1. find out their true meaning.
There is a sharp distinction, however, between construction of
B. Construction v. Judicial Legislation
Tanada v. Yulo, G.R No. 43575, 31 May 1935
[No. 43575. May 31, 1935]
JUAN TAADA, petitioner, vs. JOSE YULO, Secretary of Justice, EDUARDO GUTIERREZ DAVID,
Judge of First Instance of the Thirteenth Judicial District, and SANTIAGO TAADA, Justice of the
Peace of Alabat, Tayabas, respondents.
1. 1.COURTS; JUSTICES OF THE PEACE; RETIREMENT AGE; SECTION 203 OF THE
ADMINISTRATIVE CODE, AS AMENDED BY ACT No. 3899, CONSTRUED.The
decision of a division of the court in the case of Regalado vs. Yulo (page
173, ante), reconsidered and reexamined in bancand thereafter is applied and confirmed.
1. 2.ID.; ID.; ID.; ID.Under a law which provided "That the present justices and auxiliary
justices of the peace who shall, at the time this Act takes effect, have completed sixty-
five years of age, shall cease to hold office on January first, nineteen hundred and thirty-
three", a justice of the peace like the petitioner who became sixty-five years of age on
October 5, 1934, was not included in a law which required justices of the peace sixty-five
years of age to cease to hold office on January 1, 1933.
1. 3.ID.; ID.; ID.; SECTION 206 OF THE ADMINISTRATIVE CODE, AS AMENDED BY
ACT No. 2768, CONSTRUED.The decision of the Supreme Court of the United States
in the case of Alberto vs. Nicolas (279 U. S., 139), is applied. As a justice of the peace of
one municipality may be transferred to another by the Governor-General without the
consent of the Philippine Senate, the transfer simply amounts to an enlargement or
change of jurisdiction grounded on the original appointment and thus does not require a
new appointment.
1. 4.STATUTORY CONSTRUCTION ; LEGISLATIVE INTENTION; EXTENT OF JU-
DICIAL POWER.The determination of the legislative intent is the primary
consideration. That legislative intent must be determined from the language of the
statute itself. To depart from the meaning expressed by the words is to alter the statute,
is to legislate not to interpret. Courts are bound to follow the plain words of the statute
as to which there is no room for construction, regardless of the consequences.
1. 5.ID.; ID.; ID.; LIBERAL CONSTRUCTION.The Supreme Court of the Philippine
Islands aims to adopt a liberal construction of statutes. By liberal construction of
statutes is meant that method by which courts from the language used, the subject
matter, and the purposes of those framing laws, are able to
516
5 PHILIPPINE REPORTS
16 ANNOTATED
Taada vs. Yulo
this nature and the act of a court in engrafting upon a law something that has been
omitted which someone believes ought to have been embraced. The former is liberal
construction and is a legitimate exercise of judicial power. The latter is judicial
legislation forbidden by the tripartite division of powers among the three departments of
government, the executive, the legislative, and the judicial.
1. 6.Quo WARRANTO ; VOLUNTARY SURRENDER OF OFFICE.Acquiescence or
voluntary surrender of an office precludes the maintenance of a quo warranto
proceeding.
ORIGINAL ACTION in the Supreme Court. Quo warranto.
The facts are stated in the opinion of the court.
Pedro Ynsua for petitioner.
Solicitor-General Hiladofor respondents.
MALCOLM, J.:
For the second time the court is called upon to determine the right of a justice of the peace appointed
prior to the approval of Act No. 3899, but who completed sixty-five years of age subsequent to the
approval of the Act and to the date, January 1, 1933, specified in the Act, to continue in office. The
answer of the Solicitor-General presents two questions, the first predicated on the contention that
Act No. 3899 applies to all justices of the peace who reach the age of sixty-five years, and the second
on the acceptance of a transfer by the petitioner as denoting a new appointment bringing him within
the purview of the cited law.
Juan Taada, the petitioner, was appointed justice of the peace of Alabat, Tayabas, by the
Governor-General with the advice and consent of the Philippine Commission on December 4,1911.
He continued in that position until September 8, 1934, when at his own request, "Pursuant to the
provisions of section 206 of the Revised Administrative Code", he was "transferred from the position
of justice of the
517
VOL. 61, MAY 31, 1935 517
Taada vs. Yulo
peace for the municipality of Alabat, Province of Tayabas, to the same position in the municipality of
Perez, same province", by a communication signed by the Governor-General from which the
foregoing is quoted. Taada completed the age of sixty-five years on October 5, 1934. Thereupon the
Judge of First Instance of Tayabas, acting in accordance with instructions from the Department of
Justice, directed Taada to cease to act as justice of the peace of Perez, Tayabas. Taada
surrendered his office under protest, and thereafter instituted this original action of quo warranto.
The applicable law is found in the last proviso to section 203 of the Administrative Code, as
inserted by Act No. 3899, and in the proviso to section 206 of the same Code as last amended by Act
No. 2768, which read as follows:
"SEC. 203. Appointment and distribution of justices of the peace.* * * Provided, further,That the
present justices and auxiliary justices of the peace who shall, at the time this Act takes effect, have
completed sixty-five years of age, shall cease to hold office on January first, nineteen hundred and
thirty-three; and the Governor-General, with the advice and consent of the Philippine Senate, shall
makenew appointments to cover the vacancies occurring by operation of this Act."
"SEC. 206. Tenure of officeTransfer from one municipality to another.A justice of the peace
having the requisite legal qualifications shall hold office during good behavior unless his office be
lawfully abolished or merged in the jurisdiction of some other justice: Provided,That in case the
public interest requires it, a justice of the peace of one municipality may be transferred to another."
The first question raised by the Solicitor-General was considered in the recent case of Felipe
Regalado, petitioner, vs. Jose Yulo, Secretary of Justice, Juan G. Lesaca, Judge of First Instance of
Albay, and Esteban T. Villar, respondents (page 173, ante).It was there decided that the natural and
reasonable meaning of the language used in
518

