TERMS WITH MULTIPLE MEANING

SECOND DIVISION
[G.R. No. L-56028 : July 30, 1981.]
NILO A. MALANYAON, Petitioner-Appellant, vs. HON. ESTEBAN M.
LISING, as Judge of the CFI of Camarines Sur, Br. VI, and CESARIO
GOLETA, as Municipal Treasurer of Bula, Camarines Sur, RespondentsAppellees.
DECISION

Nilo A. Malanyaon, the petitioner, was formerly a member of the

Sangguniang Bayan of Bula, Camarines Sur. He filed an action to declare
illegal the disbursement made by Cesario Goleta as Municipal Treasurer of
the Municipality of Bula, Camarines Sur, to Venancia Pontanal, widow of the
late Mayor S.B. Pontanal, in the amount of P5,000.00 representing a portion
of the salary of the late Mayor as such mayor of said municipality during the
period of his suspension from August 16, 1977 up to November 28, 1979,
and to restrain or prevent respondent Cesario Goleta as such Municipal
Treasurer of the aforementioned municipality from further paying or
disbursing the balance of the claim. chanroblesvirtualawlibrary(Par. 1 of the
Order, supra.) However, the respondent judge dismissed the action on the
ground that the criminal case against the late Mayor S.B. Pontanal due to
his death amounted to acquittal.

ABAD SANTOS, J.:

We grant the petition and set aside the Order of the court a quo.

The question which is presented to Us for resolution in this petition for review
concerns the interpretation of Section 13 of R.A. No. 3019, otherwise known
as the Anti-Graft and Corrupt Practices Act which stipulates:

It is obvious that when the statute speaks of the suspended officer being
acquitted it means that after due hearing and consideration of the evidence
against him the court is of the opinion that his guilt has not been proved
beyond reasonable doubt. Dismissal of the case against the suspended
officer will not suffice because dismissal does not amount to acquittal. As
aptly stated in People v. Salico, 84 Phil. 722, 732-733[1949]:

Sec. 13. Suspension and loss of benefits. Any public officer

against whom any criminal prosecution under a valid information
under this Act or under the provisions of the Revised Penal Code on
bribery is pending in court, shall be suspended from office. Should he
be convicted by final judgment, he shall lose all retirement or gratuity
benefits under any law, but if he is acquitted, he shall be entitled to
reinstatement and to the salaries and benefits which he failed to
receive during suspension, unless in the meantime administrative
proceedings have been filed against him.
The facts are stated in the Order dated October 3, 1980, of the respondent
judge:
The late Mayor S.B. Pontanal is one of the accused in Criminal
Case No. P-339 for Violation of the Anti-Graft and Corrupt Practices
Act. Upon the filing of the case against him in court and after
hearing, he was suspended from office and during his incumbency
he died. Due to his death the charge against him in Criminal Case
No. P-339 was dismissed. Petitioner now contends that any
disbursement of funds by the respondent, Cesario Goleta, in his
capacity as Municipal Treasurer in favor of the heirs of the late Mayor
for salaries corresponding to the period he was under suspension
and other benefits will be illegal and contrary to the provisions of
Section 13 because said late Mayor S.B. Pontanal was not acquitted
of the charge against him.

Acquittal is always based on the merits, that is, the defendant is

acquitted because the evidence does not show that defendants guilt
is beyond a reasonable doubt; but dismissal does not decide the
case on the merits or that the defendant is not guilty. Dismissal
terminates the proceeding, either because the court is not a court of
competent jurisdiction, or the evidence does not show that the
offense was committed within the territorial jurisdiction of the court, or
the complaint or information is not valid or sufficient in form and
substance, etc. The only case in which the word dismissal is
commonly but not correctly used, instead of the proper term
acquittal, is when, after the prosecution has presented all its
evidence, the defendant moves for the dismissal and the court
dismisses the case on the ground that the evidence fails to show
beyond a reasonable doubt that the defendant is guilty; for in such
case the dismissal is in reality an acquittal because the case is
decided on the merits. If the prosecution fails to prove that the
offense was committed within the territorial jurisdiction of the court
and the case is dismissed, the dismissal is not an acquittal,
inasmuch as if it were so the defendant could not be again
prosecuted before the court of competent jurisdiction; and it is
elemental that in such case the defendant may again be prosecuted
for the same offense before a court of competent jurisdiction.

Respondents invoke Art. 81, No. 1 of the Revised Penal Code which
provides that Death of the accused pending appeal extinguishes his criminal
and civil liability. We do not see the relevance of this provision to the case at
bar. For one thing the case against Mayor Pontanal was not on appeal but on
trial. For another thing the claim for back salaries is neither a criminal nor a
civil liability. It is in fact a right provided the conditions of the law are
present.:onad

DOCTRINE OF ASSOCIATED WORDS OR NOSCITUR A SOCIIS

WHEREFORE, finding the petition to be well-taken, the same is hereby

granted, the order of the court a quo is hereby set aside and another one is
entered declaring illegal the payment of municipal funds for the salaries of
the late Mayor S.B. Pontanal during his suspension from office and ordering
the respondent treasurer to retrieve payments so far disbursed. No
pronouncement as to costs.

EN BANC

SO ORDERED.

Republic of the Philippines

SUPREME COURT
Manila

G.R. No. L-19650

September 29, 1966

CALTEX (PHILIPPINES), INC., petitioner-appellee,

vs.
ENRICO PALOMAR, in his capacity as THE POSTMASTER
GENERAL, respondent-appellant.
Office of the Solicitor General for respondent
Ross, Selph and Carrascoso for petitioner and appellee.

and

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 Magnetlite 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 all-expensespaid 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 firstclass 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. L8964, 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. 132-133, 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 antilottery 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 yard-stick
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.

ACCORDINGLY, the judgment appealed from is affirmed. No costs.

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.

FIRST DIVISION
NIXON T. KUA, G.R. No. 159410
Petitioner,
Present:
PUNO, C.J., Chairperson,
versus - SANDOVAL-GUTIERREZ,
CORONA,
AZCUNA, and
LEONARDO-DE
CASTRO, JJ.

ROBERT DEAN S. BARBERS, Promulgated:

Respondent.
January 28, 2008
X ---------------------------------------------------------------------------------------- X

(Sgd) Joseph Ejercito Estrada

MR. NIXON KUA
Thru: The Office of the General Manager
Philippine Tourism Authority
City of Manila[3]

DECISION
On the same day, petitioner took his oath of office before Associate
AZCUNA, J.:
Assailed in this petition for review on certiorari under Rule 45 of the
Revised Rules of Court are the May 30, 2003 Decision [1] and August 7, 2003
Resolution[2] of the Court of Appeals in CA-G.R. SP No. 74136, which
dismissed the quo warranto petition filed against respondent for assuming
the office of the General Manager of Philippine Tourism Authority (PTA).
The facts are uncontested.
On November 7, 2000, petitioner Nixon T. Kua, who was then one of
the three non-ex officio part-time members of the PTA Board of Directors,
was appointed as PTA General Manager by former President Joseph Ejercito
Estrada. The text of his appointment read:
Office of the President
of the Philippines
Malacaang
7 November 2000
Sir:
Pursuant to the provisions of existing laws, you are hereby
appointed GENERAL MANAGER, PHILIPPINE TOURISM
AUTHORITY vice Angelito T. Banayo.
By virtue hereof, you may qualify and enter upon the
performance of the duties of the office, furnishing this Office
and the Civil Service Commission with copies of your Oath
of Office.

Justice Teodoro P. Regino of the Court of Appeals. [4] For ceremonial

purposes, he again took his oath on December 12, 2000 before the President
at Malacaang.
Two years after petitioners appointment, on November 12, 2002,
President Gloria Macapagal-Arroyo appointed respondent Robert Dean S.
Barbers as General Manager/Chief Executive Officer of the PTA. Stated in
the letter of appointment, which was transmitted by the Executive Secretary
to the Department of Tourism (DOT) Secretary,[5] are as follows:
Office of the President
of the Philippines
Malacaang
November 12, 2002
Sir:
Pursuant to the provisions of existing laws, you are
hereby
appointed GENERAL
MANAGER/CHIEF
EXECUTIVE
OFFICER,
PHILIPPINE
TOURISM
AUTHORITY (PTA), DEPARTMENT OF TOURISM
(DOT), for a term of six (6) years expiring on October 3,
2008, vice Nixon T. Kua.
By virtue hereof, you may qualify and enter upon the
performance of the duties of the office, furnishing this Office
and the Civil Service Commission with copies of your oath of
office.

which he unlawfully holds, restoring petitioner to the

possession thereof, and issuing a final injunction against
said respondent under Section 9, Rule 58, perpetually
restraining respondent from usurping the position of PTA
General Manager;

(Sgd) Gloria Macapagal-Arroyo

Hon. ROBERT DEAN S. BARBERS
Thru: The Secretary
Department of Tourism
DOT Building, T.F. Valencia Circle
Ermita, Manila[6]
Thereafter, respondent took his oath of office and assumed the position.
Contending that his position as PTA General Manager has been
usurped and unlawfully assumed by respondent, petitioner filed a Petition
for Quo Warranto with Damages and Prayer for a Temporary Restraining
Order and a Writ of Preliminary Mandatory and Prohibitory Injunction before
the Court of Appeals on December 2, 2002.[7]
Petitioner alleged that Section 23-A of Presidential Decree (P.D.) No.
564 (otherwise known as the Revised Charter of the Philippine Tourism
Authority), as added by Sec. 2 of P.D. No. 1400, provides that the PTA
General Manager shall serve for a term of six (6) years unless sooner
removed for cause.[8] Hence, there was no vacancy in the said office at the
time of respondents appointment since his term has not yet expired; he has
not resigned or accepted any incompatible office and that neither has he
abandoned the position nor been removed therefrom for a cause. Petitioner
argued that the term of office of the PTA General Manager is fixed and
should not be equated with a situation where the law contemplates a regular
rotation or cycle in the membership like in the appointment and filling of
vacancy of the three non-ex officio part-time members of the PTA Board of
Directors, which is governed by Sections 15 and 16 of P.D. No. 564. [9] He
contended that these sections must be interpreted separately and distinctly
from Sec. 23-A of the same law. This is as it should be since, according to
him, it is well-established in this jurisdiction that a newly appointed or elected
public officer will only be made to serve the unexpired portion of the term
when it is so expressly provided; the clear intent of the creating power is that
the entire board of an agency should not go out of office at once but that
different groups should retire at regularly recurring intervals (citing Republic
v. Imperial[10]); and the beginning or end of the fixed term has been provided
(citing Boynton v. Heart[11]).Petitioner, thus, prayed that judgment be
rendered:

2.

DECLARING that petitioner Nixon T. Kua is the one

lawfully entitled to hold the aforesaid position; and

3.

ORDERING respondent to pay petitioner the following

damages: (1) Actual damages in the amount of One
Thousand Three Hundred Fifty Eight Pesos (P1,358.00)
per day from the time petitioner was unlawfully deprived
of his office until he has reassumed the same; (2) Moral
damages in the amount of Five Hundred Thousand
Pesos (P500,000.00), and (3) Attorneys fees and
litigation expenses in the amount of P500,000.00. [12]

On the other hand, respondent countered that he was validly

appointed as PTA General Manager since the position was legally vacant at
the time of his appointment. He averred that the term of office of petitioner
had already expired at the time, the latter being merely appointed for the
duration of the unexpired portion of the term of his predecessor. In support
thereof, respondent stated that while Sec. 23-A of P.D. No. 564 clearly
specifies the duration of the term of office of the PTA General Manager it is
silent as to the date of the terms commencement and termination; hence, it is
understood to start from the date of the first appointment and end after the
expiration of the period.Following this argument, he claimed that the term of
the persons subsequently appointed to the office of the PTA General
Manager is to be reckoned from the date when P.D. No. 1400 took effect,
which was on October 3, 1978, since P.D. No. 564 does not contain any
provision regarding its duration, thus:

1st Term 3 October 1978 2 October 1984

2nd Term 3 October 1984 2 October 1990
3rd Term 3 October 1990 2 October 1996
4th Term 3 October 1996 2 October 2002
5th Term 3 October 2002 2 October 2008

1.

