorce is
thereafter vali!ly obtaine! abroa!
by the alien spouse capacitatin
him or her to remarry, the 8ilipino
spouse shall have capacit5 to
remarr5 under 3hilippine &a.
It must not "e for!otten, too, that the 8amil5 %ode
(defines) a marria!e as follos2
.rticle 1. Marria!e is special
contract of permanent
union "eteen a man and oman
entered into accordance ith la for
the esta"lishment of con<u!al and
famil5 life. 7t is the foun!ation of the
family an! an inviolable social
institution hose nature,
conse?uences, and incidents are
!overned "5 la and not su"<ect to
stipulation, e@cept that marria!e
settlements ma5 fi@ the propert5
relation durin! the marria!e ithin
the limits provided "5 this %ode.
'5 simpl5 readin! the ?uestioned advertisements, it
is o"vious that the messa!e "ein! conve5ed is that
8ilipinos can avoid the le!al conse?uences of a
marria!e cele"rated in accordance ith our la, "5
simpl5 !oin! to =uam for a divorce. $his is not onl5
misleadin!, "ut encoura!es, or serves to induce,
violation of 3hilippine la. .t the ver5 least, this can
"e considered Athe dark sideA of le!al practice,
here certain defects in 3hilippine las are
e@ploited for the sake of profit. .t orst, this is
outri!ht malpractice.
#ule 1.(/. H . la5er shall not
counsel or a"et activities aimed at
defiance of the la or at lessenin!
confidence in the le!al s5stem.
In addition, it ma5 also "e relevant to point out that
advertisements such as that shon in .nne@ A.A of
the 3etition, hich contains a cartoon of a motor
vehicle ith the ords AJust MarriedA on its "umper
and seems to address those plannin! a Asecret
marria!e,A if not su!!estin! a Asecret marria!e,A
makes li!ht of the Aspecial contract of permanent
union,A the inviola"le social institution,A hich is ho
the 8amil5 %ode descri"es marria!e, o"viousl5 to
emphasiEe its sanctit5 and inviola"ilit5. >orse, this
particular advertisement appears to encoura!e
marria!es cele"rated in secrec5, hich is su!!estive
of immoral pu"lication of applications for a marria!e
license.
If the article A#@ for &e!al 3ro"lemsA is to "e
revieed, it can readil5 "e concluded that the a"ove
impressions one ma5 !ather from the
advertisements in ?uestion are accurate. $he
,haron %uneta-=a""5 %oncepcion e@ample alone
confirms hat the advertisements su!!est. 4ere it
can "e seen that criminal acts are "ein! encoura!ed
or committed
(a "i!amous marria!e in 4on! ;on! or &as 9e!as)
ith impunit5 simpl5 "ecause the <urisdiction of
3hilippine courts does not e@tend to the place here
the crime is committed.
Bven if it "e assumed, aruen!o, (that) the Ale!al
support servicesA respondent offers do not constitute
le!al services as commonl5 understood, the
advertisements in ?uestion !ive the impression that
respondent corporation is "ein! operated "5 la5ers
and that it offers le!al services, as earlier discussed.
$hus, the onl5 lo!ical conse?uence is that, in the
e5es of an ordinar5 nespaper reader, mem"ers of
the "ar themselves are encoura!in! or inducin! the
performance of acts hich are contrar5 to la,
morals, !ood customs and the pu"lic !ood, there"5
destro5in! and demeanin! the inte!rit5 of the 'ar.
@@@ @@@ @@@
It is respectfull5 su"mitted that respondent should "e
en<oined from causin! the pu"lication of the
advertisements in ?uestion, or an5 other
advertisements similar thereto. It is also su"mitted
that respondent should "e prohi"ited from further
performin! or offerin! some of the services it
presentl5 offers, or, at the ver5 least, from offerin!
such services to the pu"lic in !eneral.
$he I'3 is aare of the fact that providin!
computeriEed le!al research, electronic data
!atherin!, stora!e and retrieval, standardiEed le!al
forms, investi!ators for !atherin! of evidence, and
like services ill !reatl5 "enefit the le!al profession
and should not "e stifled "ut instead encoura!ed.
4oever, hen the conduct of such "usiness "5
non-mem"ers of the 'ar encroaches upon the
practice of la, there can "e no choice "ut to prohi"it
such "usiness.
.dmittedl5, man5 of the services involved in the
case at "ar can "e "etter performed "5 specialists in
other fields, such as computer e@perts, ho "5
reason of their havin! devoted time and effort
e@clusivel5 to such field cannot fulfill the e@actin!
re?uirements for admission to the 'ar. $o prohi"it
them from Aencroachin!A upon the le!al profession
ill den5 the profession of the !reat "enefits and
advanta!es of modern technolo!5. Indeed, a la5er
usin! a computer ill "e doin! "etter than a la5er
usin! a t5periter, even if "oth are (e?ual) in skill.
'oth the 'ench and the 'ar, hoever, should "e
careful not to allo or tolerate the ille!al practice of
la in an5 form, not onl5 for the protection of
mem"ers of the 'ar "ut also, and more importantl5,
for the protection of the pu"lic. $echnolo!ical
development in the profession ma5 "e encoura!ed
ithout toleratin!, "ut instead ensurin! prevention of
ille!al practice.
$here mi!ht "e nothin! o"<ectiona"le if respondent
is alloed to perform all of its services, "ut onl5 if
such services are made availa"le e@clusivel5 to
mem"ers of the 'ench and 'ar. #espondent ould
then "e offerin! technical assistance, not le!al
services. .lternativel5, the more difficult task of
carefull5 distin!uishin! "eteen hich service ma5
"e offered to the pu"lic in !eneral and hich should
"e made availa"le e@clusivel5 to mem"ers of the 'ar
ma5 "e undertaken. $his, hoever, ma5 re?uire
further proceedin!s "ecause of the factual
considerations involved.
It must "e emphasiEed, hoever, that some of
respondent7s services ou!ht to "e prohi"ited
outri!ht, such as acts hich tend to su!!est or
induce cele"ration a"road of marria!es hich are
"i!amous or otherise ille!al and void under
3hilippine la. >hile respondent ma5 not "e
prohi"ited from simpl5 disseminatin! information
re!ardin! such matters, it must "e re?uired to
include, in the information !iven, a disclaimer that it
is not authoriEed to practice la, that certain course
of action ma5 "e ille!al under 3hilippine la, that it is
not authoriEed or capa"le of renderin! a le!al
opinion, that a la5er should "e consulted "efore
decidin! on hich course of action to take, and that
it cannot recommend an5 particular la5er ithout
su"<ectin! itself to possi"le sanctions for ille!al
practice of la.
If respondent is alloed to advertise, advertisin!
should "e directed e@clusivel5 at mem"ers of the
'ar, ith a clear and unmistaka"le disclaimer that it
is not authoriEed to practice la or perform le!al
services.
$he "enefits of "ein! assisted "5 parale!als cannot
"e i!nored. 'ut no"od5 should "e alloed to
represent himself as a Aparale!alA for profit, ithout
such term "ein! clearl5 defined "5 rule or re!ulation,
and ithout an5 ade?uate and effective means of
re!ulatin! his activities. .lso, la practice in a
corporate form ma5 prove to "e advanta!eous to the
le!al profession, "ut "efore alloance of such
practice ma5 "e considered, the corporation7s .rticle
of Incorporation and '5-las must conform to each
and ever5 provision of the %ode of 3rofessional
#esponsi"ilit5 and the #ules of %ourt.
!
/. $hilippine Bar Association2
@@@ @@@ @@@.
#espondent asserts that it Ais not en!a!ed in the
practice of la "ut en!a!ed in !ivin! le!al support
services to la5ers and la5men, throu!h
e@perienced parale!als, ith the use of modern
computers and electronic machinesA (pars. / and +,
%omment). $his is a"surd. 6n?uestiona"l5,
respondent7s acts of holdin! out itself to the pu"lic
under the trade name A$he &e!al %linic, Inc.,A and
solicitin! emplo5ment for its enumerated services fall
ithin the realm of a practice hich thus 5ields itself
to the re!ulator5 poers of the ,upreme %ourt. 8or
respondent to sa5 that it is merel5 en!a!ed in
parale!al ork is to stretch credulit5. #espondent7s
on commercial advertisement hich announces a
certainAtty. Don $ar0inson to "e handlin! the fields
of la "elies its pretense. 8rom all indications,
respondent A$he &e!al %linic, Inc.A is offerin! and
renderin! leal services throu!h its reserve of
la5ers. It has "een held that the practice of la is
not limited to the conduct of cases in court, "ut
includes drain! of deeds, incorporation, renderin!
opinions, an! a!visin clients as to their leal riht
an! then ta0e them to an attorney an! as0 the latter
to loo0 after their case in court ,ee Martin, &e!al
and Judicial Bthics, 198- ed., p. +9).
It is apt to recall that onl5 natural persons can
en!a!e in the practice of la, and such limitation
cannot "e evaded "5 a corporation emplo5in!
competent la5ers to practice for it. :"viousl5, this
is the scheme or device "5 hich respondent A$he
&e!al %linic, Inc.A holds out itself to the pu"lic and
solicits emplo5ment of its le!al services. It is
an o!ious vehicle for deception, especiall5 so hen
the pu"lic cannot ventilate an5 !rievance
for malpractice a!ainst the "usiness conduit.
3recisel5, the limitation of practice of la to persons
ho have "een dul5 admitted as mem"ers of the 'ar
(,ec. 1, #ule 1+8, #evised #ules of %ourt) is to
su"<ect the mem"ers to the !iscipline of the
,upreme %ourt. .lthou!h respondent uses
its business name, the persons and the la5ers ho
act for it are su"<ect to court discipline. $he practice
of la is not a profession open to all ho ish to
en!a!e in it nor can it "e assi!ned to another (,ee 5
.m. Jur. /1(). It is a personal riht limited to
persons ho have ?ualified themselves under the
la. It follos that not onl5 respondent "ut also all
the persons ho are actin! for respondent are the
persons en!a!ed in unethical la practice.
"
+. $hilippine .a"yers< Association2
$he 3hilippine &a5ers7 .ssociation7s position, in
anser to the issues stated herein, are it2
1. $he &e!al %linic is en!a!ed in the practice of laD
/. ,uch practice is unauthoriEedD
+. $he advertisements complained of are not onl5
unethical, "ut also misleadin! and patentl5 immoralD
and
-. $he 4onora"le ,upreme %ourt has the poer to
supress and punish the &e!al %linic and its
corporate officers for its unauthoriEed practice of la
and for its unethical, misleadin! and immoral
advertisin!.
@@@ @@@ @@@
#espondent posits that is it not en!a!ed in the
practice of la. It claims that it merel5 renders Ale!al
support servicesA to ansers, liti!ants and the
!eneral pu"lic as enunciated in the 3rimar5 3urpose
%lause of its .rticle(s) of Incorporation. (,ee pa!es
/ to 5 of #espondent7s %omment). 'ut its advertised
services, as enumerated a"ove, clearl5 and
convincin!l5 sho that it is indeed en!a!ed in la
practice, al"eit outside of court.
.s advertised, it offers the !eneral pu"lic its advisor5
services on 3ersons and 8amil5 #elations &a,
particularl5 re!ardin! forei!n divorces, annulment of
marria!es, secret marria!es, a"sence and adoptionD
Immi!ration &as, particularl5 on visa related
pro"lems, immi!ration pro"lemsD the Investments
&a of the 3hilippines and such other related las.
Its advertised services unmistaka"l5 re?uire the
application of the aforesaid la, the le!al principles
and procedures related thereto, the le!al advices
"ased thereon and hich activities call for le!al
trainin!, knoled!e and e@perience.
.ppl5in! the test laid don "5 the %ourt in the
aforecited .!rava %ase, the activities of respondent
fall s?uarel5 and are em"raced in hat la5ers and
la5men e?uall5 term as Athe practice of la.A
7
-. 8.$. ,omen .a"yers< )ircle2
In resolvin!, the issues "efore this 4onora"le %ourt,
paramount consideration should "e !iven to the
protection of the !eneral pu"lic from the dan!er of
"ein! e@ploited "5 un?ualified persons or entities
ho ma5 "e en!a!ed in the practice of la.
.t present, "ecomin! a la5er re?uires one to take a
ri!orous four-5ear course of stud5 on top of a four-
5ear "achelor of arts or sciences course and then to
take and pass the "ar e@aminations. :nl5 then, is a
la5er ?ualified to practice la.
>hile the use of a parale!al is sanctioned in man5
<urisdiction as an aid to the administration of <ustice,
there are in those <urisdictions, courses of stud5
andKor standards hich ould ?ualif5 these
parale!als to deal ith the !eneral pu"lic as such.
>hile it ma5 no "e the opportune time to esta"lish
these courses of stud5 andKor standards, the fact
remains that at present, these do not e@ist in the
3hilippines. In the meantime, this 4onora"le %ourt
ma5 decide to make measures to protect the !eneral
pu"lic from "ein! e@ploited "5 those ho ma5 "e
dealin! ith the !eneral pu"lic in the !uise of "ein!
Aparale!alsA ithout "ein! ?ualified to do so.
In the same manner, the !eneral pu"lic should also
"e protected from the dan!ers hich ma5 "e
"rou!ht a"out "5 advertisin! of le!al services. >hile
it appears that la5ers are prohi"ited under the
present %ode of 3rofessional #esponsi"ilit5 from
advertisin!, it appears in the instant case that le!al
services are "ein! advertised not "5 la5ers "ut "5
an entit5 staffed "5 Aparale!als.A %learl5, measures
should "e taken to protect the !eneral pu"lic from
fallin! pre5 to those ho advertise le!al services
ithout "ein! ?ualified to offer such services.
#
. perusal of the ?uestioned advertisements of
#espondent, hoever, seems to !ive the impression that
information re!ardin! validit5 of marria!es, divorce,
annulment of marria!e, immi!ration, visa e@tensions,
declaration of a"sence, adoption and forei!n investment,
hich are in essence, le!al matters , ill "e !iven to them
if the5 avail of its services. $he #espondent7s name H
$he &e!al %linic, Inc. H does not help matters. It !ives the
impression a!ain that #espondent ill or can cure the
le!al pro"lems "rou!ht to them. .ssumin! that
#espondent is, as claimed, staffed purel5 "5 parale!als, it
also !ives the misleadin! impression that there are
la5ers involved in $he &e!al %linic, Inc., as there are
doctors in an5 medical clinic, hen onl5 Aparale!alsA are
involved in $he &e!al %linic, Inc.
#espondent7s alle!ations are further "elied "5 the
ver5 admissions of its 3resident and ma<orit5
stockholder, .tt5. )o!ales, ho !ave an insi!ht on
the structure and main purpose of #espondent
corporation in the aforementioned A,tareekA
article.A
9
5. ,omen .a"yer<s Association of the $hilippines2
.nne@es A.A and A'A of the petition are clearl5
advertisements to solicit cases for the purpose of
!ain hich, as provided for under the a"ove cited
la, (are) ille!al and a!ainst the %ode of
3rofessional #esponsi"ilit5 of la5ers in this
countr5.
.nne@ A.A of the petition is not onl5 ille!al in that it is
an advertisement to solicit cases, "ut it is ille!al in
that in "old letters it announces that the &e!al %linic,
Inc., could ork outKcause the cele"ration of a secret
marria!e hich is not onl5 ille!al "ut immoral in this
countr5. >hile it is advertised that one has to !o to
said a!enc5 and pa5 35*( for a valid marria!e it is
certainl5 foolin! the pu"lic for valid marria!es in the
3hilippines are solemniEed onl5 "5 officers
authoriEed to do so under the la. .nd to emplo5 an
a!enc5 for said purpose of contractin! marria!e is
not necessar5.
)o amount of reasonin! that in the 6,., %anada
and other countries the trend is toards alloin!
la5ers to advertise their special skills to ena"le
people to o"tain from ?ualified practitioners le!al
services for their particular needs can <ustif5 the use
of advertisements such as are the su"<ect matter of
the petition, for one (cannot) <ustif5 an ille!al act
even "5 hatever merit the ille!al act ma5 serve.
$he la has 5et to "e amended so that such act
could "ecome <ustifia"le.
>e su"mit further that these advertisements that
seem to pro<ect that secret marria!es and divorce
are possi"le in this countr5 for a fee, hen in fact it
is not so, are hi!hl5 reprehensi"le.
It ould encoura!e people to consult this clinic a"out
ho the5 could !o a"out havin! a secret marria!e
here, hen it cannot nor should ever "e attempted,
and seek advice on divorce, here in this countr5
there is none, e@cept under the %ode of Muslim
3ersonal &as in the 3hilippines. It is also a!ainst
!ood morals and is deceitful "ecause it falsel5
represents to the pu"lic to "e a"le to do that hich
"5 our las cannot "e done (and) "5 our %ode of
Morals should not "e done.
In the case (of) In re $a!uda, 5+ 3hil. +1, the
,upreme %ourt held that solicitation for clients "5 an
attorne5 "5 circulars of advertisements, is
unprofessional, and offenses of this character <ustif5
permanent elimination from the 'ar.