518 PHILIPPINE REPORTS ANNOTATED
Taada vs. vs. Yulo
Act No. 3899, leaves room for no other deduction than that a justice of the peace appointed prior to
the approval of the Act and who completed sixty-five years of age on September 13, 1934, subsequent
to the approval of the Act, which was on November 16, 1931, and to the date fixed for cessation from
office which was on January 1, 1933, is not affected by the said Act. The law officer of the
Government has indicated that the above cited decision came from a Division of Five and has
requested a reconsideration of the issue therein resolved.
Acceding to this petition, we have again examined microscopically word for word the
terminology used in Act No. 3899. Having done so, all of us are agreed that a justice of the peace like
the petitioner who became sixty-five years of age on October 5, 1934, was not included in a law which
required justices of the peace sixty-five years of age to cease to hold office on January 1, 1933. That
result is now arrived at in banc.
In substantiation of what has just been said, it is of course f undamental that the determination
of the legislative intent is the primary consideration. However, it is equally fundamental that that
legislative intent must be determined from the language of the statute itself. This principle must be
adhered to even though the court be convinced by extraneous circumstances that the Legislature
intended to enact something very different from that which it did enact. An obscurity cannot be
created to be cleared up by construction and hidden meanings at variance with the language used
cannot be sought out. To attempt to do so is a perilous undertaking, and is quite apt to lead to an
amendment of a law by judicial construction. To depart from the meaning expressed by the words is
to alter the statute, is to legislate not to interpret.
As corroborative authority it is only necessary to advert to a decision coming from the United
States Supreme Court, in which the court was asked to insert the word "lawfully", but the court
declined to do so, saying that there is no author-
519
VOL. 61, MAY 31, 1935 519
Taada vs. Yulo
ity to import a word into a statute in order to change its meaning. (Newhall vs. Sanger, 92 U. S.,
761.) The thought was expressed by the same court in another case, when it said that courts are
bound to follow the plain words of a statute as to which there is no room for construction, regardless
of the consequences. (Commissioner of Immigration vs. Gottlieb, 265 U. S., 310; see 25 R. C. L.,
961 et seq.)
Counsel in effect urges us to adopt a liberal construction of the statute. That in this instance, as
in the past, we aim to do. But counsel in his memorandum concedes "that the language of the proviso
in question is somewhat defective and does not clearly convey the legislative intent", and at the
hearing in response to questions was finally forced to admit that what the Government desired was
for the court to insert words and phrases in the law in order to supply an intention for the
legislature. That we cannot do. By liberal construction of statutes, courts from the language used,
the subject matter, and the purposes of those framing them are able to find out their true meaning.
There is a sharp distinction, however, between construction of this nature and the act of a court in
engrafting upon a law something that has been omitted which someone believes ought to have been
embraced. The former is liberal construction and is a legitimate exercise of judicial power. The latter
is judicial legislation forbidden by the tripartite division of powers among the three departments of
government, the executive, the legislative, and the judicial.
We give application to the decision of this court in Regalado vs. Yulo, supra,and as a result
overrule the first defense of the Government.
Passing to the second phase of the case, counsel has endeavoured to draw a distinction between
the Regalado case above cited and the present case. On the facts there is admittedly one difference.
In the Regalado case the petitioner had not been transferred from one municipality to another, while
in the present case, Taada accepted a
520
520 PHILIPPINE REPORTS ANNOTATED
Taada vs. Yulo
transfer from one municipality to another. Did the transfer amount to a new appointment bringing
Taada under the purview of the law relating to relinquishment of office on attaining the age of
sixty-five?
The effect of the Organic Act is that an appointment of a justice of the peace by the Governor-
General must be consented to by the Philippine Senate. In consonance with this provision, the
method of appointment and distribution of justices of the peace are outlined in section 203 of the
Administrative Code, a portion of which is hereinbefore quoted. The transfer from one municipality
to another, however, is accomplished by the Governor-General without the advice and consent of the
Philippine Senate, in accordance with codal section 206.
In the case of Nicolas vs.Alberto (51 Phil., 370), the issue was the legal right of the Governor-
General to transfer a justice of the peace from one municipality to another, without the consent of
the Philippine Senate. This court held that the consent of the Philippine Senate was a necessary
attribute of the transfer. As the basis for this holding, it was stated that the appointing power
consists of the Governor-General acting in conjunction with the Philippine Senate. But that case was
taken to the United States Supreme Court, and there it was held that the consent of the Senate was
unnecessary to make the transfer legal. (Alberto vs.Nicolas, 279 U. S., 139.) The holding of the
higher court, to follow the language of the syllabus, was that in view of the plenary legislative
powers of the Philippine Legislature regarding justices of the peace, Act No. 2768 of the Philippine
Legislature is valid as applied to justices of the peace whose appointment was made by the
Governor-General, and confirmed by the Senate, after its enactment. In the body of the decision
appeared the following:
"* * * When the Senate confirmed Severino Alberto to be a justice of the peace for San Jose del
Monte, sec. 206, with the proviso, was in force; and when the Senate con
521
VOL. 61, MAY 31, 1935 521
Taada vs. Yulo
firmed him, it confirmed him with the knowledge of the possibility declared in the law that his
powers and his functions as a justice of the peace upon designation of the Governor-General might
be performed and exercised in another jurisdiction, if the Governor-General should think it wise in
the public interest in his regulation of the conduct of justices of the peace. There is no such necessary
difference between the duties of a justice of the peace in one part of the Islands and those to be
performed ormed in another part as to make such enlargement or change of his jurisdiction already
provided for in existing law unreasonably beyond the scope of the consent to the original
appointment."
It is to be deduced from what has been stated above that according to the United States Supreme
Court, the transfer simply amounted to an enlargement or change of jurisdiction grounded on the
original appointment and thus did not require a new appointment. Whatever our views might have
been to the contrary, it now becomes our duty to follow the decision of the higher court. It also seems
evident that a transfer as applied to officers amounts merely to a change of position or to another
grade of service. (Cliff vs.Wentworth, 220 Mass., 393.)
We give application to the decision of the Supreme Court of the United States
in Nicolas vs. Alberto, supra,and as a result overrule the second defense of the Government.
Before closing it is incumbent upon us to observe that this case was heard in banc because of the
suggestion of the Solicitor-General that the principal issue raised by the pleadings is the validity of
Act No. 3899 of the Philippine Legislature. Our review of the case has convinced us that this
allegation overstates the matter. It is unnecessary to discuss petitioner's contention that Act No.
3899 is unconstitutional because of a defective title. On the other hand, the allegation in the answer
that the law is discriminatory and class legislation, and, consequently, unconstitutional has
apparently been abandoned. Finally it is to be observed that the fear of disorder in the affairs of the
Department
522
522 PHILIPPINE REPORTS ANNOTATED
Cabaero and Mangornong vs. Torres
of Justice and the Office of the Governor-General on account of the displacement of incumbent
justices of the peace, is unfounded, for as is well known, acquiescence or voluntary surrender of an
office precludes the maintenance of a quo warranto proceeding.
 Giving effect to the decisions of this court in the Regalado case and of the Supreme Court of the
United States in the Alberto vs.Nicolas case, and as a consequence ruling that Act No. 3899 does not
apply to a justice of the peace appointed prior to the approval of the Act who completed sixty-five
years of age after January 1, 1933, and that a transfer of a justice of the peace does not amount to an
appointment, we reach the conclusion that the special defenses interposed by the Solicitor-General
must be overruled. Accordingly, the writ will be granted and the petitioner Juan Taada will be
placed in possession of the office of justice of the peace of Perez, Tayabas. So ordered, without special
pronouncement as to the costs.
Abad Santos, Hull, Vickers, Butte, Goddard, and Diaz. JJ., concur.
Writ granted.
_____________
Copyright 2017 Central Book Supply, Inc. All rights reserved.
B. Construction v. Judicial Legislation
Manila Prince Hotel v. GSIS, G.R. No. 122156, 3 February 1997, 267 SCRA 408 (Note: read Justice
Panganibans dissenting opinion)
408 SUPREME COURT REPORTS
ANNOTATED
Manila Prince Hotel vs. Government Service
Insurance System
G.R. No. 122156. February 3, 1997. *
MANILA PRINCE HOTEL, petitioner, vs.GOVERNMENT SERVICE INSURANCE SYSTEM,
MANILA HOTEL CORPORATION, COMMITTEE ON PRIVATIZATION and OFFICE OF THE
GOVERNMENT CORPORATE COUNSEL, respondents.
Constitutional Law; Statutes; Contracts; Words and Phrases; A constitution is a system of
fundamental laws for the governance and administration of a nationit is supreme, imperious,
absolute and unalterable except by the authority from which it emanates. Since the Constitution is the
fundamental, paramount and supreme Iaw of the nation, it is deemed written in every statute and
contract.We now resolve. A constitution is a system of fundamental laws for the governance and
administration of a nation. It is supreme, imperious,
_______________
*EN BANC.
409
VOL. 267, FEBRUARY 3, 1997 4
09
Manila Prince Hotel us. Government
Service lnsurance System
absolute and unalterable except by the authority from which it emanates. It has been defined
as the fundamental and paramount law of the nation. ltprescribes the permanent framework of a
system of government, assigns to the different departments their respective powers and duties, and
establishes certain fixed principles on which government is founded. The fundamental conception in
other words is that it is a supreme law to which all other laws must conform and in accordance with
which all private rights must be determined and all public authority administered. Under the
doctrine of constitutional supremacy, if a law or contract violates any norm of the constitution that
law or contract whether promulgated by the legislative or by the executive branch or entered into by
private persons for private purposes is null and void and without any force and effect. Thus, since the
Constitution is the fundamental, paramount and supreme law of the nation, it is deemed written in
every statute and contract.
Same; Same; Statutory Construction; A constitutional provision is self-executing if the nature
and extent of the right conferred and the liability imposed are fixed by the constitution itself, so that
they can be determined by an examination and.construction of its terms, and there is no language
indicating that the subject is referred to the legislature for action.Admittedly, some constitutions
are merely declarations of policies and principles. Their provisions command the legislature to enact
laws and carry out the purposes of the framers who merely establish an outline of government
providing for the different departments of the governmental machinery and securing certain
fundamental and inalienable rights of citizens. A provision which lays down a general principle, such
as those found in Art. II of the 1987 Constitution, is usually not self-executing. But a provision which
is complete in itself and becomes operative without the aid of supplementary or enabling legislation,
or that which supplies sufficient rule by means of which the right it grants may be enjoyed or
protected, is self-executing. Thus a constitutional provision is selfexecuting if the nature and extent
of the right conferred and the liability imposed are fixed by the constitution itself, so that they can be
determined by an examination and construction of its terms, and there is no language indicating
that the subject is referred to the legislature for action.
Same; Same; Same; Unless it is expressly provided that a legislative act is necessary to enforce
a constitutional mandate, the presumption now is that all provisions of the constitution are self-
410
4 SUPREME COURT REPORTS
10 ANNOTATED
Manila Prince Hotel vs. Government
Service Insurance System
executing.As against constitutions of the past, modern constitutions have been generally
drafted upon a different principle and have often become in effect extensive codes of laws intended to
operate directly upon the people in a manner similar to that of statutory enactments, and the
function of constitutional conventions has evolved into one more like that of a legislative body.
Hence, unless it is expressly provided that a legislative act is necessary to enforce a constitutional
mandate, the presumption now is that all provisions of the constitution are self-executing. If the
constitutional provisions are treated as requiring legislation instead of self-executing, the legislature
would have the power to ignore and practically nullify the mandate of the fundamental law. This can
be cataclysmic.
Same; Same; Same; Minor details may be left to the legislature without impairing the self-
executing nature of constitutional provisions.Quite apparently, Sec. 10, second par., of Art. XII is
couched in such a way as not to make it appear that it is non-self-executing but simply for purposes
of style. But, certainly, the legislature is not precluded from enacting further laws to enforce the
constitutional provision so long as the contemplated statute squares with the Constitution. Minor
details may be left to the legislature without impairing the self-executing nature of constitutional
provisions.
 Same; Same; Same; The omission from a constitution of any express provision for a remedy for
enforcing a right or liability is not necessarily an indication that it was not intended to be self-
executingthe rule is that a self-executing provision of the constitution does not necessarily exhaust
legislative power on the subject, but any legislation must be in harmony with the constitution, further
the exercise of constitutional right and make it more available.In self-executing constitutional
provisions, the legislature may still enact legislation to facilitate the exercise of powers directly
granted by the constitution, further the operation of such a provision, prescribe a practice to be used
for its enforcement, provide a convenient remedy for the protection of the rights secured or the
determination thereof, or place reasonable safeguards around the exercise of the right. The mere fact
that legislation may supplement and add to or prescribe a penalty for the violation of a self-
executing constitutional provision does not render such a provision ineffective in the absence of such
legislation. The omission from a constitution of any express provision for a remedy for enforcing a
right or liability is not necessarily an indication that it was not intended to be self-executing. The
rule is that a self-executing provision of the constitution does not neces-
411
VOL 267, FEBRUARY 3, 1997 4 official visitors who are accorded the traditional Philippine hospitality.
11
Manila Prince Hotel us. Government
Service Insurance System
sarily exhaust legislative power on the subject, but any legislation must be in harmony with
the constitution, further the exercise of constitutional right and make it more available. Subsequent
legislation however does not necessarily mean that the subject constitutional provision is not, by
itself, fully enforceable.
Same; Same; Same; A constitutional provision may be selfexecuting in one part and non-self-
executing in another.Respondents also argue that the non-self-executing nature of Sec. 10, second
par., of Art. XII is implied from the tenor of the first and third paragraphs of the same section which
undoubtedly are not selfexecuting. The argument is flawed. If the first and third paragraphs are not
self-executing because Congress is still to enact measures to encourage the formation and operation
of enterprises fully owned by Filipinos, as in the first paragraph, and the State still needs legislation
to regulate and exercise authority over foreign investments within its national jurisdiction, as in the
third paragraph, then a fortiori, by the same logic, the second paragraph can only be selfexecuting as
it does not by its language require any legislation in order to give preference to qualified Filipinos in
the grant of rights, privileges and concessions covering the national economy and patrimony. A
constitutional provision may be self-executing in one part and non-self-executing in another.
Same; National Economy and Patrimony; When the Constitution mandates that in the grant of
rights, privileges, and concessions covering national economy and patrimony, the State shall give
preference to qualified Filipinos, it means just thatqualified Filipinos shall be preferred.On the
other hand, Sec. 10, second par., Art. XII of the 1987 Constitution is a mandatory, positive command
which is complete in itself and which needs no further guidelines or implementing laws or rules for
its enforcement. From its very words the provision does not require any legislation to put it in
operation. It is per sejudicially enforceable. When our Constitution mandates that [i]n the grant of
rights, privileges, and concessions covering national economy and patrimony, the State shall give
preference to qualified Filipinos,it means just thatqualified Filipinos shall be preferred.
Same; Same; When the Constitution declares that a right exists in certain specified
circumstances, an action may be maintained to enforce such right notwithstanding the absence of any
legislation on the subjectsuch right enforces itself by its own inherent potency and puissance.And
when our Constitution declares that a right
412
4 SUPREME COURT REPORTS
12 ANNOTATED
Manila Prince Hotel vs. Government
Service Insurance System
exists in certain specified circumstances an action may be maintained to enforce such right
notwithstanding the absence of any legislation on the subject; consequently, if there is no statute
especially enacted to enforce such constitutional right, such right enforces itself by its own inherent
potency and puissance, and from which all legislations must take their bearings. Where there is a
right there is a remedy. Ubi jus ibi remedium.
Same; Same; Words and Phrases; When the Constitution speaks of national patrimony, it
refers not only to the natural resources of the Philippines but also to the cultural heritage of the
Filipinos.In its plain and ordinary meaning, the term patrimony pertains to heritage. When the
Constitution speaks of national patrimony, it refers not only to the natural resources of the
Philippines, as the Constitution could have very well used the term natural resources, but also to
the cultural heritage of the Filipinos.
Same; Same; Manila Hotel; Manila Hotel has become a landmarka living testimonial of
Philippine heritage.ManilaHotel has become a landmarka living testimonial of Philippine
heritage. While it was restrictively an American hotel when it first opened in 1912, it immediately
evolved to be truly Filipino. Formerly a concourse for the elite, it has since then become the venue of
various significant events which have shaped Philippine history. It was called the Cultural Center of
the 1930s. It was the site of the festivities during the inauguration of the Philippine Commonwealth,
Dubbed as the Official Guest House of the Philippine Government it plays host to dignitaries and
Same; Same; Same; Verily, Manila Hotel has become part of our national economy and
patrimony.For more than eight (8) decades Manila Hotel has bore mute witness to the triumphs
and failures, loves and frustrations of the Filipinos; its existence is impressed with public interest;
its own historicity associated with our struggle for sovereignty, independence and nationhood.
Verily, Manila Hotel has become part of our national economy and patrimony. For sure, 51% of the
equity of the MHC comes within the purview of the constitutional shelter for it comprises
the majority and controlling stock, so that anyone who acquires or owns the 51% will have actual
control and management of the hotel. In this instance, 51% of the MHC cannot be disassociated from
the hotel and the land on which the hotel edifice stands.
413
VOL. 267, FEBRUARY 3, 1997 4
13
Manila Prince Hotel vs. Government
Service Insurance System
Same; Same; Same; Filipino First Policy; Words and Phrases; The term qualified Filipinos
as used in the Constitution also includes corporations at least 60% of which is owned by Filipinos.
Consequently, we cannot sustain respondents claim that the Filipino First Policyprovision is not
applicable since what is being sold is only 51% of the outstanding shares of the corporation, not the
Hotel building nor the land upon which the building stands. The argument is pure sophistry. The
term qualified Filipinos as used in our Constitution also includes corporations at least 60% of which
is owned by Filipinos. This is very clear from the proceedings of the 1986 Constitutional
Commission.
Same; Statutory Construction; Even some of the provisions of the Constitution which evidently
need implementing legislation have juridical life of their own and can be the source of judicial
remedy. The penchant to try to whittle away the mandate of the Constitution by arguing that the
subject provision is not self-executory and requires implementing legislation is quite disturbing. The
attempt to violate a clear constitutional provisionby the government itselfis only too distressing.
To adopt such a line of reasoning is to renounce the duty to ensure faithfulness to the Constitution,
For, even some of the provisions of the Constitution which evidently need implementing legislation
have juridical life of their own and can be the source of a judicial remedy. We cannot simply afford
the government a defense that arises out of the failure to enact further enabling, implementing or
guiding legislation.
Same; Same; Words and Phrases; In constitutional jurisprudence, the acts of a person distinct
from the government are considered state action covered by the Constitution (1) when the activity it
engages in is a public function; (2) when the government is so significantly involved with the private
actor as to make the governmentresponsible for his action; and, (3) when the government has
approved or authorized the action.Respondents further argue that the constitutional provision is
addressed to the State, not to respondent GSIS which by itself possesses a separate and distinct
personality. This argument again is at best specious. It is undisputed that the sale of 51% of the
MHC could only be carried out with the prior approval of the State acting through respondent
Committee on Privatization. As correctly pointed out by Fr. Joaquin G. Bernas, S.J., this fact alone
makes the sale of the assets of respondents GSIS and MHC a state action. In constitutional
jurisprudence, the acts of persons distinct from the government are considered state action
414
4 SUPREME COURT REPORTS
14 ANNOTATED
Manila Prince Hotel vs. Government
Service Insurance System
covered by the Constitution (1) when the activity it engages in is a public function; (2) when
the government is so significantly involved with the private actor as to make the government
responsible for his action; and, (3) when the government has approved or authorized the action. It is
evident that the act of respondent GSIS in selling 51% of its share in respondent MHC comes under
the second and third categories of state action.Without doubt therefore the transaction, although
entered into by respondent GSIS, is in fact a transaction of the State and therefore subject to the
constitutional command.
Same; Same; Same; When the Constitution addresses the State it refers not only to the people
but also to the government as elements of theState.When the Constitution addresses the State it
refers not only to the people but also to the government as elements of the State. After all,
government is composed of three (3) divisions of powerlegislative, executive and judicial.
Accordingly, a constitutional mandate directed to the State is correspondingly directed to the three
(3) branches of government. It is undeniable that in this case the subject constitutional injunction is
addressed among others to the Executive Department and respondent GSIS, a government
instrumentality deriving its authority from the State.
Same; National Economy and Patrimony; Filipino First Policy; Bids and Bidding; Since the
Filipino First Policy provision of the Constitution bestows preference on qualified Filipinos, the mere
tending of the highest bid is not an assurance that the highest bidder will be declared the winning
bidder.It should be stressed that while the Malaysian firm offered the higher bid it is not yet the
winning bidder. The bidding rules expressly provide that the highest bidder shall only be declared
the winning bidder after it has negotiated and executed the necessary contracts, and secured the
requisite approvals. Since the Filipino First Policy provision of the Constitution bestows preference
on qualified Filipinos the mere tending of the highest bid is not an assurance that the highest bidder
will be declared the winning bidder. Resultantly, respondents are not bound to make the award yet,
nor are they under obligation to enter into one with the highest bidder. For in choosing the awardee
respondents are mandated to abide by the dictates of the 1987 Constitution the provisions of which
are presumed to be known to all the bidders and other interested parties.
415
VOL. 267, FEBRUARY 3, 1997 4 while there is still an opportunity to do so than let the government develop the habit of forgetting
15
Manila Prince Hotel vs. Government
Service Insurance System
Same; Same; Same; Same; Adhering to the doctrine of constitutional supremacy, the Filipino
First Policy constitutional provision is, as it should be, impliedly written in the bidding rules issued
by GSIS, lest the bidding rules be nullified for being violative of the Constitution.Adhering to the
doctrine of constitutional supremacy, the subject constitutional provision is, as it should be,
impliedly written in the bidding rules issued by respondent GSIS, lest the bidding rules be nullified
for being violative of the Constitution. It is a basic principle in constitutional law that all laws and
contracts must conform with the fundamental law of the land. Those which violate the Constitution
lose their reason for being.
Same; Same; Same; Same; Certainly, the constitutional mandate itself is reason enough not to
award the block of shares immediately to the foreign bidder notwithstanding its submission of a
higher, or even the highest, bidParagraph V.J.1 of the bidding rules provides that [i]f for any
reason the Highest Bidder cannot be awarded the Block of Shares, GSIS may offer this to other
Qualified Bidders that have validly submitted bids provided that these Qualified Bidders are willing
to match the highest bid in terms of price per share.Certainly, the constitutional mandate itself
is reason enoughnot to award the block of shares immediately to the foreign bidder notwithstanding
its submission of a higher, or even the highest, bid. In fact, we cannot conceive of a stronger
reason than the constitutional injunction itself.
Same; Same; Same; Where a foreign firm submits the highest bid in a public bidding
concerning the grant of rights, privileges and concessions covering the national economy and
patrimony, thereby exceeding the bid of a Filipino, there is no question that the Filipino will have to
be allowed to match the bid of the foreign entity.ln the instant case, where a foreign firm submits
the highest bid in a public bidding concerning the grant of rights, privileges and concessions covering
the national economy and patrimony, thereby exceeding the bid of a Filipino, there is no question
that the Filipino will have to be allowed to match the bid of the foreign entity. And if the Filipino
matches the bid of a foreign firm the award should go to the Filipino. It must be so if we are to give
life and meaning to the Filipino First Policy provision of the 1987 Constitution. For, while this may
neither be expressly stated nor contemplated in the bidding rules, the constitutional fiat is
omnipresent to be simply disregarded. To ignore it would be to sanction a perilous skirting of the
basic law.
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Manila Prince Hotel vs. Government
Service Insurance System
Same; Any person desiring to do business in the Philippines or with any of its agencies or
instrumentalities is presumed to know his rights and obligations under the Constitution and the laws
of the forum.This Court does not discount the apprehension that this policy may discourage foreign
investors. But the Constitution and laws of the Philippines are understood to be always open to
public scrutiny. These are given factors which investors must consider when venturing into business
in a foreign jurisdiction. Any person therefore desiring to do business in the Philippines or with any
of its agencies or instrumentalities is presumed to know his rights and obligations under the
Constitution and the laws of the forum.
Same; Statutory Construction; The miscomprehension of the Constitution is regrettable, thus
the Supreme Court would rather remedy the indiscretion while there is still an opportunity to do so
than let the government develop the habit of forgetting that the Constitution lays down the basic
conditions and parameters for its actions.Besides, there is no time frame for invoking the
constitutional safeguard unless perhaps the award has been finally made. To insist on selling the
Manila Hotel to foreigners when there is a Filipino group willing to match the bid of the foreign
group is to insist that government be treated as any other ordinary market player, and bound by its
mistakes or gross errors of judgment, regardless of the consequences to the Filipino people. The
miscomprehension of the Constitution is regrettable. Thus we would rather remedy the indiscretion
that the Constitution lays down the basic conditions and parameters for its actions.
Same; Same; National Economy and Patrimony; Filipino First Policy; Nationalism; The
Filipino First Policy is a product of Philippine nationalism, embodied in the 1987 Constitution not
merely to be used as a guideline for future legislation but primarily to be enforcedso must it be
enforced.The Filipino First Policy is a product of Philippine nationalism. lt is embodied in the 1987
Constitution not merely to be used as a guideline for future legislation but primarily to be enforced;
so must it be enforced. This Court as the ultimate guardian of the Constitution will never shun,
under any reasonable circumstance, the duty of upholding the majesty of the Constitution which it is
tasked to defend. It is worth emphasizing that it is not the intention of this Court to impede and
diminish, much less undermine, the influx of foreign investments. Far from it,
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 the Court encourages and welcomes more business opportunities but avowedly sanctions the
preference for Filipinos whenever such preference is ordained by the Constitution.
Same; Same; Same; The Supreme Court will always defer to the Constitution in the proper
governance of a free society, after all, there is nothing so sacrosanct in any economic policy as to draw
itself beyond judicial review when the Constitution is involved.Privatization of a business asset for
purposes of enhancing its business viability and preventing further losses, regardless of the
character of the asset, should not take precedence over non-material values. A commercial, nay even
a budgetary, objective should not be pursued at the expense of national pride and dignity. For the
Constitution enshrines higher and nobler non-material values. Indeed, the Court will always defer to
the Constitution in the proper governance of a free society; after all, there is nothing so sacrosanct in
any economic policy as to draw itself beyond judicial review when the Constitution is involved.
Same; Same; Same; Nationalism; Nationalism is inherent in the very concept of the
Philippines being a democratic and republican state, with sovereignty residing in the Filipino people
and from whom all government authority emanates.Nationalism is inherent in the very concept of
the Philippines being a democratic and republican state, with sovereignty residing in the Filipino
people and from whom all government authority emanates. In nationalism, the happiness and
welfare of the people must be the goal. The nation-state can have no higher purpose. Any
interpretation of any constitutional provision must adhere to such basic concept. Protection of
foreign investments, while laudible, is merely a policy. It cannot override the demands of
nationalism.
Same; Same; Same; Same; Manila Hotel; Manila Hotel has played and continues to play a
significant role as an authentic repository of twentieth century Philippine history and culture, and in
this sense, it has become truly a reflection of the Filipino soula place with a history of grandeur, a
most historical setting that has played a part in the shaping of a country.TheManila Hotel or, for
that matter, 51% of the MHC, is not just any commodity to be sold to the highest bidder solely for
the sake of privatization. We are not talking about an ordinary piece of property in a commercial
district. We are talking about a historic relic that has hosted many of the most important events in
the short history of the Philippines as a nation. We
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Manila Prince Hotel vs. Government
Service Insurance System
are talking about a hotel where heads of states would prefer to be housed as a strong
manifestation of their desire to cloak the dignity of the highest state function to their official visits to
the Philippines. Thus the Manila Hotel has played and continues to play a significant role as an
authentic repository of twentieth century Philippine history and culture. In this sense, it has become
truly a reflection of the Filipino soula place with a history of grandeur; a most historical setting
that has played a part in the shaping of a country.
Same; Same; Same; Same; Same; The conveyance of Manila Hotel, an epic exponent of the
Filipino psyche, to alien hands cannot be less than mephistophelian for it is, in whatever manner
viewed, a veritable alienation of a nations soul for some pieces of foreign silver.This Court cannot
extract rhyme nor reason from the determined efforts of respondents to sell the historical
landmarkthis Grand Old Dame of hotels in Asiato a total stranger. For, indeed, the conveyance
of this epic exponent of the Filipino psyche to alien hands cannot be less than mephistophelian for it
is, in whatever manner viewed, a veritable alienation of a nations soul for some pieces of foreign
silver. And so we ask: What advantage, which cannot be equally drawn from a qualified Filipino, can
be gained by the Filipinos if Manila Hoteland all that it stands foris sold to a non-Filipino? How
much of national pride will vanish if the nations cultural heritage is entrusted to a foreign entity?
On the other hand, how much dignity will be preserved and realized if the national patrimony is
safekept in the hands of a qualified,zealous and wellmeaning Filipino? This is the plain and simple
meaning of the Filipino First Policy provision of the Philippine Constitution. And this Court, heeding
the clarion call of the Constitution and accepting the duty of being the elderly watchman of the
nation, will continue to respect and protect the sanctity of the Constitution.
PADILLA, J ., Concurring Opinion:
Constitutional Law; National Economy and Patrimony; Manila Hotel; There is no doubt that
the Manila Hotel is very much a part of our national patrimony and, as such, deserves constitutional
protection as to who shall own it and benefit from its operation.There is no doubt in my mind that
the Manila Hotel is very much a part of our national patrimony and, as such, deserves constitutional
protection as to who shall own it and benefit from its operation. This institution has played an
important role in our nations history, having been the venue of many a historical event, and serving
as it did, and
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Service Insurance System
as it does, as the Philippine Guest House for visiting foreign heads of state, dignitaries,
celebrities, and others.
Same; Same; Same; Bids and Bidding; The Constitutional preference should give the qualified
Filipino an opportunity to match or equal the higher bid of the non-Filipino bidder if the preference of
the qualified Filipino bidder is to be significant at all.Now, a word on preference. In my view
preference to qualified Filipinos, to be meaningful, must refer not only to things that are
peripheral, collateral, or tangential. It must touch and affect the very heart of the existing order. In
the field of public bidding in the acquisition of things that pertain to the national patrimony,
preference to qualified Filipinos must allow a qualified Filipino to match or equal the higher bid of a
non-Filipino; the preference shall not operate only when the bids of the qualified Filipino and the
non-Filipino are equal in which case, the award should undisputedly be made to the qualified
Filipino. The Constitutional preference should give the qualified Filipino an opportunity to match or
equal the higher bid of the non-Filipino bidder if the preference of the qualified Filipino bidder is to
be significant at all.
Same; Same; Same; It is true that in this present age of globalization of attitude towards
foreign investments in our country, stress is on the elimination of barriers to foreign trade and
investment in the country, yet we should not preclude ourselves from reserving to us Filipinos certain
areas where our national identity, culture and heritage are involved.It is true that in this present
age of globalization of attitude towards foreign investments in our country, stress is on the
elimination of barriers to foreign trade and investment in the country. While government agencies,
including the courts should recondition their thinking to such a trend, and make it easy and even
attractive for foreign investors to come to our shores, yet we should not preclude ourselves from
reserving to us Filipinos certain areas where our national identity, culture and heritage are
involved. In the hotel industry, for instance, foreign investors have established themselves
creditably, such as in the Shangri-La, the Nikko, the Peninsula, and Mandarin Hotels. This should
not stop us from retaining 51% of the capital stock of the Manila Hotel Corporation in the hands of
Filipinos. This would be in keeping with the intent of the Filipino people to preserve our national
patrimony, including our historical and cultural heritage in the hands of Filipinos.
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VITUG, J., Separate Opinion:
Constitutional Law; National Economy and Patrimony; Manila Hotel; Bids and Bidding; In
this particular case before us, the only meaningful preference, it seems, would realty be to allow the
qualified Filipino to match the foreign bid.On the pivotal issue of the degree of preference to
qualified Filipinos, I find it somewhat difficult to take the same path traversed by the forceful
reasoning of Justice Puno. In the particular case before us, the only meaningful preference it seems,
would really be to allow the qualified Filipino to match the foreign bid for, as a practical matter, I
cannot see any bid that literally calls for millions of dollars to be at par (to the last cent) with
another. The magnitude of the bids is such that it becomes hardly possible for the competing bids to
stand exactly equal which alone, under the dissenting view, could trigger the right of preference.
Same; Separation of Powers; Supreme Court; Judicial Review; It is regrettable that the
