1) Caltex vs.

Palomar
G.R. No. L-19650 September 29, 1966
CALTEX (PHILIPPINES), INC., petitioner-appellee,
vs.
ENRICO PALOMAR, in his capacity as THE P OSTMASTER GENERAL, respondent-appellant.
CASTRO, J.:
In the year 1960 the Caltex (Philippines) Inc. (hereinafter referred to as Caltex) conceived and laid the groundwork for a promotional scheme
calculated to drum up patronage for its oil products. Denominated "Caltex Hooded Pump Contest", it calls for participants therein to estimate the
actual number of liters a hooded gas pump at each Caltex station will dispense during a specified period. Employees of the Caltex (Philippines) Inc.,
its dealers and its advertising agency, and their immediate families excepted, participation is to be open indiscriminately to all "motor vehicle owners
and/or licensed drivers". For the privilege to participate, no fee or consideration is required to be paid, no purchase of Caltex products required to be
made. Entry forms are to be made available upon request at each Caltex station where a sealed can will be provided for the deposit of accomplished
entry stubs.
A three-staged winner selection system is envisioned. At the station level, called "Dealer Contest", the contestant whose estimate is closest to the
actual number of liters dispensed by the hooded pump thereat is to be awarded the first prize; the next closest, the second; and the next, the third.
Prizes at this level consist of a 3-burner kerosene stove for first; a thermos bottle and a Ray-O-Vac hunter lantern for second; and an Everready
Magnet-lite flashlight with batteries and a screwdriver set for third. The first-prize winner in each station will then be qualified to join in the "Regional
Contest" in seven different regions. The winning stubs of the qualified contestants in each region will be deposited in a sealed can from which the
first-prize, second-prize and third-prize winners of that region will be drawn. The regional first-prize winners will be entitled to make a three-day allexpenses-paid round trip to Manila, accompanied by their respective Caltex dealers, in order to take part in the "National Contest". The regional
second-prize and third-prize winners will receive cash prizes of P500 and P300, respectively. At the national level, the stubs of the seven regional
first-prize winners will be placed inside a sealed can from which the drawing for the final first-prize, second-prize and third-prize winners will be
made. Cash prizes in store for winners at this final stage are: P3,000 for first; P2,000 for second; Pl,500 for third; and P650 as consolation prize for
each of the remaining four participants.
Foreseeing the extensive use of the mails not only as amongst the media for publicizing the contest but also for the transmission of communications
relative thereto, representations were made by Caltex with the postal authorities for the contest to be cleared in advance for mailing, having in view
sections 1954(a), 1982 and 1983 of the Revised Administrative Code, the pertinent provisions of which read as follows:
SECTION 1954. Absolutely non-mailable matter. No matter belonging to any of the following classes, whether sealed as first-class
matter or not, shall be imported into the Philippines through the mails, or to be deposited in or carried by the mails of the Philippines, or be
delivered to its addressee by any officer or employee of the Bureau of Posts:
Written or printed matter in any form advertising, describing, or in any manner pertaining to, or conveying or purporting to convey any
information concerning any lottery, gift enterprise, or similar scheme depending in whole or in part upon lot or chance, or any scheme,
device, or enterprise for obtaining any money or property of any kind by means of false or fraudulent pretenses, representations, or
promises.
"SECTION 1982. Fraud orders.Upon satisfactory evidence that any person or company is engaged in conducting any lottery, gift
enterprise, or scheme for the distribution of money, or of any real or personal property by lot, chance, or drawing of any kind, or that any
person or company is conducting any scheme, device, or enterprise for obtaining money or property of any kind through the mails by
means of false or fraudulent pretenses, representations, or promises, the Director of Posts may instruct any postmaster or other officer or
employee of the Bureau to return to the person, depositing the same in the mails, with the word "fraudulent" plainly written or stamped
upon the outside cover thereof, any mail matter of whatever class mailed by or addressed to such person or company or the representative
or agent of such person or company.
SECTION 1983. Deprivation of use of money order system and telegraphic transfer service.The Director of Posts may, upon evidence
satisfactory to him that any person or company is engaged in conducting any lottery, gift enterprise or scheme for the distribution of money,
or of any real or personal property by lot, chance, or drawing of any kind, or that any person or company is conducting any scheme,
device, or enterprise for obtaining money or property of any kind through the mails by means of false or fraudulent pretenses,
representations, or promise, forbid the issue or payment by any postmaster of any postal money order or telegraphic transfer to said

person or company or to the agent of any such person or company, whether such agent is acting as an individual or as a firm, bank,
corporation, or association of any kind, and may provide by regulation for the return to the remitters of the sums named in money orders or
telegraphic transfers drawn in favor of such person or company or its agent.
The overtures were later formalized in a letter to the Postmaster General, dated October 31, 1960, in which the Caltex, thru counsel, enclosed a
copy of the contest rules and endeavored to justify its position that the contest does not violate the anti-lottery provisions of the Postal Law.
Unimpressed, the then Acting Postmaster General opined that the scheme falls within the purview of the provisions aforesaid and declined to grant
the requested clearance. In its counsel's letter of December 7, 1960, Caltex sought a reconsideration of the foregoing stand, stressing that there
being involved no consideration in the part of any contestant, the contest was not, under controlling authorities, condemnable as a lottery. Relying,
however, on an opinion rendered by the Secretary of Justice on an unrelated case seven years before (Opinion 217, Series of 1953), the Postmaster
General maintained his view that the contest involves consideration, or that, if it does not, it is nevertheless a "gift enterprise" which is equally
banned by the Postal Law, and in his letter of December 10, 1960 not only denied the use of the mails for purposes of the proposed contest but as
well threatened that if the contest was conducted, "a fraud order will have to be issued against it (Caltex) and all its representatives".
Caltex thereupon invoked judicial intervention by filing the present petition for declaratory relief against Postmaster General Enrico Palomar, praying
"that judgment be rendered declaring its 'Caltex Hooded Pump Contest' not to be violative of the Postal Law, and ordering respondent to allow
petitioner the use of the mails to bring the contest to the attention of the public". After issues were joined and upon the respective memoranda of the
parties, the trial court rendered judgment as follows:
In view of the foregoing considerations, the Court holds that the proposed 'Caltex Hooded Pump Contest' announced to be conducted by
the petitioner under the rules marked as Annex B of the petitioner does not violate the Postal Law and the respondent has no right to bar
the public distribution of said rules by the mails.
The respondent appealed.
The parties are now before us, arrayed against each other upon two basic issues: first, whether the petition states a sufficient cause of action for
declaratory relief; and second, whether the proposed "Caltex Hooded Pump Contest" violates the Postal Law. We shall take these up in seriatim.
1. By express mandate of section 1 of Rule 66 of the old Rules of Court, which was the applicable legal basis for the remedy at the time it was
invoked, declaratory relief is available to any person "whose rights are affected by a statute . . . to determine any question of construction or validity
arising under the . . . statute and for a declaration of his rights thereunder" (now section 1, Rule 64, Revised Rules of Court). In amplification, this
Court, conformably to established jurisprudence on the matter, laid down certain conditions sine qua non therefor, to wit: (1) there must be a
justiciable controversy; (2) the controversy must be between persons whose interests are adverse; (3) the party seeking declaratory relief must have
a legal interest in the controversy; and (4) the issue involved must be ripe for judicial determination (Tolentino vs. The Board of Accountancy, et al.,
G.R. No. L-3062, September 28, 1951; Delumen, et al. vs. Republic of the Philippines, 50 O.G., No. 2, pp. 576, 578-579; Edades vs. Edades, et al.,
G.R. No. L-8964, July 31, 1956). The gravamen of the appellant's stand being that the petition herein states no sufficient cause of action for
declaratory relief, our duty is to assay the factual bases thereof upon the foregoing crucible.
As we look in retrospect at the incidents that generated the present controversy, a number of significant points stand out in bold relief. The appellee
(Caltex), as a business enterprise of some consequence, concededly has the unquestioned right to exploit every legitimate means, and to avail of all
appropriate media to advertise and stimulate increased patronage for its products. In contrast, the appellant, as the authority charged with the
enforcement of the Postal Law, admittedly has the power and the duty to suppress transgressions thereof particularly thru the issuance of fraud
orders, under Sections 1982 and 1983 of the Revised Administrative Code, against legally non-mailable schemes. Obviously pursuing its right
aforesaid, the appellee laid out plans for the sales promotion scheme hereinbefore detailed. To forestall possible difficulties in the dissemination of
information thereon thru the mails, amongst other media, it was found expedient to request the appellant for an advance clearance therefor.
However, likewise by virtue of his jurisdiction in the premises and construing the pertinent provisions of the Postal Law, the appellant saw a violation
thereof in the proposed scheme and accordingly declined the request. A point of difference as to the correct construction to be given to the applicable
statute was thus reached. Communications in which the parties expounded on their respective theories were exchanged. The confidence with which
the appellee insisted upon its position was matched only by the obstinacy with which the appellant stood his ground. And this impasse was climaxed
by the appellant's open warning to the appellee that if the proposed contest was "conducted, a fraud order will have to be issued against it and all its
representatives."
Against this backdrop, the stage was indeed set for the remedy prayed for. The appellee's insistent assertion of its claim to the use of the mails for its
proposed contest, and the challenge thereto and consequent denial by the appellant of the privilege demanded, undoubtedly spawned a live