10
*. %e!eracion 7nternacional !e Aboa!os2
@@@ @@@ @@@
1.1 $hat entities admittedl5 not en!a!ed in the
practice of la, such as mana!ement consultanc5
firms or travel a!encies, hether run "5 la5ers or
not, perform the services rendered "5 #espondent
does not necessaril5 lead to the conclusion that
#espondent is not unlafull5 practicin! la. In the
same vein, hoever, the fact that the "usiness of
respondent (assumin! it can "e en!a!ed in
independentl5 of the practice of la) involves
knoled!e of the la does not necessaril5 make
respondent !uilt5 of unlaful practice of la.
. . . . :f necessit5, no one . . . .
actin! as a consultant can render
effective service unless he is
familiar ith such statutes and
re!ulations. 4e must "e careful not
to su!!est a course of conduct
hich the la for"ids. It
seems . . . .clear that (the
consultant7s) knoled!e of the la,
and his use of that knoled!e as a
factor in determinin! hat measures
he shall recommend, do not
constitute the practice of la . . . . It
is not onl5 presumed that all men
kno the la, "ut it is a fact that
most men have considera"le
ac?uaintance ith "road features of
the la . . . . :ur knoled!e of the
la H accurate or inaccurate H
moulds our conduct not onl5 hen
e are actin! for ourselves, "ut
hen e are servin! others.
'ankers, li?uor dealers and la5men
!enerall5 possess rather precise
knoled!e of the las touchin! their
particular "usiness or profession. .
!ood e@ample is the architect, ho
must "e familiar ith Eonin!,
"uildin! and fire prevention codes,
factor5 and tenement house
statutes, and ho dras plans and
specification in harmon5 ith the
la. $his is not practicin! la.
'ut suppose the architect, asked "5
his client to omit a fire toer, replies
that it is re?uired "5 the statute. :r
the industrial relations e@pert cites,
in support of some measure that he
recommends, a decision of the
)ational &a"or #elations 'oard. .re
the5 practicin! laG In m5 opinion,
the5 are not, provided no separate
fee is char!ed for the le!al advice or
information, and the le!al ?uestion
is su"ordinate and incidental to a
ma<or non-le!al pro"lem.
It is lar!el5 a matter of de!ree and
of custom.
If it ere usual for one intendin! to
erect a "uildin! on his land to
en!a!e a la5er to advise him and
the architect in respect to the
"uildin! code and the like, then an
architect ho performed this
function ould pro"a"l5 "e
considered to "e trespassin! on
territor5 reserved for licensed
attorne5s. &ikeise, if the industrial
relations field had "een pre-empted
"5 la5ers, or custom placed a
la5er ala5s at the el"o of the
la5 personnel man. 'ut this is not
the case. $he most important "od5
of the industrial relations e@perts are
the officers and "usiness a!ents of
the la"or unions and fe of them
are la5ers. .mon! the lar!er
corporate emplo5ers, it has "een
the practice for some 5ears to
dele!ate special responsi"ilit5 in
emplo5ee matters to a mana!ement
!roup chosen for their practical
knoled!e and skill in such matter,
and ithout re!ard to le!al thinkin!
or lack of it. More recentl5,
consultants like the defendants have
the same service that the lar!er
emplo5ers !et from their on
specialiEed staff.
$he handlin! of industrial relations
is !roin! into a reco!niEed
profession for hich appropriate
courses are offered "5 our leadin!
universities. $he court should "e
ver5 cautious a"out declarin! MthatN
a idespread, ell-esta"lished
method of conductin! "usiness is
unlaful, or that the considera"le
class of men ho customaril5
perform a certain function have no
ri!ht to do so, or that the technical
education !iven "5 our schools
cannot "e used "5 the !raduates in
their "usiness.
7n !eterminin "hether a man is
practicin la", "e shoul! consi!er
his "or0 for any particular client or
customer, as a "hole. I can ima!ine
defendant "ein! en!a!ed primaril5
to advise as to the la definin! his
client7s o"li!ations to his emplo5ees,
to !uide his client7s o"li!ations to his
emplo5ees, to !uide his client alon!
the path charted "5 la. $his, of
course, ould "e the practice of the
la. 'ut such is not the fact in the
case "efore me. 0efendant7s
primaril5 efforts are alon! economic
and ps5cholo!ical lines. $he la
onl5 provides the frame ithin hich
he must ork, <ust as the Eonin!
code limits the kind of "uildin! the
limits the kind of "uildin! the
architect ma5 plan. The inci!ental
leal a!vice or information
!efen!ant may ive, !oes not
transform his activities into the
practice of la". .et me a!! that if,
even as a minor feature of his "or0,
he performe! services "hich are
customarily reserve! to members of
the bar, he "oul! be practicin
la". 8or instance, if as part of a
elfare pro!ram, he dre
emplo5ees7 ills.
.nother "ranch of defendant7s ork
is the representations of the
emplo5er in the ad<ustment of
!rievances and in collective
"ar!ainin!, ith or ithout a
mediator. $his is not per se the
practice of la. .n5one ma5 use an
a!ent for ne!otiations and ma5
select an a!ent particularl5 skilled in
the su"<ect under discussion, and
the person appointed is free to
accept the emplo5ment hether or
not he is a mem"er of the "ar. 4ere,
hoever, there ma5 "e an e@ception
here the "usiness turns on a
?uestion of la. Most real estate
sales are ne!otiated "5 "rokers ho
are not la5ers. 'ut if the value of
the land depends on a disputed
ri!ht-of-a5 and the principal role of
the ne!otiator is to assess the
pro"a"le outcome of the dispute
and persuade the opposite part5 to
the same opinion, then it ma5 "e
that onl5 a la5er can accept the
assi!nment. :r if a controvers5
"eteen an emplo5er and his men
!ros from differin! interpretations
of a contract, or of a statute, it is
?uite likel5 that defendant should
not handle it. 'ut I need not reach a
definite conclusion here, since the
situation is not presented "5 the
proofs.
0efendant also appears to
represent the emplo5er "efore
administrative a!encies of the
federal !overnment, especiall5
"efore trial e@aminers of the
)ational &a"or #elations 'oard. .n
a!enc5 of the federal !overnment,
actin! "5 virtue of an authorit5
!ranted "5 the %on!ress, ma5
re!ulate the representation of
parties "efore such a!enc5. $he
,tate of )e Jerse5 is ithout
poer to interfere ith such
determination or to for"id
representation "efore the a!enc5 "5
one hom the a!enc5 admits. $he
rules of the )ational &a"or #elations
'oard !ive to a part5 the ri!ht to
appear in person, or "5 counsel, or
"5 other representative. #ules and
#e!ulations, ,eptem"er 11th, 19-*,
,. /(+.+1. 7%ounsel7 here means a
licensed attorne5, and ther
representative7 one not a la5er. In
this phase of his ork, defendant
ma5 lafull5 do hatever the &a"or
'oard allos, even ar!uin!
?uestions purel5 le!al. (.uer"acher
v. >ood, 5+ .. /d 8((, cited in
,tatsk5, Introduction to
3arale!alism M191-N, at pp. 15--
15*.).
1.8 8rom the fore!oin!, it can "e said that a person
en!a!ed in a laful callin! (hich ma5 involve
knoled!e of the la) is not en!a!ed in the practice
of la provided that2
(a) $he le!al ?uestion is su"ordinate and incidental
to a ma<or non-le!al pro"lemD.
(") $he services performed are not customaril5
reserved to mem"ers of the "arD .
(c) )o separate fee is char!ed for the le!al advice or
information.
.ll these must "e considered in relation to the ork
for an5 particular client as a hole.
1.9. If the person involved is "oth la5er and non-
la5er, the %ode of 3rofessional #esponsi"ilit5
succintl5 states the rule of conduct2
#ule 15.(8 H . la5er ho is en!a!ed in another
profession or occupation concurrentl5 ith the
practice of la shall make clear to his client hether
he is actin! as a la5er or in another capacit5.
1.1(. In the present case. the &e!al %linic appears to
render eddin! services (,ee .nne@ A.A 3etition).
,ervices on routine, strai!htforard marria!es, like
securin! a marria!e license, and makin!
arran!ements ith a priest or a <ud!e, ma5 not
constitute practice of la. 4oever, if the pro"lem is
as complicated as that descri"ed in A#@ for &e!al
3ro"lemsA on the ,haron %uneta-=a""5
%oncepcion-#ichard =omeE case, then hat ma5 "e
involved is actuall5 the practice of la. If a non-
la5er, such as the &e!al %linic, renders such
services then it is en!a!ed in the unauthoriEed
practice of la.
1.11. $he &e!al %linic also appears to !ive
information on divorce, a"sence, annulment of
marria!e and visas (,ee .nne@es A.A and A'A
3etition). 3urel5 !ivin! informational materials ma5
not constitute of la. $he "usiness is similar to that
of a "ookstore here the customer "u5s materials
on the su"<ect and determines on the su"<ect and
determines "5 himself hat courses of action to
take.
It is not entirel5 impro"a"le, hoever, that aside
from purel5 !ivin! information, the &e!al %linic7s
parale!als ma5 appl5 the la to the particular
pro"lem of the client, and !ive le!al advice. ,uch
ould constitute unauthoriEed practice of la.
It cannot "e claimed that the
pu"lication of a le!al te@t hich
pu"lication of a le!al te@t hich
purports to sa5 hat the la is
amount to le!al practice. .nd the
mere fact that the principles or rules
stated in the te@t ma5 "e accepted
"5 a particular reader as a solution
to his pro"lem does not affect
this. . . . . .pparentl5 it is ur!ed that
the con<oinin! of these to, that is,
the te@t and the forms, ith advice
as to ho the forms should "e filled
out, constitutes the unlaful practice
of la. 'ut that is the situation ith
man5 approved and accepted te@ts.
0ace57s "ook is sold to the pu"lic at
lar!e. There is no personal contact
or relationship "ith a particular
in!ivi!ual. =or !oes there e:ist that
relation of confi!ence an! trust so
necessary to the status of attorney
an! client. T#7S 7S T#9
9SS9=T7A. -% .9GA. $RA)T7)9
> T#9 R9$R9S9=TAT7-= A=D
AD;7S7=G -% A $ART7)8.AR
$9RS-= 7= A $ART7)8.AR
S7T8AT7-=. .t most the "ook
assumes to offer !eneral advice on
common pro"lems, and does not
purport to !ive personal advice on a
specific pro"lem peculiar to a
desi!nated or readil5 identified
person. ,imilarl5 the defendant7s
pu"lication does not purport to !ive
personal advice on a specific
pro"lem peculiar to a desi!nated or
readil5 identified person in a
particular situation H in their
pu"lication and sale of the kits, such
pu"lication and sale did not
constitutes the unlaful practice of
la . . . . $here "ein! no le!al
impediment under the statute to the
sale of the kit, there as no proper
"asis for the in<unction a!ainst
defendant maintainin! an office for
the purpose of sellin! to persons
seekin! a divorce, separation,
annulment or separation a!reement
an5 printed material or ritin!s
relatin! to matrimonial la or the
prohi"ition in the memorandum of
modification of the <ud!ment a!ainst
defendant havin! an interest in an5
pu"lishin! house pu"lishin! his
manuscript on divorce and a!ainst
his havin! an5 personal contact ith
an5 prospective purchaser. $he
record does full5 support, hoever,
the findin! that for the chan!e of
P15 or P1(( for the kit, the
defendant !ave le!al advice in the
course of personal contacts
concernin! particular pro"lems
hich mi!ht arise in the preparation
and presentation of the purchaser7s
asserted matrimonial cause of
action or pursuit of other le!al
remedies and assistance in the
preparation of necessar5 documents
($he in<unction therefore sou!ht to)
en<oin conduct constitutin! the
practice of la, particularl5 ith
reference to the !ivin! of advice and
counsel "5 the defendant relatin! to
specific pro"lems of particular
individuals in connection ith a
divorce, separation, annulment of
separation a!reement sou!ht and
should "e affirmed. (,tate v.
>inder, +-8, )C, /0 /1( M191+N,
cited in ,tatsk5, supra at p. 1(1.).
1.1/. #espondent, of course, states that its services
are Astrictl5 non-dia!nostic, non-advisor5. AIt is not
controverted, hoever, that if the services Ainvolve
!ivin! le!al advice or counsellin!,A such ould
constitute practice of la (%omment, par. *./). It is in
this li!ht that 8I0. su"mits that a factual in?uir5 ma5
"e necessar5 for the <udicious disposition of this
case.
@@@ @@@ @@@
/.1(. .nne@ A.A ma5 "e ethicall5 o"<ectiona"le in
that it can !ive the impression (or perpetuate the
ron! notion) that there is a secret marria!e. >ith
all the solemnities, formalities and other re?uisites of
marria!es (,ee .rticles /, et se'., 8amil5 %ode), no
3hilippine marria!e can "e secret.
/.11. .nne@ A'A ma5 likeise "e ethicall5
o"<ectiona"le. $he second para!raph thereof (hich
is not necessaril5 related to the first para!raph) fails
to state the limitation that onl5 Aparale!al servicesGA
or Ale!al support servicesA, and not le!al services,
are availa"le.A
11
. prefator5 discussion on the meanin! of the phrase Apractice of laA
"ecomes e@i!ent for the proper determination of the issues raised "5
the petition at "ar. :n this score, e note that the clause Apractice of
laA has lon! "een the su"<ect of <udicial construction and
interpretation. $he courts have laid don !eneral principles and
doctrines e@plainin! the meanin! and scope of the term, some of
hich e no take into account.
3ractice of la means an5 activit5, in or out of court, hich re?uires
the application of la, le!al procedures, knoled!e, trainin! and
e@perience. $o en!a!e in the practice of la is to perform those acts
hich are characteristic of the profession. =enerall5, to practice la
is to !ive advice or render an5 kind of service that involves le!al
knoled!e or skill.
12
$he practice of la is not limited to the conduct of cases in court. It
includes le!al advice and counsel, and the preparation of le!al
instruments and contract "5 hich le!al ri!hts are secured, althou!h
such matter ma5 or ma5 not "e pendin! in a court.
13
In the practice of his profession, a licensed attorne5 at la !enerall5
en!a!es in three principal t5pes of professional activit52 le!al advice
and instructions to clients to inform them of their ri!hts and
o"li!ations, preparation for clients of documents re?uirin! knoled!e
of le!al principles not possessed "5 ordinar5 la5man, and
appearance for clients "efore pu"lic tri"unals hich possess poer
and authorit5 to determine ri!hts of life, li"ert5, and propert5
accordin! to la, in order to assist in proper interpretation and
enforcement of la.
1
>hen a person participates in the a trial and advertises himself as a
la5er, he is in the practice of la.
1!
:ne ho confers ith clients,
advises them as to their le!al ri!hts and then takes the "usiness to an
attorne5 and asks the latter to look after the case in court, is also practicin!
la.
1"
=ivin! advice for compensation re!ardin! the le!al status and ri!hts
of another and the conduct ith respect thereto constitutes a practice of
la.
17
:ne ho renders an opinion as to the proper interpretation of a
statute, and receives pa5 for it, is, to that e@tent, practicin! la.
1#
In the recent case of )ayetano vs. Monso!,
19
after citin! the doctrines
in several cases, e laid don the test to determine hether certain acts
constitute Apractice of la,A thus2
'lack defines Apractice of laA as2
$he rendition of services re?uirin! the knoled!e
and the application of le!al principles and techni?ue
to serve the interest of another ith his consent. It is
not limited to appearin! in court, or advisin! and
assistin! in the conduct of liti!ation, "ut em"races
the preparation of pleadin!s, and other papers
incident to actions and special proceedin!s,
conve5ancin!, the preparation of le!al instruments
of all kinds, and the !ivin! of all le!al advice to
clients. It em"races all advice to clients and all
actions taken for them in matters connected ith the
la.
$he practice of la is not limited to the conduct of cases on court.
(&and $itle ."stract and $rust %o. v. 0orken , 1/9 :hio ,t. /+,
19+). B. *5(). . person is also considered to "e in the practice of
la hen he2
. . . . for valua"le consideration en!a!es in the
"usiness of advisin! person, firms, associations or
corporations as to their ri!ht under the la, or
appears in a representative capacit5 as an advocate
in proceedin!s, pendin! or prospective, "efore an5
court, commissioner, referee, "oard, "od5,
committee, or commission constituted "5 la or
authoriEed to settle controversies and there, in such
representative capacit5, performs an5 act or acts for
the purpose of o"tainin! or defendin! the ri!hts of
their clients under the la. :therise stated, one
ho, in a representative capacit5, en!a!es in the
"usiness of advisin! clients as to their ri!hts under
the la, or hile so en!a!ed performs an5 act or
acts either in court or outside of court for that
purpose, is en!a!ed in the practice of la. (,tate e@.
rel. Mckittrick v. %.,. 0udle5 and %o., 1(/ ,. >. /d
895, +-( Mo. 85/).