Supreme Court at times is seen to be the refuge for bureaucratic inadequacies which create the
perception that it even takes on non-justiciable controversies.It is most unfortunate that Renong
Berhad has not been spared this great disappointment, a letdown that it did not deserve, by a simple
and timely advise of the proper rules of bidding along with the peculiar constitutional implications of
the proposed transaction. It is also regrettable that. the Court at times is seen to, instead, be the
refuge for bureaucratic inadequacies which create the perception that it even takes on nonjusticiable
controversies.
MENDOZA, J., Concurring in the Judgment:
Constitutional Law; National Economy and Patrimony; Manila Hotel; Bids and Bidding; In
the context of the present controversy the only way to enforce the constitutional mandate that "[i]n the
grant of rights, privileges and concessions covering the national patrimony the State shall give
preference to qualified Filipinos is to allow petitioner ioner Philippine corporation to equal the bid of
the Malaysian firm for the purchase of the controlling shares of stocks in the Manila Hotel
Corporation.I take the view that in the context of the present contro-versy the only way to enforce
the constitutional mandate that "[i]n the grant of rights, privileges and concessions covering the
national patrimony the State shall give preference to qualified Filipinos is to allow petitioner
Philippine corporation to equal the bid of the Ma-
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VOL. 267, FEBRUARY 3, 1997 4 System; As a state-owned and controlled corporation, the GSIS is skin-bound to adhere to the policies
21
Manila Prince Hotel vs. Government
Service Insurance System
laysian firm Renong Berhad for the purchase of the controlling shares of stocks in the Manila
Hotel Corporation. Indeed, it is the only way a qualified Filipino or Philippine corporation can be
given preference in the enjoyment of a right, privilege or concession given by the State, by favoring it
over a foreign national or corporation.
TORRES, JR., J., Separate Opinion:
Constitutional Law; National Economy and Patrimony; Manila Hotel; Bids and Bidding; The
history of the Manila Hotel should not be placed in the auction block of a purely business transaction,
where profit subverts the cherished historical values of our people.I subscribe to the view that
history, culture, heritage, and tradition are not legislated and is the product of events, customs,
usages and practices. It is actually a product of growth and acceptance by the collective mores of a
race. It is the spirit and soul of a people. The Manila Hotel is part of our history, culture and
heritage. Every inch of the Manila Hotel is witness to historic events (too numerous to mention)
which shaped our history for almost 84 years. As I intimated earlier, it is not my position in this
opinion, to examine the single instances of the legal largesse which have given rise to this
controversy, as I believe that has been exhaustively discussed in the ponencia. Suffice it to say at
this point, that the history of the Manila Hotel should not be placed in the auction block of a purely
business transaction, where profit subverts the cherished historical values of our people.
PUNO, J., Dissenting Opinion:
Constitutional Law; Statutory Construction; To determine whether a particular provision of a
Constitution is self-executing, a searching inquiry should be made to find out if the provision is
intended as a present enactment, complete in itself as a definite law, or if it needs future legislation
for completion and enforcement.To determine whether a particular provision of a Constitution is
selfexecuting is a hard row to hoe. The key lies on the intent of the framers of the fundamental law
oftentimes submerged in its language. A searching inquiry should be made to find out if the
provision is intended as a presentenactment, complete in itself as a definitive law, or if it
needs future legislation for completion and en-forcement. The inquiry demands a micro-analysis of
the text and the context of the provision in question.
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Manila Prince Hotel us. Government
Service Insurance System
Same; Same; Suffused with wisdom of the ages is the unyielding rule that legislative actions
may give breath to constitutional rights but congressional inaction should not suffocate them.
Courts as a rule consider the provisions of the Constitution as selfexecuting, rather than as
requiring future legislation for their enforcement. The reason is not difficult to discern. For if they
are not treated as self-executing, the mandate of the fundamental law ratified by the sovereign
people can be easily ignored and nullified by Congress. Suffused with wisdom of the ages is the
unyielding rule that legislative actions may give breath to constitutional rights but congressional
inaction should not suffocate them.
Same; Same; A constitutional provision is not self-executing where it merely announces a
policy and its language empowers the Legislature to prescribe the means by which the policy shall be
carried into effect.Contrariwise, case law lays down the rule that a constitutional provision is not
self-executing where it merely announces a policy and its language empowers the Legislature to
prescribe the means by which the policy shall be carried into effect.
Same; Government-Owned and Controlled Corporations; Government Service Insurance
spelled out in the Constitution especially those designed to promote the general welfare of the
people.The submission is unimpressive. The GSIS is not a pure private corporation. It is
essentially a public corporation created by Congress and granted an original charter to serve a public
purpose. It is subject to the jurisdictions of the Civil Service Commission and the Commission on
Audit. As a state-owned and controlled corporation, it is skin-bound to adhere to the policies spelled
out in the Constitution especially those designed to promote the general welfare of the people. One of
these policies is the Filipino First Policy which the people elevated as a constitutional command.
Same; Only a constitution strung with elasticity can grow as a living constitution.Thefourth
issue demands that we look at the content of the phrase qualified Filipinos and their preferential
right. The Constitution desisted from defining their contents. This is as it ought to be for a
Constitution only lays down flexible policies and principles which can be bent to meet todays
manifest needs and tomorrows unmanifested demands. Only a constitution strung with elasticity
can grow as a living constitution.
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Same; National Economy and Patrimony; Filipino First Policy; The second paragraph of
Section 10, Article XII of the Constitution is pro-Filipino but not anti-alienit is pro-Filipino for it
gives preference to Filipinos but it is not anti-alien per se for it does not absolutely bar aliens in the
grant of rights, privileges and concessions covering the national economy and patrimony.Thus, we
come to the critical issue of the degree of preference which GSIS should have accorded petitioner, a
qualified Filipino, over Renong Berhad, a foreigner, in the purchase of the controlling shares of the
Manila Hotel. Petitioner claims that after losing the bid, this right of preference gives it a second
chance to match the highest bid of Renong Berhad. With due respect, I cannot sustain petitioners
submission. I prescind from the premise that the second paragraph of Section 10, Article XII of the
Constitution is pro-Filipino but not anti-alien. It is pro-Filipino for it gives preference to Filipinos. It
is not, however, anti-alien per se for it does not absolutely bar aliens in the grant of rights, privileges
and concessions covering the national economy and patrimony. Indeed, in the absence of qualified
Filipinos, the State is not prohibited from granting these rights, privileges and concessions to
foreigners if the act will promote the weal of the nation.
Same; Same; Same; In implementing the policy articulated in Section 10, Article XII of the
Constitution, the stellar task of our State policy-makers is to maintain a creative tension between two
desideratafirst, the need to develop our economy and patrimony with the help of foreigners if
necessary, and, second, the need to keep our economy controlled by Filipinos.In implementing the
policy articulated in Section 10, Article XII of the Constitution, the stellar task of our State policy-
makers is to maintain a creative tensionbetween two desideratafirst, the need to develop our
economy and patrimony with the help of foreigners if necessary, and, second, the need to keep our
economy controlled by Filipinos. Rightfully, the framers of theConstitution did not define the degree
of the right of preference to be given to qualified Filipinos. They knew that for the right to serve the
general welfare, it must have a malleable content that can be adjusted by our policy-makers to meet
the changing needs of our people. In fine, the right of preference of qualified Filipinos is to
be determined by degree as time dictates and circumstances warrant. The lesser the need for alien
assistance, the greater the degree of the right of preference can be given to Filipinos and vice versa.
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Manila Prince Hotel vs. Government
Service Insurance System
Same; Same; Same; Bids and Bidding; 1 submit that the right of preference of a Filipino
bidder arises only if it tied the bid of the foreign bidder.Todate, Congress has not enacted a law
defining the degree of the preferential right. Consequently, we must turn to the rules and
regulations of respondents Committee on Privatization and GSIS to determine the degree of
preference that petitioner is entitled to as a qualified Filipino in the subject sale. A tearless look at
the rules and regulations will show that they are silent on the degree of preferential right to be
accorded a qualified Filipino bidder. Despite their silence, however, they cannot be read to mean that
they do not grant any degree of preference to petitioner for paragraph 2, Section 10, Article XII of the
Constitution is deemed part of said rules and regulations. Pursuant to legal hermeneutics which
demand that we interpret rules to save them from unconstitutionality, I submit that the right of
preference of petitioner arises only if it tied the bid of Renong Berhad. In that instance, all things
stand equal, and petitioner, as a qualified Filipino bidder, should be preferred.
Same; Same; Same; While the Filipino First Policy requires that we incline to a Filipino, it
does not demand that we wrong an alien.We support the Filipino First Policy without any
reservation. The visionary nationalist Don Claro M. Recto has warned us that the greatest tragedy
that can befall a Filipino is to be an alien in his own land. The Constitution has embodied Rectos
counsel as a state policy and our decision should be in sync with this policy. But while the Filipino
First Policy requires that we incline to a Filipino, it does not demand that we wrong an alien.Our
policy makers can write laws and rules giving favored treatment to the Filipino but we are not free
to be unfair to a foreigner after writing the laws and the rules. After the laws are written, they must
be obeyed as written, by Filipinos and foreigners alike. The equal protection clause of the
Constitution protects all against unfairness. We can be pro-Filipino without unfairness to foreigners.
PANGANIBAN, J., Dissenting Opinion:
Constitutional Law; National Economy and Patrimony; Filipino First Policy; Bids and
Bidding; The majoritys strained interpretation constitutes unadulterated judicial legislation, which
makes bidding a ridiculous sham where no Filipino can lose and where no foreigner can win.The
majority contends the Constitution should be interpreted to mean that, after a bidding process is
concluded, the
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VOL. 267, FEBRUARY 3, 1997 4 1. I.EXECUTION OF THE NECESSARY CONTRACTS WITH GSIS/MHC
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Manila Prince Hotel vs. Government
Service Insurance System
losing Filipino bidder should be given the right to equal the highest foreign bid, and thus to
win. However, the Constitution [Sec. 10(2), Art. XII] simply states that in the grant of rights x x x
covering the national economy and patrimony, the State shall give preference to qualified Filipinos.
The majority concedes that there is no law defining the extent or degree of such
preference. Specifically, no statute empowers a losing Filipino bidder to increase his bid and equal
that of the winning foreigner. In the absence of such empowering law, the majoritys strained
interpretation, I respectfully submit, constitutes unadulterated judicial legislation, which makes
bidding a ridiculous sham where no Filipino can lose and where no foreigner can win.Only in the
Philippines!
SPECIAL CIVIL ACTION in the Supreme Court. Prohibition and Mandamus.
The facts are stated in the opinion of the Court.
Arturo M. Tolentino for petitioner.
Napoleon G. Rama, Adolfo S. Azcuna, Perla Y. Duque & Francis Y. Gaw for Manila Prince
Hotel Corp.
The Government Corporate Counsel for G.S.I.S.
Yulo, Torres, Tarriela & Bello Law Office for Manila Hotel Corporation.
Jooaquin Bernas and Enrique M. Fernando amici curiae.
BELLOSILLO, J.:
The Filipino First Policy enshrined in the 1987 Constitution, i.e., in the grant of rights, privileges,
and concessions covering the national economy and patrimony, the State shall give preference to
qualified Filipinos,1 is invoked by petitioner in its bid to acquire 51% of the shares of the Manila
Hotel Corporation (MHC) which owns the historic Manila Hotel. Opposing, respondents maintain
that the provision is not selfexecuting but requires an implementing legislation for its enforcement.
Corollarily, they ask whether the 51% shares
_______________
1See Sec. 10, par. 2, Art. XII, 1987 Constitution.
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form part of the national economy and patrimony covered by the protective mantle of the
Constitution.
The controversy arose when respondent Government Service Insurance System (GSIS),
pursuant to the privatization program of the Philippine Government under Proclamation No. 50
dated 8 December 1986, decided to sell through public bidding 30% to 51% of the issued and
outstanding shares of respondent MHC. The winning bidder, or the eventual strategic partner,
is to provide management expertise and/or an international marketing / reservation system, and
financial support to strengthen the profitability and performance of the Manila Hotel.2 In a close
bidding held on 18 September 1995 only two (2) bidders participated: petitioner Manila Prince Hotel
Corporation, a Filipino corporation, which offered to buy 51% of the MHC or 15,300,000 shares at
P41.58 per share, and Renong Berhad, a Malaysian firm, with ITT-Sheraton as its hotel operator,
which bid for the same number of shares at P44.00 per share, or P2.42 more than the bid of
petitioner.
Pertinent provisions of the bidding rules prepared by respondent GSIS state
1. 1.The Highest Bidder must comply with the conditions set forth below by October 23, 1995
(reset to November 3, 1995) or the Highest Bidder will lose the right to purchase the
 Block of Shares and GSIS will instead offer the Block of Shares to the other Qualified
Bidders:
1. a.The Highest Bidder must negotiate and execute with the GSIS/MHC the Management
Contract, International Marketing/Reservation System Contract or other type of
contract specified by the Highest Bidder in its strategic plan for the Manila Hotel x x x x
2. b.The Highest Bidder must execute the Stock Purchase and Sale Agreement with GSIS x x
xx
_______________
2 Par. I. Introduction and Highlights, Guidelines and Procedures: Second Prequalifications and
Public Bidding of the MHC Privatization; Annex A," Consolidated Reply to Comments of
Respondents; Rollo, p. 142.
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Manila Prince Hotel vs. Government Service
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1. K.DECLARATION OF THE WINNING BIDDER/STRATEGIC PARTNER
The Highest Bidder will be declared the Winning Bidder/Strategic Partner after the following
conditions are met:
1. a.Execution of the necessary contracts with GSIS/MHC not later than October 23, 1995
(reset to November 3, 1995); and
2. b.Requisite approvals from the GSIS/MHC and COP (Committee on Privatization)/OGCC
(Office of the Government Corporate Counsel) are obtained."3
Pending the declaration of Renong Berhad as the winning bidder/strategic partner and the execution
of the necessary contracts, petitioner in a letter to respondent GSIS dated 28 September 1995
matched the bid price of P44.00 per share tendered by Renong Berhad. 4 In a subsequent letter dated
10 October 1995 petitioner sent a managers check issued by Philtrust Bank for Thirty-three Million
Pesos (P33,000,000.00) as Bid Security to match the bid of the Malaysian Group, Messrs. Renong
Berhad x x x x5 which respondent GSIS refused to accept.
On 17 October 1995, perhaps apprehensive that respondent GSIS has disregarded the tender of
the matching bid and that the sale of 51% of the MHC may be hastened by respondent GSIS and
consummated with Renong Berhad, petitioner came to this Court on prohibition and mandamus. On
18 October 1995 the Court issued a temporary restraining order enjoining respondents from
perfecting and consummating the sale to the Malaysian firm.
On 10 September 1996 the instant case was accepted by the Court En Banc after it was was
referred to it by the First Division. The case was then set for oral arguments with former Chief
______________
Par. V. Guidelines for the Public Bidding, id., pp. 153154.
3 Third, granting that the Manila Hotel forms part of the national patrimony, the constitutional
Annex A," Petition for Prohibition and Mandamus with Temporary Restraining Order;
4 provision invoked is still inapplicable since what is being sold is only 51% of the outstanding shares
Rollo, pp. 1314.
5 Annex B," Petition for Prohibition and Mandamus with Temporary Restraining Order; id., p.
15.
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Justice Enrique M. Fernando and Fr. Joaquin G. Bernas, S.J., as amici curiae.
In the main, petitioner invokes Sec. 10, second par., Art. XII, of the 1987 Constitution and
submits that the Manila Hotel has been identified with the Filipino nation and has practically
become a historical monument which reflects the vibrancy of Philippine heritage and culture. It is a
proud legacy of an earlier generation of Filipinos who believed in the nobility and sacredness of
independence and its power and capacity to release the full potential of the Filipino people. To all
intents and purposes, it has become a part of the national patrimony.6 Petitioner also argues that
since 51% of the shares of the MHC carries with it the ownership of the business of the hotel which
is owned by respondent GSIS, a government-owned and controlled corporation, the hotel business of
respondent GSIS being a part of the tourism industry is unquestionably a part of the national
economy. Thus, any transaction involving 51% of the shares of stock of the MHC is clearly covered by
the term national economy, to which Sec. 10, second par., Art. XII, 1987 Constitution, applies.7
It is also the thesis of petitioner that since Manila Hotel is part of the national patrimony and
its business also unquestionably part of the national economy petitioner should be preferred after it
has matched the bid offer of the Malaysian firm. For the bidding rules mandate that if for any
reason, the Highest Bidder cannot be awarded the Block of Shares, GSIS may offer this to the other
Qualified Bidders that have validly submitted bids provided that these Qualified Bidders are willing
to match the highest bid in terms of price per share.8
_______________
6 Petition for Prohibition and Mandamus with Temporary Restraining Order, pp. 56; id., pp. 6
7.
Consolidated Reply to Comments of Respondents, p. 17; id.,p. 133.
7
Par. V.J. 1, Guidelines for Public Bidding, Guidelines and Procedures: Second
8
Prequalifications and Public Bidding of the MHC Privatization, Annex A" Consolidated Reply to
Comments of Respondents; id., p. 154.
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Manila Prince Hotel vs. Government Service
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Respondents except. They maintain that: First. Sec. 10, second par., Art. XII, of the 1987
Constitution is merely a statement of principle and policy since it is not a self-executing provision
and requires implementing legislation(s) x x x x Thus, for the said provision to operate, there must be
existing laws to lay down conditions under which business may be done."9
Second. granting that this provision is self-executing, Manila Hotel does not fall under the
term national patrimony which only refers to lands of the public domain, waters, minerals, coal,
petroleum and other mineral oils, all forces of potential energy, fisheries, forests or timber, wildlife,
flora and fauna and all marine wealth in its territorial sea, and exclusive marine zone as cited in the
first and second paragraphs of Sec. 2, Art. XII, 1987 Constitution. According to respondents, while
petitioner speaks of the guests who have slept in the hotel and the events that have transpired
therein which make the hotel historic, these alone do not make the hotel fall under the patrimony of
the nation. What is more, the mandate of the Constitution is addressed to the State, not to
respondent GSIS which possesses a personality of its own separate and distinct from the Philippines
as a State,
of the corporation, not the hotel building nor the land upon which the building stands. Certainly,
51% of the equity of the MHC cannot be considered part of the national patrimony. Moreover, if the
disposition of the shares of the MHC is really contrary to the Constitution, petitioner should have
questioned it right from the beginning and not after it had lost in the bidding.
Fourth. the reliance by petitioner on par. V., subpar. J. 1., of the bidding rules which provides
that if for any reason, the Highest Bidder cannot be awarded the Block of Shares, GSIS
_______________
 9 Respondents Joint Comment with Urgent Motion to Lift Temporary Restraining Order, p.
9;Rollo, p. 44.
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may offer this to the other Qualified Bidders that have validly submitted bids provided that these
Qualified Bidders are willing to match the highest bid in terms of price per share, is misplaced.
Respondents postulate that the privilege of submitting a matching bid has not yet arisen since it
only takes place if for any reason, the Highest Bidder cannot be awarded the Block of Shares.Thus
the submission by petitioner of a matching bid is premature since Renong Berhad could still very
well be awarded the block of shares and the condition giving rise to the exercise of the privilege to
submit a matching bid had not yet taken place.
Finally, the prayer for prohibition grounded on grave abuse of discretion should fail since
respondent GSIS did not exercise its discretion in a capricious, whimsical manner, and if ever it did
abuse its discretion it was not so patent and gross as to amount to an evasion of a positive duty or a
virtual refusal to perform a duty enjoined by law. Similarly, the petition for mandamus should fail as
petitioner has no clear legal right to what it demands and respondents do not have an imperative
duty to perform the act required of them by petitioner.
We now resolve. A constitution is a system of fundamental laws for the governance and
administration of a nation. It is supreme, imperious, absolute and unalterable except by the
authority from which it emanates. It has been defined as the fundamental and paramount law of the
nation.10 It prescribes the permanent framework of a system of government, assigns to the different
departments their respective powers and duties, and establishes certain fixed principles on which
government is founded. The fundamental conception in other words is that it is a supreme law to
which all other laws must conform and in accordance with which all private rights must be
determined and all public authority administered.11 Under the doctrine of constitutional supremacy,
if a law or contract violates any norm of the constitution that law or contract
_______________
10Marbury v. Madison, 5 U.S. 138 (1803).
1111AmJur. 606.
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Manila Prince Hotel us. Government Service
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whether promulgated by the legislative or by the executive branch or entered into by private persons
for private purposes is null and void and without any force and effect. Thus, since the Constitution is
the fundamental, paramount and supreme law of the nation, it is deemed written in every statute and
contract.
Admittedly, some constitutions are merely declarations of policies and principles. Their
provisions command the legislature to enact laws and carry out the purposes of the framers who
merely establish an outline of government providing for the different departments of the
governmental machinery and securing certain fundamental and inalienable rights of citizens. 12 A
provision which lays down a general principle, such as those found in Art. II of the 1987
Constitution, is usually not self-executing. But a provision which is complete in itself and becomes
operative without the aid of supplementary or enabling legislation, or that which supplies sufficient
rule by means of which the right it grants may be enjoyed or protected, is self-executing. Thus a
constitutional provision is self-executing if the nature and extent of the right conferred and the
liability imposed are fixed by the constitution itself, so that they can be determined by an
examination and construction of its terms, and there is no language indicating that the subject is
referred to the legislature for action.13
As against constitutions of the past, modern constitutions have been generally drafted upon a
different principle and have often become in effect extensive codes of laws intended to operate
directly upon the people in a manner similar to that of statutory enactments, and the function of
constitutional conventions has evolved into one more like that of a legislative body. Hence, unless it
is expressly provided that a legislative act is necessary to enforce a constitutional mandate, the
presumption now is that all provisions of the constitution are self-executing. If the constitutional
provisions are treated as requiring legislation instead of self-executing, the
_______________
1216 Am Jur. 2d 281.
13Id, p. 282.
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legislature would have the power to ignore and practically nullify the mandate of the fundamental
law.14 This can be cataclysmic. That is why the prevailing view is, as it has always been, that
x x x x in case of doubt, the Constitution should be considered self-executing rather than non-self-
executing x x x x Unless the contrary is clearly intended, the provisions of the Constitution should be
considered self-executing, as a contrary rule would give the legislature discretion to determine when,
or whether, they shall be effective. These provisions would be subordinated to the will of the
lawmaking body, which could make them entirely meaningless by simply refusing to pass the needed
implementing statute.15
Respondents argue that Sec. 10, second par., Art. XII, of the 1987 Constitution is clearly not
self-executing, as they quote from discussions on the floor of the 1986 Constitutional Commission
MR. RODRIGO. Madam President, I am asking this question as the Chairman of the Committee
on Style. If the wording of PREFERENCE" is given to QUALIFIED FILIPINOS," can it be
understood as a preference to qualified Filipinos vis--vis Filipinos who are not qualified. So, why do
we not make it clear? To qualified Filipinos as against aliens?
THE PRESIDENT. What is the question of Commissioner Rodrigo? Is it to remove the word
QUALIFIED?"
MR. RODRIGO; No, no, but say definitely TO QUALIFIED FILIPINOS" as against whom? As
against aliens or over aliens?
MR. NOLLEDO. Madam President, I think that is understood. We use the word QUALIFIED"
because the existing laws or prospective laws will always lay down conditions under which business
may be done. For example, qualifications on capital, qualifications on the setting up of other financial
structures, et cetera (italics supplied by respondents).
MR. RODRIGO. It is just a matter of style.
MR. NOLLEDO. Yes.16
_______________
14 SeeNote 12.
15 Cruz, Isagani A., Constitutional Law, 1993 ed., pp. 810.
16 Record of the Constitutional Commission, Vol. 3, 22 August 1986, p. 608.
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Quite apparently, Sec. 10, second par., of Art. XII is couched in such a way as not to make it appear
that it is nonself-executing but simply for purposes of style. But, certainly, the legislature is not
precluded from enacting further laws to enforce the constitutional provision so long as the
contemplated statute squares with the Constitution. Minor details may be left to the legislature
without impairing the selfexecuting nature of constitutional provisions.
In self-executing constitutional provisions, the legislature may still enact legislation to facilitate
the exercise of powers directly granted by the constitution, further the operation of such a provision,
prescribe a practice to be used for its enforcement, provide a convenient remedy for the protection of
the rights secured or the determination thereof, or place reasonable safeguards around the exercise
of the right. The mere fact that legislation may supplement and add to or prescribe a penalty for the
violation of a self-executing constitutional provision does not render such a provision ineffective in
the absence of such legislation. The omission from a constitution of any express provision for a
remedy for enforcing a right or liability is not necessarily an indication that it was not intended to be
self-executing. The rule is that a self-executing provision of the constitution does not necessarily
exhaust legislative power on the subject, but any legislation must be in harmony with the
constitution, further the exercise of constitutional right and make it more available. 17 Subsequent
legislation however does not necessarily mean that the subject constitutional provision is not, by
itself, fully enforceable.
Respondents also argue that the non-self-executing nature of Sec. 10, second par., of Art. XII is
implied from the tenor of the first and third paragraphs of the same section which undoubtedly are
not self-executing.18 The argument is flawed. If
_______________
1716
Am Jur 2d 283284.
Sec. 10, first par., reads: The Congress shall, upon recommendation of the economic and
18
planning agency, when the national interest dictates, reserve to citizens of the Philippines or to
corpora
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the first and third paragraphs are not self-executing because Congress is still to enact measures to
encourage the formation and operation of enterprises fully owned by Filipinos, as in the first
paragraph, and the State still needs legislation to regulate and exercise authority over foreign
investments within its national jurisdiction, as in the third paragraph, then a fortiori, by the same
logic, the second paragraph can only be self-executing as it does not by its language require any
legislation in order to give preference to qualified Filipinos in the grant of rights, privileges and
concessions covering the national economy and patrimony. A constitutional provision may be self-
executing in one part and non-self-executing in another.19
Even the cases cited by respondents holding that certain constitutional provisions are merely
statements of principles and policies, which are basically not self-executing and only placed in the
Constitution as moral incentives to legislation, not as judicially enforceable rightsare simply not in
point. Basco v. Philippine Amusements and Gaming Corporation20speaks of constitutional provisions
on personal dignity,21 the sanctity of family life,22 the vital role of the youth in nation-
_______________
tions or associations at least sixty per centum of whose capital is owned by such citizens, or such
higher percentage as Congress may prescribe, certain areas of investments. The Congress shall enact
measures that will encourage the formation and operation of enterprises whose capital is wholly
owned by Filipinos.
Sec. 10, third par., reads: The State shall regulate and exercise authority over foreign
investments within its national jurisdiction and in accordance with its national goals and priorities.
19 State ex rel. Miller v. OMalley,342 Mo 641, 117 SW2d 319.
20 G.R. No. 91649,14 May 1991, 197 SCRA 52.
21 Sec. 11, Art. II (Declaration of Principles and State Policies),provides that [t]he State values
the dignity of every human person and guarantees full respect for human. rights.
22 Sec. 12, Art. II, provides that [t]he State recognizes the sanctity of family life and shall protect
and strengthen the family as a basic autonomous social institution. It shall equally protect the life of
the mother and the life of the unborn from conception. The natural and primary right and duty of
parents in the rearing of the youth for
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building,23 the promotion of social justice,24 and the values of education.25Tolentino v. Secretary of
Finance26 refers to constitutional provisions on social justice and human rights27 and on
_______________
civic efficiency and the development of moral character shall receive the support of the
government
23 Sec. 13, Art. II, provides that [t]he State recognizes the vital role of the youth in nation-
building and shall promote and protect their physical, moral, spiritual, intellectual, and social well-
being. It shall inculcate in the youth patriotism and nationalism, and encourage their involvement in
public and civic affairs.
24 Sec. 1, Art. XIII (Social Justice and Human Rights), provides that [t]he Congress shall give
highest priority to the enactment of measures that protect and enhance the right of all the people to
human dignity, reduce social, economic and political inequalities, and remove cultural inequities by
equitably diffusing wealth and political power for the common good.
To this end, the State shall regulate the acquisition, ownership, use, and disposition of property
and its increments. Sec. 2, Art. XIII, provides that [t]he promotion of social justice shall include the
commitment to create economic opportunities based on freedom of initiative and self-reliance.
25 Sec. 2, Art. XIV (Education, Science and Technology, Arts, Culture, and Sports), provides that
[t]he State shall:
1. (1)Establish, maintain, and support a complete, adequate, and integrated system of
education relevant to the needs of the people and society;
2. (2)Establish and maintain a system of free public education in the elementary and high
school levels. Without limiting the natural right of parents to rear their children,
elementary education is compulsory for all children of school age;
3. (3)Establish and maintain a system of scholarship grants, student loan programs,
subsidies, and other incentives which shall be available to deserving students in both
public and private schools, especially to the underprivileged;
4. (4)Encourage non-formal, informal, and indigenous learning, independent, and out-of-
school study programs particularly those that respond to community needs; and
5. (5)Provide adult citizens, the disabled, and out-of-school youth with training in civics,
vocational efficiency, and other skills.
26G.R. No. 115455, 25 August 1994, 235 SCRA 630.
27See Note 25.
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education.28 Lastly, Kilosbayan, Inc. v. Morato29cites provisions on the promotion of general
welfare,30 the sanctity of family life,31 the vital role of the youth in nation-building32 and the
promotion of total human liberation and development. 33 A reading of these provisions indeed clearly
shows that they are not judicially enforceable constitutional rights but merely guidelines for
legislation. The very terms of the provisions manifest that they are only principles upon which
legislations must be based. Res ipsa loquitur.
On the other hand, Sec. 10, second par., Art. XII of the 1987 Constitution is a mandatory,
positive command which is complete in itself and which needs no further guidelines or implementing
laws or rules for its enforcement. From its very words the provision does not require any legislation
to put it in operation. lt is per sejudicially enforceable. When our Constitution mandates that [i]n the
grant of rights, privileges, and concessions covering national economy and patrimony, the State shall The history of the hotel has been chronicled in the book The Manila Hotel: The Heart and Memory of
give preference to qualified Filipinos, it means just thatqualified Filipinos shall be preferred. And a City.37During World War II the hotel was converted by the Japanese Military Administration into
when our Constitution declares that a right exists in certain specified circumstances an action may a military headquarters, When the American forces returned to recapture Manila the hotel was
be maintained to enforce such right notwithstanding the absence of any legislation on the selected by the Japanese together with Intramuros as the two (2) places for their final stand.
________________ Thereafter, in the 1950s and 1960s, the hotel became the center of political activities, playing host
to almost every political convention. In 1970 the hotel reopened after a renovation and reaped
28 Sec. 1, Art. XIV, provides that [t]he State shall protect and promote the right of all citizens to numerous in-
quality education at all levels of education and shall take appropriate steps to make such education ________________
accessible to all.
29 G.R. No. 118910,17 July 1995. Emperor Akihito of Japan, President Dwight Eisenhower of U.S.A., President Nguyen Van Thieu
30 See. 5, Art. II (Declaration of Principles and State Policies), provides that [t]he maintenance of of Vietnam, President Park Chung Hee of Korea, Prime Minister Richard Holt of Australia, Prime
peace and order, the protection of life, liberty, and property, and the promotion of the general welfare Minister Keith Holyoake of New Zealand, President Lyndon Johnson of U.S.A., President Jose Lopez
are essential for the enjoyment by all the people of the blessings of democracy. Portillo of Mexico, Princess Margaret of England, Prime Minister Malcolm Fraser of Australia, Prime
31 See Note 23. Minister Pierre Elliot Trudeau of Canada, President Raul Alfonsin of Argentina, President Felipe
32 See Note 24. Gonzalez of Spain, Prime Minister Noboru Takeshita of Japan, Prime Minister Hussain Muhammad
33 Sec. 17, Art. II, provides that [t]he State shall give priority to education, science and Ershad of Bangladesh, Prime Minister Bob Hawke of Australia, Prime Minister Yasuhiro Nakasone
technology, arts, culture, and sports to foster patriotism and nationalism, accelerate social progress, of Japan, Premier Li Peng of China, Sultan Hassanal Bolkiah of Brunei, President Ramaswami
and promote total human liberation and development. Venkataraman of India, Prime Minister Go Chok Tong of Singapore, Prime Minister Enrique Silva
437 Cimma of Chile, Princess Chulaborn and Mahacharri Sirindhorn of Thailand, Prime Minister
Tomiichi Murayama of Japan, Sultan Azlan Shah and Raja Permaisuri Agong of Malaysia,
VOL. 267, FEBRUARY 3, 1997 437
President Kim Young Sam of Korea, Princess Infanta Elena of Spain, President William Clinton of
Manila Prince Hotel vs. Government Service U.S.A., Prime Minister Mahathir Mohamad of Malaysia, King Juan Carlos I and Queen Sofia of
Spain, President Carlos Saul Menem of Argentina, Prime Ministers Chatichai Choonhavan and Prem
Insurance System Tinsulanonda of Thailand, Prime Minister Benazir Bhutto of Pakistan, President Vadav Havel of
subject; consequently, if there is no statute especially enacted to enforce such constitutional right, Czech Republic, Gen. Norman Schwarzkopf of U.S.A., President Ernesto Perez Balladares of Panama,
such right enforces itself by its own inherent potency and puissance, and from which all legislations Prime Minister Adolfas Slezevicius of Lithuania, President Akbar Hashemi Rafsanjani of Iran,
must take their bearings. Where there is a right there is a remedy. Ubi jus ibi remedium. President Askar Akayev of Kyrgyztan, President Ong Teng Cheong of Singapore, President Frei Ruiz
As regards our national patrimony, a member of the 1986 Constitutional Tagle of Chile, President Le Duc Anh of Vietnam, and Prime Minister Julius Chan of Papua New
Commission34 explains Guinea, see Memorandum for Petitioner, pp. 1619.
The patrimony of the Nation that should be conserved and developed refers not only to our rich 37 Authored by Beth Day Romulo.