controversy. The justiciability of the dispute cannot be gainsaid. There is an active antagonistic assertion of a legal right on one side and a denial
thereof on the other, concerning a real not a mere theoretical question or issue. The contenders are as real as their interests are substantial. To
the appellee, the uncertainty occasioned by the divergence of views on the issue of construction hampers or disturbs its freedom to enhance its
business. To the appellant, the suppression of the appellee's proposed contest believed to transgress a law he has sworn to uphold and enforce is
an unavoidable duty. With the appellee's bent to hold the contest and the appellant's threat to issue a fraud order therefor if carried out, the
contenders are confronted by the ominous shadow of an imminent and inevitable litigation unless their differences are settled and stabilized by a
tranquilizing declaration (Pablo y Sen, et al. vs. Republic of the Philippines, G.R. No. L-6868, April 30, 1955). And, contrary to the insinuation of the
appellant, the time is long past when it can rightly be said that merely the appellee's "desires are thwarted by its own doubts, or by the fears of
others" which admittedly does not confer a cause of action. Doubt, if any there was, has ripened into a justiciable controversy when, as in the
case at bar, it was translated into a positive claim of right which is actually contested (III Moran, Comments on the Rules of Court, 1963 ed., pp. 132133, citing: Woodward vs. Fox West Coast Theaters, 36 Ariz., 251, 284 Pac. 350).
We cannot hospitably entertain the appellant's pretense that there is here no question of construction because the said appellant "simply applied the
clear provisions of the law to a given set of facts as embodied in the rules of the contest", hence, there is no room for declaratory relief. The infirmity
of this pose lies in the fact that it proceeds from the assumption that, if the circumstances here presented, the construction of the legal provisions can
be divorced from the matter of their application to the appellee's contest. This is not feasible. Construction, verily, is the art or process of discovering
and expounding the meaning and intention of the authors of the law with respect to its application to a given case, where that intention is rendered
doubtful, amongst others, by reason of the fact that the given case is not explicitly provided for in the law (Black, Interpretation of Laws, p. 1). This is
precisely the case here. Whether or not the scheme proposed by the appellee is within the coverage of the prohibitive provisions of the Postal Law
inescapably requires an inquiry into the intended meaning of the words used therein. To our mind, this is as much a question of construction or
interpretation as any other.
Nor is it accurate to say, as the appellant intimates, that a pronouncement on the matter at hand can amount to nothing more than an advisory
opinion the handing down of which is anathema to a declaratory relief action. Of course, no breach of the Postal Law has as yet been committed.
Yet, the disagreement over the construction thereof is no longer nebulous or contingent. It has taken a fixed and final shape, presenting clearly
defined legal issues susceptible of immediate resolution. With the battle lines drawn, in a manner of speaking, the propriety nay, the necessity
of setting the dispute at rest before it accumulates the asperity distemper, animosity, passion and violence of a full-blown battle which looms ahead
(III Moran, Comments on the Rules of Court, 1963 ed., p. 132 and cases cited), cannot but be conceded. Paraphrasing the language in Zeitlin vs.
Arnebergh 59 Cal., 2d., 901, 31 Cal. Rptr., 800, 383 P. 2d., 152, cited in 22 Am. Jur., 2d., p. 869, to deny declaratory relief to the appellee in the
situation into which it has been cast, would be to force it to choose between undesirable alternatives. If it cannot obtain a final and definitive
pronouncement as to whether the anti-lottery provisions of the Postal Law apply to its proposed contest, it would be faced with these choices: If it
launches the contest and uses the mails for purposes thereof, it not only incurs the risk, but is also actually threatened with the certain imposition, of
a fraud order with its concomitant stigma which may attach even if the appellee will eventually be vindicated; if it abandons the contest, it becomes a
self-appointed censor, or permits the appellant to put into effect a virtual fiat of previous censorship which is constitutionally unwarranted. As we
weigh these considerations in one equation and in the spirit of liberality with which the Rules of Court are to be interpreted in order to promote their
object (section 1, Rule 1, Revised Rules of Court) which, in the instant case, is to settle, and afford relief from uncertainty and insecurity with
respect to, rights and duties under a law we can see in the present case any imposition upon our jurisdiction or any futility or prematurity in our
intervention.
The appellant, we apprehend, underrates the force and binding effect of the ruling we hand down in this case if he believes that it will not have the
final and pacifying function that a declaratory judgment is calculated to subserve. At the very least, the appellant will be bound. But more than this, he
obviously overlooks that in this jurisdiction, "Judicial decisions applying or interpreting the law shall form a part of the legal system" (Article 8, Civil
Code of the Philippines). In effect, judicial decisions assume the same authority as the statute itself and, until authoritatively abandoned, necessarily
become, to the extent that they are applicable, the criteria which must control the actuations not only of those called upon to abide thereby but also
of those in duty bound to enforce obedience thereto. Accordingly, we entertain no misgivings that our resolution of this case will terminate the
controversy at hand.
It is not amiss to point out at this juncture that the conclusion we have herein just reached is not without precedent. In Liberty Calendar Co. vs.
Cohen, 19 N.J., 399, 117 A. 2d., 487, where a corporation engaged in promotional advertising was advised by the county prosecutor that its
proposed sales promotion plan had the characteristics of a lottery, and that if such sales promotion were conducted, the corporation would be subject
to criminal prosecution, it was held that the corporation was entitled to maintain a declaratory relief action against the county prosecutor to determine
the legality of its sales promotion plan. In pari materia, see also: Bunis vs. Conway, 17 App. Div. 2d., 207, 234 N.Y.S. 2d., 435; Zeitlin vs. Arnebergh,
supra; Thrillo, Inc. vs. Scott, 15 N.J. Super. 124, 82 A. 2d., 903.

In fine, we hold that the appellee has made out a case for declaratory relief.
2. The Postal Law, chapter 52 of the Revised Administrative Code, using almost identical terminology in sections 1954(a), 1982 and 1983
thereof, supra, condemns as absolutely non-mailable, and empowers the Postmaster General to issue fraud orders against, or otherwise deny the
use of the facilities of the postal service to, any information concerning "any lottery, gift enterprise, or scheme for the distribution of money, or of any
real or personal property by lot, chance, or drawing of any kind". Upon these words hinges the resolution of the second issue posed in this appeal.
Happily, this is not an altogether untrodden judicial path. As early as in 1922, in "El Debate", Inc. vs. Topacio, 44 Phil., 278, 283-284, which
significantly dwelt on the power of the postal authorities under the abovementioned provisions of the Postal Law, this Court declared that
While countless definitions of lottery have been attempted, the authoritative one for this jurisdiction is that of the United States Supreme
Court, in analogous cases having to do with the power of the United States Postmaster General, viz.: The term "lottery" extends to all
schemes for the distribution of prizes by chance, such as policy playing, gift exhibitions, prize concerts, raffles at fairs, etc., and various
forms of gambling. The three essential elements of a lottery are: First, consideration; second, prize; and third, chance. (Horner vs. States
[1892], 147 U.S. 449; Public Clearing House vs. Coyne [1903], 194 U.S., 497; U.S. vs. Filart and Singson [1915], 30 Phil., 80; U.S. vs.
Olsen and Marker [1917], 36 Phil., 395; U.S. vs. Baguio [1919], 39 Phil., 962; Valhalla Hotel Construction Company vs. Carmona, p.
233, ante.)
Unanimity there is in all quarters, and we agree, that the elements of prize and chance are too obvious in the disputed scheme to be the subject of
contention. Consequently as the appellant himself concedes, the field of inquiry is narrowed down to the existence of the element of consideration
therein. Respecting this matter, our task is considerably lightened inasmuch as in the same case just cited, this Court has laid down a definitive yardstick in the following terms
In respect to the last element of consideration, the law does not condemn the gratuitous distribution of property by chance, if no
consideration is derived directly or indirectly from the party receiving the chance, but does condemn as criminal schemes in which a
valuable consideration of some kind is paid directly or indirectly for the chance to draw a prize.
Reverting to the rules of the proposed contest, we are struck by the clarity of the language in which the invitation to participate therein is couched.
Thus
No puzzles, no rhymes? You don't need wrappers, labels or boxtops? You don't have to buy anything? Simply estimate the actual number
of liter the Caltex gas pump with the hood at your favorite Caltex dealer will dispense from to , and win valuable prizes . . . ." .
Nowhere in the said rules is any requirement that any fee be paid, any merchandise be bought, any service be rendered, or any value whatsoever be
given for the privilege to participate. A prospective contestant has but to go to a Caltex station, request for the entry form which is available on
demand, and accomplish and submit the same for the drawing of the winner. Viewed from all angles or turned inside out, the contest fails to exhibit
any discernible consideration which would brand it as a lottery. Indeed, even as we head the stern injunction, "look beyond the fair exterior, to the
substance, in order to unmask the real element and pernicious tendencies which the law is seeking to prevent" ("El Debate", Inc. vs. Topacio, supra,
p. 291), we find none. In our appraisal, the scheme does not only appear to be, but actually is, a gratuitous distribution of property by chance.
There is no point to the appellant's insistence that non-Caltex customers who may buy Caltex products simply to win a prize would actually be
indirectly paying a consideration for the privilege to join the contest. Perhaps this would be tenable if the purchase of any Caltex product or the use of
any Caltex service were a pre-requisite to participation. But it is not. A contestant, it hardly needs reiterating, does not have to buy anything or to give
anything of value.1awphl.nt
Off-tangent, too, is the suggestion that the scheme, being admittedly for sales promotion, would naturally benefit the sponsor in the way of increased
patronage by those who will be encouraged to prefer Caltex products "if only to get the chance to draw a prize by securing entry blanks". The
required element of consideration does not consist of the benefit derived by the proponent of the contest. The true test, as laid down in People vs.
Cardas, 28 P. 2d., 99, 137 Cal. App. (Supp.) 788, is whether the participant pays a valuable consideration for the chance, and not whether those
conducting the enterprise receive something of value in return for the distribution of the prize. Perspective properly oriented, the standpoint of the
contestant is all that matters, not that of the sponsor. The following, culled from Corpus Juris Secundum, should set the matter at rest:

The fact that the holder of the drawing expects thereby to receive, or in fact does receive, some benefit in the way of patronage or
otherwise, as a result of the drawing; does not supply the element of consideration.Griffith Amusement Co. vs. Morgan, Tex. Civ. App., 98
S.W., 2d., 844" (54 C.J.S., p. 849).
Thus enlightened, we join the trial court in declaring that the "Caltex Hooded Pump Contest" proposed by the appellee is not a lottery that may be
administratively and adversely dealt with under the Postal Law.
But it may be asked: Is it not at least a "gift enterprise, or scheme for the distribution of money, or of any real or personal property by lot, chance, or
drawing of any kind", which is equally prescribed? Incidentally, while the appellant's brief appears to have concentrated on the issue of consideration,
this aspect of the case cannot be avoided if the remedy here invoked is to achieve its tranquilizing effect as an instrument of both curative and
preventive justice. Recalling that the appellant's action was predicated, amongst other bases, upon Opinion 217, Series 1953, of the Secretary of
Justice, which opined in effect that a scheme, though not a lottery for want of consideration, may nevertheless be a gift enterprise in which that
element is not essential, the determination of whether or not the proposed contest wanting in consideration as we have found it to be is a
prohibited gift enterprise, cannot be passed over sub silencio.
While an all-embracing concept of the term "gift enterprise" is yet to be spelled out in explicit words, there appears to be a consensus among
lexicographers and standard authorities that the term is commonly applied to a sporting artifice of under which goods are sold for their market value
but by way of inducement each purchaser is given a chance to win a prize (54 C.J.S., 850; 34 Am. Jur., 654; Black, Law Dictionary, 4th ed., p. 817;
Ballantine, Law Dictionary with Pronunciations, 2nd ed., p. 55; Retail Section of Chamber of Commerce of Plattsmouth vs. Kieck, 257 N.W., 493, 128
Neb. 13; Barker vs. State, 193 S.E., 605, 56 Ga. App., 705; Bell vs. State, 37 Tenn. 507, 509, 5 Sneed, 507, 509). As thus conceived, the term
clearly cannot embrace the scheme at bar. As already noted, there is no sale of anything to which the chance offered is attached as an inducement
to the purchaser. The contest is open to all qualified contestants irrespective of whether or not they buy the appellee's products.
Going a step farther, however, and assuming that the appellee's contest can be encompassed within the broadest sweep that the term "gift
enterprise" is capable of being extended, we think that the appellant's pose will gain no added comfort. As stated in the opinion relied upon, rulings
there are indeed holding that a gift enterprise involving an award by chance, even in default of the element of consideration necessary to constitute a
lottery, is prohibited (E.g.: Crimes vs. States, 235 Ala 192, 178 So. 73; Russell vs. Equitable Loan & Sec. Co., 129 Ga. 154, 58 S.E., 88; State ex rel.
Stafford vs. Fox-Great Falls Theater Corporation, 132 P. 2d., 689, 694, 698, 114 Mont. 52). But this is only one side of the coin. Equally impressive
authorities declare that, like a lottery, a gift enterprise comes within the prohibitive statutes only if it exhibits the tripartite elements of prize, chance
and consideration (E.g.: Bills vs. People, 157 P. 2d., 139, 142, 113 Colo., 326; D'Orio vs. Jacobs, 275 P. 563, 565, 151 Wash., 297; People vs.
Psallis, 12 N.Y.S., 2d., 796; City and County of Denver vs. Frueauff, 88 P., 389, 394, 39 Colo., 20, 7 L.R.A., N.S., 1131, 12 Ann. Cas., 521; 54 C.J.S.,
851, citing: Barker vs. State, 193 S.E., 605, 607, 56 Ga. App., 705; 18 Words and Phrases, perm. ed., pp. 590-594). The apparent conflict of
opinions is explained by the fact that the specific statutory provisions relied upon are not identical. In some cases, as pointed out in 54 C.J.S., 851,
the terms "lottery" and "gift enterprise" are used interchangeably (Bills vs. People, supra); in others, the necessity for the element of consideration or
chance has been specifically eliminated by statute. (54 C.J.S., 351-352, citing Barker vs. State, supra; State ex rel. Stafford vs. Fox-Great Falls
Theater Corporation, supra). The lesson that we derive from this state of the pertinent jurisprudence is, therefore, that every case must be resolved
upon the particular phraseology of the applicable statutory provision.
Taking this cue, we note that in the Postal Law, the term in question is used in association with the word "lottery". With the meaning of lottery settled,
and consonant to the well-known principle of legal hermeneutics noscitur a sociis which Opinion 217 aforesaid also relied upon although only
insofar as the element of chance is concerned it is only logical that the term under a construction should be accorded no other meaning than that
which is consistent with the nature of the word associated therewith. Hence, if lottery is prohibited only if it involves a consideration, so also must the
term "gift enterprise" be so construed. Significantly, there is not in the law the slightest indicium of any intent to eliminate that element of
consideration from the "gift enterprise" therein included.
This conclusion firms up in the light of the mischief sought to be remedied by the law, resort to the determination thereof being an accepted extrinsic
aid in statutory construction. Mail fraud orders, it is axiomatic, are designed to prevent the use of the mails as a medium for disseminating printed
matters which on grounds of public policy are declared non-mailable. As applied to lotteries, gift enterprises and similar schemes, justification lies in
the recognized necessity to suppress their tendency to inflame the gambling spirit and to corrupt public morals (Com. vs. Lund, 15 A. 2d., 839, 143
Pa. Super. 208). Since in gambling it is inherent that something of value be hazarded for a chance to gain a larger amount, it follows ineluctably that
where no consideration is paid by the contestant to participate, the reason behind the law can hardly be said to obtain. If, as it has been held