OUSTING AND EXCLUDING respondent Robert Dean

S. Barbers from the position of PTA General Manager

10

As petitioner was appointed on November 7, 2000, respondent asserted that

it falls within the 4th term, which filled the unexpired term of the 4 th term that
ended on October 2, 2002. Moreover, respondent alleged that the wording of
petitioners appointment that is, vice Angelito T. Banayo contradicts the theory
that

the

latters

appointment

was

for

complete

term

of

six

years. As vice means in lieu of, instead of, and in place of in legal parlance,
he asserted that petitioners tenure as PTA General Manager was only to
complete the remaining two years of the 4th term which was left vacant by his
predecessor.
On May 30, 2003, the Court of Appeals promulgated its Decision,
[13]

the decretal portion of which states:

WHEREFORE, for want of any leg in law to stand
on, the instant petition for quo warranto is DISMISSED. No
pronouncement as to costs.
SO ORDERED.

[14]

In finding for respondent, the Court of Appeals reasoned:

Under P.D. No. 1400, taken in relation to P.D. No.
564, the terms of office of the general manager and the parttime members were uniformly fixed at six (6) years but
following the initial staggered set-up, their terms have been
made rotational in the sense that they were not to end at the
same time, and while the appointments of the three (3) parttime board members have been mandated to be made at an
interval of two (2) years, the appointment of the general
manager has been designated to coincide with one of the
three (3) part-time members, particularly the one whose
initial term was four (4) years. To elucidate, the terms of
office of the first set of board members, exclusive of the ex
officio chairman, who were appointed in 1974 were to expire
in this order:

Indefinite - General Manager

1980 - 1st part-time member (initial
6-year term)
1978 - 2nd part-time member (initial
4-year term)
1976 - 3rd part-time member (initial
2-year term)
But after 1978, with the term of the general manager having
been pruned down to six (6) years from that same year, the
expiration of his fixed term was to be factored in along with
that of the second set of part-time members, all of whom by
then already had uniform six (6)-year terms, in this way:
1986 - 1st part-time member
1984 - General Manager and 2nd parttime member
1982 - 3rd part-time member
Every two (2) years thereafter, new appointments were to be
made, with the general manager being appointed together
with a part-time member (the second part-time member);
hence, for the third, fourth and fifth sets of appointees, the
sequence of the expiration of their respective terms would be
as follows:
(a)

Third set:
1992 - 1st part-time member
1990 - General Manager and 2nd parttime member
1988 - 3rd part-time member

(b) Fourth set:

1998 - 1st part-time member
1996 - General Manager and 2nd parttime member

11

1994 - 3rd part-time member

(c)

Fifth set:
2004 - 1st part-time member
2002 - General Manager and 2nd parttime member
2000 - 3rd part-time member

The coincidence of the terms of the general

manager and the second part-time member of the board
could have been calculated to assure the continual presence
of a quorum, together with the concurrent chairman, and to
forestall the impairment of the power of the board to execute
the functions of the Authority under Section 18 of P.D. No.
564 x x x.
And the provision of Section 16 of the same Decree
x x x insures no break in the six (6)-year terms of the general
manager and each of the part-time members of the board.
These features of P.D. No. 564, as amended by P.D.
No. 1400, fit to-a-tee into the x x x pronouncement of the
Supreme Court in Republic vs. Imperial [96 Phil. 770
(1955). Cf. Gaminde vs. COA, 401 Phil. 77 (2000)] x x x
which is applicable four-square to the case at bar, contrary to
the stance of the petitioner.
Examining the appointment of petitioner Kua in the
case before us, we readily see that it is expressly tied up to
the appointment of Angelito T. Banayo, his predecessor x x
x.
In light of x x x Sections 15 and 16 of P.D. No. 546,
we are called upon to determine when Banayos term had
begun and ended to be able to decide when his successors,
i.e., petitioners[,] own term commenced and expired.
Although the parties, particularly the respondent,
made reference to previous appointments to the position of

PTA general manager, neither of them submitted

authenticated copies thereof. Hence, to give us a complete
picture of the situation, we required the Secretary of Tourism,
being the PTA chairman, to furnish us the desired
documents. From the List of Succession, Date of
Appointment and Tenure of the General Manager of PTA
submitted by the Secretary, we found out that no permanent
appointment of a general manager had been made prior
to April 6, 1990.
On August 20, 1974, Col. Rodolfo Cacdac was
merely designated acting general manager by President
Marcos; and he held office as such until July 19, 1978.
On July 20, 1978, Engr. Bernardo Vergara was
likewise designated acting general manager also by
President Marcos; and he manned the post until April 6,
1986.
On April
7,
1986,
Ramon
P.
Binamira
was designated, this time by Tourism Minister Jose Antonio
U. Gonzalez, but his designation was, by its nature,
only temporary and eventually recalled on January 4, 1990
by Her Excellency, Corazon C. Aquino, who ascended to the
presidency by virtue of the EDSA I people power revolution,
and who designated Tourism Secretary Peter D. Garrucho as
concurrent General Manager until she could appoint a
person to serve in the said office in a permanent capacity.
It was only on April 6, 1990 that President Aquino
appointed Jose A. Capistrano, Jr. permanent general
manager. Consequently, this date April 6, 1990 should be
the reckoning point in determining the first six (6)-year term
of the office of the PTA general manager. It was to end
on April 5, 1996.
The reckoning point cannot be October 3, 1978, the
date of effectivity of P.D. No. 1400, following its publication in
the Official Gazette on October 2, 1978, pursuant to the
decision of the Supreme Court in Taada vs. Tuvera, as
posited by the respondent, because no permanent
appointment to the position had been made prior to April 6,
1990, and the law (P.D. No. 1400) cannot operate in a
vacuum or before the factual situation it is meant to govern
has arisen.

12

But Capistrano did not exhaust his full six (6)-year

term as he stayed in the position only until July 31, 1992.
On July 8, 1992, President Fidel Ramos appointed
Eduardo T. Joaquin who succeeded Capistrano on July 31,
1992.
The unexpired portion of Capistranos term assumed
by Joaquin was to end on April 5, 1996 but Joaquin
remained as PTA general manager in a hold-over capacity
until June 29, 1998, by virtue of Sec. 23-A of P.D. No. 564,
as amended by P.D. No. 1400.
On June 30, 1998, President Estrada appointed
Angelito T. Banayo whose six (6)-year term to be reckoned
from April 6, 1996, the end of the term of his predecessor,
including the period spanned by Joaquins hold-over tenure,
was to expire on April 5, 2002, conformably with Section 15
of P.D. No. 564 which commands that, a successor to a
member whose term has expired shall be appointed for the
full term of six years from the date of expiration of the term
for which his predecessor was appointed.
Accordingly, when petitioner Nixon T. Kua was
appointed on November 7, 2000, the unexpired portion of
Banayos term which he assumed ended on April 5, 2002 in
consonance with Section 16 of the same P.D. No. 564 which
directs that any member appointed to fill a vacancy prior to
the expiration of the term for which his predecessor was
appointed shall serve only for the unexpired portion of the
term of his predecessor.
The position, therefore, became vacant on April 6,
2002. That the petitioner continued to sit in the position and
even afterwards could not, as it did not, bar its being filled up
by a new appointee as his prolonged stay was already on
borrowed time as a mere hold-over general manager,
pursuant to Section 23-A of the same P.D. No. 564, as added
by P.D. No. 1400, which states that, upon the expiration of
his (general manager) term, he shall serve as such until his
successor shall have been appointed and qualified. Hence,
respondents appointment on November 12, 2002 cannot but
be valid as the position was then already very much vacant
and the petitioner had no more security or guarantee of

tenure that could be transgressed, or even merely to speak

of. But respondents term is up to April 5, 2008 only, and
not October 3, 2008 as stated in his appointment.[15]
Petitioner moved to reconsider the Decision. [16] He insisted that
Sections 15 and 16 of P.D. No. 564 apply only to the three non-ex
officio part-time members of the PTA Board while Sec. 23-A of the same
decree governs the term of office of the PTA General Manager. Petitioner
refused to concede to the Court of Appeals interpretation because, according
to him, the logical consequence is that the term of office of the DOT
Secretary, who is also an ex officio member of the PTA Board, would have to
be governed by Sections 15 and 16 of P.D. No. 564. He stressed that since
the positions held by the DOT Secretary and General Manager in the PTA
are practically the same, in the sense that both are ex officio members of the
PTA Board, the court must not distinguish or make an interpretation that does
not appear or is not intended or reflected in the very language of the statute.
Furthermore, petitioner disputed the Court of Appeals application to
the present case of this Courts rulings in Republic v. Imperial[17] and Gaminde
v. Commission on Audit.[18] He explained that, compared with the Commission
on Elections and the Commission on Audit, the office of the PTA General
Manager is not a constitutional body composed of commissioners appointed
on a rotational basis in order to prevent the President of the Philippines from
appointing more than one commissioner during his or her term to ensure and
maintain their independence. Invoking a Department of Justice (DOJ)

Opinion dated March 16, 2001 (Opinion No. 18, Series of 2001), [19] which
ruled on the inapplicability of the rotational scheme of appointment
enunciated in Imperial andGaminde to the case of the Chairman and
Members of the Energy Regulatory Board (ERB), petitioner advanced the
argument that, applying the rule of noscitur a sociis, Sec. 16 of P.D. No. 564
should be construed as limited only to the non-ex officio part-time members
of the PTA and should not be read or incorporated with Sec. 23-A thereof as
the latter section merely fixes the term of office of the PTA General Manager
at six years without expressly stating that such term is subject to the
rotational system of appointment.Accordingly, the term of office of the PTA
General Manager should start from the date of acceptance of the
appointment and expire six years thereafter. He added that in Binamira v.
Garrucho,[20] wherein the office of the PTA General Manager was likewise

13

contested, this Court never mentioned the rotational scheme laid down
in Imperial to determine the terms of office of the PTA Board members.
In denying petitioners motion, [21] the Court of Appeals opined that
P.D. No. 1400, as an amendatory law, should be viewed in conjunction with
P.D. No. 564. Particularly, it held that Sec. 16 of P.D. No. 564 referred only to
the non-ex officio part-time members of the PTA Board because prior to the
amendment it was only they who had fixed terms of office staggered at six,
four and two years for the initial appointees and a uniform term of six years
for the succeeding ones while the PTA General Manager had none. When
P.D. No. 1400 took effect, however, the term of office of the PTA General
Manager was fixed also at six years. Consequently, reading together with the
amendatory law, Sec. 16 of P.D. No. 564 should likewise be applicable to the
position of PTA General Manager, who is undeniably a member of the PTA
Board.
The Court of Appeals ruled that while the DOT Secretary and the
PTA General Manager are both members of the PTA Board in an ex
officio capacity, Sec. 16 of P.D. No. 564 cannot be applied with respect to the
latter. It noted that the difference lies on the issue of security of tenure: unlike
the PTA General Manager who could sit in the position for six years unless
removed for a cause, the DOT Secretary does not enjoy the same protection
since as an alter ego of the President he holds office at the latters pleasure.
Lastly, the appellate court rejected the applicability of the DOJ
Opinion cited by petitioner, observing that Sec. 1 of E.O. No. 172 does not
contain a provision that an appointed member of the ERB shall serve only for
the unexpired portion of the term of his predecessor if a vacancy in the board
occurs prior to the expiration of the latters term.
Now before us, petitioner submits the following issues for resolution:
1.

Whether the term of office of petitioner expired on April 5,

2002 and not on November 7, 2006.

2.

Whether the rotational scheme of appointments, laid down

in Republic v. Imperial and in Gaminde v. Commission on
Audit should apply to the case of petitioner in determining his
term of office.[22]

The CA ruling is sustained.