natural resources but also to the cultural heritage of our race. It also refers to our intelligence in
arts, sciences and letters. Therefore, we should develop not only our lands, forests, mines and other
natural resources but also the mental ability or faculty of our people.
We agree. In its plain and ordinary meaning, the term patrimony pertains to heritage.35 When the
Constitution speaks of national patrimony, it refers not only to the natural resources of the
Philippines, as the Constitution could have very well used the term natural resources, but also to
the cultural heritage of the Filipinos.
Manila Hotel has become a landmarka living testimonial of Philippine heritage. While it was
restrictively an American hotel when it first opened in 1912, it immediately evolved to be truly
Filipino. Formerly a concourse for the elite, it has since then become the venue of various significant
events which have shaped Philippine history. It was called the Cult ural Center of the 1930s. It was
the site of the festivities during the inauguration of the Philippine Commonwealth. Dubbed as
the Official Guest House of the PhilippineGovernment it plays host to dignitaries and official visitors
who are accorded the traditional Philippine hospitality.36
_______________
Nolledo, Jose N., The New Constitution of the Philippines Annotated, 1990 ed., p. 72.
34
Websters Third New International Dictionary, 1986 ed., p. 1656.
35
36 The guest list of the Manila Hotel includes Gen. Douglas MacArthur, the Duke of Windsor,
President Richard Nixon of U.S.A.,
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VOL. 267, FEBRUARY 3, 1997 439
Manila Prince Hotel vs. Government Service
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ternational recognitions, an acknowledgment of the Filipino talent and ingenuity. In 1986 the hotel
was the site of a failed coup detat where an aspirant for vice-president was proclaimed President of
the Philippine Republic.
For more than eight (8) decades Manila Hotel has bore mute witness to the triumphs and
failures, loves and frustrations of the Filipinos; its existence is impressed with public interest; its
own historicity associated with our struggle for sovereignty, independence and nationhood. Verily,
Manila Hotel has become part of our national economy and patrimony. For sure, 51% of the equity of
the MHC comes within the purview of the constitutional shelter for it comprises the majority and
controlling stock, so that anyone who acquires or owns the 51% will have actual control and
management of the hotel. In this instance, 51% of the MHC cannot be disassociated from the hotel
and the land on which the hotel edifice stands. Consequently, we cannot sustain respondents claim
that the Filipino First Policyprovision is not applicable since what is being sold is only 51% of the
outstanding shares of the corporation, not the Hotel building nor the land upon which the building
stands.38
The argument is pure sophistry. The term qualified Filipinos as used in our Constitution also
includes corporations at least 60% of which is owned by Filipinos. This is very clear from the
proceedings of the 1986 Constitutional Commission
THE PRESIDENT. Commissioner Davide is recognized.
MR. DAVIDE. I would like to introduce an amendment to the Nolledo amendment. And the
amendment would consist in substituting the words QUALIFIED FILIPINOS" with the following:
CITIZENS OF THE PHILIPPINES OR CORPORATIONS OR ASSOCIATIONS WHOSE CAPITAL
OR CONTROLLING STOCK IS WHOLLY OWNED BY SUCH CITIZENS."
xxxx
_______________ Paragraph 2 of Section 10 explicitly mandates the Pro-Filipino bias in all economic concerns. It is
better known as the FILIPINO FIRST Policy x x x x This provision was never found in previous
38See Note 9, pp. 1516; Rollo,pp. 5051. Constitutions x x x x
440 The term qualified Filipinos simply means that preference shall be given to those citizens who
can make a viable contribution to the common good, because of credible competence and efficiency. It
440 SUPREME COURT REPORTS certainly does NOT mandate the pampering and preferential treatment to Filipino citizens or
organizations that are incompetent or inefficient, since such an indiscriminate preference would be
ANNOTATED
counterproductive and inimical to the common good.
Manila Prince Hotel vs. Government Service ________________