Gratuitous distribution of property by lot or chance does not constitute "lottery", if it is not resorted to as a device to evade the law and no
consideration is derived, directly or indirectly, from the party receiving the chance, gambling spirit not being cultivated or stimulated
thereby. City of Roswell vs. Jones, 67 P. 2d., 286, 41 N.M., 258." (25 Words and Phrases, perm. ed., p. 695, emphasis supplied).
we find no obstacle in saying the same respecting a gift enterprise. In the end, we are persuaded to hold that, under the prohibitive provisions of the
Postal Law which we have heretofore examined, gift enterprises and similar schemes therein contemplated are condemnable only if, like lotteries,
they involve the element of consideration. Finding none in the contest here in question, we rule that the appellee may not be denied the use of the
mails for purposes thereof.
Recapitulating, we hold that the petition herein states a sufficient cause of action for declaratory relief, and that the "Caltex Hooded Pump Contest"
as described in the rules submitted by the appellee does not transgress the provisions of the Postal Law.
ACCORDINGLY, the judgment appealed from is affirmed. No costs.
2) Amores vs. HRET
G.R. No. 189600 June 29, 2010
MILAGROS E. AMORES, Petitioner,
vs.
HOUSE OF REPRESENTATIVES ELECTORAL TRIBUNAL and EMMANUEL JOEL J. VILLANUEVA,Respondents.
DECISION
CARPIO MORALES, J.:
Via this petition for certiorari, Milagros E. Amores (petitioner) challenges the Decision of May 14, 2009 and Resolution No. 09-130 of August 6, 2009
of the House of Representatives Electoral Tribunal (public respondent), which respectively dismissed petitioners Petition for Quo Warranto
questioning the legality of the assumption of office of Emmanuel Joel J. Villanueva (private respondent) as representative of the party-list
organization Citizens Battle Against Corruption (CIBAC) in the House of Representatives, and denied petitioners Motion for Reconsideration.
In her Petition for Quo Warranto 1 seeking the ouster of private respondent, petitioner alleged that, among other things, private respondent assumed
office without a formal proclamation issued by the Commission on Elections (COMELEC); he was disqualified to be a nominee of the youth sector of
CIBAC since, at the time of the filing of his certificates of nomination and acceptance, he was already 31 years old or beyond the age limit of 30
pursuant to Section 9 of Republic Act (RA) No. 7941, otherwise known as the Party-List System Act; and his change of affiliation from CIBACs youth
sector to its overseas Filipino workers and their families sector was not effected at least six months prior to the May 14, 2007 elections so as to be
qualified to represent the new sector under Section 15 of RA No. 7941.
Not having filed his Answer despite due notice, private respondent was deemed to have entered a general denial pursuant to public respondents
Rules.2
As earlier reflected, public respondent, by Decision of May 14, 2009, 3 dismissed petitioners Petition for Quo Warranto, finding that CIBAC was
among the party-list organizations which the COMELEC had partially proclaimed as entitled to at least one seat in the House of Representatives
through National Board of Canvassers (NBC) Resolution No. 07-60 dated July 9, 2007. It also found the petition which was filed on October 17, 2007
to be out of time, the reglementary period being 10 days from private respondents proclamation.
Respecting the age qualification for youth sectoral nominees under Section 9 of RA No. 7941, public respondent held that it applied only to those
nominated as such during the first three congressional terms after the ratification of the Constitution or until 1998, unless a sectoral party is thereafter
registered exclusively as representing the youth sector, which CIBAC, a multi-sectoral organization, is not.
In the matter of private respondents shift of affiliation from CIBACs youth sector to its overseas Filipino workers and their families sector, public
respondent held that Section 15 of RA No. 7941 did not apply as there was no resultant change in party-list affiliation.
Her Motion for Reconsideration having been denied by Resolution No. 09-130 dated August 6, 2009, 4 petitioner filed the present Petition for
Certiorari.5

Petitioner contends that, among other things, public respondent created distinctions in the application of Sections 9 and 15 of RA No. 7941 that are
not found in the subject provisions, fostering interpretations at war with equal protection of the laws; and NBC Resolution No. 07-60, which was a
partial proclamation of winning party-list organizations, was not enough basis for private respondent to assume office on July 10, 2007, especially
considering that he admitted receiving his own Certificate of Proclamation only on December 13, 2007.
In his Comment,6 private respondent avers in the main that petitioner has not substantiated her claims of grave abuse of discretion against public
respondent; and that he became a member of the overseas Filipinos and their families sector years before the 2007 elections.
It bears noting that the term of office of party-list representatives elected in the May, 2007 elections will expire on June 30, 2010. While the petition
has, thus, become moot and academic, rendering of a decision on the merits in this case would still be of practical value. 7
The Court adopts the issues framed by public respondent, to wit: (1) whether petitioners Petition for Quo Warranto was dismissible for having been
filed unseasonably; and (2) whether Sections 9 and 15 of RA No. 7941 apply to private respondent.
On the first issue, the Court finds that public respondent committed grave abuse of discretion in considering petitioners Petition for Quo Warranto
filed out of time. Its counting of the 10-day reglementary period provided in its Rules 8 from the issuance of NBC Resolution No. 07-60 on July 9, 2007
is erroneous.
To be sure, while NBC Resolution No. 07-60 partially proclaimed CIBAC as a winner in the May, 2007 elections, along with other party-list
organizations,9 it was by no measure a proclamation of private respondent himself as required by Section 13 of RA No. 7941.
Section 13. How Party-List Representatives are Chosen. Party-list representatives shall be proclaimed by the COMELEC based on the list of names
submitted by the respective parties, organizations, or coalitions to the COMELEC according to their ranking in said list.
AT ALL EVENTS, this Court set aside NBC Resolution No. 07-60 in Barangay Association for National Advancement and Transparency v.
COMELEC10 after revisiting the formula for allocation of additional seats to party-list organizations.
Considering, however, that the records do not disclose the exact date of private respondents proclamation, the Court overlooks the technicality of
timeliness and rules on the merits. Alternatively, since petitioners challenge goes into private respondents qualifications, it may be filed at anytime
during his term.
Qualifications for public office are continuing requirements and must be possessed not only at the time of appointment or election or assumption of
office but during the officer's entire tenure. Once any of the required qualifications is lost, his title may be seasonably challenged. 11
On the second and more substantial issue, the Court shall first discuss the age requirement for youth sector nominees under Section 9 of RA No.
7941 reading:
Section 9. Qualifications of Party-List Nominees. No person shall be nominated as party-list representative unless he is a natural-born citizen of the
Philippines, a registered voter, a resident of the Philippines for a period of not less than one (1)year immediately preceding the day of the election,
able to read and write, a bona fide member of the party or organization which he seeks to represent for at least ninety (90) days preceding the day of
the election, and is at least twenty-five (25) years of age on the day of the election.
In case of a nominee of the youth sector, he must at least be twenty-five (25) but not more than thirty (30) years of age on the day of the election.
Any youth sectoral representative who attains the age of thirty (30) during his term shall be allowed to continue in office until the expiration of his
term. (Emphasis and underscoring supplied.)
The Court finds no textual support for public respondents interpretation that Section 9 applied only to those nominated during the first three
congressional terms after the ratification of the Constitution or until 1998, unless a sectoral party is thereafter registered exclusively as representing
the youth sector.
A cardinal rule in statutory construction is that when the law is clear and free from any doubt or ambiguity, there is no room for construction or
interpretation. There is only room for application. 12

As the law states in unequivocal terms that a nominee of the youth sector must at least be twenty-five (25) but not more than thirty (30) years of age
on the day of the election, so it must be that a candidate who is more than 30 on election day is not qualified to be a youth sector nominee. Since this
mandate is contained in RA No. 7941, the Party-List System Act, it covers ALL youth sector nominees vying for party-list representative seats.
As petitioner points out, RA No. 7941 was enacted only in March, 1995. There is thus no reason to apply Section 9 thereof only to youth sector
nominees nominated during the first three congressional terms after the ratification of the Constitution in 1987. Under this interpretation, the last
elections where Section 9 applied were held in May, 1995 or two months after the law was enacted. This is certainly not sound legislative intent, and
could not have been the objective of RA No. 7941.
There is likewise no rhyme or reason in public respondents ratiocination that after the third congressional term from the ratification of the
Constitution, which expired in 1998, Section 9 of RA No. 7941 would apply only to sectoral parties registered exclusively as representing the youth
sector. This distinction is nowhere found in the law. Ubi lex non distinguit nec nos distinguire debemus. When the law does not distinguish, we must
not distinguish.13
Respecting Section 15 of RA No. 7941, the Court fails to find even an iota of textual support for public respondents ratiocination that the provision
did not apply to private respondents shift of affiliation from CIBACs youth sector to its overseas Filipino workers and their families sector as there
was no resultant change in party-list affiliation. Section 15 reads:
Section 15. Change of Affiliation; Effect. Any elected party-list representative who changes his political party or sectoral affiliation during his term of
office shall forfeit his seat: Provided, That if he changes his political party orsectoral affiliation within six (6) months before an election, he shall not be
eligible for nomination as party-list representative under his new party or organization. (emphasis and underscoring supplied.)
What is clear is that the wording of Section 15 covers changes in both political party and sectoral affiliation. And the latter may occur within the same
party since multi-sectoral party-list organizations are qualified to participate in the Philippine party-list system. Hence, a nominee who changes his
sectoral affiliation within the same party will only be eligible for nomination under the new sectoral affiliation if the change has been effected at least
six months before the elections. Again, since the statute is clear and free from ambiguity, it must be given its literal meaning and applied without
attempted interpretation. This is the plain meaning rule or verba legis, as expressed in the maxim index animi sermo or speech is the index of
intention.14
It is, therefore, beyond cavil that Sections 9 and 15 of RA No. 7941 apply to private respondent.
The Court finds that private respondent was not qualified to be a nominee of either the youth sector or the overseas Filipino workers and their
families sector in the May, 2007 elections.
The records disclose that private respondent was already more than 30 years of age in May, 2007, it being stipulated that he was born in August,
1975.15 Moreover, he did not change his sectoral affiliation at least six months before May, 2007, public respondent itself having found that he shifted
to CIBACs overseas Filipino workers and their families sector only on March 17, 2007. 161avvphi1
That private respondent is the first nominee of CIBAC, whose victory was later upheld, is of no moment. A party-list organizations ranking of its
nominees is a mere indication of preference, their qualifications according to law are a different matter.
It not being contested, however, that private respondent was eventually proclaimed as a party-list representative of CIBAC and rendered services as
such, he is entitled to keep the compensation and emoluments provided by law for the position until he is properly declared ineligible to hold the
same.17
WHEREFORE, the petition is GRANTED. The Decision dated May 14, 2009 and Resolution No. 09-130 dated August 6, 2009 of the House of
Representatives Electoral Tribunal are SET ASIDE. Emmanuel Joel J. Villanueva is declared ineligible to hold office as a member of the House of
Representatives representing the party-list organization CIBAC.
3) Republic vs. Toledano
G.R. No. 94147 June 8, 1994
REPUBLIC OF THE PHILIPPINES, petitioner,
vs.