On May 11, 1973, P.D. No. 189 renamed the Department of Trade
and Tourism as the Department of Trade and created the DOT with the PTA
attached to it. After more than a year, on October 2, 1974, the decree was

revised by P.D. No. 564. On this point, relevant for our consideration are
Sections 15 and 16 thereof, which are quoted again for clarity:
SEC. 15. Term of Office. The term of office of the
part-time members of the Board shall be six years. Of the
part-time members first appointed, one shall hold office for
six years, one for four years, and the last one for two years.
A successor to a member whose term has expired shall be
appointed for the full term of six years from the date of
expiration of the term for which his predecessor was
appointed.
SEC. 16. Vacancy Before Expiration of Term. Any
member appointed to fill a vacancy in the Board occurring
prior to the expiration of the term for which his predecessor
was appointed shall serve only for the unexpired portion of
the term of his predecessor.

Later, on June 5, 1978, P.D. No. 564 was amended by P.D. No.
1400. Among the modifications introduced was the addition of Section 23-A
to the existing decree, stating:
Section 23-A. General Manager Appointment and
Tenure. The General Manager shall be appointed by the
President of the Philippines and shall serve for a term of six
(6) years unless sooner removed for cause; Provided, That
upon the expiration of his term, he shall serve as such until
his successor shall have been appointed and qualified.
Essentially, the bottom line of the issues raised by petitioner
is whether Sections 15 and 16 of P.D. No. 564 should be read in relation to
Sec. 23-A such that the PTA General Manager may also be required to hold
office only for the unexpired portion of the term of his predecessor, if
appointed to fill a vacancy in the Board which occurred prior to the expiration
of the latters term.
Petitioner maintains his submission that Sections 15 and 16 of P.D.
No. 564 are applicable only to the three non-ex officio part-time members of
the PTA Board. Aside from reiterating his arguments in the court below, he
adds that there is a marked difference between the tasks of the PTA General

14

Manager and the part-time members: the powers and duties of the PTA
Board are enumerated in Sec. 22 of P.D. No. 564 which are alleged to be
circumscribed solely to participating in the exercise of the corporate powers
and functions of the PTA, while those of the General Manager are found in
Sections 23, 24, 25 and 26 of the same law. Also, the principal function of the
PTA General Manager is to act as PTAs Chief Executive and to direct,
manage, and supervise its day-to-day operations and internal administration
in accordance with the policies set by the Board. He is furthermore said to be
vested with additional authority and functions in the event of extraordinary
emergencies.
The argument is not tenable.
In Estrada v. Caseda,[23] this Court held:
An amended act is ordinarily to be construed as if
the original statute had been repealed, and a new and
independent act in the amended form had been adopted in
its stead; or, as frequently stated by the courts, so far as
regards any action after the adoption of the amendment, [it
is] as if the statute had been originally enacted in its
amended form. The amendment becomes a part of the
original statute as if it had always been contained therein,
unless such amendment involves the abrogation of
contractual relations between the state and others. Where
an amendment leaves certain portions of the original act
unchanged, such portions are continued in force, with the
same meaning and effect they had before the amendment x
x x .[24]
The Court is, therefore, in full accord with the ruling of the Court of
Appeals that the provisions of P.D. No. 1400, particularly Sec. 2 thereof
which added Sec. 23-A, should be considered as part and parcel of P.D. No.
564 as if it had always been contained in the latter at the time it took
effect. On the other hand, the portions of the original act left unchanged by
the succeeding law are continued in force, bearing the same meaning and
effect that they had before the amendment.
But what exactly then is the proper construction of Section 16 of P.D.
No. 564?

The significant provisions of P.D. No. 564, which were unaltered by

P.D. No. 1400, would reveal that petitioners resolute insistence is to no avail.
Sections 17 to 21 of P.D. No. 564 provide, thus:
SEC. 17. Per Diems. Unless otherwise fixed by the
President of the Philippines, the members of the
Board shall receive for every meeting attended as per
diem of not to exceed two hundred pesos (P200); Provided,
That such per diems shall not exceed one thousand pesos
(P1,000) during any month for each member. Members of
the Board shall be reimbursed by the Authority for actual
expenses (including traveling and subsistence expenses)
incurred by them in the performance of their duties for the
Authority as may be specifically authorized by the Board.
SEC. 18. Quorum; Effect of Vacancies. The
presence of three members of the Board, including the
Chairman or the Vice Chairman, shall constitute a quorum
for the transaction of the business of the Board.
Vacancies in the Board, as long as there shall
be three members in the office, shall not impair the powers
of the Board to execute the functions of the Authority.
SEC. 19. Withdrawal from the Meeting of a Member
Having Prohibited Interest. Whenever a member of the
Board has a personal interest of any sort on a matter before
the Board, or any of his business associates, or any of his
relatives within the fourth civil degree of consanguinity or
second degree of affinity has such interest, he shall not
participate in the discussion or resolution of the matter and
must retire from the meeting during the deliberations
thereon. After the Board has resolved the matter, the fact
that the member concerned or any of his business associate,
or his relatives within the prohibited degrees has a personal
interest in it, is to be made available to the public and the
minutes of the meeting shall note the withdrawal of the
member concerned.
SEC. 20. Removal or Suspension for Cause. A
member of the Board may be suspended or removed by
the President for cause, such as: mismanagement, grave
abuse of discretion, infidelity in the conduct of fiduciary
relations, gross negligence in the performance of duties,
dishonesty, corruption, or any act involving moral turpitude.

15

SEC. 21. Meetings of the Board. The Board shall

meet as frequently as necessary to discharge its duties and
responsibility properly, but shall meet regularly at least once
a month. The Board shall be convoked by the Chairman or
upon the written request of a majority of its members.
Except when otherwise provided for in this Decree, the vote
of a majority of the members constituting a quorum shall
be sufficient for the adoption of any rule, resolution, decision
or any act of the Board. (Emphasis ours)[25]
Upon analysis of the afore-quoted sections, specifically of the
emphasized words and phrases, one obvious fact is manifest: that
Sections 17 to 21 of P.D. No. 564 speak ofmember/s in a generic sense; no
particular allusion whatsoever is made on the DOT Secretary, the General
Manager or the three part-time members of the PTA Board. Said provisions
equally apply to them all without distinction or qualification. Necessarily, the
logical consequence of this would be to construe Sec. 16 of P.D. No. 564 in
light of the company of words where it is found, that is, Sections 17 to 21
thereof. Perforce, the words any member mentioned in Sec. 16 should be
understood to refer not just to the part-time members of the PTA Board but to
its General Manager as well.

recognized that the Legislature is aware of previous statutes relating to the

same subject matter, and that in the absence of any express repeal or
amendment therein, the new provision is deemed enacted pursuant to the
legislative policy embodied in the prior statutes which should all be construed
together.[31]
To conclude, Section 23-A, as well as all other amendments made by
P.D. No. 1400, should be read in connection with the provisions of P.D. No.
564 as if all had been enacted at the same time in the said decree, and, as
far as possible, effect should be given to them all in furtherance of the
general design of the statute.[32]
On the basis of the above disquisition alone, this Court finds no
necessity to further dwell on our rulings in Imperial and Gaminde, which deal
with the rotational scheme of appointment, to bolster the correct position of
respondent affirmed by the CA.
WHEREFORE, the petition is DENIED. The May 30, 2003 Decision
and August 7, 2003 Resolution of the Court of Appeals are
hereby AFFIRMED. No costs.
SO ORDERED.

The foregoing declaration is but sensible since it is a basic rule in

statutory construction "that the particular words, clauses and phrases should
not be studied as detached and isolated expressions, but the whole and
every part of the statute must be considered in fixing the meaning of any of
its parts and in order to produce a harmonious whole. A statute must be so
construed as to harmonize and give effect to all its provisions whenever
possible."[26] Every meaning to be given to each word or phrase must be
ascertained from the context of the body of the statute since a word or
phrase in a statute is always used in association with other words or phrases
and its meaning may be modified or restricted by the latter.[27]
Under the doctrine of noscitur a sociis, which even petitioner himself
recognizes but appears to have misapplied, where a particular word or
phrase is ambiguous in itself or is equally susceptible of various meanings,
its meaning may be made clear and specific by considering the company of
the words in which it is found or with which it is associated. [28] Stated
differently, the obscurity or doubt on a particular word or phrase may be
removed by reference to associated words.[29]
Moreover, the lawmaking body is presumed to know the meaning of
the words employed in the statute and to have used them advisedly. [30] It is

16

FIRST DIVISION
G.R. No. 89757 August 6, 1990
ABOITIZ
SHIPPING
CORPORATION, petitioner,
vs.
COURT OF APPEALS AND GENERAL ACCIDENT FIRE AND LIFE
ASSURANCE CORPORATION, LTD.,respondents.
Sycip, Salazar, Hernandez & Gatmaitan for petitioner.
Dollete, Blanco, Ejercito & Associates for private respondent.

GANCAYCO, J.:
The extent of the liability of a carrier of goods is again brought to the fore in
this case.
On October 28, 1980, the vessel M/V "P. Aboitiz" took on board in Hongkong
for shipment to Manila some cargo consisting of one (1) twenty (20)-footer
container holding 271 rolls of goods for apparel covered by Bill of Lading No.
515-M and one (1) forty (40)-footer container holding four hundred fortyseven (447) rolls, ten (10) bulk and ninety-five (95) cartons of goods for
apparel covered by Bill of Lading No. 505-M. The total value, including
invoice value, freightage, customs duties, taxes and similar imports amounts
to US$39,885.85 for the first shipment while that of the second shipment
amounts to US$94,190.55. Both shipments were consigned to the Philippine
Apparel, Inc. and insured with the General Accident Fire and Life Assurance
Corporation, Ltd. (GAFLAC for short). The vessel is owned and operated by
Aboitiz Shipping Corporation (Aboitiz for short).

On October 31, 1980 on its way to Manila the vessel sunk and it was
declared lost with all its cargoes. GAFLAC paid the consignee the amounts
US$39,885.85 or P319,086.80 and US$94,190.55 or P753,524.40 for the lost
cargo. As GAFLAC was subrogated to all the rights, interests and actions of
the consignee against Aboitiz, it filed an action for damages against Aboitiz in
the Regional Trial Court of Manila alleging that the loss was due to the fault
and negligence of Aboitiz and the master and crew of its vessel in that they
did not observe the extraordinary diligence required by law as regards
common carriers.
After the issues were joined and the trial on the merits a decision was
rendered by the trial court on June 29, 1985, the dispositive part of which
reads as follows:
PREMISES CONSIDERED, the Court finds in favor of the
plaintiff and against the defendant, ordering the latter to pay
the former actual damages in the sum of P1,072,611.20 plus
legal interest from the date of the filing of the complaint on
October 28, 1981, until full payment thereof, attorney's fees
in the amount of 20% of the total claim and to pay the costs.
SO ORDERED. 1
Not satisfied therewith, Aboitiz appealed to the Court of Appeals wherein in
due course a decision was rendered on March 9, 1989 affirming in toto the
appealed decision, with costs against defendant Aboitiz . 2
A motion for reconsideration of said decision filed by Aboitiz was denied in a
resolution dated August 15, 1989.
Hence the herein petition for review alleging that the Court of Appeals
decided the case not in accordance with law when
1. The Court of Appeals held that "findings of administrative
bodies are not always binding on court . This is especially so
in the case at bar where GAFLAC was not a party in the BMI
proceedings and which proceedings was not adversary in
characther." This ruling is contrary to the principle
established in Vasquez vs. Court of Appeals (138 SCRA
559), where it was held that since the BMI possesses the
required expertise in shipping matters and is imbued with