Insurance System 41 Id., p. 616.

MR. MONSOD. Madam President, apparently the proponent is agreeable, but we have to raise a
question. Suppose it is a corporation that is 80-percent Filipino, do we not give it preference?
MR. DAVIDE. The Nolledo amendment would refer to an individual Filipino. What about a
corporation wholly owned by Filipino citizens?
MR. MONSOD. At least 60 percent, Madam President.
MR. DAVIDE. Is that the intention?
MR. MONSOD. Yes, because, in fact, we would be limiting it if we say that the preference
should only be 100-percent Filipino.
MR. DAVIDE. I want to get that meaning dear because QUALIFIED FILIPINOS" may refer
only to individuals and not to juridical personalities or entities.
MR. MONSOD. We agree, Madam President.39
xxxx
MR. RODRIGO. Before we vote, may I request that the amendment be read again.
MR. NOLLEDO. The amendment will read: IN THE GRANT OF RIGHTS, PRIVILEGES AND
CONCESSIONS COVERING THE NATIONAL ECONOMY AND PATRIMONY, THE STATE
SHALL GIVE PREFERENCE TO QUALIFIED FILIPINOS." And the word Filipinos here, as
intended by the proponents, will include not only individual Filipinos but also Filipino-controlled
entities or entities fully-controlled by Filipinos.40
The phrase preference to qualified Filipinos was explained thus
MR. FOZ. Madam President, I would like to request commissioner Nolledo to please restate his
amendment so that I can ask a question.
MR. NOLLEDO. IN THE GRANT OF RIGHTS, PRIVILEGES AND CONCESSIONS
COVERING THE NATIONAL ECONOMY AND PATRIMONY, THE STATE SHALL GIVE
PREFERENCE TO QUALIFIED FILIPINOS."
_______________
39Record of the Constitutional Commission, Vol. 3, 22 August 1986, p. 607.
40Id., p. 612.
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MR. FOZ. In connection with that amendment, if a foreign enterprise is qualified and a Filipino
enterprise is also qualified, will the Filipino enterprise still be given a preference?
42 Id., p. p. 606.
43 Nolledo, J.N., The New Constitution of the Philippines Annotated, 1990 ed., pp. 930931.
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442 SUPREME COURT REPORTS
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In the granting of economic rights, privileges, and concessions, when a choice has to be made
between a qualified foreigner and a qualified Filipino, the latter shall be chosen over the former.
Lastly, the word qualified is also determinable, Petitioner was so considered by respondent GSIS
and selected as one of the qualified bidders. It was pre-qualified by respondent GSIS in accordance
with its own guidelines so that the sole inference here is that petitioner has been found to be
possessed of proven management expertise in the hotel industry, or it has significant equity
ownership in another hotel company, or it has an overall management and marketing proficiency to
successfully operate the Manila Hotel.44
The penchant to try to whittle away the mandate of the Constitution by arguing that the subject
provision is not selfexecutory and requires implementing legislation is quite disturbing. The attempt
to violate a clear constitutional provisionby the government itselfis only too distressing. To
adopt such a line of reasoning is to renounce the duty to ensure faithfulness to the Constitution. For,
even some of the provisions of the Constitution which evidently need implementing legislation have
juridical life of their own and can be the source of a judicial remedy. We cannot simply afford the
government a defense that arises out of the failure to enact further enabling, implementing or
guiding legislation. In fine, the discourse of Fr. Joaquin G. Bernas, S.J., on constitutional
government is apt
The executive department has a constitutional duty to implement laws, including the Constitution,
even before Congress actsprovided that there are discoverable legal standards for executive action.
When the executive acts, it must be guided by its own understanding of the constitutional command
and of applicable laws. The responsibility for reading and understanding the Constitution and the
laws is not the sole prerogative of Congress. If it were, the executive would have to ask Congress, or
perhaps the Court, for an inter
_______________
44 Bidders were required to have at least one of these qualifications to be able to participate in

MR. NOLLEDO. Obviously. the bidding process; see Note 2.