HONORABLE RODOLFO TOLEDANO, in his capacity as Presiding Judge of the Regional Trial Court, Third Judicial Region, Branch 69, Iba,
Zambales and SPOUSES ALVIN A. CLOUSE and EVELYN A. CLOUSE, respondents.
PUNO, J.:
Before us is a petition for review on certiorari of the decision 1 of the Regional Trial Court of Iba, Zambales, Branch 69, in Special Proceeding No.
RTC-140-I, entitled, "In the Matter of the Adoption of the Minor named Solomon Joseph Alcala", raising a pure question of law.
The sole issue for determination concerns the right of private respondents spouses Alvin A. Clouse and Evelyn A. Clouse who are aliens to adopt
under Philippine Law.
There is no controversy as to the facts.
On February 21, 1990, in a verified petition filed before the Regional Trial Court of Iba, Zambales, private respondents spouses Clouse sought to
adopt the minor, Solomon Joseph Alcala, the younger brother of private respondent Evelyn A. Clouse. In an Order issued on March 12, 1990, the
petition was set for hearing on April 18, 1990. The said Order was published in a newspaper of general circulation in the province of Zambales and
City of Olongapo for three (3) consecutive weeks.
The principal evidence disclose that private respondent Alvin A. Clouse is a natural born citizen of the United States of America. He married Evelyn,
a Filipino on June 4, 1981 at Olongapo City. On August 19, 1988, Evelyn became a naturalized citizen of the United States of America in Guam.
They are physically, mentally, morally, and financially capable of adopting Solomon, a twelve (12) year old minor.
Since 1981 to 1984, then from November 2, 1989 up to the present, Solomon Joseph Alcala was and has been under the care and custody of private
respondents. Solomon gave his consent to the adoption. His mother, Nery Alcala, a widow, likewise consented to the adoption due to poverty and
inability to support and educate her son.
Mrs. Nila Corazon Pronda, the social worker assigned to conduct the Home and Child Study, favorably recommended the granting of the petition for
adoption.
Finding that private respondents have all the qualifications and none of the disqualifications provided by law and that the adoption will redound to the
best interest and welfare of the minor, respondent judge rendered a decision on June 20, 1990, disposing as follows:
WHEREFORE, the Court grants the petition for adoption filed by Spouses Alvin A. Clouse and Evelyn A. Clouse and decrees that
the said minor be considered as their child by adoption. To this effect, the Court gives the minor the rights and duties as the
legitimate child of the petitioners. Henceforth, he shall be known as SOLOMON ALCALA CLOUSE.
The Court dissolves parental authority bestowed upon his natural parents and vests parental authority to the herein petitioners
and makes him their legal heir. Pursuant to Article 36 of P.D. 603 as amended, the decree of adoption shall be effective as of the
date when the petition was filed. In accordance with Article 53 of the same decree, let this decree of adoption be recorded in the
corresponding government agency, particularly the Office of the Local Civil Registrar of Merida, Leyte where the minor was born.
The said office of the Local Civil Registrar is hereby directed to issue an amended certificate of live birth to the minor adopted by
the petitioners.
Let copies of this decision be furnished (sic) the petitioners, DSWD, Zambales Branch, Office of the Solicitor General and the
Office of the Local Civil Registrar of Merida, Leyte.
SO ORDERED. 2
Petitioner, through the Office of the Solicitor General appealed to us for relief, contending:
THE LOWER COURT ERRED IN GRANTING THE PETITION FOR ADOPTION OF ALVIN AND EVELYN CLOUSE, BECAUSE
THEY ARE NOT QUALIFIED TO ADOPT UNDER PHILIPPINE LAW.

We rule for petitioner.

Under Articles 184 and 185 of Executive Order (E.O.) No. 209, otherwise known as "The Family Code of the Philippines", private respondents
spouses Clouse are clearly barred from adopting Solomon Joseph Alcala.
Article 184, paragraph (3) of Executive Order No. 209 expressly enumerates the persons who are not qualified to adopt, viz.:
(3) An alien, except:
(a) A former Filipino citizen who seeks to adopt a relative by consanguinity;
(b) One who seeks to adopt the legitimate child of his or her Filipino spouse; or
(c) One who is married to a Filipino citizen and seeks to adopt jointly with his or her spouse a relative by
consanguinity of the latter.
Aliens not included in the foregoing exceptions may adopt Filipino children in accordance with the rules on
inter-country adoption as may be provided by law.
There can be no question that private respondent Alvin A. Clouse is not qualified to adopt Solomon Joseph Alcala under any of the exceptional cases
in the aforequoted provision. In the first place, he is not a former Filipino citizen but a natural born citizen of the United States of America. In the
second place, Solomon Joseph Alcala is neither his relative by consanguinity nor the legitimate child of his spouse. In the third place, when private
respondents spouses Clouse jointly filed the petition to adopt Solomon Joseph Alcala on February 21, 1990, private respondent Evelyn A. Clouse
was no longer a Filipino citizen. She lost her Filipino citizenship when she was naturalized as a citizen of the United States in 1988.
Private respondent Evelyn A. Clouse, on the other hand, may appear to qualify pursuant to paragraph 3(a) of Article 184 of E.O. 209. She was a
former Filipino citizen. She sought to adopt her younger brother. Unfortunately, the petition for adoption cannot be granted in her favor alone without
violating Article 185 which mandates a joint adoption by the husband and wife. It reads:
Article 185. Husband and wife must jointly adopt, except in the following cases:
(1) When one spouse seeks to adopt his own illegitimate child; or
(2) When one spouse seeks to adopt the legitimate child of the other.
Article 185 requires a joint adoption by the husband and wife, a condition that must be read along together with Article 184. 3
The historical evolution of this provision is clear. Presidential Decree 603 (The Child and Youth Welfare Code), provides that husband and wife "may"
jointly adopt. 4 Executive Order No. 91 issued on December 17, 1986 amended said provision of P.D. 603. It demands that both husband and wife
"shall" jointly adopt if one of them is an alien. 5 It was so crafted to protect Filipino children who are put up for adoption. The Family Code reiterated
the rule by requiring that husband and wife "must" jointly adopt, except in the cases mentioned before. Under the said new law, joint adoption by
husband and wife is mandatory. 6 This is in consonance with the concept of joint parental authority over the child, which is the ideal situation. 7 As the
child to be adopted is elevated to the level of a legitimate child, it is but natural to require the spouses to adopt jointly. The rule also insures harmony
between the spouses. 8
In a distinctly similar case, we held:
As amended by Executive Order 91, Presidential Decree No. 603, had thus made it mandatory for both the spouses to jointly
adopt when one of them was an alien. The law was silent when both spouses were of the same nationality.
The Family Code has resolved any possible uncertainty. Article 185 thereof expresses the necessity for a joint adoption by the
spouses except in only two instances

(1) When one spouse seeks to adopt his own illegitimate child; or
(2) When one spouse seeks to adopt the legitimate child of the other.
It is in the foregoing cases when Article 186 of the Code, on the parental authority, can aptly find governance.
Article 186. In case husband and wife jointly adopt or one spouse adopts the legitimate child of the other, jointly parental
authority shall be exercised by the spouses in accordance with this Code. 9
Article 185 is all too clear and categorical and there is no room for its interpretation. There is only room for application. 10
We are not unaware that the modern trend is to encourage adoption and every reasonable intendment should be sustained to promote that
objective. 11 Adoption is geared more towards the promotion of the welfare of the child and enhancement of his opportunities for a useful and happy
life. 12 It is not the bureaucratic technicalities but the interest of the child that should be the principal criterion in adoption cases. 13 Executive Order
209 likewise upholds that the interest and welfare of the child to be adopted should be the paramount consideration. These considerations
notwithstanding, the records of the case do not evince any fact as would justify us in allowing the adoption of the minor, Solomon Joseph Alcala, by
private respondents who are aliens.
WHEREFORE, the petition is GRANTED. The decision of the lower court is REVERSED and SET ASIDE. No costs.
4) RCP vs. NTC
G.R. No. L-68729 May 29, 1987
RADIO COMMUNICATIONS OF THE PHILIPPINES, INC., petitioner,
vs.
NATIONAL TELECOMMUNICATIONS COMMISSION and KAYUMANGGI RADIO NETWORK INCORPORATED,respondents.