17

quasi-judicial powers, its factual findings are conclusive and

binding on the court. Likewise, the case of Timber Export
Inc. vs. Retla Steamship Co. (CA-G.R. No. 66143-R) also
established the rule that decision of BMI must be given
"great materiality and weight to the determination and
resolution of the case."
2. The Court of Appeals also held that the trial court did not
err when it fixed the liability of Aboitiz not on the basis of the
stipulation in the bills of lading at US$500.00 per
package/container but on the actual value of the shipment
lost notwithstanding the long line of cases decided by this
Honorable Supreme Court holding a contrary opinion, as
shown below.
3. The Court of Appeals also held that the trial court did not
abuse its discretion in granting GAFLAC's motion for
execution pending appeal notwithstanding the absence of
reasonable and justifiable grounds to support the same. 3
Under the first issue petitioner state that the sinking of the vessel M/V "P.
Aboitiz" was the subject of an administrative investigation conducted by the
Board of Marine Inquiry (BMI) whereby in a decision dated December 26,
1984, it was found that the sinking of the vessel may be attributed to force
majeure on account of a typhoon. Petitioner contends that these findings are
conclusive on the courts.
In rejecting the evidence offered by the petitioner the appellate court ruled
But over and above all these considerations, the trial court
did not err in not giving weight to the finding of the BMI that
the vessel sank due to a fortuitous event. Findings of
administrative bodies are not always binding on courts. This
is especially so in the case at bar where plaintiff was not a
party in the BMI proceedings and which proceeding was not
adversary in character. 4
As a general rule, administrative findings of facts are not disturbed by the
courts when supported by substantial evidence unless it is tainted with
unfairness or arbitrariness that would amount to abuse of discretion or lack of
jurisdiction. 5 Even in Vasquez vs. Court of Appeals, 6 which is cited by

petitioner, this Court ruled that We nevertheless disagree with the conclusion
of the BMI exonerating the captain from any negligence "since it obviously
had not taken into account the legal responsibility of a common carrier
towards the security of the passengers involved."
This case was brought to court on October 28, 1981. The trial court was
never informed of a parallel administrative investigation that was being
conducted by the BMI in any of the pleadings of the petitioner. It was only on
March 22, 1985 when petitioner revealed to the trial court the decision of the
BMI dated December 26, 1984 (one day after Christmas day). 7 The said
decision appears to have been rendered over three (3) years after the case
was brought to court.
Moreover, said administrative investigation was conducted unilaterally.
Private respondent GAFLAC was not notified or given an opportunity to
participate therein. It cannot thereby be bound by said findings and
conclusions of the BMI.
The trial court and the appellate court found that the sinking of the M/V "P.
Aboitiz" was not due to the waves caused by tropical storm "Yoning" but due
to the fault and negligence of petitioner, its master and crew. The court
reproduces with approval said findings
xxx xxx xxx
After a careful examination of the evidence, the Court is
convinced in the plaintiffs claim that the M/V "Aboitiz" and its
cargo were not lost due to fortuitous event or force majeure.
To begin with, paragraph 4 of the marine protest (Exh. "4",
also Exhibit "M"), which is defendant's own evidence, shows
that the wind force when the ill-fated ship foundered was 10
to 15 knots. According to the Beaufort Scale (Exhibit "I"),
which is admittedly an accurate reference for measuring
wind velocity, the wind force of 10 to 15 knots is classified as
scale No. 4 and described as "moderate breeze," small
waves, becoming longer, fairly frequent white horses.
Meteorologist Justo Iglesias, Jr. himself affirms the above
description of a wind force of 10 to 15 knots and adds that
the weather condition prevailing under said wind force is
usual and forseeable. Thus Iglesias, Jr. testified:

18

Q. In the marine protest of the master of the

vessel of Aboitiz, there is reference to wind
force from ten to 15 knots. In this Beaufort
Scale, will you be able to clarify what this
wind force of 10 to 15 as stated in the
marine protest?

Q. This weather condition between October

28 and November 1, 1980, will you classify
this as extraordinary or ordinary?
A. It was ordinary.
Q. When you said ordinary, was it usual or
unusual?

A. It will be under Force 4 of the Beaufort

Scale.

A. It is usual.

Q. What is the basis of your answer?

Q. When you said it is usual it is foreseeable

and predictable?

A. 10 to 15 falls within this scale of the

Beaufort Scale, Force 4.

A. For an experienced meteorologist like a

ship captain, it is foreseeable.

Atty. Dollete:
May I read into the records, Your Honor.
Force 4, descriptive term moderate breeze.
Near velocity in knots 11-16 meters per
second, 5.5-7.9 in kilometers per hour to 20
to 28 kilometers per hour and 13 to 18 miles
per hour. Sea the description of this will be
small waves becoming longer fairly frequent
white horse (sic).

Q. When it is foreseeable, necessarily it

follows that the weather could be predicted
based on the weather bulletin or report?
A. Yes, sir.
Q. And usually the bulletin states the
condition in other words, this weather
condition which you testified to and reflected
in your Exhibit "7" is an ordinary occurrence
within that area of Philippine responsibility?

Q. In the layman's language how do you

interpret this white horses?
A. It means white forms. At the top of the
crest they were beginning to form white
foams.

A. Yes, sir.
Q. And in fact this weather condition is to be
anticipated at that time of the year with
respect to weather condition which is
reflected in Exhibit "7"?

Q. How about this moderate breeze as

described under this Force 4 of the Beaufort
Scale, how will you interpret that?
A. Moderate breeze will only give winds of
29 kilometers per hour which is equivalent to
just extending your hand out of a running car
at that speed.

A. It is a regular occurrence.
xxx xxx xxx

19

Moreover, Capt. Racines again admitted in

Court that his ill-fated vessel was 200 miles
away from the storm 'Yoning when it sank.
Said Capt. Racines:
Q. How far were you from this depression or
weather disturbance on October 30, 1980?
A. Two hundred miles.
xxx xxx xxx
Q. In other words, this depression was far
from your route because it took a northern
approach whereas you were towards the
south approach?
A. As I have said, I was 200 miles away from
the disturbance.
xxx xxx xxx
Considering the foregoing reasons, the Court holds that the
vessel M/V "Aboitiz" and its cargo were not lost due to
fortuitous event or force majeure.
In accordance with Article 1732 of the Civil Code, the
defendant common carrier, from the nature of its business
and for reasons of public policy, is bound to observe
extraordinary diligence in the vigilance over the goods and
for the safety of the passengers transported by it according
to all the circumstances of each case. While the goods are in
the possession of the carrier, it is but fair that it exercise
extra ordinary diligence in protecting them from loss or
damage, and if its occurs the law presumes that it was due
to the carrier's fault or negligence; that is necessary to
protect the interest of the shipper which is at the mercy of
the carrier (Article 1756, Civil Code; Anuran vs. Puno, 17
SCRA 224; Nocum vs. Laguna Tayabas Bus Co., 30 SCRA
69; Landigan vs. Pangasinan Transportation Company, 88
SCRA 284). In the case at bar, the defendant failed to prove

that the loss of the subject cargo was not due to its fault or
negligence. 8
The said factual findings of the appellate court and the trial court are finding
on this Court. Its conclusion as to the negligence of the petitioner is
supported by the evidence.
The second issue raised to the effect that the liability of the petitioner should
be fixed at US$500.00 per package/container, as stipulated in the bill of
lading and not at the actual value of the cargo, should be resolved against
petitioner.
While it is true that in the bill of lading there is such stipulation that the liability
of the carrier is US$500.00 per package/container/customary freight, there is
an exception, that is, when the nature and value of such goods have been
declared by the shipper before shipment and inserted in the bill of lading.
This is provided for in Section 4(5) of the Carriage of Goods by Sea Act to wit

(5) Neither the carrier nor the ship shall in any event be or
become liable for any loss or damage to or in connection
with the transportation of goods in an amount exceeding
$500 per package of lawful money of the United States, or in
case of goods not shipped in packages, per customary
freight unit, or the equivalent of that sum in other
currency,unless the nature and value of such goods have
been inserted in the bill of lading. This declaration, if
embodied in the bill of lading, shall be prima facie evidence,
but shall not be conclusive on the carrier.
By agreement between the carrier, master or agent of the
carrier, and the shipper another maximum amount than that
mentioned in this paragraph may be fixed: Provided, that
such maximum shall not be less than the figure above
named. In no event shall the carrier be liable for more than
the amount of damage actually sustained.
Neither the carrier nor the ship shall be responsible in any
event for loss or damage to or in connection with the
transportation of the goods if the nature or value thereof has

20

been knowingly and fraudulently mis-stated by the shipper in

the bill of lading. (Emphasis supplied.)
In this case the description of the nature and the value of the goods shipped
are declared and reflected in the bills of lading. Thus, it is the basis of the
liability of the carrier as the actual value of the loss.
Moreover, it is absurd to interpret "container," as provided in the bill of lading
to be valued at US$500.00 each, to refer to the container which is the
modern substitute for the hold of the vessel. 9The package/container
contemplated by the law to limit the liability of the carrier should be sensibly
related to the unit in which the shipper packed the goods and described
them, not a large metal object, functionally a part of the ship, in which the
carrier used them to be contained. 10 Such "container" must be given the
same meaning and classification as a "package" and "customary freight unit."
The appellate court in disposing this issue quoted its decision in Allied
Guarantee Insurance Co. Inc. vs. Aboitiz Shipping Corporation, CA GR. CV
No. 04121, March 23, 1987, viz;
Third. Still it is contended that the carrier's liability is limited
to $500.00, pursuant to section 8 of the Bill of Lading which
provides that 'The liability of the Carrier for any loss or
damage to the goods shall in no case exceed the sum of
U.S. $500.00 per package/container/customary freight unit,
unless the value of the goods has been correctly declared
and extra freight paid, prior to the shipment and a signed
declaration to this effect appears in the bill of lading, duly
confirmed by the Carrier. ... It is contended that the Bill of
Lading does not indicate the value of the goods. Nor was the
corresponding freight ... paid prior to shipment.
Generally speaking a stipulation, limiting the common
carrier's liability to the value of the goods appearing in the bill
of lading, unless the shipper or owner declares a greater
value, is valid. (Civil Code, Art. 1749). Such stipulation,
however, must be reasonable and just under the
circumstances and must have been fairly and freely agreed
upon. (St. Paul Fire & Marine Insurance Co. vs.
Macondray Co., 70 SCRA 122, 126-127 (1976) In the case
at bar, the goods shipped on the M/V "P. Aboitiz" were

insured for P278,530.50, which may be taken as their value.

To limit the liability of the carrier to $500.00 would obviously
put it in its power to have taken the whole cargo. In
Juan Ysmael & Co. vs. Gabino Barreto & Co., 51 Phil. 90
(1927), it was held that a stipulation limiting the carrier's
liability to $500.00 per package of silk when the value of
such package was P2,500.00 unless the true value had
been declared and the corresponding freight paid was "void
as against public policy." That ruling applies to this case.
Moreover, by the weight of modern authority, a carrier cannot
limit its liability for injury or loss of goods shipped where such
injury or loss was caused by its own negligence. (Juan
Ysmael & Co. v. Gabino Barreto & Co., supra) Here to limit
the liability of Aboitiz Shipping to $500.00 would nullify the
policy of the law imposing on common carriers the duty to
observe extraordinary diligence in the carriage of goods.
Indeed, it is even doubtful whether the word "container" in
section 8 of the Bill of Lading includes containers which are
a substitute for the hold of a vessel. This provision limits the
carrier's liability to "the sum of US$500.00 per package
/container customary freight unit." By the rule of noscitur a
sociis the word "container" must be given the same meaning
as package and customary freight unit and therefore cannot
possibly refer to modern containers which are used for
shipment of goods in bulk. 11
In the same light, the third issue questioning the order of execution pending
appeal of the trial court must be resolved against petitioner as well.
The averments in the motion for execution pending appeal dated December
8, 1985 are as follows
Aside from the fact that petitioner can easily post a
supersedeas bond to stay execution, still other
circumstances are present peculiar in the incident of the
sinking of M/V P. Aboitiz which would justify the issuance of
execution pending appeal. There are other decided cases
adjudging petitioner liable in the lower court in the same
incident. Other cases are on appeal, upcoming and about to