$his %ourt, in the case of $hilippines .a"yers Association
v. Arava (1(5 3hil. 11+, 11*-111),stated2
$he practice of la is not limited to the conduct of
cases or liti!ation in courtD it em"races the
preparation of pleadin!s and other papers incident to
actions and special proceedin!s, the mana!ement of
such actions and proceedin!s on "ehalf of clients
"efore <ud!es and courts, and in addition, conve5in!.
In !eneral, all advice to clients, and all action taken
for them in matters connected ith the la
incorporation services, assessment and
condemnation services contemplatin! an
appearance "efore a <udicial "od5, the foreclosure of
a mort!a!e, enforcement of a creditor7s claim in
"ankruptc5 and insolvenc5 proceedin!s, and
conductin! proceedin!s in attachment, and in
matters or estate and !uardianship have "een held
to constitute la practice, as do the preparation and
draftin! of le!al instruments, here the ork done
involves the determination "5 the trained le!al mind
of the le!al effect of facts and conditions. (5 .m. Jr.
p. /*/, /*+).
3ractice of la under modern conditions consists in
no small part of ork performed outside of an5 court
and havin! no immediate relation to proceedin!s in
court. It em"races conve5ancin!, the !ivin! of le!al
advice on a lar!e variet5 of su"<ects and the
preparation and e@ecution of le!al instruments
coverin! an e@tensive field of "usiness and trust
relations and other affairs. .lthou!h these
transactions ma5 have no direct connection ith
court proceedin!s, the5 are ala5s su"<ect to
"ecome involved in liti!ation. $he5 re?uire in man5
aspects a hi!h de!ree of le!al skill, a ide
e@perience ith men and affairs, and !reat capacit5
for adaptation to difficult and comple@ situations.
$hese customar5 functions of an attorne5 or
counselor at la "ear an intimate relation to the
administration of <ustice "5 the courts. )o valid
distinction, so far as concerns the ?uestion set forth
in the order, can "e dran "eteen that part of the
ork of the la5er hich involves appearance in
court and that part hich involves advice and
draftin! of instruments in his office. It is of
importance to the elfare of the pu"lic that these
manifold customar5 functions "e performed "5
persons possessed of ade?uate learnin! and skill, of
sound moral character, and actin! at all times under
the heav5 trust o"li!ations to clients hich rests
upon all attorne5s. (Moran, %omments on the #ules
o %ourt, 9ol. + M191+ ed.N, pp. **5-***, citin! In #e
:pinion of the Justices MMassN, 19- ). B. +1+,
?uoted in #hode Is. 'ar .ssoc. v. .utomo"ile
,ervice .ssoc. M#.I.N 191 .. 1+9, 1--).
$he practice of la, therefore, covers a ide ran!e of activities in
and out of court. .ppl5in! the aforementioned criteria to the case at
"ar, e a!ree ith the perceptive findin!s and o"servations of the
aforestated "ar associations that the activities of respondent, as
advertised, constitute Apractice of la.A
$he contention of respondent that it merel5 offers le!al support
services can neither "e seriousl5 considered nor sustained. ,aid
proposition is "elied "5 respondent7s on description of the services
it has "een offerin!, to it2
&e!al support services "asicall5 consists of !ivin!
read5 information "5 trained parale!als to la5men
and la5ers, hich are strictl5 non-dia!nostic, non-
advisor5, throu!h the e@tensive use of computers
and modern information technolo!5 in the !atherin!,
processin!, stora!e, transmission and reproduction
of information and communication, such as
computeriEed le!al researchD encodin! and
reproduction of documents and pleadin!s prepared
"5 la5men or la5ersD document searchD evidence
!atherin!D locatin! parties or itnesses to a caseD
fact findin! investi!ationsD and assistance to la5men
in need of "asic institutional services from
!overnment or non-!overnment a!encies, like "irth,
marria!e, propert5, or "usiness re!istrationsD
educational or emplo5ment records or certifications,
o"tainin! documentation like clearances, passports,
local or forei!n visasD !ivin! information a"out las
of other countries that the5 ma5 find useful, like
forei!n divorce, marria!e or adoption las that the5
can avail of preparator5 to emi!ration to the forei!n
countr5, and other matters that do not involve
representation of clients in courtD desi!nin! and
installin! computer s5stems, pro!rams, or softare
for the efficient mana!ement of la offices,
corporate le!al departments, courts and other
entities en!a!ed in dispensin! or administerin! le!al
services.
20
>hile some of the services "ein! offered "5 respondent corporation
merel5 involve mechanical and technical knoho, such as the
installation of computer s5stems and pro!rams for the efficient
mana!ement of la offices, or the computeriEation of research aids
and materials, these ill not suffice to <ustif5 an e@ception to the
!eneral rule.
>hat is palpa"l5 clear is that respondent corporation !ives out le!al
information to la5men and la5ers. Its contention that such function
is non-advisor5 and non-dia!nostic is more apparent than real. In
providin! information, for e@ample, a"out forei!n las on marria!e,
divorce and adoption, it strains the credulit5 of this %ourt that all the
respondent corporation ill simpl5 do is look for the la, furnish a
cop5 thereof to the client, and stop there as if it ere merel5 a
"ookstore. >ith its attorne5s and so called parale!als, it ill
necessaril5 have to e@plain to the client the intricacies of the la and
advise him or her on the proper course of action to "e taken as ma5
"e provided for "5 said la. $hat is hat its advertisements
represent and for the hich services it ill conse?uentl5 char!e and
"e paid. $hat activit5 falls s?uarel5 ithin the <urisprudential definition
of Apractice of la.A ,uch a conclusion ill not "e altered "5 the fact
that respondent corporation does not represent clients in court since
la practice, as the ei!ht of authorit5 holds, is not limited merel5
!ivin! le!al advice, contract draftin! and so forth.
$he aforesaid conclusion is further stren!thened "5 an article
pu"lished in the Januar5 1+, 1991 issue of the ,tareekK$he ,unda5
Ma!aEine of the 3hilippines ,tar, entitled A#@ for &e!al 3ro"lems,A
here an insi!ht into the structure, main purpose and operations of
respondent corporation as !iven "5 its on Aproprietor,A .tt5.
#o!elio 3. )o!ales2
$his is the kind of "usiness that is transacted
ever5da5 at $he &e!al %linic, ith offices on the
seventh floor of the 9ictoria 'uildin! alon! 6. ).
.venue in Manila. )o matter hat the client7s
pro"lem, and even if it is as complicated as the
%uneta-%oncepcion domestic situation, .tt5.
)o!ales and his staff of la5ers, ho, like doctors
are AspecialistsA in various fields can take care of it.
$he &e!al %linic, Inc. has specialists in ta@ation and
criminal la, medico-le!al pro"lems, la"or, liti!ation,
and famil5 la. $hese specialist are "acked up "5 a
"atter5 of parale!als, counsellors and attorne5s.
.tt5. )o!ales set up $he &e!al %linic in 198-.
Inspired "5 the trend in the medical field toard
specialiEation, it caters to clients ho cannot afford
the services of the "i! la firms.
$he &e!al %linic has re!ular and alk-in clients.
Ahen the5 come, e start "5 anal5Ein! the pro"lem.
$hat7s hat doctors do also. $he5 ask 5ou ho 5ou
contracted hat7s "otherin! 5ou, the5 take 5our
temperature, the5 o"serve 5ou for the s5mptoms
and so on. $hat7s ho e operate, too. .nd once the
pro"lem has "een cate!oriEed, then it7s referred to
one of our specialists.
$here are cases hich do not, in medical terms,
re?uire sur!er5 or follo-up treatment. $hese $he
&e!al %linic disposes of in a matter of minutes.
A$hin!s like preparin! a simple deed of sale or an
affidavit of loss can "e taken care of "5 our staff or, if
this ere a hospital the residents or the interns. >e
can take care of these matters on a hile 5ou ait
"asis. .!ain, kun! "a!a sa hospital, out-patient,
hindi kailan!an! ma-confine. It7s <ust like a common
cold or diarrhea,A e@plains .tt5. )o!ales.
$hose cases hich re?uires more e@tensive
AtreatmentA are dealt ith accordin!l5. AIf 5ou had a
rich relative ho died and named 5ou her sole heir,
and 5ou stand to inherit millions of pesos of propert5,
e ould refer 5ou to a specialist in ta@ation. $here
ould "e real estate ta@es and arrears hich ould
need to "e put in order, and 5our relative is even
ta@ed "5 the state for the ri!ht to transfer her
propert5, and onl5 a specialist in ta@ation ould "e
properl5 trained to deal ith the pro"lem. )o, if
there ere other heirs contestin! 5our rich relatives
ill, then 5ou ould need a liti!ator, ho knos ho
to arran!e the pro"lem for presentation in court, and
!ather evidence to support the case.
21
$hat fact that the corporation emplo5s parale!als to carr5 out its
services is not controllin!. >hat is important is that it is en!a!ed in
the practice of la "5 virtue of the nature of the services it renders
hich there"5 "rin!s it ithin the am"it of the statutor5 prohi"itions
a!ainst the advertisements hich it has caused to "e pu"lished and
are no assailed in this proceedin!.
8urther, as correctl5 and appropriatel5 pointed out "5 the 6.3.
>I&:%I, said reported facts sufficientl5 esta"lish that the main
purpose of respondent is to serve as a one-stop-shop of sorts for
various le!al pro"lems herein a client ma5 avail of le!al services
from simple documentation to comple@ liti!ation and corporate
undertakin!s. Most of these services are undou"tedl5 "e5ond the
domain of parale!als, "ut rather, are e@clusive functions of la5ers
en!a!ed in the practice of la.
22
It should "e noted that in our <urisdiction the services "ein! offered
"5 private respondent hich constitute practice of la cannot "e
performed "5 parale!als. :nl5 a person dul5 admitted as a mem"er
of the "ar, or hereafter admitted as such in accordance ith the
provisions of the #ules of %ourt, and ho is in !ood and re!ular
standin!, is entitled to practice la.
23
3u"lic polic5 re?uires that the practice of la "e limited to those
individuals found dul5 ?ualified in education and character. $he
permissive ri!ht conferred on the la5ers is an individual and limited
privile!e su"<ect to ithdraal if he fails to maintain proper standards
of moral and professional conduct. $he purpose is to protect the
pu"lic, the court, the client and the "ar from the incompetence or
dishonest5 of those unlicensed to practice la and not su"<ect to the
disciplinar5 control of the court.
2
$he same rule is o"served in the american <urisdiction herefrom
respondent ould ish to dra support for his thesis. $he doctrines
there also stress that the practice of la is limited to those ho meet
the re?uirements for, and have "een admitted to, the "ar, and
various statutes or rules specificall5 so provide.
2!
$he practice of la is
not a laful "usiness e@cept for mem"ers of the "ar ho have complied ith
all the conditions re?uired "5 statute and the rules of court. :nl5 those
persons are alloed to practice la ho, "5 reason of attainments
previousl5 ac?uired throu!h education and stud5, have "een reco!niEed "5
the courts as possessin! profound knoled!e of le!al science entitlin! them
to advise, counsel ith, protect, or defend the ri!hts claims, or lia"ilities of
their clients, ith respect to the construction, interpretation, operation and
effect of la.
2"
$he <ustification for e@cludin! from the practice of la those
not admitted to the "ar is found, not in the protection of the "ar from
competition, "ut in the protection of the pu"lic from "ein! advised and
represented in le!al matters "5 incompetent and unrelia"le persons over
hom the <udicial department can e@ercise little control.
27
>e have to necessaril5 and definitel5 re<ect respondent7s position
that the concept in the 6nited ,tates of parale!als as an occupation
separate from the la profession "e adopted in this <urisdiction.
>hatever ma5 "e its merits, respondent cannot "ut "e aare that
this should first "e a matter for <udicial rules or le!islative action, and
not of unilateral adoption as it has done.
3arale!als in the 6nited ,tates are trained professionals. .s
admitted "5 respondent, there are schools and universities there
hich offer studies and de!rees in parale!al education, hile there
are none in the 3hilippines.
2#
.s the concept of the Aparale!alsA or Ale!al
assistantA evolved in the 6nited ,tates, standards and !uidelines also
evolved to protect the !eneral pu"lic. :ne of the ma<or standards or
!uidelines as developed "5 the .merican 'ar .ssociation hich set up
=uidelines for the .pproval of &e!al .ssistant Bducation 3ro!rams (191+).
&e!islation has even "een proposed to certif5 le!al assistants. $here are
also associations of parale!als in the 6nited ,tates ith their on code of
professional ethics, such as the )ational .ssociation of &e!al .ssistants,
Inc. and the .merican 3arale!al .ssociation.
29
In the 3hilippines, e still have a restricted concept and limited
acceptance of hat ma5 "e considered as parale!al service. .s
pointed out "5 8I0., some persons not dul5 licensed to practice la
are or have "een alloed limited representation in "ehalf of another
or to render le!al services, "ut such alloa"le services are limited in
scope and e@tent "5 the la, rules or re!ulations !rantin! permission
therefor.
30
.ccordin!l5, e have adopted the .merican <udicial polic5 that, in
the a"sence of constitutional or statutor5 authorit5, a person ho has
not "een admitted as an attorne5 cannot practice la for the proper
administration of <ustice cannot "e hindered "5 the unarranted
intrusion of an unauthoriEed and unskilled person into the practice of
la.
31
$hat polic5 should continue to "e one of encoura!in! persons ho
are unsure of their le!al ri!hts and remedies to seek le!al assistance onl5
from persons licensed to practice la in the state.
32
.nent the issue on the validit5 of the ?uestioned advertisements, the
%ode of 3rofessional #esponsi"ilit5 provides that a la5er in makin!
knon his le!al services shall use onl5 true, honest, fair, di!nified
and o"<ective information or statement of facts.
33
4e is not supposed to
use or permit the use of an5 false, fraudulent, misleadin!, deceptive,
undi!nified, self-laudator5 or unfair statement or claim re!ardin! his
?ualifications or le!al services.
3
)or shall he pa5 or !ive somethin! of value
to representatives of the mass media in anticipation of, or in return for,
pu"licit5 to attract le!al "usiness.
3!
3rior to the adoption of the code of
3rofessional #esponsi"ilit5, the %anons of 3rofessional Bthics had also
arned that la5ers should not resort to indirect advertisements for
professional emplo5ment, such as furnishin! or inspirin! nespaper
comments, or procurin! his photo!raph to "e pu"lished in connection ith
causes in hich the la5er has "een or is en!a!ed or concernin! the
manner of their conduct, the ma!nitude of the interest involved, the
importance of the la5er7s position, and all other like self-laudation.
3"
$he standards of the le!al profession condemn the la5er7s
advertisement of his talents. . la5er cannot, ithout violatin! the
ethics of his profession. advertise his talents or skill as in a manner
similar to a merchant advertisin! his !oods.
37
$he prescription a!ainst
advertisin! of le!al services or solicitation of le!al "usiness rests on the
fundamental postulate that the that the practice of la is a profession. $hus,
in the case of $he Director of Reliious Affairs. vs. 9stanislao R. Bayot
3#
an
advertisement, similar to those of respondent hich are involved in the
present proceedin!,
39
as held to constitute improper advertisin! or
solicitation.
$he pertinent part of the decision therein reads2
It is undenia"le that the advertisement in ?uestion
as a fla!rant violation "5 the respondent of the
ethics of his profession, it "ein! a "raEen solicitation
of "usiness from the pu"lic. ,ection /5 of #ule 1/1
e@pressl5 provides amon! other thin!s that Athe
practice of solicitin! cases at la for the purpose of
!ain, either personall5 or thru paid a!ents or
"rokers, constitutes malpractice.A It is hi!hl5
unethical for an attorne5 to advertise his talents or
skill as a merchant advertises his ares. &a is a
profession and not a trade. $he la5er de!rades
himself and his profession ho stoops to and adopts
the practices of mercantilism "5 advertisin! his
services or offerin! them to the pu"lic. .s a mem"er
of the "ar, he defiles the temple of <ustice ith
mercenar5 activities as the mone5-chan!ers of old
defiled the temple of Jehovah. A$he most orth5 and
effective advertisement possi"le, even for a 5oun!
la5er, . . . . is the esta"lishment of a ell-merited
reputation for professional capacit5 and fidelit5 to
trust. $his cannot "e forced "ut must "e the outcome
of character and conduct.A (%anon /1, %ode of
Bthics.).
>e repeat, the canon of the profession tell us that the "est
advertisin! possi"le for a la5er is a ell-merited reputation for
professional capacit5 and fidelit5 to trust, hich must "e earned as
the outcome of character and conduct. =ood and efficient service to
a client as ell as to the communit5 has a a5 of pu"liciEin! itself
and catchin! pu"lic attention. $hat pu"licit5 is a normal "5-product of
effective service hich is ri!ht and proper. . !ood and reputa"le
la5er needs no artificial stimulus to !enerate it and to ma!nif5 his
success. 4e easil5 sees the difference "eteen a normal "5-product
of a"le service and the unholesome result of propa!anda.