MR. FOZ. If the foreigner is more qualified in some aspects than the Filipino enterprise, will the 443
Filipino still be preferred?
MR. NOLLEDO. The answer is yes. VOL. 267, FEBRUARY 3, 1997 443
MR. FOZ. Thank you.41 Manila Prince Hotel vs. Government Service
Expounding further on the Filipino First Policyprovision Commissioner Nolledo continues
MR. NOLLEDO. Yes, Madam President. Instead of MUST," it will be SHALLTHE STATE Insurance System
SHALL GIVE PREFERENCE TO QUALIFIED FILIPINOS." This embodies the so-called Filipino pretation every time the executive is confronted by a constitutional command. That is not how
First policy. That means that Filipinos should be given preference in the grant of concessions, constitutional government operates.45
privileges and rights covering the national patrimony.42 Respondents further argue that the constitutional provision is addressed to the State, not to
The exchange of views in the sessions of the Constitutional Commission regarding the subject respondent GSIS which by itself possesses a separate and distinct personality. This argument again
provision was still further clarified by Commissioner Nolledo43 is at best specious. It is undisputed that the sale of 51% of the MHC could only be carried out with
the prior approval of the State acting through respondent Committee on Privatization. As correctly
pointed out by Fr. Joaquin G. Bernas, S.J., this fact alone makes the sale of the assets of respondents
GSIS and MHC a state action. In constitutional jurisprudence, the acts of persons distinct from the
government are considered state actioncovered by the Constitution (1) when the activity it engages
in is a public function; (2) when the government is so significantly involved with the private actor
as to make the government responsible for his action; and, (3) when the government has approved or
authorized the action. It is evident that the act of respondent GSIS in selling 51% of its share in
respondent MHC comes under the second and third categories of state action.Without doubt
therefore the transaction, although entered into by respondent GSIS, is in fact a transaction of the
State and therefore subject to the constitutional command.46
When the Constitution addresses the State it refers not only to the people but also to the
government as elements of the State. After all, government is composed of three (3) divisions of
powerlegislative, executive and judicial. Accordingly, a constitutional mandate directed to the
State is correspondingly directed to the three (3) branches of government. It is undeniable that in
this case the subject constitutional injunction is addressed among others to the Executive
Department and respondent GSIS, a government instrumentality deriving its authority from the
State.
_______________
45Memorandum of Fr. Joaquin G. Bernas, S.J., p. 6.
46Id., pp. 34.
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It should be stressed that while the Malaysian firm offered the higher bid it is not yet the winning
bidder. The bidding rules expressly provide that the highest bidder shall only be declared the
winning bidder after it has negotiated and executed the necessary contracts, and secured the
requisite approvals. Since the Filipino First Policy provision of the Constitution bestows preference
on qualified Filipinos the mere tending of the highest bid is not an assurance that the highest bidder
will be declared the winning bidder. Resultantly, respondents are not bound to make the award yet,
nor are they under obligation to enter into one with the highest bidder. For in choosing the awardee
respondents are mandated to abide by the dictates of the 1987 Constitution the provisions of which
are presumed to be known to all the bidders and other interested parties.
Adhering to the doctrine of constitutional supremacy, the subject constitutional provision is, as
it should be, impliedly written in the bidding rules issued by respondent GSIS, lest the bidding rules
be nullified for being violative of the Constitution. It is a basic principle in constitutional law that all
laws and contracts must conform with the fundamental law of the land. Those which violate the
Constitution lose their reason for being.
Paragraph V.J.1 of the bidding rules provides that [i]f for any reason the Highest Bidder
cannot be awarded the Block of Shares, GSIS may offer this to other Qualified Bidders that have
validly submitted bids provided that these Qualified Bidders are willing to match the highest bid in
terms of price per share.47 Certainly, the constitutional mandate itself is reason enough not to award
the block of shares immediately to the foreign bidder notwithstanding its submission of a higher, or
even the highest, bid. In fact, we cannot conceive of a stronger reason than the constitutional
injunction itself.
In the instant case, where a foreign firm submits the highest bid in a public bidding concerning
the grant of rights, privileges and concessions covering the national economy and
_______________
47See Note 8.
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Manila Prince Hotel vs. Government Service
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patrimony, thereby exceeding the bid of a Filipino, there is no question that the Filipino will have to
be allowed to match the bid of the foreign entity. And if the Filipino matches the bid of a foreign firm
the award should go to the Filipino. lt must be so if we are to give life and meaning to the Filipino
First Policyprovision of the 1987 Constitution. For, while this may neither be expressly stated nor
contemplated in the bidding rules, the constitutional fiat is omnipresent to be simply disregarded. To
ignore it would be to sanction a perilous skirting of the basic law.
This Court does not discount the apprehension that this policy may discourage foreign investors.
But the Constitution and laws of the Philippines are understood to be always open to public scrutiny.
These are given factors which investors must consider when venturing into business in a foreign
jurisdiction. Any person therefore desiring to do business in the Philippines or with any of its
agencies or instrumentalities is presumed to know his rights and obligations under the Constitution
and the laws of the forum.
The argument of respondents that petitioner is now estopped from questioning the sale to
Renong Berhad since petitioner was well aware from the beginning that a foreigner could participate
in the bidding is meritless. Undoubtedly, Filipinos and foreigners alike were invited to the bidding.
But foreigners may be awarded the sale only if no Filipino qualifies, or if the qualified Filipino fails
to match the highest bid tendered by the foreign entity. In the case before us, while petitioner was
already preferred at the inception of the bidding because of the constitutional mandate, petitioner
had not yet matched the bid offered by Renong Berhad. Thus it did not have the right or personality
then to compel respondent GSIS to accept its earlier bid. Rightly, only after it had matched the bid of
the foreign firm and the apparent disregard by respondent GSIS of petitioners matching bid did the
latter have a cause of action.
Besides, there is no time frame for invoking the constitutional safeguard unless perhaps the
award has been finally made. To insist on selling the Manila Hotel to foreigners when
446
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there is a Filipino group willing to match the bid of the foreign group is to insist that government be
treated as any other ordinary market player, and bound by its mistakes or gross errors of judgment,
regardless of the consequences to the Filipino people. The miscomprehension of the Constitution is
regrettable. Thus we would rather remedy the indiscretion while there is still an opportunity to do so
than let the government develop the habit of forgetting that the Constitution lays down the basic
conditions and parameters for its actions.
Since petitioner has already matched the bid price tendered by Renong Berhad pursuant to the
bidding rules, respondent GSIS is left with no alternative but to award to petitioner the block of
shares of MHC and to execute the necessary agreements and documents to effect the sale in
accordance not only with the bidding guidelines and procedures but with the Constitution as well.
The refusal of respondent GSIS to execute the corresponding documents with petitioner as provided
in the bidding rules after the latter has matched the bid of the Malaysian firm clearly constitutes
grave abuse of discretion.
The Filipino First Policyis a product of Philippine nationalism. It is embodied in the 1987
Constitution not merely to be used as a guideline for future legislation but primarily to be enforced;
so must it be enforced. This Court as the ultimate guardian of the Constitution will never shun,
under any reasonable circumstance, the duty of upholding the majesty of the Constitution which it is
tasked to defend. It is worth emphasizing that it is not the intention of this Court to impede and
diminish, much less undermine, the influx of foreign investments. Far from it, the Court encourages
and welcomes more business opportunities but avowedly sanctions the preference for Filipinos
whenever such preference is ordained by the Constitution. The position of the Court on this matter
could have not been more appropriately articulated by Chief Justice Narvasa
As scrupulously as it has tried to observe that it is not its function to substitute its judgment for that
of the legislature or the
447
 to a nonFilipino? How much of national pride will vanish if the nations cultural heritage is
VOL. 267, FEBRUARY 3, 1997 447
entrusted to a foreign entity? On the
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Insurance System
executive about the wisdom and feasibility of legislation economic in nature, the Supreme Court has
not been spared criticism for decisions perceived as obstacles to economic progress and development
x x x x in connection with a temporary injunction issued by the Courts First Division against the
sale of the Manila Hotel to a Malaysian Firm and its partner, certain statements were published in a
major daily to the effect that that injunction again demonstrates that the Philippine legal system
can be a major obstacle to doing business here.
Let it be stated for the record once again that while it is no business of the Court to intervene in
contracts of the kind referred to or set itself up as the judge of whether they are viable or attainable,
it is its bounden duty to make sure that they do not violate the Constitution or the laws, or are not
adopted or implemented with grave abuse of discretion amounting to lack or excess of jurisdiction. It
will never shirk that duty, no matter how buffeted by winds of unfair and ill-informed criticism.48
Privatization of a business asset for purposes of enhancing its business viability and preventing
further losses, regardless of the character of the asset, should not take precedence over non-material
values. A commercial, nay even a budgetary, objective should not be pursued at the expense of
national pride and dignity. For the Constitution enshrines higher and nobler non-material values.
Indeed, the Court will always defer to the Constitution in the proper governance of a free society;
after all, there is nothing so sacrosanct in any economic policy as to draw itself beyond judicial
review when the Constitution is involved.49
Nationalism is inherent in the very concept of the Philippines being a democratic and
republican state, with sovereignty residing in the Filipino people and from whom all gov-
_______________
48 Keynote Address at the ASEAN Regional Symposium on Enforcement of Industrial Property
Rights held 23 October 1995 at New World Hotel, Makati City.
49 Speech of Senior Associate Justice Teodoro R. Padilla at the Induction of Officers and
Directors of the PHILCONSA for 1996 held 16 January 1996 at the Sky-Top, Hotel Intercontinental,
Makati City.
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448 SUPREME COURT REPORTS
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50Memorandum of Authorities submitted by former Chief Justice Enrique M. Fernando, p. 5.
518 March 1996 issue of Philippine Daily Inquirer, p. B13.
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other hand, how much dignity will be preserved and realized if the national patrimony is safekept in
the hands of a qualified, zealous and well-meaning Filipino? This is the plain and simple meaning of
the Filipino First Policy provision of the Philippine Constitution. And this Court, heeding the clarion
call of the Constitution and accepting the duty of being the elderly watchman of the nation, will
continue to respect and protect the sanctity of the Constitution.
WHEREFORE, respondents GOVERNMENT SERVICE INSURANCE SYSTEM, MANILA
HOTEL CORPORATION, COMMITTEE ON PRIVATIZATION and OFFICE OF THE
GOVERNMENT CORPORATE COUNSEL are directed to CEASE and DESIST from selling 51% of
the shares of the Manila Hotel Corporation to RENONG BERHAD, and to ACCEPT the matching
bid of petitioner MANILA PRINCE HOTEL CORPORATION to purchase the subject 51% of the
shares of the Manila Hotel Corporation at P44.00 per share and thereafter to execute the necessary
agreements and documents to effect the sale, to issue the necessary clearances and to do such other
acts and deeds as may be necessary for the purpose.
SO ORDERED.
Regalado, Davide, Jr., Romero, Kapunan, Francisco and Hermosisima, Jr., JJ., concur.
Narvasa (C.J.), I join Justice Puno in his dissent.
Padilla, J., See concurring opinion.
Melo, J., I join in the dissent of Justice Puno.
Puno, J., Please see dissent.
Vitug, J., Please see separate (concurring) opinion.
Mendoza, J., See concurring opinion.
Panganiban, J.,Please see separate (dissenting) opinion.
Torres, Jr., J., With separate opinion.
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ernment authority emanates. In nationalism, the happiness and welfare of the people must be the
goal. The nation-state can have no higher purpose. Any interpretation of any constitutional provision
must adhere to such basic concept, Protection of foreign investments, while laudible, is merely a
policy. It cannot override the demands of nationalism.50
The Manila Hotel or, for that matter, 51% of the MHC, is not just any commodity to be sold to
the highest bidder solely for the sake of privatization. We are not talking about an ordinary piece of
property in a commercial district. We are talking about a historic relic that has hosted many of the
most important events in the short history of the Philippines as a nation. We are talking about a
hotel where heads of states would prefer to be housed as a strong manifestation of their desire to
cloak the dignity of the highest state function to their official visits to the Philippines. Thus the
Manila Hotel has played and continues to play a significant role as an authentic repository of
twentieth century Philippine history and culture. In this sense, it has become truly a reflection of the
Filipino soula place with a history of grandeur; a most historical setting that has played a part in
the shaping of a country.51
This Court cannot extract rhyme nor reason from the determined efforts of respondents to sell
the historical landmarkthis Grand Old Dame of hotels in Asiato a total stranger. For, indeed,
the conveyance of this epic exponent of the Filipino psyche to alien hands cannot be less than
mephistophelian for it is, in whatever manner viewed, a veritable alienation of a nations soul for
some pieces of foreign silver. And so we ask: What advantage, which cannot be equally drawn from a
qualified Filipino, can be gained by the Filipinos if Manila Hoteland all that it stands foris sold
Manila Prince Hotel vs. Government Service
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CONCURRING OPINION
PADILLA, J.:
I concur with the ponencia of Mr. Justice Bellosillo. At the same time, I would like to expound a bit
more on the concept of national patrimony as including within its scope and meaning institutions
such as the Manila Hotel.
It is argued by petitioner that the Manila Hotel comes under national patrimony over which
qualified Filipinos have the preference, in ownership and operation. The Constitutional provision on
point states:
x x x
In the grant of rights, privileges, and concessions covering the national economy and patrimony,
the State shall give preference to qualified Filipinos."1
Petitioners argument, I believe, is well taken. Under the 1987 Constitution, national patrimony
consists of the natural resources provided by Almighty God (Preamble) in our territory (Article I)
consisting of land, sea, and air.2 A study of the 1935 Constitution, where the concept of national
patrimony originated, would show that its framers decided to adopt the even more comprehensive
expression Patrimony of the Nation in the belief that the phrase encircles a concept embracing not
only the natural resources of the country but practically everything that belongs to the Filipino
people, the tangible and the material as well as the intangible and the spiritual assets and
possessions of the people. It is to be noted that the framers did not stop with conservation. They
knew that conservation alone does not spell progress; and that this may be achieved only through
development as a correlative factor to assure to the people not only the exclusive owner-
_______________
1Article XII, Section 10, par. 2, 1987 Constitution.
2Padilla, The 1987 Constitution of the Republic of the Philippines, Volume III, p. 89.
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ship, but also the exclusive benefits of their national patrimony.3
Moreover, the concept of national patrimony has been viewed as referring not only to our rich
natural resources but also to the cultural heritage of our race. 4
There is no doubt in my mind that the Manila Hotel is very much a part of our national
patrimony and, as such, deserves constitutional protection as to who shall own it and benefit from its
operation. This institution has played an important role in our nations history, having been the
venue of many a historical event, and serving as it did, and as it does, as the Philippine Guest House
for visiting foreign heads of state, dignitaries, celebrities, and others.5
It is therefore our duty to protect and preserve it for future generations of Filipinos. As
President Manuel L. Quezon once said, we must exploit the natural resources of our country, but we
should do so with an eye to the welfare of the future generations. In other words, the leaders of today
are the trustees of the patrimony of our race. To preserve our national patrimony and reserve it for
Filipinos was the intent of the distinguished gentlemen who first framed our Constitution. Thus, in
debating the need for nationalization of our lands and natural resources, one expounded that we
should put more teeth into our laws, and not make the nationalization of our lands and natural
resources a subject of ordinary legislation but of constitutional enactment." 6To quote further: Let
not our children be mere tenants and trespassers in their own country. Let us preserve and bequeath
to them what is rightfully theirs, free from all foreign liens and encumbrances."7
_______________
3 Sinco, Philippine Political Law, 11th ed., p. 112.
4 Nolledo, The New Constitution of the Philippines, Annotated, 1990 ed., p. 72.
5 Memorandum for Petitioner, p. 1.
6 Laurel, Proceedings of the Philippine Constitutional Convention (19341935), p. 507.
7 Id., p. 562.
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Now, a word on preference. In my view preference to qualified Filipinos, to be meaningful, must
refer not only to things that are peripheral, collateral, or tangential. It must touch and affect the
very heart of the existing order In the field of public bidding in the acquisition of things that
pertain to the national patrimony, preference to qualified Filipinos must allow a qualified Filipino to
match or equal the higher bid of a non-Filipino; the preference shall not operate only when the bids
of the qualified Filipino and the nonFilipino are equal in which case, the award should undisputedly
be made to the qualified Filipino. The Constitutional preference should give the qualified Filipino an
opportunity to match or equal the higher bid of the non-Filipino bidder if the preference of the
qualified Filipino bidder is to be significant at all.
It is true that in this present age of globalization of attitude towards foreign investments in our
country, stress is on the elimination of barriers to foreign trade and investment in the country. While
government agencies, including the courts should re-condition their thinking to such a trend, and
make it easy and even attractive for foreign investors to come to our shores, yet we should not
preclude ourselves from reserving to us Filipinos certain areas where our national identity, culture
and heritage are involved. In the hotel industry, for instance, foreign investors have established
themselves creditably, such as in the Shangri-La, the Nikko, the Peninsula, and Mandarin Hotels.
This should not stop us from retaining 51% of the capital stock of the Manila Hotel Corporation in
the hands of Filipinos. This would be in keeping with the intent of the Filipino people to preserve our
national patrimony, including our historical and cultural heritage in the hands of Filipinos.
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SEPARATE OPINION
VITUG, J.:
I agree with Mr. Justice Josue N. Bellosillo on his clear-cut statements, shared by Mr. Justice
Reynato S. Puno in a well written separate (dissenting) opinion, that:
First, the provision in our fundamental law which provides that "(i)n the grant of rights,
privileges, and concessions covering the national economy and patrimony, the State shall give
preference to qualified Filipinos"1 is self-executory. The provision verily does not need, although it
can obviously be amplified or regulated by, an enabling law or a set of rules.
Second, the term patrimony does not merely refer to the countrys natural resources but also
to its cultural heritage. A historical landmark, to use the words of Mr. Justice Justo P. Torres, Jr.,
Manila Hotel has now indeed become part of Philippine heritage.
Third, the act of the Government Service Insurance System (GSIS"), a government entity
which derives its authority from the State, in selling 51% of its share in MHC should be considered
an act of the State subject to the Constitutional mandate.
On the pivotal issue of the degree of preference to qualified Filipinos, I find it somewhat
difficult to take the same path traversed by the forceful reasoning of Justice Puno. In the particular
case before us, the only meaningful preference, it seems, would really be to allow the qualified
Filipino to match the foreign bid for, as a practical matter, I cannot see any bid that literally calls for
millions of dollars to be at par (to the last cent) with another. The magnitude of the bids is such that
it becomes hardly possible for the competing bids to stand exactly equal which alone, under the
dissenting view, could trigger the right of preference.
It is most unfortunate that Renong Berhad has not been spared this great disappointment, a
letdown that it did not
_______________
1Second par. Section 10, Art. XII, 1987 Constitution.
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deserve, by a simple and timely advise of the proper rules of bidding along with the peculiar
constitutional implications of the proposed transaction. It is also regrettable that the Court at times
is seen to, instead, be the refuge for bureaucratic inadequacies which create the perception that it
even takes on non-justiciable controversies.
 All told, I am constrained to vote for granting the petition.
SEPARATE OPINION
MENDOZA, J., concurring in the judgment:
I take the view that in the context of the present controversy the only way to enforce the
constitutional mandate that "[i]n the grant of rights, privileges and concessions covering the national
patrimony the State shall give preference to qualified Filipinos" 1 is to allow petitioner Philippine
corporation to equal the bid of the Malaysian firm Renong Berhad for the purchase of the controlling
shares of stocks in the Manila Hotel Corporation. Indeed, it is the only way a qualified Filipino or
Philippine corporation can be given preference in the enjoyment of a right, privilege or concession
given by the State, by favoring it over a foreign national or corporation.
Under the rules on public bidding of the Government Service and Insurance System, if
petitioner and the Malaysian firm had offered the same price per share, priority [would be given] to
the bidder seeking the larger ownership interest in MHC,"2 so that if petitioner bid for more shares,
it would be preferred to the Malaysian corporation for that reason and not because it is a Philippine
corporation. Consequently, it is only in cases like the present one, where an alien corporation is the
highest bidder, that preferential treatment of the Philippine corporation is mandated not by
declaring it winner but by allowing it to match the highest bid in terms of
_______________
1 Art. XII, 10, second paragraph.
2 GUIDELINES AND PROCEDURES: SECOND PREQUALIFICATION AND PUBLIC
BIDDING OF THE MHC PRIVATIZATION (hereafter referred to as GUIDELINES), Part V, par.
H(4).
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price per share before it is awarded the shares of stocks.3 That, to me, is what preference to
qualified Filipinos means in the context of this caseby favoring Filipinos whenever they are at a
disadvantage vis--vis foreigners.
This was the meaning given in Co Chiong v. Cuaderno4 to a 1947 statute giving preference to
Filipino citizens in the lease of public market stalls." 5 This Court upheld the cancellation of existing
leases covering market stalls occupied by persons who were not Filipinos and the award thereafter of
the stalls to qualified Filipino vendors as ordered by the Department of Finance. Similarly, in Vda.
de Salgado v. De la Fuente,6 this Court sustained the validity of a municipal ordinance passed
pursuant to the statute (R.A. No. 37), terminating existing leases of public market stalls and
granting preference to Filipino citizens in the issuance of new licenses for the occupancy of the stalls.
In Chua Lao v. Raymundo,7the preference granted under the statute was held to apply to cases in
which Filipino vendors sought the same stalls occupied by alien vendors in the public markets even
if there were available other stalls as good as those occupied by aliens. The law, apparently, is
applicable whenever there is a conflict of interest between Filipino applicants and aliens for lease of
stalls in public markets, in which situation the right to preference immediately arises."8
Our legislation on the matter thus antedated by a quarter of a century efforts began only in the
1970s in America to realize the promise of equality, through affirmative action and reverse
discrimination programs designed to remedy past discrimination against colored people in such
areas as em-
_______________
3Id.
4 83 Phil. 242 (1949).
5 R.A. No. 37, 1.
6 87 Phil. 343 (1950).
7104 Phil. 302 (1958).
8Id., at 309.
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ployment, contracting and licensing.9 Indeed, in vital areas of our national economy, there are
situations in which the only way to place Filipinos in control of the national economy as
contemplated in the Constitution10 is to give them preferential treatment where they can at least
stand on equal footing with aliens.
There need be no fear that thus preferring Filipinos would either invite foreign retaliation or
deprive the country of the benefit of foreign capital or know-how. We are dealing here not with
common trades or common means of livelihood which are open to aliens in our midst, 11 but with the
sale of government property, which is like the grant of government largess or benefits. In the words
of Art. XII, 10, we are dealing here with rights, privileges and concessions covering the national
economy and therefore no one should begrudge us if we give preferential treatment to our citizens.
That at any rate is the command of the Constitution. For the Manila Hotel is a business owned by
the Government. It is being privatized. Privatization should result in the relinquishment of the
business in favor of private individuals and groups who are Filipino citizens, not in favor of aliens.
Nor should there be any doubt that by awarding the shares of stocks to petitioner we would be
trading competence and capability for nationalism. Both petitioner and the Malaysian firm are
qualified, having hurdled the prequalification process.12 It is only the result of the public bidding
that is sought
_______________
9 For an excellent analysis of American cases on reverse discrimination in these areas,
see GERALD GUNTHER, CONSTITUTIONAL LAW 780819 (1991).
10 Art. II, 19: The State shall develop a self-reliant and independent national
economy effectively controlled by Filipinos.(Emphasis added)
11 See Villegas v. Hiu Chiung Tsai Pao Ho, 86 SCRA 270 (1978) (invalidating an ordinance
imposing a flat fee of P500 on aliens for the privilege of earning a livelihood).
12 Petitioner passed the criteria set forth in the GUIDELINES, Part IV, par. F(4), of the GSIS,
relating to the following:
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to be modified by enabling petitioner to up its bid to equal the highest bid.
Nor, finally, is there any basis for the suggestion that to allow a Filipino bidder to match the
highest bid of an alien could encourage speculation, since all that a Filipino entity would then do
would be not to make a bid or make only a token one and, after it is known that a foreign bidder has
submitted the highest bid, make an offer matching that of the foreign firm. This is not possible
under the rules on public bidding of the GSIS. Under these rules there is a minimum bid required
(P36.67 per share for a range of 9 to 15 million shares). 13Bids below the minimum will not be
considered. On the other hand, if the Filipino entity, after passing the prequalification process, does
not submit a bid, he will not be allowed to match the highest bid of the foreign firm because this is a
privilege allowed only to those who have validly submitted bids." 14 The suggestion is, to say the
least, fanciful and has no basis in fact.
For the foregoing reasons, I vote to grant the petition.
SEPARATE OPINION
TORRES, JR., J.:
Constancy in law is not an attribute of a judicious mind. I say this as we are confronted in the case
at bar with legal and constitutional issuesand yet I am driven so to speak, on the side of history.
The reason perhaps is due to the belief that in the words of Justice Oliver Wendell Holmes, Jr., a
page of history is worth a volume of logic.
_______________
1. a.Business management expertise, track record, and experience;
2. b.Financial capability;
3. c.Feasibility and acceptability of the proposed strategic plan for The Manila Hotel.
13GUIDELINES, Part V, par. C (1)(3), in relation to Part I.
14Id., Part V, par. V(1).
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I will, however, attempt to share my thoughts on whether the Manila Hotel has a historical and
cultural aspect within the meaning of the constitution and thus, forming part of the patrimony of
the nation.
Section 10, Article of the 1987 Constitution provides:
xxx
In the grant of rights, privileges, and concessions covering the national economy and
patrimony, the State shall give preference to qualified Filipinos.
The State shall regulate and exercise authority over foreign investments within its national
goals and priorities.
The foregoing provisions should be read in conjunction with Article II of the same Constitution
pertaining to Declaration of Principles and State Policies which ordain
The State shall develop a self-reliant and independent national economy effectively controlled by
Filipinos. (Sec. 19).
Interestingly, the matter of giving preference to qualified Filipinos was one of the highlights in the
1987 Constitutional Commission proceedings, thus:
xxx
MR. NOLLEDO. The Amendment will read: IN THE GRANT OF RIGHTS, PRIVILEGES
AND CONCESSIONS COVERING THE NATIONAL ECONOMY AND PATRIMONY, THE STATE
SHALL GIVE PREFERENCE TO QUALIFIED FILIPINOS." And the word Filipinos here, as
intended by the proponents, will include not only individual Filipinos but also Filipino-Controlled
entities fully controlled by Filipinos (Vol. III, Records of the Constitutional Commission, p. 608).
MR. MONSOD, We also wanted to add, as Commissioner Villegas said, this committee and this
body already approved what is known as the Filipino First policy which was suggested by
Commissioner de Castro. So that it is now in our Constitution (Vol. IV, Records of the Constitutional
Commission, p. 225).
Commissioner Jose Nolledo explaining the provision adverted to above, said:
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MR. NOLLEDO. In the grant of rights, privileges and concessions covering the national economy
and patrimony, the State shall give preference to qualified Filipinos.
MR. FOZ. In connection with that amendment, if a foreign enterprise is qualified and the
Filipinos enterprise is also qualified, will the Filipino enterprise still be given a preference?
MR. NOLLEDO. Obviously.
MR. FOZ. If the foreigner is more qualified in some aspects than the Filipino enterprise, will the
Filipino still be preferred?
MR. NOLLEDO. The answer is yes. (Vol. III, p. 616, Records of the Constitutional
Commission).
The nationalistic provisions of the 1987 Constitution reflect the history and spirit of the Malolos
Constitution of 1898, the 1935 Constitution and the 1973 Constitutions. That we have not reneged
on this nationalist policy is articulated in one of the earliest cases, this Court said
The nationalistic tendency is manifested in various provisions of the Constitution. x x x It cannot
therefore be said that a law imbued with the same purpose and spirit underlying many of the
provisions of the Constitution is unreasonable, invalid or unconstitutional (Ichong, et al. vs.
Hernandez, et al., 101 Phil. 1155).'"
I subscribe to the view that history, culture, heritage, and tradition are not legislated and is the
product of events, customs, usages and practices. It is actually a product of growth and acceptance by
the collective mores of a race. It is the spirit and soul of a people.
The Manila Hotel is part of our history, culture and heritage, Every inch of the Manila Hotel is
witness to historic events (too numerous to mention) which shaped our history for almost 84 years.
As I intimated earlier, it is not my position in this opinion, to examine the single instances of
the legal largesse which have given rise to this controversy, as I believe that has been exhaustively
discussed in the ponencia. Suffice it to say at this point, that the history of the Manila Hotel should
not be placed in the auction block of a purely business transaction,
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where profit subverts the cherished historical values of our people.
As a historical landmark in this Pearl of the Orient Seas, it has its enviable tradition which, in
the words of the philosopher Salvador de Madarriaga, (tradition) is more of a river than a stone, it
keeps flowing, and one must view the flowing, and one must view the flow in both directions If you
look towards the hill from which the river flows, you see tradition in the form of forceful currents
that push the river or people towards the future; and if you look the other way, you progress.
Indeed, tradition and progress are the same, for progress depends on the kind of tradition. Let
us not jettison the tradition of the Manila Hotel and thereby repeat our colonial history.
I grant, of course, that men of the law can see the same subject in different lights.
I remember, however, a Spanish proverb which says"He is always right who suspects that he
makes mistakes. On this note, I say that if I have to make a mistake, I would rather err upholding
the belief that the Filipino be first under his Constitution and in his own land.
I vote to GRANT the petition.
DISSENTING OPINION
PUNO, J.:
This is a petition for prohibition and mandamus filed by the Manila Prince Hotel Corporation, a
domestic corporation, to stop the Government Service Insurance System (GSIS) from selling
the controlling shares of the Manila Hotel Corporation to a foreign corporation. Allegedly, the sale
violates the second paragraph of Section 10, Article XII of the Constitution.
Respondent GSIS is a government-owned and controlled corporation, It is the sole owner of the
Manila Hotel which it operates through its subsidiary, the Manila Hotel Corpora-
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tion. Manila Hotel was included in the privatization program of the government. In 1995, GSIS
proposed to sell to interested buyers 30% to 51% of its shares, ranging from 9,000,000 to 15,300,000
shares, in the Manila Hotel Corporation. After the absence of bids at the first public bidding, the
block of shares offered for sale was increased from a maximum of 30% to 51%. Also, the winning
bidder, or the eventual strategic partner of the GSIS was required to provide management 1. D.PREQUALIFICATION DOCUMENTS
expertise and/or an international marketing/reservation system, and financial support to strengthen
the profitability and performance of the Manila Hotel."1 The proposal was approved by respondent
xxx
Committee on Privatization.
In July 1995, a conference was held where prequalification documents and the bidding rules
were furnished interested parties. Petitioner Manila Prince Hotel, a domestic corporation, and 1. E.APPLICATION PROCEDURE
Renong Berhad, a Malaysian firm with ITT Sheratonas operator, prequalified.2 The bidding rules
and procedures entitled Guidelines and Procedures: Second Prequalification and Public Bidding of
the MHC Privatization provide: 1. 1.DOCUMENTS AVAILABLE AT THE REGISTRATION OFFICE