GUTIERREZ, JR, J.:

This petition seeks the reversal of the decision of the National Telecommunications Commission (NTC) which ordered petitioner Radio
Communications of the Philippines, Incorporated (RCPI) to desist from operating its radio telephone services in Catarman, Northern Samar; San
Jose, Occidental Mindoro; and Sorsogon, Sorsogon.
Petitioner has been operating a radio communications system since 1957 under its legislative franchise granted by Republic Act No. 2036 which was
enacted on June 23, 1957.
In 1968, the petitioner established a radio telegraph service in Sorsogon, Sorsogon. In 1971, another radio telegraph service was put up in San Jose,
Mindoro followed by another in Catarman, Samar in 1976. The installation of radio telephone services started in 1971 in San Jose, Mindoro; then in
Sorsogon, Sorsogon and Catarman, Samar in 1983.
In a decision dated June 24, 1980 in NTC Case No. 80-08, private respondent Kayumanggi Radio Network Incorporated was authorized by the
public respondent to operate radio communications systems in Catarman, Samar and in San Jose, Mindoro.
On December 14, 1983, the private respondent filed a complaint with the NTC alleging that the petitioner was operating in Catarman, Samar and in
San Jose, Mindoro without a certificate of public covenience and necessity. The petitioner, on the other hand, counter-alleged that its telephone
services in the places subject of the complaint are covered by the legislative franchise recognized by both the public respondent and its predecessor,
the Public Service Commission. In its supplemental reply, the petitioner further stated that it has been in operation in the questioned places long
before private respondent Kayumanggi filed its application to operate in the same places.
After conducting a hearing, NTC, in its decision dated August 22, 1984 ordered petitioner RCPI to immediately cease or desist from the operation of
its radio telephone services in Catarman Northern Samar; San Jose, Occidental Mindoro; and Sorsogon, Sorsogon stating that under Executive

Order No. 546, a certificate of public convenience and necessity is mandatory for the operation of communication utilities and services including
radio communications.
On September 4, 1984, the petitioner filed a motion for reconsideration which was denied in an order dated September 12, 1984.
On October 1, 1984, the present petition was filed raising the issue of whether or not petitioner RCPI, a grantee of a legislative franchise to operate a
radio company, is required to secure a certificate of public convenience and necessity before it can validly operate its radio stations including radio
telephone services in Catarman, Northern Samar; San Jose, Occidental Mindoro; and Sorsogon, Sorsogon.
The petitioner's main argument states that the abolition of the Public Service Commission under Presidential Decree No. 1 and the creation of the
National Telecommunications Commission under Executive Order No. 546 to replace the defunct Public Service Commission did not affect sections
14 and 15 of the Public Service Law (Commonwealth Act. No. 146, as amended).
The provisions of the Public Service Law pertinent to the petitioner's allegation are as follows:
Section 13. (a) the Commission shall have jurisdiction, supervision, and control over all public services and their franchises,
equipment and other properties, and in the exercise of its authority, it shall have the necessary powers and the aid of public
force: ...
Section 14. The following are exempted from the provisions of the preceding section:
xxx xxx xxx
(d) Radio companies except with respect to the fixing of rates;
xxx xxx xxx
Section 15. With the exception of those enumerated in the preceding section, no public service shall operate in the Philippines
without possessing a valid and subsisting certificate from the Public Service Commission, known as "certificate of public
convenience," or "certificate of convenience and public necessity," as the case may be, to the effect that the operation of said
service and the authorization to do business will promote the public interests in a proper and suitable manner. ...
We find no merit in the petitioner's contention.
Pursuant to Presidential Decree No. 1 dated September 23,1972, reorganizing the executive branch of the National Government, the Public Service
Commission was abolished and its functions were transferred to three specialized regulatory boards, as follows: the Board of Transportation, the
Board of Communications and the Board of Power and Waterworks. The functions so transferred were still subject to the limitations provided in
sections 14 and 15 of the Public Service Law, as amended. With the enactment of Executive Order No. 546 on July 23, 1979 implementing P.D.
No.1, the Board of Communications and the Telecommunications Control Bureau were abolished and their functions were transferred to the National
Telecommunications Commission (Sec. 19(d), Executive Order No. 546). Section 15 of said Executive Order spells out the functions of the National
Telecommunications Commission as follows:
Sec. 15. Functions of the Commission.-The Commission shall exercise the following functions:
a. Issue Certificate of Public Convenience for the operation of communications utilities and services, radio communications
petitions systems, wire or wireless telephone or telegraph system, radio and television broadcasting system and other similar
public utilities;
b. Establish, prescribe and regulate areas of operation of particular operators of public service communications; and determine
and prescribe charges or rates pertinent to the operation of such public utility facilities and services except in cases where
charges or rates are established by international bodies or associations of which the Philippines is a participating member or by
bodies recognized by the Philippine Government as the proper arbiter of such charges or rates;

c. Grant permits for the use of radio frequencies for wireless telephone and telegraph systems and radio communication systems
including amateur radio stations and radio and television broadcasting systems;
d. Sub-allocate series of frequencies of bands allocated by the International Telecommunications Union to the specific services;
e. Establish and prescribe rules, regulations, standards, specifications in all cases related to the issued Certificate of Public
Convenience and administer and enforce the same;
f. Coordinate and cooperate with government agencies and other entities concerned with any aspect involving communications
with a view to continuously improve the communications service in the country;
g. Promulgate such rules and regulations, as public safety and interest may require, to encourage a larger and more effective
use of communications, radio and television broadcasting facilities, and to maintain effective competition among private entities
in these activities whenever the Commission finds it reasonably feasible;
h. Supervise and inspect the operation of radio stations and telecommunications facilities;
i. Undertake the examination and licensing of radio operators;
j. Undertake, whenever necessary, the registration of radio transmitters and transceivers; and
k. Perform such other functions as may be prescribed by law.
It is clear from the aforequoted provision that the exemption enjoyed by radio companies from the jurisdiction of the Public Service Commission and
the Board of Communications no longer exists because of the changes effected by the Reorganization Law and implementing executive orders. The
petitioner's claim that its franchise cannot be affected by Executive Order No. 546 on the ground that it has long been in operation since 1957 cannot
be sustained.
A franchise started out as a "royal privilege or (a) branch of the King's prerogative, subsisting in the hands of a subject." This definition was given by
Finch, adopted by Blackstone, and accepted by every authority since (State v. Twin Village Water Co., 98 Me 214, 56 A 763 (1903)). Today, a
franchise, being merely a privilege emanating from the sovereign power of the state and owing its existence to a grant, is subject to regulation by the
state itself by virtue of its police power through its administrative agencies. We ruled in Pangasinan transportation Co., Inc. v. Public Service
Commission (70 Phil. 221) that:
... statutes enacted for the regulation of public utilities, being a proper exercise by the State of its police power, are applicable not
only to those public utilities coming into existence after its passage, but likewise to those already established and in operation ...
Executive Order No. 546, being an implementing measure of P.D. No. I insofar as it amends the Public Service Law (CA No. 146, as amended) is
applicable to the petitioner who must be bound by its provisions. The petitioner cannot install and operate radio telephone services on the basis of its
legislative franchise alone.
The position of the petitioner that by the mere grant of its franchise under RA No. 2036 it can operate a radio communications system anywhere
within the Philippines is erroneous. Section 1 of said statute reads:
Section 1. Subject to the provisions of the Constitution, and to the provisions, not inconsistent herewith, of Act Numbered Three
thousand eight hundred and forty-six, entitled.' An Act providing for the regulation of radio stations and radio communications in
the Philippine Islands, and for other purposes;' Commonwealth Act Numbered One hundred forty-six, known as the Public
Service Act, and their amendments, and other applicable laws, there is hereby granted to the Radio Communications of the
Philippines, its successors or assigns, the right and privilege of constructing, installing, establishing and operating in the
Philippines, at such places as the said corporation may select and the Secretary of Public Works and Communications may
approve, radio stations for the reception and transmission of wireless messages on radiotelegraphy and/or radiotelephone,
including both coastal and marine telecommunications, each station to consist of two radio apparatus comprising of a receiving
and sending radio apparatus. (Emphasis supplied).