21

be decided. The value of cargo loss caused by the sinking of

petitioner's vessel is in the tune of no less than fifty million
pesos inclusive of interests fees and all claims. Its insurer
has gone bankrupt and petitioner alone must face and
answer for all these claims. In one branch of the Regional
Trial Court of Manila alone there are twenty five (25) cases
pending against petitioner involving the same loss of
cargoes aboard M/V "P. Aboitiz" as per certification herewith
attached as Annex "A". This claim do not include others,
pending in various courts in Metro Manila which would have
to be satisfied ultimately by petitioner, it being a common
carrier which failed to exercise extraordinary diligence over
the goods lost. The judgment sought to be enforced may
indeed be rendered imminently ineffectual in the ultimate
analysis.
The purpose of Sec. 2 Rule 39 would not be achieved or
execution pending appeal would not be achieved if
insolvency would still be awaited. The remedy is available to
petitioner under Sec. 3 Rule 39 of the Rules of Court but to
place insolvency as a condition to issuance of a writ of
execution pending appeal would render it illusory and
ineffectual.
Justice and equity therefore dictates, that as a consequence
of the bond posted by private respondent and there being
several other cases against petitioner, decided as well as
pending, the totality of which claims may render the
appealed decision imminently ineffectual and the further fact
that the appeal being interposed is evidently for delay as a
consequence of the several adverse decisions against it as a
common carrier in the lower court, a reconsideration of the
decision dated November 25, 1985 of the Honorable Court
will be in consonance with law, jurisprudence and equity.
In order to erase all apprehensions that the aforesaid
judgment award will wind up ineffectual when not
immediately executed, it is most respectfully prayed that
herein respondent be required to post a supersedeas bond.
The statutory undertaking of posting a bond will then achieve
a three-pronged direction of justice, (1) it will cast no doubt
on the solvency of the herein petitioner; (2) it will not defeat

or render phyrric a just resolution of the case whichever

party prevails in the end or in the main case on appeal, since
both of their claims are secured by their corresponding
bonds; and (3) it will put to equitable operation Sec. 3 Rule
39 of the Revised Rules of Court. 12
The foregoing allegations which were not traversed that petitioner is facing
many law suits arising from said sinking of its vessel involving cargo loss of
no less than 50 million pesos, in some cases of which judgment had been
rendered against Aboitiz, and considering that its insurer is now bankrupt,
leaving Aboitiz alone to face and answer the suits, which may render any
judgment for GAFLAC ineffectual, that the appeal is interposed manifestly for
delay and the willingness of GAFLAC to put up a bond certainly are cogent
bases for the issuance of an order of execution pending appeal.
Finally, in a similar case for damages arising from the same incident
entitled Aboitiz Shipping Corporation vs. Honorable Court of Appeals and
Allied Guaranteed Insurance Company, Inc., G.R. No. 88159, this Court in a
resolution dated November 13, 1989 dismissed the petition for lack of merit.
Therein this Court held in part
The appellate court affirmed the decision of the lower court
based on its findings that the cause of sinking of the vessel
was due to its unseaworthiness and the failure of its crew
and the master to exercise extraordinary diligence.
The petitioner, however, contends that the appellate court
erred on this matter and insists that the contrary findings of
the Board of Marine Inquiry (BMI), which conducted a
separate investigation to the effect that the proximate cause
of the sinking of the vessel was due toforce majeure and that
the officers and crew had exhausted all preventive measures
to save the vessel and her cargo but to no avail, should
prevail. This, according to the petitioner is based on the
doctrine of primary administrative jurisdiction.
This argument is untenable.

22

A cursory reading of the decision and resolution of the

appellate court shows that the same took into consideration
not only the findings of the lower court but also the findings
of the BMI. Thus, the appellate court stated:
Indeed, the decision of the Board was based
simply on its finding that the Philippine
Coast Guard had certified the vessel to be
seaworthy and that it sank because it was
exposed later to an oncoming typhoon
plotted within the radius where the vessel
was positioned. This generalization certainly
cannot prevail over the detailed explanation
of the trial court in this case as basis for its
contrary conclusion. (Rollo, at p. 42)
We find no cogent reason to deviate from the factual findings
of the appellate court and rule that the doctrine of primary
administrative jurisdiction is not applicable in the case at bar.
The other issue raised is whether or not the carrier's liability
is limited to $500.00 pursuant to section 8 of the Bill of
Lading. The petitioner claims that the appellate court erred in
disregarding the limitation of liability stipulated in the bill of
lading. It argues that the consignee agreed to this amount
(and) therefore is bound by this rate and that there is no
basis for the appellate court's finding that the rate is
unreasonable.

liability of the carrier to $500.00 would obviously put in its

power to have taken the whole cargo. In Juan Ysmael & Co.
v. Gabino Barretto & Co., 51 Phil. 90 [1927], it was held that
a stipulation limiting the carrier's liability to P300.00 per
package of silk, when the value of such package was
P2,500.00, unless the true value had been declared and the
corresponding freight paid; was void as against public policy.
That ruling applies to this case.
As argued by the respondent, a limitation of liability in this
case would render inefficacious the extraordinary diligence
required by law of common carriers. 13
The motion for reconsideration of said resolution filed by petitioner was
denied with finality in a resolution dated January 8, 1990. Said resolution of
the case had become final and executory, entry of judgment having been
made and the records remanded for execution on March 22, 1990.
Said case is now the law of the case applicable to the present petition.
WHEREFORE, the petition is dismissed with costs against petitioner.
SO ORDERED.

The argument is not well-taken. As aptly stated by the appellate court:

Generally speaking any stipulation, limiting the common
carrier's liability to the value of the goods appearing in the bill
of lading, unless the shipper or owner declares a greater
value is valid. (Civil Code, Art. 1749) Such stipulation,
however, must be reasonable and just under the
circumstances and must have been fairly and freely agreed
upon. (St. Paul Fire & Marine Insurance Co. v. Macondray &
Co., 70 SCRA 122, 126-127 [1976] In the case at bar, the
goods shipped on the M/V "P. Aboitiz" were insured for
P278,536.50, which may be taken as their value. To limit the

EJUSDEM GENERIS
EN BANC
G.R. No. L-32717 November 26, 1970

23

AMELITO
R.
vs.
COMMISSION ON ELECTIONS, respondent.

MUTUC, petitioner,

Amelito R. Mutuc in his own behalf.

Romulo C. Felizmena for respondent.

FERNANDO, J.:
The invocation of his right to free speech by petitioner Amelito Mutuc, then a
candidate for delegate to the Constitutional Convention, in this special civil
action for prohibition to assail the validity of a ruling of respondent
Commission on Elections enjoining the use of a taped jingle for campaign
purposes, was not in vain. Nor could it be considering the conceded absence
of any express power granted to respondent by the Constitutional
Convention Act to so require and the bar to any such implication arising from
any provision found therein, if deference be paid to the principle that a statute
is to be construed consistently with the fundamental law, which accords the
utmost priority to freedom of expression, much more so when utilized for
electoral purposes. On November 3, 1970, the very same day the case was
orally argued, five days after its filing, with the election barely a week away,
we issued a minute resolution granting the writ of prohibition prayed for. This
opinion is intended to explain more fully our decision.
In this special civil action for prohibition filed on October 29, 1970, petitioner,
after setting forth his being a resident of Arayat, Pampanga, and his
candidacy for the position of delegate to the Constitutional Convention,
alleged that respondent Commission on Elections, by a telegram sent to him
five days previously, informed him that his certificate of candidacy was given
due course but prohibited him from using jingles in his mobile units equipped
with sound systems and loud speakers, an order which, according to him, is
"violative of [his] constitutional right ... to freedom of speech." 1 There being
no plain, speedy and adequate remedy, according to petitioner, he would
seek a writ of prohibition, at the same time praying for a preliminary
injunction. On the very next day, this Court adopted a resolution requiring
respondent Commission on Elections to file an answer not later than
November 2, 1970, at the same time setting the case for hearing for Tuesday
November 3, 1970. No preliminary injunction was issued. There was no

denial in the answer filed by respondent on November 2, 1970, of the factual

allegations set forth in the petition, but the justification for the prohibition was
premised on a provision of the Constitutional Convention Act, 2which made it
unlawful for candidates "to purchase, produce, request or distribute sample
ballots, or electoral propaganda gadgets such as pens, lighters, fans (of
whatever nature), flashlights, athletic goods or materials, wallets, bandanas,
shirts, hats, matches, cigarettes, and the like, whether of domestic or foreign
origin." 3It was its contention that the jingle proposed to be used by petitioner
is the recorded or taped voice of a singer and therefore a tangible
propaganda material, under the above statute subject to confiscation. It
prayed that the petition be denied for lack of merit. The case was argued, on
November 3, 1970, with petitioner appearing in his behalf and Attorney
Romulo C. Felizmena arguing in behalf of respondent.
This Court, after deliberation and taking into account the need for urgency,
the election being barely a week away, issued on the afternoon of the same
day, a minute resolution granting the writ of prohibition, setting forth the
absence of statutory authority on the part of respondent to impose such a
ban in the light of the doctrine ofejusdem generis as well as the principle that
the construction placed on the statute by respondent Commission on
Elections would raise serious doubts about its validity, considering the
infringement of the right of free speech of petitioner. Its concluding portion
was worded thus: "Accordingly, as prayed for, respondent Commission on
Elections is permanently restrained and prohibited from enforcing or
implementing or demanding compliance with its aforesaid order banning the
use of political jingles by candidates. This resolution is immediately
executory." 4
1. As made clear in our resolution of November 3, 1970, the question before
us was one of power. Respondent Commission on Elections was called upon
to justify such a prohibition imposed on petitioner. To repeat, no such
authority was granted by the Constitutional Convention Act. It did contend,
however, that one of its provisions referred to above makes unlawful the
distribution of electoral propaganda gadgets, mention being made of pens,
lighters, fans, flashlights, athletic goods or materials, wallets, bandanas,
shirts, hats, matches, and cigarettes, and concluding with the words "and the
like." 5 For respondent Commission, the last three words sufficed to justify
such an order. We view the matter differently. What was done cannot merit
our approval under the well-known principle of ejusdem generis, the general
words following any enumeration being applicable only to things of the same
kind or class as those specifically referred to. 6 It is quite apparent that what
was contemplated in the Act was the distribution of gadgets of the kind

24

referred to as a means of inducement to obtain a favorable vote for the

candidate responsible for its distribution.
The more serious objection, however, to the ruling of respondent
Commission was its failure to manifest fealty to a cardinal principle of
construction that a statute should be interpreted to assure its being in
consonance with, rather than repugnant to, any constitutional command or
prescription. 7 Thus, certain Administrative Code provisions were given a
"construction which should be more in harmony with the tenets of the
fundamental law." 8 The desirability of removing in that fashion the taint of
constitutional infirmity from legislative enactments has always commended
itself. The judiciary may even strain the ordinary meaning of words to avert
any collision between what a statute provides and what the Constitution
requires. The objective is to reach an interpretation rendering it free from
constitutional defects. To paraphrase Justice Cardozo, if at all possible, the
conclusion reached must avoid not only that it is unconstitutional, but also
grave doubts upon that score. 9
2. Petitioner's submission of his side of the controversy, then, has in its favor
obeisance to such a cardinal precept. The view advanced by him that if the
above provision of the Constitutional Convention Act were to lend itself to the
view that the use of the taped jingle could be prohibited, then the challenge
of unconstitutionality would be difficult to meet. For, in unequivocal language,
the Constitution prohibits an abridgment of free speech or a free press. It has
been our constant holding that this preferred freedom calls all the more for
the utmost respect when what may be curtailed is the dissemination of
information to make more meaningful the equally vital right of suffrage. What
respondent Commission did, in effect, was to impose censorship on
petitioner, an evil against which this constitutional right is directed. Nor could
respondent Commission justify its action by the assertion that petitioner, if he
would not resort to taped jingle, would be free, either by himself or through
others, to use his mobile loudspeakers. Precisely, the constitutional
guarantee is not to be emasculated by confining it to a speaker having his
say, but not perpetuating what is uttered by him through tape or other
mechanical contrivances. If this Court were to sustain respondent
Commission, then the effect would hardly be distinguishable from a previous
restraint. That cannot be validly done. It would negate indirectly what the
Constitution in express terms assures. 10

of government. That is to manifest fealty to the rule of law, with priority

accorded to that which occupies the topmost rung in the legal hierarchy. The
three departments of government in the discharge of the functions with which
it is entrusted have no choice but to yield obedience to its commands.
Whatever limits it imposes must be observed. Congress in the enactment of
statutes must ever be on guard lest the restrictions on its authority, whether
substantive or formal, be transcended. The Presidency in the execution of
the laws cannot ignore or disregard what it ordains. In its task of applying the
law to the facts as found in deciding cases, the judiciary is called upon to
maintain inviolate what is decreed by the fundamental law. Even its power of
judicial review to pass upon the validity of the acts of the coordinate
branches in the course of adjudication is a logical corollary of this basic
principle that the Constitution is paramount. It overrides any governmental
measure that fails to live up to its mandates. Thereby there is a recognition of
its being the supreme law.
To be more specific, the competence entrusted to respondent Commission
was aptly summed up by the present Chief Justice thus: "Lastly, as the
branch of the executive department although independent of the President
to which the Constitution has given the 'exclusive charge' of the
'enforcement and administration of all laws relative to the conduct of
elections,' the power of decision of the Commission is limited to purely
'administrative questions.'"11 It has been the constant holding of this Court, as
it could not have been otherwise, that respondent Commission cannot
exercise any authority in conflict with or outside of the law, and there is no
higher law than the Constitution. 12 Our decisions which liberally construe its
powers are precisely inspired by the thought that only thus may its
responsibility under the Constitution to insure free, orderly and honest
elections be adequately fulfilled. 13 There could be no justification then for
lending approval to any ruling or order issuing from respondent Commission,
the effect of which would be to nullify so vital a constitutional right as free
speech. Petitioner's case, as was obvious from the time of its filing, stood on
solid footing.
WHEREFORE, as set forth in our resolution of November 3, 1970,
respondent Commission is permanently restrained and prohibited from
enforcing or implementing or demanding compliance with its aforesaid order
banning the use of political taped jingles. Without pronouncement as to
costs.