0
:f course, not all t5pes of advertisin! or solicitation are prohi"ited.
$he canons of the profession enumerate e@ceptions to the rule
a!ainst advertisin! or solicitation and define the e@tent to hich the5
ma5 "e undertaken. $he e@ceptions are of to "road cate!ories,
namel5, those hich are e@pressl5 alloed and those hich are
necessaril5 implied from the restrictions.
1
$he first of such e@ceptions is the pu"lication in reputa"le la lists, in
a manner consistent ith the standards of conduct imposed "5 the
canons, of "rief "io!raphical and informative data. A,uch data must
not "e misleadin! and ma5 include onl5 a statement of the la5er7s
name and the names of his professional associatesD addresses,
telephone num"ers, ca"le addressesD "ranches of la practicedD
date and place of "irth and admission to the "arD schools attended
ith dates of !raduation, de!rees and other educational distinctionD
pu"lic or ?uasi-pu"lic officesD posts of honorD le!al authorshipsD le!al
teachin! positionsD mem"ership and offices in "ar associations and
committees thereof, in le!al and scientific societies and le!al
fraternitiesD the fact of listin!s in other reputa"le la listsD the names
and addresses of referencesD and, ith their ritten consent, the
names of clients re!ularl5 represented.A
2
$he la list must "e a reputa"le la list pu"lished primaril5 for that
purposeD it cannot "e a mere supplemental feature of a paper,
ma!aEine, trade <ournal or periodical hich is pu"lished principall5
for other purposes. 8or that reason, a la5er ma5 not properl5
pu"lish his "rief "io!raphical and informative data in a dail5 paper,
ma!aEine, trade <ournal or societ5 pro!ram. )or ma5 a la5er permit
his name to "e pu"lished in a la list the conduct, mana!ement or
contents of hich are calculated or likel5 to deceive or in<ure the
pu"lic or the "ar, or to loer the di!nit5 or standin! of the
profession.
3
$he use of an ordinar5 simple professional card is also permitted.
$he card ma5 contain onl5 a statement of his name, the name of the
la firm hich he is connected ith, address, telephone num"er and
special "ranch of la practiced. $he pu"lication of a simple
announcement of the openin! of a la firm or of chan!es in the
partnership, associates, firm name or office address, "ein! for the
convenience of the profession, is not o"<ectiona"le. 4e ma5 likeise
have his name listed in a telephone director5 "ut not under a
desi!nation of special "ranch of la.

9eril5, takin! into consideration the nature and contents of the

advertisements for hich respondent is "ein! taken to task, hich
even includes a ?uotation of the fees char!ed "5 said respondent
corporation for services rendered, e find and so hold that the same
definitel5 do not and conclusivel5 cannot fall under an5 of the a"ove-
mentioned e@ceptions.
$he rulin! in the case of Bates, et al. vs. State Bar of
Ari*ona,
!
hich is repeatedl5 invoked and constitutes the <ustification
relied upon "5 respondent, is o"viousl5 not applica"le to the case at "ar.
8oremost is the fact that the disciplinar5 rule involved in said case e@plicitl5
allos a la5er, as an e@ception to the prohi"ition a!ainst advertisements "5
la5ers, to pu"lish a statement of le!al fees for an initial consultation or the
availa"ilit5 upon re?uest of a ritten schedule of fees or an estimate of the
fee to "e char!ed for the specific services. )o such e@ception is provided
for, e@pressl5 or impliedl5, hether in our former %anons of 3rofessional
Bthics or the present %ode of 3rofessional #esponsi"ilit5. 'esides, even the
disciplinar5 rule in the Bates case contains a proviso that the e@ceptions
stated therein are Anot applica"le in an5 state unless and until it is
implemented "5 such authorit5 in that state.A
"
$his !oes to sho that an
e@ception to the !eneral rule, such as that "ein! invoked "5 herein
respondent, can "e made onl5 if and hen the canons e@pressl5 provide for
such an e@ception. :therise, the prohi"ition stands, as in the case at "ar.
It "ears mention that in a surve5 conducted "5 the .merican 'ar
.ssociation after the decision in 'ates, on the attitude of the pu"lic
a"out la5ers after viein! television commercials, it as found that
pu"lic opinion dropped si!nificantl5
7
ith respect to these
characteristics of la5ers2
$rustorth5 from 11L to 1-L
3rofessional from 11L to 1-L
4onest from *5L to 1-L
0i!nified from -5L to 1-L
,econdl5, it is our firm "elief that ith the present situation of our
le!al and <udicial s5stems, to allo the pu"lication of advertisements
of the kind used "5 respondent ould onl5 serve to a!!ravate hat
is alread5 a deterioratin! pu"lic opinion of the le!al profession hose
inte!rit5 has consistentl5 "een under attack latel5 "5 media and the
communit5 in !eneral. .t this point in time, it is of utmost importance
in the face of such ne!ative, even if unfair, criticisms at times, to
adopt and maintain that level of professional conduct hich is
"e5ond reproach, and to e@ert all efforts to re!ain the hi!h esteem
formerl5 accorded to the le!al profession.
In sum, it is undou"tedl5 a mis"ehavior on the part of the la5er,
su"<ect to disciplinar5 action, to advertise his services e@cept in
alloa"le instances
#
or to aid a la5man in the unauthoriEed practice of
la.
9
%onsiderin! that .tt5. #o!elio 3. )o!ales, ho is the prime
incorporator, ma<or stockholder and proprietor of $he &e!al %linic, Inc. is a
mem"er of the 3hilippine 'ar, he is here"5 reprimanded, ith a arnin! that
a repetition of the same or similar acts hich are involved in this proceedin!
ill "e dealt ith more severel5.
>hile e deem it necessar5 that the ?uestion as to the le!alit5 or
ille!alit5 of the purposeKs for hich the &e!al %linic, Inc. as created
should "e passed upon and determined, e are constrained to
refrain from lapsin! into an o"iter on that aspect since it is clearl5 not
ithin the ad<udicative parameters of the present proceedin! hich is
merel5 administrative in nature. It is, of course, imperative that this
matter "e promptl5 determined, al"eit in a different proceedin! and
forum, since, under the present state of our la and <urisprudence, a
corporation cannot "e or!aniEed for or en!a!e in the practice of la
in this countr5. $his interdiction, <ust like the rule a!ainst unethical
advertisin!, cannot "e su"verted "5 emplo5in! some so-called
parale!als supposedl5 renderin! the alle!ed support services.
$he remed5 for the apparent "reach of this prohi"ition "5 respondent
is the concern and province of the ,olicitor =eneral ho can institute
the correspondin! 'uo "arranto action,
!0
after due ascertainment of the
factual "ack!round and "asis for the !rant of respondent7s corporate charter,
in li!ht of the putative misuse thereof. $hat spin-off from the instant "ar
matter is referred to the ,olicitor =eneral for such action as ma5 "e
necessar5 under the circumstances.
.%%:#0I)=&C, the %ourt #esolved to #B,$#.I) and B)J:I)
herein respondent, $he &e!al %linic, Inc., from issuin! or causin! the
pu"lication or dissemination of an5 advertisement in an5 form hich
is of the same or similar tenor and purpose as .nne@es A.A and A'A
of this petition, and from conductin!, directl5 or indirectl5, an5
activit5, operation or transaction proscri"ed "5 la or the %ode of
3rofessional Bthics as indicated herein. &et copies of this resolution
"e furnished the Inte!rated 'ar of the 3hilippines, the :ffice of the
'ar %onfidant and the :ffice of the ,olicitor =eneral for appropriate
action in accordance hereith.
=arvasa, ).(., )ru*, %eliciano, $a!illa, Bi!in, Gri&o-A'uino, Davi!e,
(r., Romero, =ocon, Bellosillo, Melo an! ?uiason, ((., concur
#epu"lic of the 3hilippines
S,PREME +O,RT
Manila
B) '.)%
A.+. No. 3!0 Au3u)' 7, 19!9
In &e4 DALMA+IO DE LOS ANGELES, respondent.
-ffice of the Solicitor General 9!ilberto Barot an! Solicitor
9merito M. Salva for the Government.
Dalmacio !e los Aneles an! .uis %. Gabinete for respon!ent.
2A,TISTA ANGELO, J.4
.tt5. 0almacio de los .n!eles as convicted of the crime of
attempted "ri"er5 in a final decision rendered "5 the %ourt of
.ppeals and as sentenced to to (/) 5ears, four (-( months,
and one (1) da5 of !estierro, and to pa5 a fine of 3/,+((, ith
su"sidiar5 !estierro in case of insolvenc5 (%.-=.#. )o. 11-11-#),
and under section 1, #ule 1/8, of the #ules of %ourt, he as
re?uired to sho cause h5 he should not "e dis"arred from the
practice of his profession.
In his ritten e@planation he appealed to the s5mpath5 and merc5
of this %ourt considerin! that he has si@ children to support the
eldest "ein! 1* 5ears old and the 5oun!est - 5ears ho ill "ear
the sti!ma of dishonor if disciplinar5 action "e taken a!ainst him.
4e made manifest to this %ourt that if he ever committed hat is
attri"uted to him, it as merel5 due to an error of <ud!ment hich
he honestl5 and sincerel5 deplores.
6nder section /5, #ule 1/1, a mem"er of the "ar ma5 "e
removed from his office as attorne5 if he is convicted of a crime
involvin! moral turpitude the reason "ehind this rule "ein! that
the continued possession of a !ood moral character is a re?uisite
condition for the ri!htful continuance of the la5er in the practice
of la ith the result that the loss of such ?ualification <ustifies his
dis"arment (Mortel vs. .spiras 1(( 3hil., 58*D 5+ :ff. =aE., )o. +,
*/8). .nd since "ri"er5 is admittedl5 a felon5 involvin! moral
turpitude (1 %.J.,., p. 1+*D 5 .m. Jur. p. -/8), this %ourt, much as
it s5mpathiEes ith the pli!ht of respondent, is constrained to
decree his dis"arment as ordained "5 section /5 of #ule 1/1.
It is therefore ordered that respondent "e removed from his office
as attorne5 and that his name "e stricken out from the #oll of
.ttorne5s. ,o ordered.
$aras, ).(., Ben*on, $a!illa, Montemayor, .abra!or,
)oncepcion, 9n!encia an! Barrera, ((., concur.
B) '.)%
M=.#. )o. &-/1*(1. 0ecem"er /8, 19*8.N
NIELSON 5 +OMPAN6, IN+., $7%(n'(889%$$e77%n', .). LEPANTO
+ONSOLIDATED MINING +OMPAN6, 1e8en1%n'9%$$e77ee.
,C&&.'6,
1. #BMB0I.& &.>D .33B.&D J6B,$I:) :8 8.%$ :# &.> ):$
#.I,B0 I) $4B &:>B# %:6#$ M.C ):$ 'B #.I,B0 :) .33B.&D
I),$.)$ %.,B. H In the pleadin!s filed "5 defendant &epanto in the loer
court and its memorandum and "rief on appeal it never asserted the theor5
that it has the ri!ht to terminate the mana!ement contract "ecause that
contract is one of a!enc5 hich it could terminate at ill. >hile it is true that
in its ninth and tenth special affirmative defenses, it has the ri!ht to terminate
the mana!ement contract in ?uestion, that plea of its ri!ht to terminate as
not "ased upon the !round that the relation "eteen defendant and plaintiff
as that of principal and a!ent "ut upon the !round that plaintiff had
alle!edl5 not complied ith certain terms of the mana!ement contract. If
defendant had thou!ht of considerin! the mana!ement contract as one of
a!enc5 it could have amended its anser "5 statin! e@actl5 its position. It
could have asserted its theor5 of a!enc5 in its memorandum for the loer
and in its "rief on appeal. $his, defendant did not do. It is the rule, and the
settled doctrine that a part5 cannot chan!e his theor5 on appeal, that is, that
a part5 cannot raise in the appellate court an5 ?uestion of la or of fact that
as not raised in the court "elo or hich as not ithin the issue made "5
the parties in their pleadin!s.
/. %I9I& &.>D ,3B%I.& %:)$#.%$,D .=B)%C 0I,$I)=6I,4B0
8#:M &B.,B :8 ,B#9I%B,. H In "oth a!enc5 and lease of services one
of the parties "inds himself to render some service to the other part5.
.!enc5, hoever, is distin!uished from lease of ork or services in that the
"asis of a!enc5 is representation, hile in the lease of ork or services the
"asis is emplo5ment. $he lessor of services does not represent his emplo5er
hile the a!ent represents his principal. .!enc5 is a preparator5 contract as
a!enc5 Adoes not stop ith the a!enc5 "ecause the purpose is to enter into
other contracts.A $he most characteristic feature of an a!enc5 relationship is
the a!ent7s poer to "rin! a"out "usiness relations "eteen his principal
and third persons. A$he a!ent is destined to e@ecute <uridical acts (creation,
modification or e@tinction of relations ith third parties). &ease services
contemplate onl5 material (non-<uridical) acts.A
+. I0.D I0.D %:)$#.%$ I) I),$.)$ %.,B I, 8:# &B.,B :8
,B#9I%B,. H It appears that the principal and paramount undertakin! of
plaintiff under the mana!ement contract as the operation and development
of the mine and the operation of the mill. .ll the other undertakin!s
mentioned in the contract are necessar5 or incidental to the principal
undertakin! H these other undertakin!s "ein! dependent upon the ork on
the development of the mine and the operation of the mill. In the
performance of this principal undertakin! plaintiff as not in an5 a5
e@ecutin! <uridical acts for defendant, destined to create, modif5 or
e@tin!uish "usiness relations "eteen &epanto and third persons. In other
ords, in performin! its principal undertakin! plaintiff as not actin! as an
a!ent of defendant &epanto, in the sense that the term a!ent is interpreted
under the la of a!enc5, "ut as one ho as performin! material acts for an
emplo5er, for a compensation.
-. I0.D I0.D I0.D 0B8B)0.)$ M.C ):$ $B#MI).$B %:)$#.%$ .$
>I&&. H In the instant case, para!raph QI of the contract provides2 A. . .
)ielson a!rees that &epanto ma5 cancel this a!reement at an5 time upon
ninet5 da5s ritten notice, in the event that )ielson for an5 reason
hatsoever, e@cept acts of =od, strike and other causes "e5ond its control,
shall cease to prosecute the operation and development of the properties
herein descri"ed, in !ood faith and in accordance ith the approved minin!
practiceA defendant could not terminate the a!reement at ill. 6nder the
provision, it could terminate or cancel the a!reement "5 !ivin! notice of
termination 9( da5s in advance onl5 in the event that plaintiff should
prosecute in "ad faith and not in accordance ith approved minin! practice
the operation and development of the minin! properties of defendant.
0efendant could not terminate the a!reement if plaintiff should cease to
prosecute the operation and development of the minin! properties "5 reason
of acts of =od, strike and other causes "e5ond the control of plaintiff. It is,
therefore, "5 e@press stipulation of the parties, the mana!ement contract in
?uestion is not revoca"le at ill of defendant. $his mana!ement contract is
not a contract of a!enc5 as defined in .rticle 11(( of the :ld %ivil %ode, "ut
a contract of lease of service as defined in .rticle 15-- of the same code.
$his contract can not "e unilaterall5 revoked "5 defendant.
5. I0.D I0.D I0.D BQ$B),I:) :8 %:)$#.%$ BJ6.& $: 3B#I:0 :8
,6,3B),I:). H $he nature of the contract for mana!ement and operation
of mines <ustifies the interpretation of the force ma<eure clause, that a period
e?ual to the period of suspension due to force ma<eure should "e added to
the ori!inal term of the contract "5 a5 of an e@tension. >e, therefore,
reiterate the rulin! in our decision that since the mana!ement contract in the
instant case as suspended from 8e"ruar5 19-/ to June /*, 19-8, from the
latter the contract had 5et five 5ears to !o.
*. I0.D I0.D I0.D I0.D 3&.I)$I88 &IMI$B0 $: M.).=BMB)$ 8BB,
8:# 3B#I:0 :8 BQ$B),I:). H ,ince the mana!ement contract had
"een e@tended for 5 5ears, or *( months, from June /1, 19-8 to June /*,
195+, and the cause of action of plaintiff to claim for its compensation durin!
that period of e@tension had not prescri"ed, it follos that plaintiff should "e
aarded the mana!ement fees durin! the hole period of e@tension plus the
1(L of the value of the dividends declared durin! the said period of
e@tension the 1(L of the depletion reserve that as set up, and the 1(L of
an5 amount e@pended out of surplus earnin!s for capital account.
1. I0.D 3#B,%#I3$I:)D I).33&I%.'I&I$C $4B#B:8 I) I),$.)$
%.,B. H $he claim accrued on 0ecem"er +1, 19-1, and the ri!ht to
commence an action thereon started on Januar5 1, 19-/. $he action on this
claim did not prescri"e althou!h the complaint as filed on 8e"ruar5 *, 1958
- or after a lapse of 1* 5ears, 1 month and 5 da5s H "ecause of the
operation of moratorium la. $he moratorium period of 8 5ears, / months
and 8 da5s should "e deducted from the period that had elapsed since the
accrual of the cause of action to the date of the filin! of the complaint, so
that there is a period of less than 8 5ears to "e reckoned for the purpose of
prescription.