Section 4(a) of the same Act further provides that:

Sec. 4(a). This franchise shall not take effect nor shall any powers thereunder be exercised by the grantee until the Secretary of
Public works and Communications shall have allotted to the grantee the frequencies and wave lengths to be used, and issued to
the grantee a license for such case. (Emphasis supplied)
Thus, in the words of R.A. No. 2036 itself, approval of the then Secretary of Public Works and Communications was a precondition before the
petitioner could put up radio stations in areas where it desires to operate. It has been repeated time and again that where the statutory norm speaks
unequivocally, there is nothing for the courts to do except to apply it. The law, leaving no doubt as to the scope of its operation, must be obeyed.
(Gonzaga v. Court of Appeals, 51 SCRA 381).
The records of the case do not show any grant of authority from the then Secretary of Public Works and Communications before the petitioner
installed the questioned radio telephone services in San Jose, Mindoro in 1971. The same is true as regards the radio telephone services opened in
Sorsogon, Sorsogon and Catarman, Samar in 1983. No certificate of public convenience and necessity appears to have been secured by the
petitioner from the public respondent when such certificate,was required by the applicable public utility regulations (See executive Order No. 546,
sec. 15, supra.; Philippine Long Distance Telephone Co. v. City of Davao, 15 SCRA 75; Olongapo Electric Light and Power Corp. v. National Power
Corporation, et al., G.R. No. L-24912, promulgated April 9, 1987.)
It was well within the powers of the public respondent to authorize the installation by the private respondent network of radio communications
systems in Catarman, Samar and San Jose, Mindoro. Under the circumstances of this case, the mere fact that the petitioner possesses a franchise
to put up and operate a radio communications system in certain areas is not an insuperable obstacle to the public respondent's issuing the proper
certificate to an applicant desiring to extend the same services to those areas. The Constitution mandates that a franchise cannot be exclusive in
nature nor can a franchise be granted except that it must be subject to amendment, alteration, or even repeal by the legislature when the common
good so requires. (Art. XII, sec. 11 of the 1986 Constitution). There is an express provision in the petitioner's franchise which provides compliance
with the above mandate R.A. 2036, sec. 15).
In view of the foregoing, we find no reason to disturb the public respondent's findings of fact, and conclusions of law insofar as the private
respondent was authorized to operate in Catarman, Samar and San Jose, Mindoro. As a rule, the Commission's findings of fact, if supported by
substantial evidence, are conclusive upon this Court. We may modify or ignore them only when it clearly appears that there is no evidence to
support reasonably such a conclusion. (Halili v. Daplas, 14 SCRA 14). The petitioner has not shown why the private respondent should be denied the
authority to operate its services in Samar and Mindoro. It has not overcome the presumption that when the public respondent disturbed the
petitioner's monopoly in certain areas, it was doing so pursuant to public interest and the common good.
WHEREFORE, the challenged order of the public respondent dated August 22, 1984 is hereby AFFIRMED. The petition is dismissed for lack of
merit.
5) Republic vs. CA (Molina)
G.R. No. 108763 February 13, 1997
REPUBLIC OF THE PHILIPPINES,
vs.
COURT OF APPEALS and RORIDEL OLAVIANO MOLINA, respondents.
PANGANIBAN, J.:
The Family Code of the Philippines provides an entirely new ground (in addition to those enumerated in the Civil Code) to assail the validity of a
marriage, namely, "psychological incapacity." Since the Code's effectivity, our courts have been swamped with various petitions to declare marriages
void based on this ground. Although this Court had interpreted the meaning of psychological incapacity in the recent case of Santos vs. Court of
Appeals, still many judges and lawyers find difficulty in applying said novel provision in specific cases. In the present case and in the context of the
herein assailed Decision of the Court of Appeals, the Solicitor General has labelled exaggerated to be sure but nonetheless expressive of his
frustration Article 36 as the "most liberal divorce procedure in the world." Hence, this Court in addition to resolving the present case, finds the
need to lay down specific guidelines in the interpretation and application of Article 36 of the Family Code.

Before us is a petition for review on certiorari under Rule 45 challenging the January 25, 1993 Decision 1of the Court of Appeals 2 in CA-G.R. CV No.
34858 affirming in toto the May 14, 1991 decision of the Regional Trial Court of La Trinidad, 3 Benguet, which declared the marriage of respondent
Roridel Olaviano Molina to Reynaldo Molina void ab initio, on the ground of "psychological incapacity" under Article 36 of the Family Code.
The Facts
This case was commenced on August 16, 1990 with the filing by respondent Roridel O. Molina of a verified petition for declaration of nullity of her
marriage to Reynaldo Molina. Essentially, the petition alleged that Roridel and Reynaldo were married on April 14, 1985 at the San Agustin
Church 4 in Manila; that a son, Andre O. Molina was born; that after a year of marriage, Reynaldo showed signs of "immaturity and irresponsibility" as
a husband and a father since he preferred to spend more time with his peers and friends on whom he squandered his money; that he depended on
his parents for aid and assistance, and was never honest with his wife in regard to their finances, resulting in frequent quarrels between them; that
sometime in February 1986, Reynaldo was relieved of his job in Manila, and since then Roridel had been the sole breadwinner of the family; that in
October 1986 the couple had a very intense quarrel, as a result of which their relationship was estranged; that in March 1987, Roridel resigned from
her job in Manila and went to live with her parents in Baguio City; that a few weeks later, Reynaldo left Roridel and their child, and had since then
abandoned them; that Reynaldo had thus shown that he was psychologically incapable of complying with essential marital obligations and was a
highly immature and habitually quarrel some individual who thought of himself as a king to be served; and that it would be to the couple's best
interest to have their marriage declared null and void in order to free them from what appeared to be an incompatible marriage from the start.
In his Answer filed on August 28, 1989, Reynaldo admitted that he and Roridel could no longer live together as husband and wife, but contended that
their misunderstandings and frequent quarrels were due to (1) Roridel's strange behavior of insisting on maintaining her group of friends even after
their marriage; (2) Roridel's refusal to perform some of her marital duties such as cooking meals; and (3) Roridel's failure to run the household and
handle their finances.
During the pre-trial on October 17, 1990, the following were stipulated:
1. That the parties herein were legally married on April 14, 1985 at the Church of St. Augustine, Manila;
2. That out of their marriage, a child named Albert Andre Olaviano Molina was born on July 29, 1986;
3. That the parties are separated-in-fact for more than three years;
4. That petitioner is not asking support for her and her child;
5. That the respondent is not asking for damages;
6. That the common child of the parties is in the custody of the petitioner wife.
Evidence for herein respondent wife consisted of her own testimony and that of her friends Rosemarie Ventura and Maria Leonora Padilla as well as
of Ruth G. Lalas, a social worker, and of Dr. Teresita Hidalgo-Sison, a psychiatrist of the Baguio General Hospital and Medical Center. She also
submitted documents marked as Exhibits "A" to "E-1." Reynaldo did not present any evidence as he appeared only during the pre-trial conference.
On May 14, 1991, the trial court rendered judgment declaring the marriage void. The appeal of petitioner was denied by the Court of Appeals which
affirmed in toto the RTC's decision. Hence, the present recourse.
The Issue
In his petition, the Solicitor General insists that "the Court of Appeals made an erroneous and incorrect interpretation of the phrase 'psychological
incapacity' (as provided under Art. 36 of the Family Code) and made an incorrect application thereof to the facts of the case," adding that the
appealed Decision tended "to establish in effect the most liberal divorce procedure in the world which is anathema to our culture."
In denying the Solicitor General's appeal, the respondent Court relied 5 heavily on the trial court's findings "that the marriage between the parties
broke up because of their opposing and conflicting personalities." Then, it added it sown opinion that "the Civil Code Revision Committee (hereinafter
referred to as Committee) intended to liberalize the application of our civil laws on personal and family rights. . . ." It concluded that:

As ground for annulment of marriage, We view psychologically incapacity as a broad range of mental and behavioral conduct on
the part of one spouse indicative of how he or she regards the marital union, his or her personal relationship with the other
spouse, as well as his or her conduct in the long haul for the attainment of the principal objectives of marriage. If said conduct,
observed and considered as a whole, tends to cause the union to self-destruct because it defeats the very objectives of
marriage, then there is enough reason to leave the spouses to their individual fates.
In the case at bar, We find that the trial judge committed no indiscretion in analyzing and deciding the instant case, as it did,
hence, We find no cogent reason to disturb the findings and conclusions thus made.
Respondent, in her Memorandum, adopts these discussions of the Court of Appeals.
The petitioner, on the other hand, argues that "opposing and conflicting personalities" is not equivalent to psychological incapacity, explaining that
such ground "is not simply the neglect by the parties to the marriage of their responsibilities and duties, but a defect in their psychological nature
which renders them incapable of performing such marital responsibilities and duties."
The Court's Ruling
The petition is meritorious.
In Leouel Santos vs. Court of Appeals 6 this Court, speaking thru Mr. Justice Jose C. Vitug, ruled that "psychological incapacity should refer to no less
than a mental (nor physical) incapacity . . . and that (t)here is hardly any doubt that the intendment of the law has been to confine the meaning of
'psychological incapacity' to the most serious cases of personality disorders clearly demonstrative of an utter insensitivity or inability to give meaning
and significance to the marriage. This psychologic condition must exist at the time the marriage is celebrated." Citing Dr. Gerardo Veloso, a former
presiding judge of the Metropolitan Marriage Tribunal of the Catholic Archdiocese of Manila, 7 Justice Vitug wrote that "the psychological incapacity
must be characterized by (a) gravity, (b) juridical antecedence, and (c) incurability."
On the other hand, in the present case, there is no clear showing to us that the psychological defect spoken of is an incapacity. It appears to us to be
more of a "difficulty," if not outright "refusal" or "neglect" in the performance of some marital obligations. Mere showing of "irreconciliable differences"
and "conflicting personalities" in no wise constitutes psychological incapacity. It is not enough to prove that the parties failed to meet their
responsibilities and duties as married persons; it is essential that they must be shown to be incapable of doing so, due to some psychological (nor
physical) illness.
The evidence adduced by respondent merely showed that she and her husband could nor get along with each other. There had been no showing of
the gravity of the problem; neither its juridical antecedence nor its incurability. The expert testimony of Dr. Sison showed no incurable psychiatric
disorder but only incompatibility, not psychological incapacity. Dr. Sison testified: 8
COURT
Q It is therefore the recommendation of the psychiatrist based on your findings that it is better for the Court to
annul (sic) the marriage?
A Yes, Your Honor.
Q There is no hope for the marriage?
A There is no hope, the man is also living with another woman.
Q Is it also the stand of the psychiatrist that the parties are psychologically unfit for each other but they are
psychologically fit with other parties?
A Yes, Your Honor.
Q Neither are they psychologically unfit for their professions?

A Yes, Your Honor.

The Court has no more questions.
In the case of Reynaldo, there is no showing that his alleged personality traits were constitutive of psychological incapacity existing at the time of
marriage celebration. While some effort was made to prove that there was a failure to fulfill pre-nuptial impressions of "thoughtfulness and
gentleness" on Reynaldo's part of being "conservative, homely and intelligent" on the part of Roridel, such failure of expectation is nor indicative of
antecedent psychological incapacity. If at all, it merely shows love's temporary blindness to the faults and blemishes of the beloved.
During its deliberations, the Court decided to go beyond merely ruling on the facts of this case vis-a-visexisting law and jurisprudence. In view of the
novelty of Art. 36 of the Family Code and the difficulty experienced by many trial courts interpreting and applying it, the Court decided to invite
two amici curiae, namely, the Most Reverend Oscar V. Cruz, 9 Vicar Judicial (Presiding Judge) of the National Appellate Matrimonial Tribunal of the
Catholic Church in the Philippines, and Justice Ricardo C. Puno, 10 a member of the Family Code Revision Committee. The Court takes this occasion
to thank these friends of the Court for their informative and interesting discussions during the oral argument on December 3, 1996, which they
followed up with written memoranda.
From their submissions and the Court's own deliberations, the following guidelines in the interpretation and application of Art. 36 of the Family Code
are hereby handed down for the guidance of the bench and the bar:
(1) The burden of proof to show the nullity of the marriage belongs to the plaintiff. Any doubt should be resolved in favor of the existence and
continuation of the marriage and against its dissolution and nullity. This is rooted in the fact that both our Constitution and our laws cherish the
validity of marriage and unity of the family. Thus, our Constitution devotes an entire Article on the Family, 11 recognizing it "as the foundation of the
nation." It decrees marriage as legally "inviolable," thereby protecting it from dissolution at the whim of the parties. Both the family and marriage are
to be "protected" by the state.
The Family Code 12 echoes this constitutional edict on marriage and the family and emphasizes the permanence, inviolability and solidarity
(2) The root cause of the psychological incapacity must be (a) medically or clinically identified, (b) alleged in the complaint, (c) sufficiently proven by
experts and (d) clearly explained in the decision. Article 36 of the Family Code requires that the incapacity must be psychological not physical.
although its manifestations and/or symptoms may be physical. The evidence must convince the court that the parties, or one of them, was mentally
or physically ill to such an extent that the person could not have known the obligations he was assuming, or knowing them, could not have given
valid assumption thereof. Although no example of such incapacity need be given here so as not to limit the application of the provision under the
principle of ejusdem generis, 13 nevertheless such root cause must be identified as a psychological illness and its incapacitating nature explained.
Expert evidence may be given qualified psychiatrist and clinical psychologists.
(3) The incapacity must be proven to be existing at "the time of the celebration" of the marriage. The evidence must show that the illness was
existing when the parties exchanged their "I do's." The manifestation of the illness need not be perceivable at such time, but the illness itself must
have attached at such moment, or prior thereto.
(4) Such incapacity must also be shown to be medically or clinically permanent or incurable. Such incurability may be absolute or even relative only
in regard to the other spouse, not necessarily absolutely against everyone of the same sex. Furthermore, such incapacity must be relevant to the
assumption of marriage obligations, not necessarily to those not related to marriage, like the exercise of a profession or employment in a job. Hence,
a pediatrician may be effective in diagnosing illnesses of children and prescribing medicine to cure them but may not be psychologically capacitated
to procreate, bear and raise his/her own children as an essential obligation of marriage.
(5) Such illness must be grave enough to bring about the disability of the party to assume the essential obligations of marriage. Thus, "mild
characteriological peculiarities, mood changes, occasional emotional outbursts" cannot be accepted as root causes. The illness must be shown as
downright incapacity or inability, nor a refusal, neglect or difficulty, much less ill will. In other words, there is a natal or supervening disabling factor in
the person, an adverse integral element in the personality structure that effectively incapacitates the person from really accepting and thereby
complying with the obligations essential to marriage.
(6) The essential marital obligations must be those embraced by Articles 68 up to 71 of the Family Code as regards the husband and wife as well as
Articles 220, 221 and 225 of the same Code in regard to parents and their children. Such non-complied marital obligation(s) must also be stated in
the petition, proven by evidence and included in the text of the decision.

(7) Interpretations given by the National Appellate Matrimonial Tribunal of the Catholic Church in the Philippines, while not controlling or decisive,
should be given great respect by our courts. It is clear that Article 36 was taken by the Family Code Revision Committee from Canon 1095 of the
New Code of Canon Law, which became effective in 1983 and which provides:
The following are incapable of contracting marriage: Those who are unable to assume the essential obligations of marriage due
to causes of psychological nature. 14
Since the purpose of including such provision in our Family Code is to harmonize our civil laws with the religious faith of our people, it stands to
reason that to achieve such harmonization, great persuasive weight should be given to decision of such appellate tribunal. Ideally subject to our
law on evidence what is decreed as canonically invalid should also be decreed civilly void.
This is one instance where, in view of the evident source and purpose of the Family Code provision, contemporaneous religious interpretation is to
be given persuasive effect. Here, the State and the Church while remaining independent, separate and apart from each other shall walk
together in synodal cadence towards the same goal of protecting and cherishing marriage and the family as the inviolable base of the nation.
(8) The trial court must order the prosecuting attorney or fiscal and the Solicitor General to appear as counsel for the state. No decision shall he
handed down unless the Solicitor General issues a certification, which will be quoted in the decision, briefly staring therein his reasons for his
agreement or opposition, as the case may be, to the petition. The Solicitor General, along with the prosecuting attorney, shall submit to the court
such certification within fifteen (15) days from the date the case is deemed submitted for resolution of the court. The Solicitor General shall discharge
the equivalent function of the defensor vinculi contemplated under Canon 1095.
In the instant case and applying Leouel Santos, we have already ruled to grant the petition. Such ruling becomes even more cogent with the use of
the foregoing guidelines.
WHEREFORE, the petition is GRANTED. The assailed Decision is REVERSED and SET ASIDE. The marriage of Roridel Olaviano to Reynaldo
Molina subsists and remains valid.
SO ORDERED.