3. Nor is this all. The concept of the Constitution as the fundamental law,
setting forth the criterion for the validity of any public act whether proceeding
from the highest official or the lowest functionary, is a postulate of our system

25

Republic of the Philippines

SUPREME COURT
Manila

The Official Zoning Code of Calasiao, Art. 6, Section 44, 1 the

nearest school building which is San Miguel Elementary
School and church, the distances are less than 100 meters.
No neighbors were called as witnesses when actual
measurements were done by HLURB Staff, Baguio City
dated 22 June 1989.

July 14, 2006

b) The gasoline station remains in thickly populated area with

commercial/residential buildings, houses closed (sic) to each other
which still endangers the lives and safety of the people in case of
fire. Moreover, additional selling and storing of several LPG tanks in
the station (sic).

CONCEPCION PARAYNO, petitioner,

vs.
JOSE JOVELLANOS and the MUNICIPALITY OF CALASIAO,
PANGASINAN,* respondents.

c) The residents of our barangay always complain of the irritating

smell of gasoline most of the time especially during gas filling which
tend to expose residents especially children to frequent colds,
asthma, cough and the like nowadays.

DECISION
CORONA, J.:

d) xxx the gasoline station violated Building and Fire Safety Codes
because the station has 2nd floor storey building used for business
rental offices, with iron grilled windows, no firewalls. It also
endangers the lives of people upstairs.

This is a petition for review on certiorari under Rule 45 of the 1997 Rules of
Court questioning the resolution of the Court of Appeals (CA) which
dismissed the petition for certiorari, mandamus and prohibition, with prayer
for issuance of a preliminary and mandatory injunction, filed by petitioner
Concepcion Parayno against respondents Jose Jovellanos and the
Municipality of Calasiao, Pangasinan.

e) It hampers the flow of traffic, the gasoline station is too small and
narrow, the entrance and exit are closed to the street property lines.
It couldn't cope situation (sic) on traffic because the place is a
congested area.2

SECOND DIVISION
G.R. No. 148408

Petitioner was the owner of a gasoline filling station in Calasiao, Pangasinan.

In 1989, some residents of Calasiao petitioned the Sangguniang Bayan (SB)
of said municipality for the closure or transfer of the station to another
location. The matter was referred to the Municipal Engineer, Chief of Police,
Municipal Health Officer and the Bureau of Fire Protection for investigation.
Upon their advise, the Sangguniang Bayan recommended to the Mayor the
closure or transfer of location of petitioner's gasoline station. In Resolution
No. 50, it declared:
a) xxx the existing gasoline station is a blatant violation and
disregard of existing law to wit:

Petitioner moved for the reconsideration of the SB resolution but it was

denied. Hence, she filed a special civil action for prohibition and mandamus
with the Regional Trial Court (RTC) of Dagupan City, Branch 44 against
respondents. The case, docketed as SP Civil Case No. 99-03010-D, was
raffled to the sala of Judge Crispin Laron.
Petitioner claimed that her gasoline station was not covered by Section 44 of
the Official Zoning Code since it was not a "gasoline service station" but a
"gasoline filling station" governed by Section 21 thereof. She added that the
decision of the Housing and Land Use Regulatory Board (HLURB), 3 in a
previous case filed by the same respondent Jovellanos against her
predecessor (Dennis Parayno), barred the grounds invoked by respondent
municipality in Resolution No. 50. In the HLURB case, respondent Jovellanos

26

opposed the establishment of the gas station on the grounds that: (1) it was
within the 100-meter prohibited radius under Section 44 and (2) it posed a
pernicious effect on the health and safety of the people in Calasiao.
After the hearing on the propriety of issuing a writ of preliminary prohibitory
and mandatory injunction, the trial court ruled:

The Principle of Ejusdem Generis

We hold that the zoning ordinance of respondent municipality made a clear
distinction between "gasoline service station" and "gasoline filling station."
The pertinent provisions read:
xxx

There is no basis for the court to issue a writ of preliminary

prohibitory and mandatory injunction. Albeit,Section 44 of the
Official Zoning Code of respondent municipality does not
mention a gasoline filling station, [but] following the principle
of ejusdem generis, a gasoline filling station falls within the
ambit of Section 44.
The gasoline filling station of the petitioner is located under the
establishment belonging to the petitioner and is very near several
buildings occupied by several persons. Justice dictates that the
same should not be allowed to continue operating its business
on that particular place. Further, the gasoline filling station
endangers the lives and safety of people because once there is
fire, the establishment and houses nearby will be razed to the
ground.4(emphasis supplied)
Petitioner moved for reconsideration of the decision but it was denied by the
trial court.
Petitioner elevated the case to the CA via a petition for certiorari, prohibition
and mandamus,5 with a prayer for injunctive relief. She ascribed grave abuse
of discretion, amounting to lack or excess of jurisdiction, on the part of Judge
Laron who dismissed her case.
After the CA dismissed the petition, petitioner filed a motion for
reconsideration but the same was denied. Hence, this appeal.
Before us, petitioner insists that (1) the legal maxim of ejusdem generis did
not apply to her case; (2) the closure/transfer of her gasoline filling station by
respondent municipality was an invalid exercise of the latter's police powers
and (3) it was the principle of res judicata that applied in this case.6
We find merit in the petition.

xxx

xxx

Section 21. Filling Station. A retail station servicing automobiles and

other motor vehicles with gasoline and oil only.7
xxx

xxx

xxx

Section 42. Service Station. A building and its premises where

gasoline oil, grease, batteries, tires and car accessories may be
supplied and dispensed at retail and where, in addition, the following
services may be rendered and sales and no other.
a. Sale and servicing of spark plugs, batteries, and
distributor parts;
b. Tire servicing and repair, but not recapping or regrooving;
c. Replacement of mufflers and tail pipes, water hose, fan
belts, brake fluids, light bulbs, fuses, floor mats, seat covers,
windshield wipers and wiper blades, grease retainers, wheel,
bearing, mirrors and the like;
d. Radiator cleaning and flushing;
e. Washing and polishing, and sale of automobile washing
and polishing materials;
f. Grease and lubricating;
g. Emergency wiring repairs;
h. Minor servicing of carburators;
i. Adjusting and repairing brakes;

27

j. Minor motor adjustments not involving removal of the head

or crankcase, or raising the motor.8
xxx

xxx

Section 44 necessarily included "gasoline filling station" under Section 21.

Indeed, the activities undertaken in a "gas service station" did not
automatically embrace those in a "gas filling station."

xxx
The Exercise of Police Powers

It is evident from the foregoing that the ordinance intended these two terms
to be separate and distinct from each other. Even respondent municipality's
counsel admitted this dissimilarity during the hearing on the application for
the issuance of a writ of preliminary prohibitory and mandatory injunction.
Counsel in fact admitted:
1. That there exist[ed] an official zoning code of Calasiao,
Pangasinan which [was] not yet amended;
2. That under Article III of said official zoning code there [were]
certain distinctions made by said municipality about the
designation of the gasoline filling station and that of the
gasoline service station as appearing in Article III, Nos. 21 and
42, [respectively];
3. That the business of the petitioner [was] one of a gasoline
filling station as defined in Article III, Section 21 of the zoning
code and not as a service station as differently defined under
Article 42 of the said official zoning code;
4. That under Section 44 of the official zoning code of Calasiao,
the term filling station as clearly defined under Article III,
Section 21, [did] not appear in the wordings thereof; 9(emphasis
supplied)
The foregoing were judicial admissions which were conclusive on the
municipality, the party making them.10Respondent municipality thus could not
find solace in the legal maxim of ejusdem generis11 which means "of the
same kind, class or nature." Under this maxim, where general words follow
the enumeration of particular classes of persons or things, the general words
will apply only to persons or things of the same general nature or class as
those enumerated.12 Instead, what applied in this case was the legal
maxim expressio unius est exclusio alteriuswhich means that the express
mention of one thing implies the exclusion of others. 13 Hence, because of the
distinct and definite meanings alluded to the two terms by the zoning
ordinance, respondents could not insist that "gasoline service station" under

Respondent municipality invalidly used its police powers in ordering the

closure/transfer of petitioner's gasoline station. While it had, under RA
7160,14 the power to take actions and enact measures to promote the health
and general welfare of its constituents, it should have given due deference to
the law and the rights of petitioner.
A local government is considered to have properly exercised its police
powers only when the following requisites are met: (1) the interests of the
public generally, as distinguished from those of a particular class, require the
interference of the State and (2) the means employed are reasonably
necessary for the attainment of the object sought to be accomplished and not
unduly oppressive.15 The first requirement refers to the equal protection
clause and the second, to the due process clause of the Constitution. 16
Respondent municipality failed to comply with the due process clause when it
passed Resolution No. 50. While it maintained that the gasoline filling station
of petitioner was less than 100 meters from the nearest public school and
church, the records do not show that it even attempted to measure the
distance, notwithstanding that such distance was crucial in determining
whether there was an actual violation of Section 44. The different local offices
that respondent municipality tapped to conduct an investigation never
conducted such measurement either.
Moreover, petitioner's business could not be considered a nuisance which
respondent municipality could summarily abate in the guise of exercising its
police powers. The abatement of a nuisance without judicial proceedings is
possible only if it is a nuisance per se. A gas station is not a nuisance per
se or one affecting the immediate safety of persons and property,17 hence, it
cannot be closed down or transferred summarily to another location.
As a rule, this Court does not pass upon evidence submitted by the parties in
the lower courts.18 We deem it necessary, however, to recall the findings of
the HLURB which petitioner submitted as evidence during the proceedings
before the trial court, if only to underscore petitioner's compliance with the
requirements of law before she put up her gasoline station.