8. I0.D BQB%6$I9B :#0B# )6M'B# +/, M:#.$:#I6M &.>. H
B@ecutive :rder )o. +/ covered all de"ts and monetar5 o"li!ation on
contract "efore the ar (or "efore 0ecem"er 19-1) and those contracted
su"se?uent to 0ec. 8, 19-1 and durin! the Japanese occupation. #. )o.
+-/, approved on Jul5 /*, 19-8, lifted the moratorium provided for in
B@ecutive :rder )o. +/ on pre-ar (or pre-0ec. 8, 19-1) de"ts of de"tors
ho had not filed ar dama!e claims ith the 6nited ,tates >ar 0ama!e
%ommission. In other ords, after the effectivit5 of #. )o. +-/, the de"t
moratorium as limited (1) to de"ts and other monetar5 o"li!ations hich
ere contracted after 0ec. 8, 19-1 and durin! the Japanese occupation, and
(/) to those pre-ar (or pre-0ec. 8, 19-1) de"ts and other monetar5 claims.
$hat as the situation up to Ma5 18, 195+ hen this %ourt declared #. )o.
+-/ unconstitutional. It has "een held "5 this %ourt, hoever, that from
March 1(, 19-5 hen B@ecutive :rder )o. +/ as issued, to Ma5 18, 195+
hen #. )o. +-/ as declared unconstitutional H or a period of 8 5ears, /
months and 8 da5s H the de"t moratorium as in force, and had the effect
of suspendin! the period of prescription.
9. MB#%.)$I&B &.>D %:#3:#.$I:),D ,4.#B, :8 ,$:%;D
I,,6.)%B $4B#B:8. H 8rom ,ection 1* of the %orporation &a, the
consideration for hich shares of stock ma5 "e issued are2 (1) cashD (/)
propert5 and (+) undistri"uted profits. ,hares of stock are !iven the special
name Astock dividendsA onl5 if the5 are issued in lieu of undistri"uted profits.
If the shares of stocks are issued in e@chan!e of cash or 3ropert5 then those
shares do not fall under the cate!or5 of Astock dividendsA. . corporation ma5
le!all5 issue shares of stock in consideration of services rendered to it "5 a
person not a stockholder, or in pa5ment of its inde"tedness. . share of stock
issued to pa5 for services rendered is e?uivalent to a stock issued in
e@chan!e of propert5 "ecause services is e?uivalent to propert5. &ikeise a
share of stock issued in pa5ment of inde"tedness is e?uivalent to issuin! a
stock in e@chan!e for cash. 'ut a share of stock thus issued should "e part
of the ori!inal capital stock of the corporation upon its or!aniEation, or part of
the stocks issued hen the increase of the capitaliEation of a corporation is
properl5 authoriEed.
1(. I0.D I0.D ,$:%; 0I9I0B)0, 0B8I)B0. H . Astock dividendA is an5
dividend pa5a"le in shares of stock of the corporation declarin! or
authoriEin! such dividend. It is, hat the term itself implies, a distri"ution of
the shares of stock of the corporation amon! the stockholders as dividends.
. stock dividend of a corporation is a dividend paid in shares of stock
instead of cash and is properl5 pa5a"le onl5 out of surplus profits. ,o, a
stock dividend is actuall5 to thin!s2 (1) a dividend, and (/) the enforced use
of the dividend mone5 to purchase additional shares of stock at par. >hen a
corporation issues stock dividends, it shos that the corporations7
accumulated profits have "een capitaliEed instead of distri"uted to the
stockholders or retained as surplus availa"le for distri"ution, in mone5 or in
kind, should opportunit5 offer. 8ar from "ein! a realiEation of profits for the
stockholder, it tends rather to postpone said realiEation, in that the fund
represented "5 the ne stock has "een transferred from the surplus to
assets and no lon!er availa"le for actual distri"ution.
11. I0.D I0.D 0I9I0B)0. H $he term AdividendA "oth in the technical
sense and its ordinar5 acceptation, is that part or portion of the profits of the
enterprise hich the corporation, "5 its !overnin! a!ents, sets apart for
rata"le division amon! the holders of the capital stock. It means the fund
actuall5 set aside, and declared "5 the directors of the corporation as a
dividend, and dul5 ordered "5 the director5, or "5 the stockholders at a
corporate meetin! to "e divided or distri"uted amon! the stockholders
accordin! to their respective interests.
1/. .$$:#)BC,D .$$:#)BC, 8BB,D .>.#0 :8 .$$:#)BC,
8BB, I, >I$4I) $4B ,:6)0 0I,%#B$I:) :8 $4B %:6#$. H $he
matter of the aard of attorne5s fees is ithin the sound discretion of this
court. In our decision >e have stated the reason h5 the aard of
35(,(((.(( for attorne57s fees is considered "5 this %ourt as reasona"le.
0 B % I , I : )
R.&0I9.#, J p2
&epanto seeks the reconsideration of the decision rendered on 0ecem"er
11, 19**. $he motion for reconsideration is "ased on to sets of !rounds H
the first set consistin! of four principal !rounds, and the second set
consistin! of five alternative !rounds, as follos2
3rincipal =rounds2
1. $he court erred in overlookin! and failin! to appl5 the proper la
applica"le to the a!enc5 or mana!ement contract in ?uestion, namel5,
.rticle 11++ of the :ld %ivil %ode (.rticle 19/( of the ne), "5 virtue of
hich said a!enc5 as effectivel5 revoked and terminated in 19-5 hen, as
stated in para!raph /( of the complaint, Adefendant voluntaril5 . . . prevented
plaintiff from resumin! mana!ement and operation of said minin!
properties.A
/. $he court erred in holdin! that para!raph II of the mana!ement
contract (B@hi"it %) suspended the period of said contract.
+. $he court erred in reversin! the rulin! of the trial <ud!e, "ased on
ell-settled <urisprudence of this ,upreme %ourt, that the mana!ement
a!reement as onl5 suspended "ut not e@tended on account of the ar.
- $he court erred in reversin! the findin! of the trial <ud!e that
)ielson7s action had prescri"ed, "ut considerin! onl5 the first claim and
i!norin! the prescripti"ilit5 of the other claims.
.lternative =rounds2
5. $he court erred in holdin! that the period of suspension of the
contract on account of the ar lasted from 8e"ruar5 19-/ to June /*, 19-8.
*. .ssumin! ar!uendo that )ielson is entitled to an5 relief, the court
erred in aardin! as dama!es (a) 1(L of the cash dividends declared and
paid in 0ecem"er, 19-1D (") the mana!ement fee of 3/,5((.(( for the month
of Januar5, 19-/D and (c) the full contract price for the e@tended period of
si@t5 months, since these dama!es ere neither demanded nor proved and,
in an5 case, not alloa"le under the !eneral la of dama!es.
1. .ssumin! ar!uendo that appellant is entitled to an5 relief, the court
erred in orderin! appellee to issue and deliver to appellant shares of stock
to!ether ith fruits thereof.
8. $he court erred in aardin! to appellant an undetermined amount
of shares of stock andKor cash, hich aard cannot "e ascertained and
e@ecuted ithout further liti!ation.
9. $he court erred in renderin! <ud!ment for attorne57s fees.
>e are !oin! to dell on these !rounds in the order the5 are presented.
1. In its first principal !round &epanto claims that its on counsel and
this %ourt had overlooked the real nature of the mana!ement contract
entered into "5 and "eteen &epanto and )ielson, and the la that is
applica"le on said contract. &epanto no asserts for the first time - and this
is done in a motion for reconsideration H that the mana!ement contract in
?uestion is a contract of a!enc5 such that it has the ri!ht to revoke and
terminate the said contract, as it did terminate the same, under the la of
a!enc5, and particularl5 pursuant to .rticle 11++ of the :ld %ivil %ode
(.rticle 19/( of the )e %ivil %ode)
>e have taken note that &epanto is advancin! a ne theor5. >e have
carefull5 e@amined the pleadin!s filed "5 &epanto in the loer court, its
memorandum and its "rief on appeal, and never did it assert the theor5 that
it has the ri!ht to terminate the mana!ement contract "ecause that contract
is one of a!enc5 hich it could terminate at ill. >hile it is true that in its
ninth and tenth special affirmative defenses, in its anser in the court "elo,
&epanto pleaded that it had the ri!ht to terminate the mana!ement contract
in ?uestion, that plea of its ri!ht to terminate as not "ased upon the !round
that the relation "eteen &epanto and )ielson as that of principal and
a!ent "ut upon the !round that )ielson had alle!edl5 not complied ith
certain terms of the mana!ement contract. If &epanto had thou!ht of
considerin! the mana!ement contract as one of a!enc5 it could have
amended its anser "5 statin! e@actl5 its position. It could have asserted its
theor5 of a!enc5 in its memorandum for the loer court and in its "rief on
appeal. $his, &epanto did not do. It is the rule, and the settled doctrine of this
%ourt, that a part5 cannot chan!e his theor5 on appeal H that is, that a part5
cannot raise in the appellate court an5 ?uestion of la or of fact that as not
raised in the court "elo or hich as not ithin the issue made "5 the
parties in their pleadin!s (,ection 19, #ule -9 of the old #ules of %ourt, and
also ,ection 18 of the ne #ules of %ourtD 4autea vs. Ma!allon, &-/(+-5,
)ovem"er /8, 19*-D )orthern Motors, Inc. vs. 3rince &ine, &-1+88-,
8e"ruar5 /9, 19*(D .merican B@press %o. vs. )atividad, -* 3hil. /(1D
.!oncillo vs. Javier, +8 3hil. -/- and Molina vs. ,omes, /- 3hil. -9)
.t an5 rate, even if e allo &epanto to assert its ne theor5 at this ver5 late
sta!e of the proceedin!s, this %ourt cannot sustain the same.
&epanto contends that the mana!ement contract in ?uestion (B@hi"it %) is
one of a!enc5 "ecause2 (1) )ielson as to mana!e and operate the minin!
properties and mill on "ehalf, and for the account, of &epantoD and (/)
)ielson as authoriEed to represent &epanto in enterin!, on &epanto7s
"ehalf, into contracts for the hirin! of la"orers, purchase of supplies, and the
sale and marketin! of the ores mined. .ll these, &epanto claims, sho that
)ielson as, "5 the terms of the contract, destined to e@ecute <uridical acts
not on its on "ehalf "ut on "ehalf of &epanto under the control of the 'oard
of 0irectors of &epanto Aat all timesA. 4ence &epanto claims that the contract
is one of a!enc5. &epanto then maintains that an a!enc5 is revoca"le at the
ill of the principal (.rticle 11++ of the :ld %ivil %ode) re!ardless of an5
term or period stipulated in the contract, and it as in pursuance of that ri!ht
that &epanto terminated the contract in 19-5 hen it took over and assumed
e@clusive mana!ement of the ork previousl5 entrusted to )ielson under the
contract. &epanto finall5 maintains that )ielson as an a!ent is not entitled to
dama!es since the la !ives to the principal the ri!ht to terminate the
a!enc5 at ill.
'ecause of &epanto7s ne theor5 >e consider it necessar5 to determine the
nature of the mana!ement contract H hether it is a contract of a!enc5 or a
contract of lease of services. Incidentall5, e have noted that the loer
court, in the decision appealed from, considered the mana!ement contract
as a contract of lease of services.
.rticle 11(9 of the :ld %ivil %ode, definin! contract of a!enc5, provides2
A'5 the contract of a!enc5, one person "inds himself to render some service
or do somethin! for the account or at the re?uest of another.A
.rticle 15--, definin! contract of lease of service, provides2
AIn a lease of ork or services, one of the parties "inds himself to make or
construct somethin! or to render a service to the other for a price certain.A
In "oth a!enc5 and lease of services one of the parties "inds himself to
render some service to the other part5. .!enc5, hoever, is distin!uished
from lease of ork or services in that the "asis of a!enc5 is representation,
hile in the lease of ork or services the "asis is emplo5ment. $he lessor of
services does not represent his emplo5er, hile the a!ent represents his
principal. Manresa, in his A%ommentarios al %odi!o %ivil BspaIolA (19+1,
$omo IQ, pp. +1/-+1+), points out that the element of representation
distin!uishes a!enc5 from lease of services, as follos2
A)uestro art. 1.1(9 como el art 1.98- del %odi!o de )apoleon 5 cuantos
te@tos le!ales citamos en las concordancias, e@presan claramente esta idea
de la representaciSn, 7hacer al!una cosa por cuenta o encar!o de otra7 dice
nuestro %odi!oD 7poder de hacer al!una cosa para el mandante o en su
nom"re7 dice el %odi!o de )apoleon, 5 en tales pala"ras aparece vivo 5
luminoso el concepto 5 la teoria de la representacion, tan fecunda en
enseIanEas, ?ue a su sola luE es como se e@plican las diferencias ?ue
separan el mandato del arrendamiento de servicios, de los contratos
inominados, del conse<o 5 de la !estion de ne!ocios.
ABn efecto, en el arrendamiento de servicios al o"li!arse para su e<ecucion,
se tra"a<a, en verdad, para el dueIo ?ue remunera la la"or, pero ni se le
representa ni se o"ra en su nom"re . . .A
:n the "asis of the interpretation of .rticle 11(9 of the old %ivil %ode, .rticle
18*8 of the ne %ivil %ode has defined the contract of a!enc5 in more
e@plicit terms, as follos2
A'5 the contract of a!enc5 a person "inds himself to render some service or
to do somethin! in representation or on "ehalf of another, ith the consent
or authorit5 of the latter.A
$here is another o"vious distinction "eteen a!enc5 and lease of services.
.!enc5 is a preparator5 contract, as a!enc5 Adoes not stop ith the a!enc5
"ecause the purpose is to enter into other contracts.A $he most
characteristic feature of an a!enc5 relationship is the a!ent7s poer to "rin!
a"out "usiness relations "eteen his principal and third persons. A$he a!ent
is destined to e@ecute <uridical acts (creation, modification or e@tinction of
relations ith third parties). &ease of services contemplate onl5 material
(non-<uridical) acts.A (#e5es and 3uno, A.n :utline of 3hilippine %ivil &a,A
9ol. 9, p. /11)
In the li!ht of the interpretations e have mentioned in the fore!oin!
para!raphs, let us no determine the nature of the mana!ement contract in
?uestion. 6nder the contract, )ielson had a!reed, for a period of five 5ears,
ith the ri!ht to rene for a like period, to e@plore, develop and operate the
minin! claims of &epanto, and to mine, or mine and mill, such pa5 ore as
ma5 "e found therein and to market the metallic products recovered
therefrom hich ma5 prove to "e marketa"le, as ell as to render for
&epanto other services specified in the contract. >e !ather from the contract
that the ork undertaken "5 )ielson as to take complete char!e, su"<ect at
all times to the !eneral control of the 'oard of 0irectors of &epanto, of the
e@ploration and development of the minin! claims, of the hirin! of a sufficient
and competent staff and of sufficient and capa"le la"orers, of the
prospectin! and development of the mine, of the erection and operation of
the mill, and of the "eneficiation and marketin! of the minerals found on the
minin! propertiesD and in carr5in! out said o"li!ation )ielson should proceed
dili!entl5 and in accordance ith the "est minin! practice. In connection ith
its ork )ielson as to su"mit reports, maps, plans and recommendations
ith respect to the operation and development of the minin! properties,
make recommendations and plans on the erection or enlar!ement of an5
e@istin! mill, dispatch minin! en!ineers and technicians to the minin!
properties as from time to time ma5 reasona"l5 "e re?uired to investi!ate
and make recommendations ithout cost or e@pense to &epanto. )ielson
as also to Aact as purchasin! a!ent of supplies, e?uipment and other
necessar5 purchases "5 &epanto, provided, hoever, that no purchase shall
"e made ithout the prior approval of &epantoD and provided further, that no
commission shall "e claimed or retained "5 )ielson on such purchaseAD and
Ato su"mit all re?uisition for supplies, all contracts and arran!ement ith
en!ineers, and staff and all matters re?uirin! the e@penditures of mone5,
present or future, for prior approval "5 &epantoD and also to make contracts
su"<ect to the prior approval of &epanto for the sale and marketin! of the
minerals mined from said properties, hen said products are in a suita"le
condition for marketin!.A 1
It thus appears that the principal and paramount undertakin! of )ielson
under the mana!ement contract as the operation and development of the
mine and the operation of the mill. .ll the other undertakin!s mentioned in
the contract are necessar5 or incidental to the principal undertakin! H these
other undertakin!s "ein! dependent upon the ork on the development of
the mine and the operation of the mill. In the performance of this principal
undertakin! )ielson as not in an5 a5 e@ecutin! <uridical acts for &epanto,
destined to create, modif5 or e@tin!uish "usiness relations "eteen &epanto
and third persons. In other ords, in performin! its principal undertakin!
)ielson as not actin! as an a!ent of &epanto, in the sense that the term
a!ent is interpreted under the la of a!enc5, "ut as one ho as performin!
material acts for an emplo5er, for a compensation.
It is true that the mana!ement contract provides that )ielson ould also act
as purchasin! a!ent of supplies and enter into contracts re!ardin! the sale
of mineral, "ut the contract also provides that )ielson could not make an5
purchase, or sell the minerals, ithout the prior approval of &epanto. It is
clear, therefore, that even in these cases )ielson could not e@ecute <uridical
acts hich ould "ind &epanto ithout first securin! the approval of
&epanto. )ielson, then, as to act onl5 as an intermediar5, not as an a!ent.
&epanto contends that the mana!ement contract in ?uestion "ein! one of
a!enc5 it had the ri!ht to terminate the contract at ill pursuant to the
provision of .rticle 11++ of the old %ivil %ode. >e find, hoever, a provision
in the mana!ement contract hich militates a!ainst this stand of &epanto.
3ara!raph QI of the contract provides2
A'oth parties to this a!reement full5 reco!niEe that the terms of this
.!reement are made possi"le onl5 "ecause of the faith or confidence that
the :fficials of each compan5 have in the otherD therefore, in order to assure
that such confidence and faith shall a"ide and continue, )IB&,:) a!rees
that &B3.)$: ma5 cancel this .!reement at an5 time upon ninet5 (9()
da5s ritten notice, in the event that )IB&,:) for an5 reason hatsoever,
e@cept acts of =od, strike and other causes "e5ond its control, shall cease
to prosecute the operation and development of the properties herein
descri"ed, in !ood faith and in accordance ith approved minin! practice.A
It is thus seen, from the a"ove-?uoted provision of para!raph QI of the
mana!ement contract, that &epanto could not terminate the a!reement at
ill. &epanto could terminate or cancel the a!reement "5 !ivin! notice of
termination ninet5 da5s in advance onl5 in the event that )ielson should
prosecute in "ad faith and not in accordance ith approved minin! practice
the operation and development of the minin! properties of &epanto. &epanto
could not terminate the a!reement if )ielson should cease to prosecute the
operation and development of the minin! properties "5 reason of acts of
=od, strike and other causes "e5ond the control of )ielson.
$he phrase A'oth parties to this a!reement full5 reco!niEe that the terms of
this a!reement are made possi"le onl5 "ecause of the faith and confidence
of the officials of each compan5 have in the otherA in para!raph QI of the
mana!ement contract does not ?ualif5 the relation "eteen &epanto and
)ielson as that of principal and a!ent "ased on trust and confidence, such
that the contractual relation ma5 "e terminated "5 the principal at an5 time
that the principal loses trust and confidence in the a!ent. #ather, that phrase
simpl5 implies the circumstance that "rou!ht a"out the e@ecution of the
mana!ement contract. $hus, in the annual report for 19+* / , su"mitted "5
Mr. %. .. 0eit, 3resident of &epanto, to its7 stockholders, under date of
March 15, 19+1, e read the folloin!2
A$o the ,tockholders2
@@@ @@@ @@@
A$he incorporation of our %ompan5 as effected as a result of ne!otiations
ith Messrs. )ielson O %o., Inc., and an offer "5 these !entlemen to Messrs.
%. I. %ookes and 9. &. &ednick5, dated .u!ust 11, 19+*, readin! as follos2
7Messrs. %ookes and &ednick5,7
73resent.
7#e2 Manka5an %opper Mines.
7=B)$&BMB)2
7.fter an e@amination of 5our propert5 "5 our en!ineers, e have decided to
offer as e here"5 offer to underrite the entire issue of stock of a
corporation to "e formed for the purpose of takin! over said properties, said
corporation to have an authoriEed capital of 31,15(,(((.((, of hich
31((,(((.(( ill "e issued in escro to the claimoners in e@chan!e for
their claims, and the "alance of 31,(5(,(((.(( e ill sell to the pu"lic at
par or take ourselves.
7$he arran!ement ill "e under the folloin! conditions2
71. $he su"scriptions for cash shall "e pa5a"le 5(L at time of
su"scription and the "alance su"<ect to the call of the 'oard of 0irectors of
the proposed corporation.
7/. >e shall have an underritin! and "rokera!e commission of 1(L
of the 31,(5(,(((.(( to "e sold for cash to the pu"lic, said commission to "e
pa5a"le from the first pa5ment of 5(L on each su"scription.
7+. >e ill "ear the cost of preparin! and mailin! an5 prospectus that
ma5 "e re?uired, "ut no such prospectus ill "e sent out until the te@t
thereof has "een first approved "5 the 'oard of 0irectors of the proposed
corporation.
7-. $hat after the or!aniEation of the corporation, all operatin! contract
"e entered into "eteen ourselves and said corporation, under the terms
hich the propert5 ill "e developed and mined and a mill erected, under
our supervision, our compensation to "e 3/,(((.(( per month until the
propert5 is put on a profita"le "asis and 3/,5((.(( per month plus 1(L of
the net profits for a period of five 5ears thereafter.T
75. $hat e shall have the option to rene said operatin! contract for
an additional period of five 5ears, on the same "asis as the ori!inal contract,
upon the e@piration thereof.
7It is understood that the development and minin! operations on said
propert5, and the erection of the mill thereon, and the e@penditures
therefore, shall "e su"<ect to the !eneral control of the 'oard of 0irectors of
the proposed corporation, and, in case 5ou accept this proposition, that a
detailed operatin! contract ill "e entered into, coverin! the relationships
"eteen the parties.
Cours ver5 trul5,
(,!d.) &. #. )ielson7A
A3ursuant to the provisions of para!raph / of this offer, Messrs. )ielson O
%o., took su"scriptions for :ne Million 8ift5 $housand 3esos
(31,(5(,(((.(() in shares of our %ompan5 and their underritin! and
"rokera!e commission has "een paid. More than fift5 per cent of these
su"scriptions have "een paid to the %ompan5 in cash. $he claimoners
have transferred their claims to the %orporation, "ut the 31((,(((.(( in
stock hich the5 are to receive therefor, is as 5et held in escro.
AImmediatel5 upon the formation of the %orporation Messrs. )ielson O %o.,
assumed the Mana!ement of the propert5 under the control of the 'oard of
0irectors. . modification in the Mana!ement %ontract as made ith the
consent of all the then stockholders, in virtue of hich the compensation of
Messrs. )ielson O %o., as increased to 3/,5((.(( per month hen mill
construction "e!an. $he formal Mana!ement %ontract as not entered into
until Januar5 +(, 19+1.A
@@@ @@@ @@@
AManila, March 15, 19+1
(,!d.) A%... 0e>itt
A3residentA
>e can !ather from the fore!oin! statements in the annual report for 19+*,
and from the provision of para!raph QI of the Mana!ement contract, that the
emplo5ment "5 &epanto of )ielson to operate and mana!e its mines as
principall5 in consideration of the kno-ho and technical services that
)ielson offered &epanto. $he contract thus entered into pursuant to the offer
made "5 )ielson and accepted "5 &epanto as a Adetailed operatin!
contractA. It as not a contract of a!enc5. )ohere in the record is it shon
that &epanto considered )ielson as its a!ent and that &epanto terminated
the mana!ement contract "ecause it had lost its trust and confidence in
)ielson.
$he contention of &epanto that it had terminated the mana!ement contract in
19-5, folloin! the li"eration of the mines from Japanese control, "ecause
the relation "eteen it and )ielson as one of a!enc5 and as such it could
terminate the a!enc5 at ill, is, therefore, untena"le. :n the other hand, it
can "e said that, in assertin! that it had terminated or cancelled the
mana!ement contract in 19-5, &epanto had there"5 violated the e@press
terms of the mana!ement contract. $he mana!ement contract as reneed
to last until Januar5 +1, 19-1, so that the contract had 5et almost to 5ears
to !o H upon the li"eration of the mines in 19-5. $here is no shoin! that
)ielson had ceased to prosecute the operation and development of the
mines in !ood faith and in accordance ith approved minin! practice hich
ould arrant the termination of the contract upon ninet5 da5s ritten
notice. In fact there as no such ritten notice of termination. It is an
admitted fact that )ielson ceased to operate and develop the mines "ecause
of the ar H a cause "e5ond the control of )ielson.
Indeed, if the mana!ement contract in ?uestion as intended to create a
relationship of principal and a!ent "eteen &epanto and )ielson, para!raph
QI of the contract should not have "een inserted "ecause, as provided in
.rticle 11++ of the old %ivil %ode, a!enc5 is essentiall5 revoca"le at the ill
of the principal - that means, ith or ithout cause. 'ut precisel5 said
para!raph QI as inserted in the mana!ement contract to provide for the
cause for its revocation. $he provision of para!raph QI must "e !iven effect.
In the construction of an instrument here there are several provisions or
particulars, such a construction is, if possi"le, to "e adopted as ill !ive
effect to all, + and if some stipulation of an5 contract should admit of several
meanin!s, it shall "e understood as "earin! that import hich is most
ade?uate to render it effectual. -
It is :ur considered vie that "5 e@press stipulation of the parties, the
mana!ement contract in ?uestion is not revoca"le at the ill of &epanto. >e
rule that this mana!ement contract is not a contract of a!enc5 as defined in
.rticle 11(9 of the old %ivil %ode, "ut a contract of lease of services as
defined in .rticle 15-- of the same %ode. $his contract can not "e
unilaterall5 revoked "5 &epanto.
$he first !round of the motion for reconsideration should, therefore, "e
"rushed aside.
/. In the second, third and fifth !rounds of its motion for
reconsideration, &epanto maintains that this %ourt erred, in holdin! that
para!raph II of the mana!ement contract suspended the period of said
contract, in holdin! that the a!reement as not onl5 suspended "ut as
e@tended on account of the ar, and in holdin! that the period of suspension
on account of the ar lasted from 8e"ruar5, 19-/ to June /*, 19-8. >e are
!oin! to discuss these three !rounds to!ether "ecause the5 are inter-
related.
In :ur decision e have delt len!thil5 on the points that the mana!ement
contract as suspended "ecause of the ar, and that the period of the
contract as e@tended for the period e?uivalent to the time hen )ielson
as una"le to perform the ork of minin! and millin! "ecause of the
adverse effects of the ar on the ork of minin! and millin!. It is the
contention of &epanto that the happenin! of those events, and the effects of
those events, simpl5 suspended the performance of the o"li!ations "5 either
part5 in the contract, "ut did not suspend the period of the contract, much
less e@tended the period of the contract.
>e have conscientiousl5 considered the ar!uments of &epanto in support of
these three !rounds, "ut >e are not persuaded to reconsider the rulin!s that
>e made in :ur decision.
>e ant to sa5 a little more on these points, hoever. 3ara!raph II of the
mana!ement contract provides as follos2
AIn the event of inundation, floodin! of the mine, t5phoon, earth?uake or an5
other force ma<eure, ar, insurrection, civil commotion, or!aniEed strike, riot,
fire, in<ur5 to the machiner5 or other event or cause reasona"l5 "e5ond the
control of )IB&,:) and hich adversel5 affects the ork of minin! and
millin!D )IB&,:) shall report such fact to &B3.)$: and ithout lia"ilit5 or
"reach of the terms of this .!reement, the same shall remain in suspense,
holl5 or partiall5 durin! the terms of such ina"ilit5.A(Italics supplied)
. readin! of the a"ove-?uoted para!raph II cannot "ut conve5 the idea that
upon the happenin! of an5 of the events enumerated therein, hich
adversel5 affects the ork of minin! and millin!, the a!reement is deemed
suspended for as lon! as )ielson is una"le to perform its ork of minin! and
millin! "ecause of the adverse effects of the happenin! of the event on the
ork of minin! and millin!. 0urin! the period hen the adverse effects on
the ork of minin! and millin! e@ist, neither part5 in the contract ould "e
held lia"le for non- compliance of its o"li!ation under the contract. In other
ords, the operation of the contract is suspended for as lon! as the adverse
effects of the happenin! of an5 of those events had impeded or o"structed
the ork of minin! and millin!. .n anal5sis of the phraseolo!5 of the a"ove-
?uoted para!raph II of the mana!ement contract readil5 supports the
conclusion that it is the a!reement, or the contract, that is suspended. $he
phrase Athe sameA can refer to no other than the term A.!reementA hich
immediatel5 precedes it. $he A.!reementA ma5 "e holl5 or partiall5
suspended, and this situation ill depend on hether the event holl5 or
partiall5 affected adversel5 the ork of minin! and millin!. In the instant
case, the ar had adversel5 affected H and holl5 at that H the ork of
minin! and millin!. >e have clearl5 stated in :ur decision the circumstances
"rou!ht a"out "5 the ar hich caused the hole or total suspension of the
a!reement or of the mana!ement contract.
&B3.)$: itself admits that the mana!ement contract as suspended. >e
?uote from the "rief of &B3.)$:2
A3ro"a"l5, hat )ielson meant as, it as prevented "5 &epanto to assume
a!ain the mana!ement of the mine in 19-5, at the precise time hen
defendant as at the feverish phase of reha"ilitation and althou!h the
contract had alread5 "een suspended.A (&epanto7s 'rief, p. 9)
A. . . it as impossi"le, as a result of the destruction of the mine, for the
plaintiff to mana!e and operate the same and "ecause, as provided in the
a!reement, the contract as suspended "5 reason of the ar.A (&epanto7s
'rief, pp. 9-1()
A%lause II, "5 its terms, is clear that the contract is suspended in case
fortuitous event or force ma<eure, such as ar, adversel5 affects the ork of
minin! and millin!.A (&epanto7s 'rief, p. -9)
&epanto is correct hen it said that the o"li!ations under the contract ere
suspended upon the happenin! of an5 of the events enumerated in
para!raph II of the mana!ement contract. Indeed, those o"li!ations ere
suspended "ecause the contract itself as suspended. >hen e talk of a
contract that has "een suspended e certainl5 mean that the contract
temporaril5 ceased to "e operative, and the contract "ecomes operative
a!ain upon the happenin! of a condition H or hen a situation o"tains H
hich arrants the termination of the suspension of the contract.
In :ur decision >e pointed out that the a!reement in the mana!ement
contract ould "e suspended hen to conditions concur, namel52 (1) the
happenin! of the event constitutin! a force ma<eure that as reasona"l5
"e5ond the control of )ielson, and (/) that the event constitutin! the force
ma<eure adversel5 affected the ork of minin! and millin!. $he suspension,
therefore, ould last not onl5 hile the event constitutin! the force ma<eure
continued to occur "ut also for as lon! as the adverse effects of the force
ma<eure on the ork of minin! and millin! had not "een eliminated. 6nder
the mana!ement contract the happenin! alone of the event constitutin! the
force ma<eure hich did not affect adversel5 the ork of minin! and millin!
ould not suspend the period of the contract. It is onl5 hen the to
conditions concur that the period of the a!reement is suspended.
It is not denied that "ecause of the ar, in 8e"ruar5 19-/, the mine, the
ori!inal mill, the ori!inal poer plant, the supplies and e?uipment, and all
installations at the Manka5an mines of &epanto, ere destro5ed upon order
of the 6nited ,tates .rm5, to prevent their utiliEation "5 the enem5. It is not
denied that for the duration of the ar )ielson could not undertake the ork
of minin! and millin!. >hen the mines ere li"erated from the enem5 in
.u!ust, 19-5, the condition of the mines, the mill, the poer plant and other
installations, as not the same as in 8e"ruar5 19-/ hen the5 ere ordered
destro5ed "5 the 6, arm5. %ertainl5, upon the li"eration of the mines from
the enem5, the ork of minin! and millin! could not "e undertaken "5
)ielson under the same favora"le circumstances that o"tained "efore
8e"ruar5 19-/. $he ork of minin! and millin!, as undertaken "5 )ielson in
Januar5, 19-/, could not "e resumed "5 )ielson soon after li"eration
"ecause of the adverse effects of the ar, and this situation continued until
June of 19-8. 4ence, the suspension of the mana!ement contract did not
end upon the li"eration of the mines in .u!ust, 19-5. $he mines and the mill
and the installations, laid aste "5 the rava!es of ar, had to "e
reconstructed and reha"ilitated, and it can "e said that it as onl5 on June
/*, 19-8 that the adverse effects of the ar on the ork of minin! and
millin! had ended, "ecause it as on that date that the operation of the
mines and the mill as resumed. $he period of suspension should,
therefore, "e reckoned from 8e"ruar5 19-/ until June /*, 19-8, "ecause it
as durin! this period that the ar and the adverse effects of the ar on the
ork of minin! and millin! had lasted. $he mines and the installations had to
"e reha"ilitated "ecause of the adverse effects of the ar. $he ork of
reha"ilitation started soon after the li"eration of the mines in .u!ust, 19-5
and lasted until June /*, 19-8 hen, as stated in &epanto7s annual report to
its stockholders for the 5ear 19-8, AJune /8, 19-8 marked the official return
to operation of this compan5 at its properties at Manka5an, Mountain
province, 3hilippinesA (B@h. 8-1).