28

Another factor that should not be left unnoticed is the diligence

exercised by [petitioner] in complying with the requirements of the
several laws prior to the actual implementation of the project as can
be attested by the fact that [petitioner] has secured the necessary
building permit and approval of [her] application for authority to
relocate as per the letter of the Energy Regulatory Board xxx. 19
On the alleged hazardous effects of the gasoline station to the lives and
properties of the people of Calasiao, we again note:
Relative to the allegations that the project (gasoline station) is
hazardous to life and property, the Board takes cognizance of the
respondent's contention that the project "is not a fire hazard since
petroleum products shall be safely stored in underground tanks and
that the installation and construction of the underground tanks shall
be in accordance with the Caltex Engineering Procedures which is
true to all gasoline stations in the country. xxx
Hence, the Board is inclined to believe that the project being
hazardous to life and property is more perceived than
factual. For, after all, even the Fire Station Commander, after
studying the plans and specifications of the subject proposed
construction, recommended on 20 January 1989, "to build such
buildings after conform (sic) all the requirements of PP 1185." It is
further alleged by the complainants that the proposed location
is "in the heart of the thickly populated residential area of
Calasiao." Again, findings of the [HLURB] staff negate the
allegations
as
the
same
is
within
a
designated
Business/Commercial
Zone
per
the
Zoning
Ordinance. xxx20 (emphasis supplied)
The findings of fact of the HLURB are binding as they are already final and
conclusive vis--vis the evidence submitted by respondents.
The Principle of Res Judicata
Petitioner points out that the HLURB decision in the previous case filed
against her predecessor (Dennis Parayno) by respondent Jovellanos had
effectively barred the issues in Resolution No. 50 based on the principle
of res judicata. We agree.

Res judicata refers to the rule that a final judgment or decree on the merits
by a court of competent jurisdiction is conclusive of the rights of the parties or
their privies in all later suits on all points and matters determined in the
former suit.21 For res judicata to apply, the following elements must be
present: (1) the judgment or order must be final; (2) the judgment must be on
the merits; (3) it must have been rendered by a court having jurisdiction over
the subject matter and the parties and (4) there must be, between the first
and second actions, identity of parties, of subject matter and of cause of
action.22
Respondent municipality does not contest the first, second and third
requisites. However, it claims that it was not a party to the HLURB case but
only its co-respondent Jovellanos, hence, the fourth requisite was not met.
The argument is untenable.
The absolute identity of parties is not required for the principle of res
judicata to apply.23 A shared identity of interests is sufficient to invoke the
application of this principle.24 The proscription may not be evaded by the
mere expedient of including an additional party.25 Res judicata may lie as
long as there is a community of interests between a party in the first case
and a party in the second case although the latter may not have been
impleaded in the first.26
In the assailed resolution of respondent municipality, it raised the same
grounds invoked by its co-respondent in the HLURB: (1) that the resolution
aimed to close down or transfer the gasoline station to another location due
to the alleged violation of Section 44 of the zoning ordinance and (2) that the
hazards of said gasoline station threatened the health and safety of the
public. The HLURB had already settled these concerns and its adjudication
had long attained finality. It is to the interest of the public that there should be
an end to litigation by the parties over a subject matter already fully and fairly
adjudged. Furthermore, an individual should not be vexed twice for the same
cause.27
WHEREFORE, the petition is hereby GRANTED. The assailed resolution of
the Court of the Appeals isREVERSED and SET ASIDE. Respondent
Municipality of Calasiao is hereby directed to cease and desist from
enforcing Resolution No. 50 against petitioner insofar as it seeks to close
down or transfer her gasoline station to another location.
No costs.

29

SO ORDERED.

Notified of the decision on September 7, 1951, the Manabats sent on

September 22, 1951 their notice of appeal by registered mail together with a
postal money order payable to the justice of the peace for P16 as docket
fees and a surety bond in the sum of P30 as appeal bond. These papers
were actually received at the peace court of Tarlac, Tarlac, on September 24,
1951.
Forwarded to the court of instance, the appeal was docketed as civil case
No. 638. Subsequently, however, the Roxas couple submitted a motion to
dismiss the appeal of the Manabats on the grounds: (a) that the appeal
documents had been received by the inferior court of Tarlac, on September
24, i.e., two days after the expiration of the time prescribed by law for
appeals from that court and (b) because the appeal was frivolous, interposed
obviously for delay.

EXPRESSIO UNIUS EXCLUSIO ALTERIUS RULE

EN BANC
G.R. No. L-5558

April 29, 1953

ENRIQUE D. MANABAT and RUFINA S. MANABAT, petitioners,

vs.
THE HON. BERNABE DE AQUINO, Judge of First Instance of Tarlac, and
ALEJANDRA L. DE ROXAS and CLAUDIO ROXAS, respondent.
Luciano
V.
Bonicilio
Ruben
L.
Roxas
Bernabe de Aquino in his own behalf.

for
for

petitioners.
respondents.

Noting that the 15-day period expired on September 22, and that the appeal
papers were actually received on September 24, the judge of first instance
declared the appeal was late and dismissed it for lack of jurisdiction. He
expressly refused to apply section 1 Rule 27 of the Rules of Court on which
the Manabats relied to sustain the timeliness of their move. That section
provides that "the date of the mailing" of the court papers "as shown by the
post-office registry receipt shall be considered as the date of their filing" in
court. His honor opined that this section does not regulate inferior courts,
since it is found only among rules governing courts of first instance, and,
unlike other rules, it is not extended to inferior courts and therefore
excluded by section 19 Rule 4, which for convenience is quoted
hereunder:

BENGZON, J.:
The case: This is a petition for mandamus to require the respondent judge of
first instance to give due course to, and hear the petitioners' appeal from the
decision of a justice of the peace which he dismissed believing it had not
been perfected in due time.
The facts: Sued on a promissory note in the peace court of Tarlac, Tarlac,
Enrique S. Manabat and his wife, denied liability, alleging usury. Having failed
to appear and present evidence at the hearing, they were ordered to pay the
amount of P1,261.74 plus interest, upon the proofs and introduced by the
plaintiffs, Alejandra L. de Roxas and her husband Claudio Roxas.

SEC. 19. Application of certain rules. Rules 10, 12, 13, 14, 18, 28,
29, 30, and 39 are applicable in inferior courts in cases falling within
their jurisdictions and in so far as they are not inconsistent with the
provisions of this rule.
Hence this petition for mandamus, appeal being inadequate, because the
defendants in the case, (petitioners herein) have not introduced evidence.
The question is whether the appeal had been perfected within fifteen days as
required by section 2 Rule 40 of the Rules of Court. If it was, this petition
should be granted. 1 Otherwise it will be denied. That question, in turn,
depends upon the issue whether the appeal papers are deemed filed in court
on September 22 when they were deposited in the mails by registered mail,

30

or on September 24 when they were actually received. If the first, the appeal
was timely; otherwise it was belated.
Discussion: If section 1 Rule 27 is applied, the appeal papers would be
deemed filed on September 22, and therefore the appeal would have been
seasonably perfected. His Honor, however, and the other respondents,
maintain that Rule 27 is not applicable because it is not mentioned in section
19 Rule 4 hereinbefore quoted, andinclusio unius est exclusio alterius,
enumeration of certain rules, excludes others.
That legal maxim is well-known, and respondents' position seems at first
blush tenable. But the maxim is not more than an auxiliary rule of
interpretation to be ignored where other circumstances indicate the
enumeration was not intended to be exclusive.
Now, if section 19 Rule 4 is exclusive, justices of the peace may disregard,
(a) the principles of evidence prescribed in Rule 123, (b) Rule 131 as to costs
and (c) the fundamental principles about splitting or joinder of causes of
action in Rule 2, and the theories about parties in interest, necessary parties,
married women etc. in Rule 3.
These undesirable consequences could not have been overlooked by the
framers of the Rules. They could not have intended, therefore, to make the
enumeration in section 19 Rule 4 as all-inclusive and exclusive.

to uphold the uniform principle that "the date of deposit in the post-office by
registered mail" of court papers is "the date of filing" not only in the Supreme
Court, the appellate court, and the superior courts but also in inferior courts.
Uniformity of rules is to be desired to simplify procedure (Cf. Henning vs.
Western Equipment, 62 Phil., 886).
Conclusion: Hence, this Court's opinion is that the Manabats appealed on
time.
The Roxas spouses interpose here two other points: (a) instead of delivering
a certificate of the municipal treasurer showing deposit of the docket fees,
the Manabats sent only a postal money order payable to the justice of the
peace; and (b) the appeal was unmeritorious and merely for delay.
The first objection was not raised in the court of first instance, wherein the
time of the appeal not the form was discussed. Any way there was
substantial compliance of the deposit requirement. 2
The second point was ignored by the respondent judge. Rightly, we believe,
because at this stage we are not prepared to deprive the Manabats of their
day in court, usury being contrary to the policies of our system of legislation.
Judgment: Wherefore, the writ will be issued for the respondent judge to hear
and thereafter decide the appeal interposed by herein petitioners. Costs
against the Roxases. So ordered.

As a matter of fact this Court applied to litigations in inferior courts

Rules other than those enumerated in Rule 4, section 19. Thus in Viola
Fernando vs. Aragon,* 43 Off. Gaz., 145 we applied Rule 17 to a municipal
court saying "Although Rule 17 has not been made applicable to justice of
the peace courts, such omission (from the enumeration in section 19 Rule 4),
can not be interpreted as a prohibition to apply it."
In Beltran vs. Cabrera (73 Phil., 666), Rule 124 was considered applicable to
the Manila municipal court.
In Co Tiamco vs. Diaz (75 Phil., 672), Rules 8, 16, 17, 20, 21, 22, and the
appendix of forms after Rule 133 were deemed binding on inferior courts,
over the objection that they were excluded by section 19 Rule 4.
Consequently, there can be no legal obstacle to the application of Rule 27
section 1 to the justice of the peace court of Tarlac. And it should be applied,

31

ng Tikay launched a fund drive for the purpose of renovating the chapel of
Barrio Tikay, Malolos, Bulacan. Petitioner Martin Centeno, the chairman of
the group, together with Vicente Yco, approached Judge Adoracion G.
Angeles, a resident of Tikay, and solicited from her a contribution of
P1,500.00. It is admitted that the solicitation was made without a permit from
the Department of Social Welfare and Development.
As a consequence, based on the complaint of Judge Angeles, an
information 1 was filed against petitioner Martin Centeno, together with
Religio Evaristo and Vicente Yco, for violation of Presidential Decree No.
1564, or the Solicitation Permit Law, before the Municipal Trial Court of
Malolos, Bulacan, Branch 2, and docketed as Criminal Case No. 2602.
Petitioner filed a motion to quash the information 2 on the ground that the
facts alleged therein do not constitute an offense, claiming that Presidential
Decree No. 1564 only covers solicitations made for charitable or public
welfare purposes, but not those made for a religious purpose such as the
construction of a chapel. This was denied 3 by the trial court, and petitioner's
motion for reconsideration having met the same fate, trial on the merits
ensued.
G.R. No. 113092 September 1, 1994
MARTIN CENTENO, petitioner,
vs.
HON. VICTORIA VILLALON-PORNILLOS, Presiding Judge of the
Regional Trial Court of Malolos, Bulacan, Branch 10, and THE PEOPLE
OF THE PHILIPPINES, respondents.
Santiago V. Marcos, Jr. for petitioner.
REGALADO, J.:
It is indeed unfortunate that a group of elderly men, who were moved by their
desire to devote their remaining years to the service of their Creator by
forming their own civic organization for that purpose, should find themselves
enmeshed in a criminal case for making a solicitation from a community
member allegedly without the required permit from the Department of Social
Welfare and Development.
The records of this case reveal that sometime in the last quarter of 1985, the
officers of a civic organization known as the Samahang Katandaan ng Nayon

On December 29, 1992, the said trial court rendered judgment 4 finding
accused Vicente Yco and petitioner Centeno guilty beyond reasonable doubt
and sentencing them to each pay a fine of P200.00. Nevertheless, the trial
court recommended that the accused be pardoned on the basis of its finding
that they acted in good faith, plus the fact that it believed that the latter
should not have been criminally liable were it not for the existence of
Presidential
Decree
No. 1564 which the court opined it had the duty to apply in the instant case.
Both accused Centeno and Yco appealed to the Regional Trial Court of
Malolos, Bulacan, Branch 10. However, accused Yco subsequently withdrew
his appeal, hence the case proceeded only with respect to petitioner
Centeno. On May 21, 1993, respondent Judge Villalon-Pornillos affirmed the
decision of the lower court but modified the penalty, allegedly because of the
perversity of the act committed which caused damage and prejudice to the
complainant, by sentencing petitioner Centeno to suffer an increased penalty
of imprisonment of 6 months and a fine of P1,000.00, without subsidiary
imprisonment in case of insolvency. 5 The motion for reconsideration of the
decision was denied by the court. 6
Thus it is that a fine of P200.00 imposed as a penalty by the lowest court in
the judicial hierarchy eventually reached this highest tribunal, challenged on