&epanto ould ar!ue that if the mana!ement contract as suspended at all
the suspension should cease in .u!ust of 19-5, contendin! that the effects
of the ar should cease upon the li"eration of the mines from the enem5.
$his contention cannot "e sustained, "ecause the period of reha"ilitation
as still a period hen the ph5sical effects of the ar H the destruction of
the mines and of all the minin! installations H adversel5 affected, and made
impossi"le, the ork of minin! and millin!. 4ence, the period of the
reconstruction and reha"ilitation of the mines and the installations must "e
counted as part of the period of suspension of the contract.
&epanto claims that it ould not "e unfair to end the period of suspension
upon the li"eration of the mines "ecause soon after the li"eration of the
mines )ielson insisted to resume the mana!ement ork, and that )ielson
as under o"li!ation to reconstruct the mill in the same a5 that it as
under o"li!ation to construct the mill in 19+1. $his contention is untena"le. It
is true that )ielson insisted to resume its mana!ement ork after li"eration,
"ut this as onl5 for the purpose of restorin! the mines, the mill, and other
installations to their operatin! and producin! condition as of 8e"ruar5 19-/
hen the5 ere ordered destro5ed. It is not shon "5 an5 evidence in the
record, that )ielson had a!reed, or ould have a!reed, that the period of
suspension of the contract ould end upon the li"eration of the mines. $his
is so "ecause, as found "5 this %ourt, the intention of the parties in the
mana!ement contract, and as understood "5 them, the mana!ement
contract as suspended for as lon! as the adverse effects of the force
ma<eure on the ork of minin! and millin! had not "een removed, and the
contract ould "e e@tended for as lon! as it as suspended. 6nder the
mana!ement contract )ielson had the o"li!ation to erect and operate the
mill, "ut not to re-erect or reconstruct the mill in case of its destruction "5
force ma<eure.
It is the considered vie of this %ourt that it ould not "e fair to )ielson to
consider the suspension of the contract as terminated upon the li"eration of
the mines "ecause then )ielson ould "e placed in a situation here"5 it
ould have to suffer the adverse effects of the ar on the ork of minin!
and millin!. $he evidence shos that as of Januar5 19-/ the operation of
the mines under the mana!ement of )ielson as alread5 under "eneficial
conditions, so much so that dividends ere alread5 declared "5 &epanto for
the 5ears 19+9, 19-( and 19-1. $o make the mana!ement contract
immediatel5 operative after the li"eration of the mines from the Japanese, at
the time hen the mines and all its installations ere laid aste as a result
of the ar, ould "e to place )ielson in a situation here"5 it ould lose all
the "enefits of hat it had accomplished in placin! the &epanto mines in
profita"le operation "efore the out"reak of the ar in 0ecem"er, 19-1. $he
record shos that )ielson started its mana!ement operation a5 "ack in
19+*, even "efore the mana!ement contract as entered into. .s earl5 as
.u!ust 19+* )ielson ne!otiated ith Messrs. %.I. %ookes and 9.&. &ednick5
for the operation of the Manka5an mines and it as the result of those
ne!otiations that &epanto as incorporatedD that it as )ielson that helped
to capitaliEe &epanto, and that after the formation of the corporation
(&epanto) )ielson immediatel5 assumed the mana!ement of the minin!
properties of &epanto. It as not until Januar5 +(, 19+1 hen the
mana!ement contract in ?uestion as entered into "eteen &epanto and
)ielson (B@hi"it .).
. contract for the mana!ement and operation of mines calls for a
speculative and risk5 venture on the part of the mana!er-operator. $he
mana!er-operator invests its technical kno-ho, undertakes "ack-"reakin!
efforts and tremendous spade-ork, so to sa5, in the first 5ears of its
mana!ement and operation of the mines, in the e@pectation that the
investment and the efforts emplo5ed mi!ht "e rearded later ith success.
$his e@pected success ma5 never come. $his had happened in the ver5
case of the Manka5an mines here, as recounted "5 Mr. &ednick5 of
&epanto, various persons and entities of different nationalities, includin!
&ednick5 himself, invested all their mone5 and failed. $he mana!er-operator
ma5 not strike sufficient ore in the first, second, third, or fourth 5ear of the
mana!ement contract, or he ma5 not strike ore even until the end of the fifth
5ear. 6nless the mana!er-operator strikes sufficient ?uantit5 of ore he
cannot e@pect profits or reard for his investment and efforts. In the case of
)ielson, its corps of competent en!ineers, !eolo!ists, and technicians "e!un
orkin! on the Manka5an mines of &epanto since the latter part of 19+*, and
continued their ork ithout success and profit throu!h 19+1, 19+8, and the
earlier part of 19+9. It as onl5 in 0ecem"er of 19+9 hen the efforts of
)ielson started to "e rearded hen &epanto realiEed profits and the first
dividends ere declared. 8rom that time on )ielson could e@pect profit to
come to it H as in fact &epanto declared dividends for 19-( and 19-1 H if
the development and operation of the mines and the mill ould continue
unhampered. $he operation, and the e@pected profits, hoever, ould still
"e su"<ect to haEards due to the occurrence of fortuitous events, fires,
earth?uakes, strikes, ar, etc., constitutin! force ma<eure, hich ould
result in the destruction of the mines and the mill. :ne of these diverse
causes, or one after the other, ma5 consume the hole period of the
contract, and if it should happen that a5 the mana!er- operator ould reap
no profit to compensate for the first 5ears of spade-ork and investment of
efforts and kno-ho. 4ence, in fairness to the mana!er-operator, so that
he ma5 not "e deprived of the "enefits of the ork he had accomplished, the
force ma<eure clause is incorporated as a standard clause in contracts for
the mana!ement and operation of mines.
$he nature of the contract for the mana!ement and operation of mines
<ustifies the interpretation of the force ma<eure clause, that a period e?ual to
the period of suspension due to force ma<eure should "e added to the
ori!inal term of the contract "5 a5 of an e@tension. >e, therefore, reiterate
the rulin! in :ur decision that the mana!ement contract in the instant case
as suspended from 8e"ruar5, 19-/ to June /*, 19-8, and that from the
latter date the contract had 5et five 5ears to !o.
+. In the fourth !round of its motion for reconsideration, &epanto
maintains that this %ourt erred in reversin! the findin! of the trial court that
)ielson7s action has prescri"ed, "5 considerin! onl5 the first claim and
i!norin! the prescripti"ilit5 of the other claims.
$his !round of the motion for reconsideration has no merit.
In :ur decision >e stated that the claims of )ielson are "ased on a ritten
document, and, as such, the cause of action prescri"es in ten 5ears. 5
Inasmuch as there are different claims hich accrued on different dates the
prescriptive periods for all the claims are not the same. $he claims of
)ielson that have "een aarded "5 this %ourt are itemiEed in the dispositive
part of the decision.
$he first item of the aards in :ur decision refers to )ielson7s compensation
in the sum of 311,5((.((, hich is e?uivalent to 1(L of the cash dividends
declared "5 &epanto in 0ecem"er, 19-1. .s >e have stated in :ur decision,
this claim accrued on 0ecem"er +1, 19-1, and the ri!ht to commence an
action thereon started on Januar5 1, 19-/. >e declared that the action on
this claim did not prescri"e althou!h the complaint as filed on 8e"ruar5 *,
1958 H or after a lapse of 1* 5ears, 1 month and 5 da5s H "ecause of the
operation of the moratorium la. >e declared that under the applica"le
decisions of this %ourt * the moratorium period of 8 5ears, / months and 8
da5s should "e deducted from the period that had elapsed since the accrual
of the cause of action to the date of the filin! of the complaint, so that there
is a period of less than 8 5ears to "e reckoned for the purpose of
prescription.
$his claim of )ielson is covered "5 B@ecutive :rder )o. +/, issued on March
1(, 19-5, hich provides as follos2
ABnforcement of pa5ments of all de"ts and other monetar5 o"li!ations
pa5a"le in the 3hilippines, e@cept de"ts and other monetar5 o"li!ations
entered into in an5 area after declaration "5 3residential 3roclamation that
such area has "een freed from enem5 occupation and control, is temporaril5
suspended pendin! action "5 the %ommonealth =overnment.A (-1 :.=.
5*-51D Bmphasis supplied)
B@ecutive :rder )o. +/ covered all de"ts and monetar5 o"li!ation
contracted "efore the ar (or "efore 0ecem"er 8, 19-1) and those
contracted su"se?uent to 0ecem"er 8, 19-1 and durin! the Japanese
occupation. #epu"lic .ct )o. +-/, approved on Jul5 /*, 19-8, lifted the
moratorium provided for in B@ecutive :rder )o. +/ on pre-ar (or pre-
0ecem"er 8, 19-1) de"ts of de"tors ho had not filed ar dama!e claims
ith the 6nited ,tates >ar 0ama!e %ommission. In other ords, after the
effectivit5 of #epu"lic .ct )o. +-/, the de"t moratorium as limited2 (1) to
de"ts and other monetar5 o"li!ations hich ere contracted after 0ecem"er
8, 19-1 and durin! the Japanese occupation, and (/) to those pre-ar (or
pre-0ecem"er 8, 19-1) de"ts and other monetar5 o"li!ations here the
de"tors filed ar dama!e claims. $hat as the situation up to Ma5 18, 195+
hen this %ourt declared #epu"lic .ct )o. +-/ unconstitutional. 1 It has
"een held "5 this %ourt, hoever, that from March 1(, 19-5 hen B@ecutive
:rder )o. +/ as issued, to Ma5 18, 195+ hen #epu"lic .ct )o. +-/ as
declared unconstitutional H or a period of 8 5ears, / months and 8 da5s H
the de"t moratorium as in force, and had the effect of suspendin! the
period of prescription. 8
&epanto is ron! hen in its motion for reconsideration it claims that the
moratorium provided for in B@ecutive :rder )o. +/ as continued "5
#epu"lic .ct )o. +-/ Aonl5 ith respect to de"tors of pre-ar o"li!ations or
those incurred prior to 0ecem"er 8, 19-1,A and that Athe moratorium as
lifted and terminated ith respect to o"li!ations incurred after 0ecem"er 8,
19-1.A 9
$his %ourt has held that #epu"lic .ct )o. +-/ does not appl5 to de"ts
contracted durin! the ar and did not lift the moratorium in relation thereto.
1( In the case of ."raham, et al. vs. Intestate Bstate of Juan %. Csmael, et
al., &-1*1-1, Jan. +1, 19*/, this %ourt said2
A#espondents, hoever, contend that #epu"lic .ct )o. +-/, hich took
effect on Jul5 /*, 19-8, lifted the moratorium on de"ts contracted durin! the
Japanese occupation. $he court has alread5 held that #epu"lic .ct )o. +-/
did not lift the moratorium on de"ts contracted durin! the ar (65 vs. ;ala
;ati!"ak, =.#. )o. &-18+(, 0ec. +1, 19-9) "ut modified B@ecutive :rder )o.
+/ as to pre-ar de"ts, makin! the protection availa"le onl5 to de"tors ho
had ar dama!e claims (,ison vs. Mirasol, =.#. )o. &--111, :ct. +, 195/)A
>e therefore reiterate the rulin! in :ur decision that the claim involved in the
first item aarded to )ielson had not prescri"ed.
>hat e have stated herein re!ardin! the non-prescription of the cause of
action of the claim involved in the first item in the aard also holds true ith
respect to the second item in the aard, hich refers to )ielson7s claim for
mana!ement fee of 3/,5((.(( for Januar5, 19-/. &epanto admits that this
second item, like the first, is a monetar5 o"li!ation. $he ri!ht of action of
)ielson re!ardin! this claim accrued on Januar5 +1, 19-/.
.s re!ards items +, -, 5, * and 1 in the aards in the decision, the
moratorium la is not applica"le. $hat is the reason h5 in :ur decision >e
did not discuss the ?uestion of prescription re!ardin! these items. $he
claims of )ielson involved in these items are "ased on the mana!ement
contract, and )ielson7s cause of action re!ardin! these claims prescri"es in
ten 5ears. %orollar5 to :ur rulin! that the mana!ement contract as
suspended from 8e"ruar5, 19-/ until June /*, 19-8, and that the contract
as e@tended for five 5ears from June /*, 19-8, the ri!ht of action of
)ielson to claim for hat is due to it durin! that period of e@tension accrued
durin! the period from June /*, 19-8 till the end of the five-5ear e@tension
period H or until June /*, 195+. .nd so, even if >e reckon June /*, 19-8
as the startin! date of the ten-5ear period in connection ith the
prescripti"ilit5 of the claims involved in items +, -, 5, * and 1 of the aards in
the decision, it is o"vious that hen the complaint as filed on 8e"ruar5 *,
1958 the ten-5ear prescriptive period had not 5et lapsed.
In :ur decision >e have also ruled that the ri!ht of action of )ielson a!ainst
&epanto had not prescri"ed "ecause of the ar"itration clause in the
Mana!ement contract. >e are satisfied that there is evidence that )ielson
had asked for ar"itration, and an ar"itration committee had "een constituted.
$he ar"itration committee, hoever, failed to "rin! a"out an5 settlement of
the differences "eteen )ielson and &epanto. :n June /5, 1951 counsel for
&epanto definitel5 advised )ielson that the5 ere not entertainin! an5 claim
of )ielson. $he complaint in this case as filed on 8e"ruar5 *, 1958.
-. In the si@th !round of its motion for reconsideration, &epanto
maintains that this %ourt Aerred in aardin! as dama!es (a) 1(L of the cash
dividends declared and paid in 0ecem"er, 19-1D (") the mana!ement fee of
3/,5((.(( for the month of Januar5 19-/D and (c) the full contract price for
the e@tended period of *( months, since the dama!es ere never
demanded nor proved and, in an5 case, not alloa"le under the !eneral la
on dama!es.A
>e have stated in :ur decision that the ori!inal a!reement in the
mana!ement contract re!ardin! the compensation of )ielson as modified,
such that instead of receivin! a monthl5 compensation of 3/,5((.(( plus
1(L of the net profits from the operation of the properties for the precedin!
month, 11 )ielson ould receive a compensation of 3/,5((.(( a month,
plus (1)1(L of the dividends declared and paid, hen and as paid, durin!
the period of the contract, and at the end of each 5ear, (/)1(L of an5
depletion reserve that ma5 "e set up, and (+) 1(L of an5 amount e@pended
durin! the 5ear out of surplus earnin!s for capital account.
It is shon that in 0ecem"er, 19-1, cash dividends amountin! to
3115,(((.(( as declared "5 &epanto. 1/ )ielson, therefore, should
receive the e?uivalent of 1(L of this amount, or the sum of 311,5((.((. >e
have found that this amount as not paid to )ielson.
In its motion for reconsideration, &epanto inserted a photo!raphic cop5 of
pa!e 1/1 of its cash dis"ursement "ook, alle!edl5 for 19-1, in an effort to
sho that this amount of 311,5((.(( had "een paid to )ielson. It appears,
hoever, in this photo!raphic cop5 of pa!e 1/1 of the cash dis"ursement
"ook that the sum of 311,5((.(( as entered on :cto"er /9 as Asurplus aKc
)ielson O %o. Inc.A $he entr5 does not make an5 reference to dividends or
participation of )ielson in the profits. :n the other hand, in the photo!raphic
cop5 of pa!e 89 of the 19-1 cash dis"ursement "ook, also attached to the
motion for reconsideration, there is an entr5 for 311,5((.(( on .pril /+, 19-1
hich states A.ccts. 3a5. 3articip. )ielson O %o. Inc.A $his entr5 for .pril /+,
19-1 ma5 reall5 "e the participation of )ielson in the profits "ased on
dividends declared in .pril 19-1 as shon in B@hi"it &. 'ut in the same
B@hi"it & it is not stated that an5 dividend as declared in :cto"er 19-1. :n
the contrar5 it is stated in B@hi"it & that dividends ere declared in
0ecem"er 19-1. >e cannot entertain this piece of evidence for several
reasons2 (1) "ecause this evidence as not presented durin! the trial in the
court "eloD (/) there is no shoin! that this piece of evidence is nel5
discovered and that &epanto as not in possession of said evidence hen
this case as "ein! tried in the court "eloD and (+) accordin! to B@hi"it &
cash dividends of 3115,(((.(( ere declared in 0ecem"er, 19-1, and so
the sum of 311,5((.(( hich appears to have "een paid to )ielson in
:cto"er 19-1 could not "e pa5ment of the e?uivalent of 1(L of the cash
dividends that ere later declared in 0ecem"er, 19-1.
.s re!ards the mana!ement fee of )ielson correspondin! to Januar5, 19-/,
in the sum of 3/,5((.((, >e have also found that )ielson is entitled to "e
paid this amount, and that this amount as not paid "5 &epanto to )ielson.
>hereas, &epanto as a"le to prove that it had paid the mana!ement fees
of )ielson for )ovem"er and 0ecem"er, 19-1, 1+ it as not a"le to present
an5 evidence to sho that the mana!ement fee of 3/,5((.(( for Januar5,
19-/ had "een paid.
It havin! "een declared in :ur decision, as ell as in this resolution, that the
mana!ement contract had "een e@tended for 5 5ears, or si@t5 months, from
June /1, 19-8 to June /*, 195+, and that the cause of action of )ielson to
claim for its compensation durin! that period of e@tension had not
prescri"ed, it follos that )ielson should "e aarded the mana!ement fees
durin! the hole period of e@tension, plus the 1(L of the value of the
dividends declared durin! the said period of e@tension, the 1(L of the
depletion reserve that as set up, and the 1(L of an5 amount e@pended out
of surplus earnin!s for capital account.
5. In the seventh !round of its motion for reconsideration, &epanto
maintains that this %ourt erred in orderin! &epanto to issue and deliver to
)ielson shares of stock to!ether ith fruits thereof.
In :ur decision, >e declared that pursuant to the modified a!reement
re!ardin! the compensation of )ielson hich provides, amon! others, that
)ielson ould receive 1(L of an5 dividends declared and paid, hen and as
paid, )ielson should "e paid 1(L of the stock dividends declared "5
&epanto durin! the period of e@tension of the contract.
It is not denied that on )ovem"er /8, 19-9, &epanto declared stock
dividends orth 31,(((,(((.((D and on .u!ust //, 195(, it declared stock
dividends orth 3/,(((,(((.((. In other ords, durin! the period of
e@tension &epanto had declared stock dividends orth +,(((,(((.((. >e
held in :ur decision that )ielson is entitled to receive 1(L of the stock
dividends declared, or shares of stocks, orth 3+((,(((.(( at the par value
of 3(.1( per share. >e ordered &epanto to issue and deliver to )ielson
those shares of stocks as ell as all the fruits or dividends that accrued to
said shares.
In its motion for reconsideration, &epanto contends that the pa5ment to
)ielson of stock dividends as compensation for its services under the
mana!ement contract is a violation of the %orporation &a, and that it as
not, and it could not "e, the intention of &epanto and )ielson H as
contractin! parties H that the services of )ielson should "e paid in shares of
stock taken out of stock dividends declared "5 &epanto. >e have
assiduousl5 considered the ar!uments adduced "5 &epanto in support of its
contention, as ell as the anser of )ielson in this connection, and >e have
arrived at the conclusion that there is merit in the contention of &epanto.
,ection 1* of the %orporation &a, in part, provides as follos2
A)o corporation or!aniEed under this .ct shall create or issue "ills, notes or
other evidence of de"t, for circulation as mone5, and no corporation shall
issue stock or "onds e@cept in e@chan!e for actual cash paid to the
corporation or for2 (1) propert5 actuall5 received "5 it at a fair valuation e?ual
to the par or issued value of the stock or "onds so issuedD and in case of
disa!reement as to their value, the same shall "e presumed to "e the
assessed value or the value appearin! in invoices or other commercial
documents, as the case ma5 "eD and the "urden or proof that the real
present value of the propert5 is !reater than the assessed value or value
appearin! in invoices or other commercial documents, as the case ma5 "e,
shall "e upon the corporation, or for (/) profits earned "5 it "ut not
distri"uted amon! its stockholders or mem"ersD 3rovided, hoever, $hat no
stock or "ond dividend shall "e issued ithout the approval of stockholders
representin! not less than to-thirds of all stock then outstandin! and
entitled to vote at a !eneral meetin! of the corporation or at a special
meetin! dul5 called for the purpose.
@@@ @@@ @@@
A)o corporation shall make or declare an5 dividend e@cept from the surplus
profits arisin! from its "usiness, or divide or distri"ute its capital stock or
propert5 other than actual profits amon! its mem"ers or stockholders until
after the pa5ment of its de"ts and the termination of its e@istence "5
limitation or laful dissolution2 3rovided, $hat "ankin!, savin!s and loan,
and trust corporations ma5 receive deposits and issue certificates of deposit,
checks, drafts, and "ills of e@chan!e, and the like in the transaction of the
ordinar5 "usiness of "ankin!, savin!s and loan, and trust corporations.A (.s
amended "5 .ct )o. /19/, and .ct )o. +518D Bmphasis supplied.)
8rom the a"ove-?uoted provision of ,ection 1* of the %orporation &a, the
consideration for hich shares of stock ma5 "e issued are2 (1) cashD (/)
propert5D and (+) undistri"uted profits. ,hares of stock are !iven the special
name Astock dividendsA onl5 if the5 are issued in lieu of undistri"uted profits.
If shares of stocks are issued in e@chan!e of cash or propert5 then those
shares do not fall under the cate!or5 of Astock dividendsA. . corporation ma5
le!all5 issue shares of stock in consideration of services rendered to it "5 a
person not a stockholder, or in pa5ment of its inde"tedness. . share of stock
issued to pa5 for services rendered is e?uivalent to a stock issued in
e@chan!e of propert5, "ecause services is e?uivalent to propert5. 1-
&ikeise a share of stock issued in pa5ment of inde"tedness is e?uivalent to
issuin! a stock in e@chan!e for cash. 'ut a share of stock thus issued
should "e part of the ori!inal capital stock of the corporation upon its
or!aniEation, or part of the stocks issued hen the increase of the
capitaliEation of a corporation is properl5 authoriEed. In other ords, it is the
shares of stock that are ori!inall5 issued "5 the corporation and formin! part
of the capital that can "e e@chan!ed for cash or services rendered, or
propert5D that is, if the corporation has ori!inal shares of stock unsold or
unsu"scri"ed, either comin! from the ori!inal capitaliEation or from the
increased capitaliEation. $hose shares of stock ma5 "e issued to a person
ho is not a stockholder, or to a person alread5 a stockholder in e@chan!e
for services rendered or for cash or propert5. 'ut a share of stock comin!
from stock dividends declared cannot "e issued to one ho is not a
stockholder of a corporation.
. Astock dividendA is an5 dividend pa5a"le in shares of stock of the
corporation declarin! or authoriEin! such dividend. It is, hat the term itself
implies, a distri"ution of the shares of stock of the corporation amon! the
stockholders as dividends. . stock dividend of a corporation is a dividend
paid in shares of stock instead of cash, and is properl5 pa5a"le onl5 out of
surplus profits. 15 ,o, a stock dividend is actuall5 to thin!s2 (1) a dividend,
and (/) the enforced use of the dividend mone5 to purchase additional
shares of stock at par. 1* >hen a corporation issues stock dividends, it
shos that the corporation7s accumulated profits have "een capitaliEed
instead of distri"uted to the stockholders or retained as surplus availa"le for
distri"ution, in mone5 or kind, should opportunit5 offer. 8ar from "ein! a
realiEation of profits for the stockholder, it tends rather to postpone said
realiEation, in that the fund represented "5 the ne stock has "een
transferred from surplus to assets and no lon!er availa"le for actual
distri"ution. 11 $hus, it is apparent that stock dividends are issued onl5 to
stockholders. $his is so "ecause onl5 stockholders are entitled to dividends.
$he5 are the onl5 ones ho have a ri!ht to a proportional share in that part
of the surplus hich is declared as dividends. . stock dividend reall5 adds
nothin! to the interest of the stockholderD the proportional interest of each
stockholder remains the same. 18 If a stockholder is deprived of his stock
dividends H and this happens if the shares of stock formin! part of the stock
dividends are issued to a non-stockholder H then the proportion of the
stockholder7s interest chan!es radicall5. ,tock dividends are civil fruits of the
ori!inal investment, and to the oners of the shares "elon! the civil fruits. 19
$he term AdividendA "oth in the technical sense and its ordinar5 acceptation,
is that part or portion of the profits of the enterprise hich the corporation, "5
its !overnin! a!ents, sets apart for rata"le division amon! the holders of the
capital stock. It means the fund actuall5 set aside, and declared "5 the
directors of the corporation as a dividends, and dul5 ordered "5 the director,
or "5 the stockholders at a corporate meetin!, to "e divided or distri"uted
amon! the stockholders accordin! to their respective interests. /(
It is :ur considered vie, therefore, that under ,ection 1* of the %orporation
&a stock dividends can not "e issued to a person ho is not a stockholder
in pa5ment of services rendered. .nd so, in the case at "ar )ielson can not
"e paid in shares of stock hich form part of the stock dividends of &epanto
for services it rendered under the mana!ement contract. >e sustain the
contention of &epanto that the understandin! "eteen &epanto and )ielson
as simpl5 to make the cash value of the stock dividends declared as the
"asis for determinin! the amount of compensation that should "e paid to
)ielson, in the proportion of 1(L of the cash value of the stock dividends
declared. .nd this conclusion of :urs finds support in the record.
>e had adverted to in :ur decision that in 19-( there as some dispute
"eteen &epanto and )ielson re!ardin! the application and interpretation of
certain provisions of the ori!inal contract particularl5 ith re!ard to the 1(L
participation of )ielson in the net profits, so that some ad<ustments had to "e
made. In the minutes of the meetin! of the 'oard of 0irectors of &epanto on
.u!ust /1, 19-(, >e read the folloin!2
A$he %hairman stated that he "elieved that it ould "e "etter to tie the
computation of the 1(L participation of )ielson O %ompan5, Inc. to the
dividend, "ecause )ielson ill then "e a"le to definitel5 compute its net
participation "5 the amount of the dividends declared. In addition to the
dividend, e have "een settin! up a depletion reserve and it does not seem
fair to "urden the 1(L participation of )ielson ith the depletion reserve, as
the depletion reserve should not "e considered as an operatin! e@pense.
.fter a prolon!ed discussion, upon motion dul5 made and seconded, it as
H
A#B,:&9B0, $hat the 3resident, "e, and he here"5 is, authoriEed to enter
into an a!reement ith )ielson O %ompan5, Inc., modif5in! 3ara!raph 9 of
mana!ement contract of Januar5 +(, 19+1, effective Januar5 1, 19-(, in
such a a5 that )ielson O %ompan5, Inc. shall receive 1(L of an5 dividends
declared and paid, hen and as paid durin! the period of the contract and at
the end of each 5ear, 1(L of an5 depletion reserve that ma5 "e set up and
1(L of an5 amount e@pended durin! the 5ear out of surplus earnin!s for
capital account.A (Bmphasis supplied.)
8rom the sentence, A$he %hairman stated that he "elieved that it ould "e
"etter to tie the computation of the 1(L participation of )ielson O %ompan5,
Inc. to the dividend, "ecause )ielson ill then "e a"le to definitel5 compute
its net participation "5 the amount of the dividends declaredA the idea is
conve5ed that the intention of &epanto, as e@pressed "5 its %hairman %. ..
0e>itt, as to make the value of the dividends declared H hether the
dividends ere in cash or in stock H as the "asis for determinin! the
amount of compensation that should "e paid to )ielson, in the proportion of
1(L of the cash value of the dividends so declared. It does not mean,
hoever, that the compensation of )ielson ould "e taken from the amount
actuall5 declared as cash dividend to "e distri"uted to the stockholder, nor
from the shares of stocks to "e issued to the stockholders as stock
dividends, "ut from the other assets or funds of the corporation hich are
not "urdened "5 the dividends thus declared. In other ords, if, for e@ample,
cash dividends of 3+((,(((.(( are declared. )ielson ould "e entitled to a
compensation of 3+(,(((.((, "ut this 3+(,(((.(( should not "e taken from
the 3+((,(((.(( to "e distri"uted as cash dividends to the stockholders "ut
from some other funds or assets of the corporation hich are not included in
the amount to anser for the cash dividends thus declared. $his is so
"ecause if the 3+(,(((.(( ould "e taken out from the 3+((,(((.((
declared as cash dividends, then the stockholders ould not "e !ettin!
3+((,(((.(( as dividends "ut onl5 3/1(,(((.((. $here ould "e a dilution
of the dividend that corresponds to each share of stock held "5 the
stockholders. ,imilarl5, if there ere stock dividends orth one million pesos
that ere declared, hich means an issuance of ten million shares at the par
value of ten centavos per share, it does not mean that )ielson ould "e
!iven 1((,((( shares. It onl5 means that )ielson should "e !iven the
e?uivalent of 1(L of the a!!re!ate cash value of those shares issued as
stock dividends. $hat this as the understandin! of )ielson itself is "orne
out "5 the fact that in its appeal "rief )ielson ur!ed that it should "e paid
3+((,(((.(( "ein! 1(L of the 3+,(((,(((.(( stock dividends declared on
)ovem"er /8, 19-9 and .u!ust /(, 195( . . .A /1
>e, therefore, reconsider that part of :ur decision hich declares that
)ielson is entitled to shares of stock orth 3+((,(((.(( "ased on the stock
dividends declared on )ovem"er /8, 19-9 and on .u!ust /(, 195(, to!ether
ith all the fruits accruin! thereto. Instead, >e declare that )ielson is
entitled to pa5ment "5 &epanto of 3+((,(((.(( in cash, hich is e?uivalent
to 1(L of the mone5 value of the stock dividends orth 3+,(((,(((.((
hich ere declared on )ovem"er /8, 19-9 and on .u!ust /(, 195(, ith
interest thereon at the rate of *L from 8e"ruar5 *, 1958.
*. In the ei!hth !round of its motion for reconsideration &epanto
maintains that this %ourt erred in aardin! to )ielson an undetermined
amount of shares of stock andKor cash, hich aard can not "e ascertained
and e@ecuted ithout further liti!ation.
In vie of :ur rulin! in this resolution that )ielson is not entitled to receive
shares of stock as stock dividends in pa5ment of its compensation under the
mana!ement contract, >e do not consider it necessar5 to discuss this
!round of the motion for reconsideration. $he aards in the present case are
all reduced to specific sums of mone5.
1. In the ninth !round of its motion for reconsideration &epanto
maintains that this %ourt erred in renderin! <ud!ment or attorne57s fees.
$he matter of the aard of attorne57s fees is ithin the sound discretion of
this %ourt. In :ur decision >e have stated the reason h5 the aard of
35(,(((.(( for attorne57s fees is considered "5 this %ourt as reasona"le.
.ccordin!l5, >e resolve to modif5 the decision that >e rendered on
0ecem"er 11, 19**, in the sense that instead of aardin! )ielson shares of
stock orth 3+((,(((.(( at the par value of ten centavos (3(.1() per share
"ased on the stock dividends declared "5 &epanto on )ovem"er /8, 19-9
and .u!ust /(, 195(, to!ether ith their fruits, )ielson should "e aarded
the sum of 3+((,(((.(( hich is an amount e?uivalent to 1(L of the cash
value of the stock dividends thus declared, as part of the compensation due
)ielson under the mana!ement contract. $he dispositive portion of the
decision should, therefore, "e amended, to read as follos2
I) 9IB> :8 $4B 8:#B=:I)= %:),I0B#.$I:),, >e here"5 reverse
the decision of the court a ?uo and enter in lieu thereof another, orderin! the
appellee &epanto to pa5 the appellant )ielson the different amounts as
specified herein"elo2
(1) ,eventeen thousand five hundred pesos (311,5((.((), e?uivalent
to 1(L of the cash dividends of 0ecem"er, 19-1, ith le!al interest thereon
from the date of the filin! of the complaintD
(/) $o thousand five hundred pesos (3/,5((.((), as mana!ement fee
for Januar5, 19-/, ith le!al interest thereon from the date of the filin! of the
complaintD
(+) :ne hundred fift5 thousand pesos (315(,(((.((), representin!
mana!ement fees for the si@t5-month period of e@tension of the
mana!ement contract, ith le!al interest thereon from the date of the filin!
of the complaintD
(-) :ne million four hundred thousand pesos (31,-((,(((.((),
e?uivalent to 1(L of the cash dividends declared durin! the period of
e@tension of the mana!ement contract, ith le!al interest thereon from the
date of the filin! of the complaintD
(5) $hree hundred thousand pesos (3+((,(((.((), e?uivalent to 1(L
of the cash value of the stock dividends declared on )ovem"er /8, 19-9 and
.u!ust /(, 195(, ith le!al interest thereon from the date of the filin! of the
complaintD
(*) 8ift5 three thousand nine hundred tent5 ei!ht pesos and ei!ht5
ei!ht centavos (35+,9/8.88), e?uivalent to 1(L of the depletion reserve set
up durin! the period of e@tension, ith le!al interest thereon from the date of
the filin! of the complaintD
(1) ,i@ hundred ninet5 four thousand three hundred si@t5 four pesos
and sevent5 si@ centavos (3*9-,+*-.1*), e?uivalent to 1(L of the e@penses
for capital account durin! the period of e@tension, ith le!al interest thereon
from the date of the filin! of the complaintD
(8) 8ift5 thousand pesos (35(,(((.(() as attorne57s feesD and
(9) $he costs.
It is so ordered..
%oncepcion, % . J ., #e5es, J.'.&., 0iEon, Makalintal, ,ancheE and #uiE
%astro, JJ ., concur.
8ernando, %apistrano, $eehankee and 'arredo, JJ ., did not take part.