32

the sole issue of whether solicitations for religious purposes are within the
ambit of Presidential Decree No. 1564. Quantitatively, the financial sanction
is a nominal imposition but, on a question of principle, it is not a trifling
matter. This Court is gratified that it can now grant this case the benefit of a
final adjudication.
Petitioner questions the applicability of Presidential Decree No. 1564 to
solicitations for contributions intended for religious purposes with the
submissions that (1) the term "religious purpose" is not expressly included in
the provisions of the statute, hence what the law does not include, it
excludes;
(2) penal laws are to be construed strictly against the State and liberally in
favor of the accused; and (3) to subject to State regulation solicitations made
for a religious purpose would constitute an abridgment of the right to freedom
of religion guaranteed under the Constitution.
Presidential Decree No. 1564 (which amended Act No. 4075, otherwise
known as the Solicitation Permit Law), provides as follows:
Sec. 2. Any person, corporation, organization, or association
desiring to solicit or receive contributions for charitable or
public welfare purposes shall first secure a permit from the
Regional Offices of the Department of Social Services and
Development as provided in the Integrated Reorganization
Plan. Upon the filing of a written application for a permit in
the form prescribed by the Regional Offices of the
Department of Social Services and Development, the
Regional Director or his duly authorized representative may,
in his discretion, issue a permanent or temporary permit or
disapprove the application. In the interest of the public, he
may in his discretion renew or revoke any permit issued
under Act 4075.
The main issue to be resolved here is whether the phrase "charitable
purposes" should be construed in its broadest sense so as to include a
religious purpose. We hold in the negative.
I. Indeed, it is an elementary rule of statutory construction that the express
mention of one person, thing, act, or consequence excludes all others. This
rule is expressed in the familiar maxim "expressio unius est exclusio
alterius." Where a statute, by its terms, is expressly limited to certain matters,

it may not, by interpretation or construction, be extended to others. The rule

proceeds from the premise that the legislature would not have made
specified enumerations in a statute had the intention been not to restrict its
meaning and to confine its terms to those expressly mentioned. 7
It will be observed that the 1987 Constitution, as well as several other
statutes, treat the words "charitable" and "religious" separately and
independently of each other. Thus, the word "charitable" is only one of three
descriptive words used in Section 28 (3), Article VI of the Constitution which
provides that "charitable institutions, churches and personages . . ., and all
lands, buildings, and improvements, actually, directly, and exclusively used
for religious, charitable, or educational purposes shall be exempt from
taxation." There are certain provisions in statutes wherein these two terms
are likewise dissociated and individually mentioned, as for instance, Sections
26 (e) (corporations exempt from income tax) and 28 (8) (E) (exclusions from
gross income) of the National Internal Revenue Code; Section 88 (purposes
for the organization of non-stock corporations) of the Corporation Code; and
Section 234 (b) (exemptions from real property tax) of the Local Government
Code.
That these legislative enactments specifically spelled out "charitable" and
"religious" in an enumeration, whereas Presidential Decree No. 1564 merely
stated "charitable or public welfare purposes," only goes to show that the
framers of the law in question never intended to include solicitations for
religious purposes within its coverage. Otherwise, there is no reason why it
would not have so stated expressly.
All contributions designed to promote the work of the church are "charitable"
in nature, since religious activities depend for their support on voluntary
contributions. 8 However, "religious purpose" is not interchangeable with the
expression "charitable purpose." While it is true that there is no religious
purpose which is not also a charitable purpose, yet the converse is not
equally true, for there may be a "charitable" purpose which is not "religious"
in the legal sense of the term. 9 Although the term "charitable" may include
matters which are "religious," it is a broader term and includes matters which
are not "religious," and, accordingly, there is a distinction between "charitable
purpose" and "religious purpose," except where the two terms are obviously
used synonymously, or where the distinction has been done away with by
statute.10 The word "charitable," therefore, like most other words, is capable
of different significations. For example, in the law, exempting charitable uses
from taxation, it has a very wide meaning, but under Presidential Decree No.

33

1564 which is a penal law, it cannot be given such a broad application since
it would be prejudicial to petitioners.
To illustrate, the rule is that tax exemptions are generally construed strictly
against the taxpayer. However, there are cases wherein claims for exemption
from tax for "religious purposes" have been liberally construed as covered in
the law granting tax exemptions for "charitable purposes." Thus, the term
"charitable purposes," within the meaning of a statute providing that the
succession of any property passing to or for the use of any institution for
purposes only of public charity shall not be subject to succession tax, is
deemed to include religious purposes. 11A gift for "religious purposes" was
considered as a bequest for "charitable use" as regards exemption from
inheritance tax.12
On the other hand, to subsume the "religious" purpose of the solicitation
within the concept of "charitable" purpose which under Presidential Decree
No. 1564 requires a prior permit from the Department of Social Services and
Development, under paid of penal liability in the absence thereof, would be
prejudicial to petitioner. Accordingly, the term "charitable" should be strictly
construed so as to exclude solicitations for "religious" purposes. Thereby, we
adhere to the fundamental doctrine underlying virtually all penal legislations
that such interpretation should be adopted as would favor the accused.
For, it is a well-entrenched rule that penal laws are to be construed strictly
against the State and liberally in favor of the accused. They are not to be
extended or enlarged by implications, intendments, analogies or equitable
considerations. They are not to be strained by construction to spell out a new
offense, enlarge the field of crime or multiply felonies. Hence, in the
interpretation of a penal statute, the tendency is to subject it to careful
scrutiny and to construe it with such strictness as to safeguard the rights of
the accused. If the statute is ambiguous and admits of two reasonable but
contradictory constructions, that which operates in favor of a party accused
under its provisions is to be preferred. The principle is that acts in and of
themselves innocent and lawful cannot be held to be criminal unless there is
a clear and unequivocal expression of the legislative intent to make them
such. Whatever is not plainly within the provisions of a penal statute should
be regarded as without its intendment. 13
The purpose of strict construction is not to enable a guilty person to escape
punishment through a technicality but to provide a precise definition of
forbidden acts. 14 The word "charitable" is a matter of description rather than
of precise definition, and each case involving a determination of that which is

charitable must be decided on its own particular facts and

circumstances. 15 The law does not operate in vacuo nor should its
applicability be determined by circumstances in the abstract.
Furthermore, in the provisions of the Constitution and the statutes mentioned
above, the enumerations therein given which include the words "charitable"
and "religious" make use of the disjunctive "or." In its elementary sense, "or"
as used in a statute is a disjunctive article indicating an alternative. It often
connects a series of words or propositions indicating a choice of either. When
"or" is used, the various members of the enumeration are to be taken
separately. 16 Accordingly, "charitable" and "religious," which are integral
parts of an enumeration using the disjunctive "or" should be given different,
distinct, and disparate meanings. There is no compelling consideration why
the same treatment or usage of these words cannot be made applicable to
the questioned provisions of Presidential Decree No. 1564.
II. Petitioner next avers that solicitations for religious purposes cannot be
penalized under the law for, otherwise, it will constitute an abridgment or
restriction on the free exercise clause guaranteed under the Constitution.
It may be conceded that the construction of a church is a social concern of
the people and, consequently, solicitations appurtenant thereto would
necessarily involve public welfare. Prefatorily, it is not implausible that the
regulatory powers of the State may, to a certain degree, extend to
solicitations of this nature. Considering, however, that such an activity is
within the cloak of the free exercise clause under the right to freedom of
religion guaranteed by the Constitution, it becomes imperative to delve into
the efficaciousness of a statutory grant of the power to regulate the exercise
of this constitutional right and the allowable restrictions which may possibly
be imposed thereon.
The constitutional inhibition of legislation on the subject of religion has a
double aspect. On the one hand, it forestalls compulsion by law of the
acceptance of any creed or the practice of any form of worship. Freedom of
conscience and freedom to adhere to such religious organization or form of
worship as the individual may choose cannot be restricted by law. On the
other hand, it safeguards the free exercise of the chosen form of religion.
Thus, the constitution embraces two concepts, that is, freedom to believe
and freedom to act. The first is absolute but, in the nature of things, the
second cannot be. Conduct remains subject to regulation for the protection of
society. The freedom to act must have appropriate definitions to preserve the
enforcement of that protection. In every case, the power to regulate must be

34

so exercised, in attaining a permissible end, as not to unduly infringe on the

protected
freedom. 17
Whence, even the exercise of religion may be regulated, at some slight
inconvenience, in order that the State may protect its citizens from injury.
Without doubt, a State may protect its citizens from fraudulent solicitation by
requiring a stranger in the community, before permitting him publicly to solicit
funds for any purpose, to establish his identity and his authority to act for the
cause which he purports to represent. The State is likewise free to regulate
the time and manner of solicitation generally, in the interest of public safety,
peace, comfort, or convenience. 18
It does not follow, therefore, from the constitutional guaranties of the free
exercise of religion that everything which may be so called can be
tolerated. 19 It has been said that a law advancing a legitimate governmental
interest is not necessarily invalid as one interfering with the "free exercise" of
religion merely because it also incidentally has a detrimental effect on the
adherents of one or more religion. 20 Thus, the general regulation, in the
public interest, of solicitation, which does not involve any religious test and
does not unreasonably obstruct or delay the collection of funds, is not open
to any constitutional objection, even though the collection be for a religious
purpose. Such regulation would not constitute a prohibited previous restraint
on the free exercise of religion or interpose an inadmissible obstacle to its
exercise. 21

Even with numerous regulative laws in existence, it is surprising how many

operations are carried on by persons and associations who, secreting their
activities under the guise of benevolent purposes, succeed in cheating and
defrauding a generous public. It is in fact amazing how profitable the
fraudulent schemes and practices are to people who manipulate them. The
State has authority under the exercise of its police power to determine
whether or not there shall be restrictions on soliciting by unscrupulous
persons or for unworthy causes or for fraudulent purposes. That solicitation
of contributions under the guise of charitable and benevolent purposes is
grossly abused is a matter of common knowledge. Certainly the solicitation of
contributions in good faith for worthy purposes should not be denied, but
somewhere should be lodged the power to determine within reasonable limits
the worthy from the unworthy. 22 The objectionable practices of unscrupulous
persons are prejudicial to worthy and proper charities which naturally suffer
when the confidence of the public in campaigns for the raising of money for
charity is lessened or destroyed. 23 Some regulation of public solicitation is,
therefore, in the public interest. 24
To conclude, solicitation for religious purposes may be subject to proper
regulation by the State in the exercise of police power. However, in the case
at bar, considering that solicitations intended for a religious purpose are not
within the coverage of Presidential Decree No. 1564, as earlier
demonstrated, petitioner cannot be held criminally liable therefor.
As a final note, we reject the reason advanced by respondent judge for
increasing the penalty imposed by the trial court, premised on the supposed
perversity of petitioner's act which thereby caused damage to the
complainant. It must be here emphasized that the trial court, in the
dispositive portion of its decision, even recommended executive clemency in
favor of petitioner and the other accused after finding that the latter acted in
good faith in making the solicitation from the complainant, an observation
with which we fully agree. After all, mistake upon a doubtful and difficult
question of law can be the basis of good faith, especially for a layman.
There is likewise nothing in the findings of respondent judge which would
indicate, impliedly or otherwise, that petitioner and his co-accused acted
abusively or malevolently. This could be reflective upon her objectivity,
considering that the complainant in this case is herself a judge of the
Regional Trial Court at Kalookan City. It bears stressing at this point that a
judge is required to so behave at all times as to promote public confidence in
the integrity and impartiality of the judiciary, 25 should be vigilant against any

35

attempt to subvert its independence, and must resist any pressure from
whatever source. 26

SO ORDERED.

WHEREFORE, the decision appealed from is hereby REVERSED and SET

ASIDE, and petitioner Martin Centeno is ACQUITTED of the offense
charged, with costs de oficio.

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