1. IINTRODUCTION AND HIGHLIGHTS The prequalification documents can be secured at the Registration Office between 9:00 AM to
4:00 PM during working days within the period specified in Section III. Each set of documents
consists of the following:
DETERMINING THE WINNING BIDDER/STRATEGIC PARTNER
The party that accomplishes the steps set forth below will be declared the Winning Bidder/Strategic
Partner and will be awarded the Block of Shares: 1. a.Guidelines and Procedures: Second Prequalification and Public Bidding of the MHC
FirstPass the prequalification process; Privatization.
________________
463
Introduction and Highlights, Guidelines and Procedures: Second Prequalification and Public
1
VOL. 267, FEBRUARY 3, 1997 463
Bidding of the MHC Privatization, Annex A" to Petitioners Consolidated Reply to Comments of
Respondents, Rollo, p. 142. Manila Prince Hotel vs. Government Service
2 The four bidders who previously prequalified for the first bidding, namely, ITT Sheraton,

Marriot International, Inc., Renaissance Hotel International, Inc., and the consortium of RCBC and Insurance System
the Ritz Carlton, were deemed prequalified for the second bidding.
462 1. b.Confidential Information Memorandum: The Manila Hotel Corporation.
462 SUPREME COURT REPORTS 2. c.Letter of Invitation to the Prequalification and Bidding Conference.
xxxx
ANNOTATED

Manila Prince Hotel vs. Government Service
Insurance System
SecondSubmit the highest bid on a price per share basis for the Block of Shares;
ThirdNegotiate and execute the necessary contracts with GSIS/MHC not later than October
23, 1995.
xxx
1. IVGUIDELINES FOR PREQUALIFICATION
1. A.PARTIES WHO MAY APPLY FOR PREQUALIFICATION
The Winning Bidder/Strategic Partner will be expected to provide management expertise and/or an
international marketing reservation system, and financial support to strengthen the profitability
and performance of The Manila Hotel. In this context, the GSIS is inviting to the prequalification
process any local and/or foreign corporation, consortrum/joint venture or juridical entity with at least
one of the following qualifications:
1. a.Proven management expertise in the hotel industry; or
2. b.Significant equity ownership (i.e. board representation) in another hotel company; or
3. c.Overall management and marketing expertise to successfully operate the Manila Hotel.
Parties interested in bidding for MHC should be able to provide access to the requisite
management expertise and/or international marketing/reservation system for The Manila Hotel.
xxx
1. 4.PREQUALIFICATION AND BIDDING CONFERENCE
A prequalification and bidding conference will be held at The Manila Hotel on the date specified in
Section III to allow the Applicant to seek clarifications and further information regarding the
guidelines and procedures. Only those who purchased the prequalification documents will be allowed
in this conference. Attendance to this conference is strongly advised, although the Applicant will not
be penalized if it does not attend.
1. 5.SUBMISSION OF PREQUALIFICATION DOCUMENTS
The Applicant should submit 5 sets of the prequalification documents (1 original set plus 4
copies) at the Registration Office between 9:00 AM to 4:00 PM during working days within the
period specified in Section III.
1. F.PREQUALIFICATION PROCESS
1. 1.The Applicant will be evaluated by the PBAC with the assistance of the TEC based on
the Information Package and other information available to the PBAC.
2. 2.If the Applicant is a Consortium/Joint Venture, the evaluation will consider the overall
qualifications of the group, taking into account the contribution of each member to the
venture.
3. 3.The decision of the PBAC with respect to the results of the PBAC evaluation will be
final.
4. 4.The Applicant shall be evaluated according to the criteria set forth below:

1. a.Business management expertise, track record, and experience.

 2. b.Financial capability.
3. c.Feasibility and acceptability of the proposed strategic plan for the Manila Hotel. VOL. 267, FEBRUARY 3, 1997 465

Manila Prince Hotel vs. Government Service

1. 5.The PBAC will shortlist such number of Applicants as it may deem appropriate. Insurance System

464 1. D.TRANSFER COSTS

464 SUPREME COURT REPORTS 2. x x x
3. E.OFFICIAL BID FORM
ANNOTATED

Manila Prince Hotel vs. Government Service
lnsurance System
1. 6.The parties that prequalified in the first MHC public biddingITT Sheraton, Marriot
International, Inc., Renaissance Hotels International, Inc., consortium of RCBC
Capital/Ritz Carltonmay participate in the Public Bidding without having to undergo
the prequalification process again.
1. 1.Bids must be contained in the prescribed Official Bid Form, a copy of which is attached
as Annex IV. The Official Bid Form must be properly accomplished in all details;
improper accomplishment may be a sufficient basis for disqualification.
2. 2.During the Public Bidding, the Qualified Bidder will submit the Official Bid Form,
which will indicate the offered purchase price, in a sealed envelope marked OFFICIAL
BID."
1. F.SUPPORTING DOCUMENTS

1. G.SHORTLIST OF QUALIFIED BIDDERS
1. 1.A notice of prequalification results containing the shortlist of Qualified Bidders will be
posted at the Registration Office at the date specified in Section III.
2. 2.In the case of a Consortium/Joint Venture, the withdrawal by a member whose
qualification was a material consideration for being included in the shortlist is a ground
for disqualification of the Applicant
1. V.GUIDELINES FOR THE PUBLIC BIDDING
1. A.PARTIES WHO MAY PARTICIPATE IN THE PUBLIC BIDDING
During the Public Bidding, the following documents should be submitted along with the bid in a
separate envelope marked SUPPORTING DOCUMENTS":
1. 1.WRITTEN AUTHORITY TO BID (UNDER OATH)
If the Qualified Bidder is a corporation, the representative of the Qualified Bidder should submit a
Board resolution which adequately authorizes such representative to bid for and in behalf of the
corporation with full authority to perform such acts necessary or requisite to bind the Qualified
Bidder. If the Qualified Bidder is a Consortium/Joint Venture, each member of the Consortium/Joint
Venture should submit a Board resolution authorizing one of its members and such members
representative to make the bid on behalf of the group with full authority to perform such acts
necessary or requisite to bind the Qualified Bidder.

All parties in the shortlist of Qualified Bidders will be eligible to participate in the Public Bidding.
1. 2.BID SECURITY

1. B.BLOCK OF SHARES
A range of Nine Million (9,000,000) to Fifteen Million Three Hundred Thousand (15,300,000) shares
of stock, representing Thirty Percent to Fifty-One Percent (30%-51%) of the issued and outstanding
shares of MHC, will be offered in the Public Bidding by the GSIS. The Qualified Bidders will have
the option of determining the number of shares within the range to bid for. The range is intended to
attract bidders with different preferences and objectives for the operation and management of The
Manila Hotel.
1. a,The Qualified Bidder should deposit Thirty-Three Million Pesos (P33,000,000.00), in
Philippine currency as Bid Security in the form of:
1. i.Managers check or unconditional demand draft payable to the Government Service
Insurance System and issued by a reputable banking institution duly licensed to do
business in the Philippines and acceptable to GSIS; or
2. ii.Stand-by letter of credit issued by a reputable banking institution acceptable to the
GSIS.

1. C.MINIMUM BID REQUIRED ON A PRICE PER SHARE BASIS

466

1. 1.Bids will be evaluated on a price per share basis. The minimum bid required on a price 466 SUPREME COURT REPORTS
per share basis for the Block of Shares is Thirty-Six Pesos and Sixty-Seven Centavos
ANNOTATED
(P36.67).
2. 2.Bids should be in the Philippine currency payable to the GSIS. Manila Prince Hotel vs. Government Service
3. 3.Bids submitted with an equivalent price per share below the minimum required will not
be considered. Insurance System

465 1. b,The GSIS will reject a bid if:

 1. i.The bid does not have a Bid Security; or
2. ii.The Bid Security accompanying the bid is for less than the required amount.
1. c.If the Bid Security is in the form of a managers check or unconditional demand draft,
the interest earned on the Bid Security will be for the account of GSIS.
2. d.If the Qualified Bidder becomes the Winning Bidder/Strategic Partner, the Bid Security
will be applied as the downpayment on the Qualified Bidders offered purchase price.
3. e.The Bid Security of the Qualified Bidder will be returned immediately after the Public
Bidding if the Qualified Bidder is not declared the Highest Bidder.
4. f.The Bid Security will be returned by October 23, 1995 if the Highest Bidder is unable to
negotiate and execute with GSIS/MHC the Management Contract, International
Marketing/Reservation System Contract Or other types of contract specified by the
Highest Bidder in its strategic plan for The Manila Hotel.
5. g.The Bid Security of the Highest Bidder will be forfeited in favor of GSIS if the Highest
Bidder, after negotiating and executing the Management Contract, International
Marketing/Reservation System Contract or other types of contract specified by the
Highest Bidder in its strategic plan for The Manila Hotel, fails or refuses to:
1. i.Execute the Stock Purchase and Sale Agreement with GSIS not later than October 23,
1995; or
2. ii.Pay the full amount of the offered purchase price not later than October 23, 1995; or
3. iii.Consummate the sale of the Block of Shares for any other reason.
468
1. G.SUBMISSION OF BIDS
Manila Prince Hotel vs. Government Service
1. 1.The Public Bidding will be held on September 7, 1995 at the following location:
New GSIS Headquarters Building
Financial Center, Reclamation Area
Roxas Boulevard, Pasay City, Metro Manila
2. 2.The Secretariat of the PBAC will be stationed at the Public Bidding to accept any and all
bids and supporting re
467
VOL. 267, FEBRUARY 3, 1997 467
Manila Prince Hotel vs. Government Service
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1. quirements. Representatives from the Commission on Audit and COP will be invited to
witness the proceedings.
2. 3.The Qualified Bidder should submit its bid using the Official Bid Form. The
accomplished Official Bid Form should be submitted in a sealed envelope marked
OFFICIAL BID."
3. 4.The Qualified Bidder should submit the following documents in another sealed envelope
marked SUPPORTING BID DOCUMENTS."
1. a.Written Authority Bid
2. b.Bid Security
1. 5.The two sealed envelopes marked OFFICIAL BID" and SUPPORTING BID
DOCUMENTS" must be submitted simultaneously to the Secretariat between 9:00 AM
and 2:00 PM, Philippine Standard Time, on the date of the Public Bidding. No bid shall
be accepted after the closing time. Opened or tampered bids shall not be accepted.
2. 6.The Secretariat will log and record the actual time of submission of the two sealed
envelopes. The actual time of submission will also be indicated by the Secretariat on the
face of the two envelopes.
3. 7.After Step No. 6, the two sealed envelopes will be dropped in the corresponding bid
boxes provided for the purpose. These boxes will be in full view of the invited public.
1. H.OPENING AND READING OF BIDS
1. 1.After the closing time of 2:00 PM on the date of the Public Bidding, the PBAC will open
all sealed envelopes marked SUPPORTING BID DOCUMENTS" for screening,
evaluation and acceptance. Those who submitted incomplete/insufficient documents or
document/s which is/are not substantially in the form required by PBAC will be
disqualified. The envelope containing their Official Bid Form will be immediately
returned to the disqualified bidders.
2. 2.The sealed envelopes marked OFFICIAL BID" will be opened at 3:00 PM. The name of
the bidder and the amount of its bid price will be read publicly as the envelopes are
opened.
3. 3.Immediately following the reading of the bids, the PBAC will formally announce the
highest bid and the Highest Bidder.
468
SUPREME COURT REPORTS
ANNOTATED
Insurance System
1. 4.The highest bid will be determined on a price per share basis. In the event of a tie
wherein two or more bids have the same equivalent price per share, priority will be
given to the bidder seeking the larger ownership interest in MHC.
2. 5.The Public Bidding will be declared a failed bidding in case:
1. a.No single bid is submitted within the prescribed period; or
2. b.There is only one (1) bid that is submitted and acceptable to the PBAC.
1. I.EXECUTION OF THE NECESSARY CONTRACTS WITH GSIS/MHC
1. 1.The Highest Bidder must comply with the conditions set forth below by October 23, 1995
or the Highest Bidder will lose the right to purchase the Block of Shares and GSIS will
instead offer the Block of Shares to the other Qualified Bidders:
1. a.The Highest Bidder must negotiate and execute with GSIS/MHC the Management
Contract, International Marketing/Reservation System Contract or other type of
contract specified by the Highest Bidder in its strategic plan for The Manila Hotel. If the
Highest Bidder is intending to provide only financial support to The Manila Hotel, a
separate institution may enter into the aforementioned contract/s with GSIS/MHC.
2. b.The Highest Bidder must execute the Stock Purchase and Sale Agreement with GSIS, a
copy of which will be distributed to each of the Qualified Bidder after the
prequalification process is completed.
1. 2.In the event that the Highest Bidder chooses a Management Contract for The Manila
Hotel, the maximum levels for the management fee structure that GSIS/MHC are
prepared to accept in the Management Contract are as follows:
 1. a.Basic management fee: Maximum of 2.5% of gross revenues.(1)
2. b.Incentive fee: Maximum of 8.0% of gross operating profit (1) after deducting undistributed
overhead expenses and the basic management fee.
3. c.Fixed component of the international marketing/reservation system fee: Maximum of
2.0% of gross
469
VOL. 267, FEBRUARY 3, 1997 469
Manila Prince Hotel vs. Government Service
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1. room revenues. (1) The Applicant should indicate in its Information Package if it is wishes
to charge this fee.
Note (1): As defined in the uniform system of account for hotels.
The GSIS/MHC have indicated above the acceptable parameters for the hotel management fees
to facilitate the negotiations with the Highest Bidder for the Management Contract after the Public
Bidding.
A Qualified Bidder envisioning a Management Contract for The Manila Hotel should determine
whether or not the management fee structure above is acceptable before submitting their
prequalification documents to GSIS.
1. J.BLOCK SALE TO THE OTHER QUALIFIED BIDDERS
1. 1.If for any reason, the Highest Bidder cannot be awarded the Block of Shares, GSIS may
offer this to the other Qualified Bidders that have validly submitted bids provided that
those Qualified are willing to match the highest bid in terms of price per share.
2. 2.The order of priority among the interested Qualified Bidders will be in accordance with
the equivalent price per share of their respective bids in the Public Bidding, i.e. first and
second priority will be given to the Qualified Bidders that submitted the second and
third highest bids on the price per share basis, respectively, and so on.
1. K.DECLARATION OF THE WINNING BID DER/STRATEGIC PARTNER
The Highest Bidder will be declared the Winning Bidder/Strategic Partner after the following
conditions are met:
1. a.Execution of the necessary contract with GSIS/MHC not later than October 23, 1995;
and
2. b.Requisite approvals from the GSIS/MHC and COP/OGCC are obtained.
1. I.FULL PAYMENT FOR THE BLOCK OF SHARES
1. 1.Upon execution of the necessary contracts with GSIS/MHC, the Winning
Bidder/Strategic Partner must fully pay, not later than October 23, 1995, the offered
purchase price for the Block of Shares after deducting the Bid Security applied as
downpayment.
470
470 SUPREME COURT REPORTS
ANNOTATED
Manila Prince Hotel vs. Government Service
Insurance System
1. 2.All payments should be made in the form of a Managers Check or unconditional
Demand Draft, payable to the Government Service Insurance System, issued by a
reputable banking institution licensed to do business in the Philippines and acceptable
to GSIS.
1. M.GENERAL CONDITIONS
1. 1.The GSIS unconditionally reserves the right to reject any or all applications, waive any
formality therein, or accept such application as may be considered most advantageous to
the GSIS. The GSIS similarly reserves the right to require the submission of any
additional information from the Applicant as the PBAC may deem necessary.
2. 2.The GSIS further reserves the right to call off the Public Bidding prior to acceptance of
the bids and call for a new public bidding under amended rules, and without any
liability whatsoever to any or all the Qualified Bidders, except the obligation to return
the Bid Security.
3. 3.The GSIS reserves the right to reset the date of the prequalification/bidding conference,
the deadline for the submission of the prequalification documents, the date of the Public
Bidding or other pertinent activities at least three (3) calendar days prior to the
respective deadlines/target dates.
4. 4.The GSIS sells only whatever rights, interest and participation it has on the Block of
Shares.
5. 5.All documents and materials submitted by the Qualified Bidders, except the Bid
Security, may be returned upon request.
6. 6.The decision of the PBAC/GSIS on the results of the Public Bidding is final. The
Qualified Bidders, by participating in the Public Bidding, are deemed to have agreed to
accept and abide by these results.
7. 7.The GSIS will be held free and harmless from any liability, suit or allegation arising out
of the Public Bidding by the Qualified Bidders who have participated in the Public
Bidding."3
________________
3Annex A" to the Consolidated Reply to Comments of Respondents, Rollo, pp. 140155.
471
VOL. 267, FEBRUARY 3, 1997 471
Manila Prince Hotel vs. Government Service
Insurance System
The second public bidding was held on September 18, 1995. Petitioner bidded P41.00 per share for
15,300,000 shares and Renong Berhad bidded P44.00 per share also for 15,300,000 shares. The GSIS
declared Renong Berhad the highest bidder and immediately returned petitioners bid security.
On September 28, 1995, ten days after the bidding, petitioner wrote to GSIS offering to match
the bid price of Renong Berhad. It requested that the award be made to itself citing the second
paragraph of Section 10, Article XII of the Constitution. It sent a managers check for thirty-three
million pesos (P33,000,000.00) as bid security.
Respondent GSIS, then in the process of negotiating with Renong Berhad the terms and
conditions of the contract and technical agreements in the operation of the hotel, refused to entertain
petitioners request
Hence, petitioner filed the present petition. We issued a temporary restraining order on October
18, 1995.
 Petitioner anchors its plea on the second paragraph of Article XII, Section 10 of the
Constitution4 on the National Economy and Patrimony which provides:
x x x
In the grant of rights, privileges, and concessions covering the national economy and
patrimony, the State shall give preference to qualified Filipinos.
xxx
The vital issues can be summed up as follows:
1. (1)Whether section 10, paragraph 2 of Article XII of the Constitution \8 a self-executing
provision and does not need implementing legislation to carry it into effect;
2. (2)Assuming section 10, paragraph 2 of Article XII is selfexecuting, whether the
controlling shares of the Manila Hotel Corporation form part of our patrimony as a
nation;
________________
Former Chief Justice Enrique Fernando and Commissioner Joaquin Bernas were invited by
4 87 [1921]; see also Gonzales, Philippine Constitutional Law, p. 26 [1969].
the Court as amicus curiae to shed light on its meaning.
472
472 SUPREME COURT REPORTS
ANNOTATED
Manila Prince Hotel vs. Government Service
Insurance System
1. (3)Whether GSIS is included in the term State, hence, mandated to implement section
10, paragraph 2 of Article XII of the Constitution;
2. (4)Assuming GSIS is part of the State, whether it failed to give preference to petitioner, a
qualified Filipino corporation, over and above Renong Berhad, a foreign corporation, in
the sale of the controlling shares of the Manila Hotel Corporation;
3. (5)Whether petitioner is estopped from questioning the sale of the shares to Renong
Berhad, a foreign corporation.
Anent the first issue, it is now familiar learning that a Constitution provides the guiding policies and
principles upon which is built the substantial foundation and general framework of the law and
government.5 As a rule, its provisions are deemed self-executing and can be enforced without further
legislative action.6 Some of its provisions, however, can be implemented only through appropriate
laws enacted by the Legislature, hence not self-executing.
To determine whether a particular provision of a Constitution is self-executing is a hard row to
hoe. The key lies on the intent of the framers of the fundamental law oftentimes submerged in its
language. A searching inquiry should be made to find out if the provision is intended as
a present enactment, complete in itself as a definitive law, or if it needs futurelegislation for
completion and enforcemet.7 The inquiry demands a micro-analysis of the text and the context of the
provision in question.8
________________
Lopez v. de los Reyes, 55 Phil. 170, 1901 [1930].
5
16 Am Jur 2d, Constitutional Law, Sec. 139, p. 510 [1979 ed.]; B R.C.L. Sec. 52, p. 57
6
[1915]; see also Willis v. St. Paul Sanitation Co., 48 48 Minn. 140, 50 N.W. 1110, 31 A.J.R. 626, 16
L.R.A. 281 11-892]; State ex rel. Schneider v. Kennedy, 587 P. 2d 844, 225 Kan 13 [1978].
7 Willis Y. St. Paul Sanitation, supra, at 11101111; see alsoCooley, A Treatise on Constitutional
Limitations 167, vol. 111927].
8 16 C.J.S., Constitutional Law, Sec. 48, p. 100.
473
VOL. 267, FEBRUARY 3, 1997 473
Manila Prince Hotel vs. Government Service
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Courts as a rule consider the provisions of the Constitution as self-executing,9 rather than as
requiring future legislation for their enforcement.10 The reason is not difficult to discern. For if they
are not treated as self-executing, the mandate of the fundamental law ratified by the sovereign
people can be easily ignored and nullified by Congress. 11Suffused with wisdom of the ages is the
unyielding rule that legislative actions may give breath to constitutional rights but congressional
inaction should not suffocate them.12
Thus, we have treated as self-executing the provisions in the Bill of Rights on arrests, searches
and seizures,13 the rights of a person under custodial investigation, 14 the rights of an accused,15 and
the privilege against self-incrimination.16 It
________________
9 Cooley, supra, at 171; 6 R.C.L. Sec. 53, pp. 5758; Brice v. McDow, 116 S.C. 324, 108 S.E. 84,
10 16 C.J.S., Constitutional Law, Sec. 48, p. 101.
11 Way v. Barney, 116 Minn. 285, 133 N.W. 801, 804 38 L.R.A. (N.S.) 648, Ann. Cas. 1913 A, 719
[1911]; Brice v. McDow, supra, at 87; Morgan v. Board of Supervisors, 67 Ariz. 133, 192 P. 2d 236,
241 [1948]; Gonzales, supra.
12 Ninth Decennial Digest Part I, Constitutional Law, (Key No 28), p. 1638.
13 Article III, Section 2; see Webb v. de Leon, 247 SCRA 652 [1995]; People v. Saycon, 236 SCRA
325[1994]; Allado v. Diokno 232 SCRA 192 [1994]; Burgos v. Chief of Staff, 133 SCRA 800 [1984]Yee
Sue Kuy v. Almeda, 70 Phil. 141 [1940]; Pasion Vda. De Garcia v. Locsin, 65 Phil. 689 [1938]; and a
host of other cases.
14 Article III, 12, Section 12, pars. 1 to 3; People v. Alicando, 251 SCRA 293 [1995]; People v.
Bandula, 232 SCRA 566 [1994]- People v. Nito, 228 SCRA 442 [1993]; People v. Duero, 104 SCRA
319 [1981]; People v. Galit, 135 SCRA 465 119851; and a host of other cases.
15 Article III, Section 14; People v. Digno, 250 SCRA 237 [1995]; People v. Godoy, 250 SCRA
676[1995]; People v. Colcol, 219 SCRA 107 [1993]; Borja v. Mendoza, 77 SCRA 422 [1977]; People v.
Dramayo, 42 SCRA 59 [1971]; and a host of other cases.
16 Galman v. Pamaran, 138 SCRA 274 [1985]; Chavez v. Court of Appeals, 24 SCRA
663 [1968]; People v. Otadura, 86 Phil. 244
474
474 SUPREME COURT REPORTS
ANNOTATED
Manila Prince Hotel vs. Government Service
Insurance System
is recognized that legislation is unnecessary to enable courts to effectuate constitutional provisions
guaranteeing the fundamental rights of life, liberty and.the protection of property. 17 The same
treatment is accorded to constitutional provisions forbidding the taking or damaging of property for
public use without just compensation.18
Contrariwise, case law lays down the rule that a constitutional provision is not self-executing
where it merely announces a policy and its language empowers the Legislature to prescribe the
means by which the policy shall be carried into effect.19 Accordingly, we have held that the
provisions in Article II of our Constitution entitled Declaration of Principles and State Policies
should generally be construed as mere statements of principles of the State. 20 We have also ruled
that some provisions of Article XIII on Social Justice and Human Rights," 21 and Article XIV on
Education Science and Technology, Arts, Culture and Sports"22 cannot be the basis of judi-
________________
[1950]; Bermudez v. Castillo, 64 Phil. 485 [1937]; and a host of other cases.
 17 Harley v. Schuylkill County, 476 F. Supp. 191, 195196 [1979]; Erdman v. Mitchell, 207 Pa.
St. 79, 56 Atl. 327, 99 A.S.R. 783, 63 L.R.A. 534 [1903]; see Ninth Decennial Digest Part I,
Constitutional Law, (Key No. 28), pp. 16381639.
18 City of Chicago v. George F. Harding Collection, 217 N.E. 2d 381, 383, 70111. App. 2d 254
[1966]; People v. Buellton Dev. Co., 136 P. 2d 793, 796, 58 Cal. App. 2d 178 [1943]; Bordy v. State, 7
N.W. 2d 632, 635, 142 Neb. 71411943]; Cohen v. City of Chicago, 36 N.E. 2d 220, 224, 377 111. 221
[1941].
19 16 Am Jur 2d, Constitutional Law, Sec. 143, p. 514; 16 C.J.S. Constitutional Law, Sec. 48, p.
100; 6 R.C.L. Sec. 54, p. 59; see also State ex rel. Noe v. Knop La. App. 190 So. 135, 142 [1939]; State
ex rel. Walker v. Board of Commrs. for Educational Lands and Funds, 3 N.W. 2d 196, 200, 141 Neb.
172 [1942]; Maddox v. Hunt, 83 P. 2d 553, 556, 83 Okl. 465 [1938].
20 Article II, Sections 11, 12 and 13 (Basco v. Phil. Amusements and Gaming Corporation, 197
SCRA 52, 68 [1991]); Sections 5, 12, 13 and 17 (Kilosbayan, Inc. v. Morato, 246 SCRA 540, 564
[1995]).
21 Article XIII, Section 13 (Basco, supra).
22 Article XIV, Section 2 (Basco, supra).
475
VOL. 267, FEBRUARY 3, 1997 475
Manila Prince Hotel vs. Government Service
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cially enforceable rights. Their enforcement is addressed to the discretion of Congress though they
provide the framework for legislation23 to effectuate their policy content.24
Guided by this map of settled jurisprudence, we now consider whether Section 10, Article XII of
the 1987 Constitution is self-executing or not. It reads:
Sec. 10. The Congress shall, upon recommendation of the economic and planning agency, when the
national interest dictates, reserve to citizens of the Philippines or to corporations or associations at
least sixty per centum of whose capital is owned by such citizens, or such higher percentage as
Congress may prescribe, certain areas of investments. The Congress shall enact measures that will
encourage the formation and operation of enterprises whose capital is wholly owned by Filipinos.
In the grant of rights, privileges, and concessions covering the national economy and patrimony,
the State shall give preference to qualified Filipinos.
The State shall regulate and exercise authority over foreign investments within its national
jurisdiction and in accordance with its national goals and priorities.
The first paragraph directs Congress to reserve certain areas of investments in the country 25 to
Filipino citizens or to corporations sixty per cent26 of whose capital stock is owned by Filipinos. It
further commands Congressto enact laws that will encourage the formation and operation of one
hundred percent Filipino-owned enterprises. In checkered contrast, the second paragraph orders the
entire State to give preference to qualified Filipinos in the grant of rights and privileges covering the
national economy and patrimony. The third para-
________________
23Kilosbayan v. Morato, supra,at 564.
24Basco v. Phil. Amusements and Gaming Corporation, supra, at 68.
25 Congress had previously passed the Retail Trade Act (R.A. 1180); the Private Security Agency
Act (R.A. 5487; the law on engaging in the rice and corn industry (R.A. 3018, P.D. 194), etc.
26 Or such higher percentage as Congress may prescribe.
476
476 SUPREME COURT REPORTS
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Manila Prince Hotel vs. Government Service
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graph also directs the Stateto regulate foreign investments in line with our national goals and well-
set priorities.
The first paragraph of Section 10 is not self-executing. By its express text, there is a categorical
command for Congress to enact laws restricting foreign ownership in certain areas of investments in
the country and to encourage the formation and operation of wholly-owned Filipino enterprises. The
right granted by the provision is clearly still in esse. Congress has to breathe life to the right by
means of legislation. Parenthetically, this paragraph was plucked from Section 3, Article XIV of the
1973 Constitution.27 The provision in the 1973 Constitution affirmed our ruling in the landmark case
of Lao Ichong v. Hernandez,28 where we upheld the discretionary authority of Congress to Filipinize
certain areas of investments.29 By reenacting the 1973 provision, the first paragraph of Section 10
affirmed the power of Congress to nationalize certain areas of investments in favor of Filipinos.
The second and third paragraphs of Section 10 are different. They are directed to the State and
not to Congress alone which is but one of the three great branches of our government. Their coverage
is also broader for they cover the national economy and patrimony and foreign investments within
[the] national jurisdiction and not merely certain areas of investments. Beyond debate, they
cannot be read as granting Congress the exclusive power to implement by law
________________
27 Article XIV, Section 3 of the 1973 Constitution reads:
Sec. 3. The Batasang Pambansa shall, upon recommendation of the National Economic and
Development Authority, reserve to citizens of the Philippines or to corporations or associations
wholly owned by such citizens, certain traditional areas of investments when the national interest so
dictates.
28 101 Phil. 1155 [1957].
29 See Bernas, The Constitution of the Republic of the Philippines 450, vol. II [1988]. The Lao
lchongcase upheld the Filipinization of the retail trade and implied that particular areas of business
may be Filipinized without doing violence to the equal protection clause of the Constitution.
477
VOL. 267, FEBRUARY 3, 1997 477
Manila Prince Hotel vs. Government Service
Insurance System
the policy of giving preference to qualified Filipinos in the conferral of rights and privileges covering
our national economy and patrimony. Their language does not suggest that any of the State agency
or instrumentality has the privilege to hedge or to refuse its implementation for any reason
whatsoever. Their duty to implement is unconditional and it is now. The second and the third
paragraphs of Section 10, Article XII are thus self-executing.
This submission is strengthened by Article II of the Constitution entitled Declaration of
Principles and State Policies. Its Section 19 provides that "[T]he State shall develop a selfreliant and
independent national economy effectively controlled by Filipinos. It engrafts the all-important
Filipino First policy in our fundamental law and by the use of the mandatory word shall, directs its
enforcement by the whole State without any pause or a half-pause in time. The second issue is
whether the sale of a majority of the stocks of the Manila Hotel Corporation involves the disposition
of part of our national patrimony. The records of the Constitutional Commission show that the
Commissioners entertained the same view as to its meaning. According to Commissioner Nolledo,
patrimony refers not only to our rich natural resources but also to the cultural heritage of our
race.30 By this yardstick, the sale of Manila Hotel falls within the coverage of the constitutional
provision giving preferential treatment to qualified Filipinos in the grant of rights involving our
national patrimony. The unique value of the Manila Hotel to our history and culture cannot be
viewed with a myopic eye. The value of the hotel goes beyond pesos and cen-
_______________
30 Nolledo, The New Constitution of the Philippines, Annotated, 1990 ed., p. 72. The word
patrimony first appeared in the preamble of the 1935 Constitution and was understood to cover
everything that belongs to the Filipino people, the tangible and the material as well as the intangible
and the spiritual assets and possessions of the nation (Sinco, Philippine Political Law, Principles and
Concepts [1962 ed.], p. 112; Speech of Delegate Conrado Benitez defending the draft preamble of the
1935 Constitution in Laurel, Proceedings of the Constitutional Convention, vol. III, p. 325 [1966]).
478
478 SUPREME COURT REPORTS

ANNOTATED
Manila Prince Hotel vs. Government Service
Insurance System
tavos. As chronicled by Beth Day Romulo,31 the hotel first opened on July 4, 1912 as a first-class
hotel built by the American Insular Government for Americans living in, or passing through, Manila
while travelling to the Orient Indigenous materials and Filipino craftsmanship were utilized in its
construction. For sometime, it was exclusively used by American and Caucasian travelers and served
as the official guesthouse of the American Insular Government for visiting foreign dignitaries.
Filipinos began coming to the Hotel as guests during the Commonwealth period. When the Japanese
occupied Manila, it served as military headquarters and lodging for the highest-ranking officers from
Tokyo. It was at the Hotel and the Intramuros that the Japanese made their last stand during the
Liberation of Manila. After the war, the Hotel again served foreign guests and Filipinos alike.
Presidents and kings, premiers and potentates, as well as glamorous international film and sports
celebrities were housed in the Hotel. It was also the situs of international conventions and
conferences. In the local scene, it was the venue of historic meetings, parties and conventions of
political parties. The Hotel has reaped and continues reaping numerous recognitions and awards
from international hotel and travel awardgiving bodies, a fitting acknowledgment of Filipino talent
and ingenuity. These are judicially cognizable facts which cannot be bent by a biased mind.
The Hotel may not, as yet, have been declared a national cultural treasure pursuant to Republic
Act No. 4846 but that does not exclude it from our national patrimony. Republic Act No. 4846, The
Cultural Properties Preservation and Protection Act, merely provides a procedure whereby a
particular cultural property may be classified a national cultural treasure or an important Constitution especially those designed to promote the general welfare of the people. One of these
cultural property."32 Approved on June
________________
31 Commissioned by the Manila Hotel Corporation for the Diamond Jubilee celebration of the
Hotel in 1987; see The Manila Hotel: The Heart and Memory of a City.
32 Section 7 of R.A. 4846 provides:
479
VOL. 267, FEBRUARY 3, 1997 479
Manila Prince Hotel vs. Government Service
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18, 1966 and amended by P.D. 374 in 1974, the law is limited in its reach and cannot be read as the
exclusive law implementing Section 10, Article XII of the 1987 Constitution. To be sure, the law does
not equate cultural treasure and cultural property as synonymous to the phrase patrimony of the
nation.
The third issue is whether the constitutional command to the State includes the respondent
GSIS. A look at its charter will reveal that GSIS is a government-owned and controlled corporation
that administers funds that come from the monthly contributions of government employees and the
government.33 The funds are held in trust for a distinct purpose
________________
Sec. 7. In the designation of a particular cultural property as a national cultural treasure, the
following procedure shall be observed:
(a) Before the actual designation, the owner, if the property is privately owned, shall be notified
at least fifteen days prior to the intended designation, and he shall be invited to attend the
deliberation and given a chance to be heard. Failure on the part of the owner to attend the
deliberation shall not bar the panel to render its decision. Decision shall be given by the panel within
a week after its deliberation. In the event that the owner desires to seek reconsideration of the
designation made by the panel, he may do so within thirty days from the date that the decision has
been rendered. If no request for reconsideration is filed after this period, the designation is then
considered final and executory. Any request for reconsideration filed within thirty days and
subsequently again denied by the panel, may be further appealed to another panel chairmanned by
the Secretary of Education with two experts as members appointed by the Secretary of Education.
Their decision shall be final and binding.
(b) Within each kind or class of objects, only the rare and unique objects may be designated as
National Cultural Treasures. The remainder, if any, shall be treated as cultural property.
xxx
33 P.D. 1146, Sec. 5; P.D. 1146, known as The Revised Government Service Insurance Act of
1977" amended Commonwealth Act No. 186, the Government Service Insurance Act of 1936.
480
480 SUPREME COURT REPORTS
ANNOTATED
Manila Prince Hotel vs. Government Service
Insurance System
which cannot be disposed of indifferently.34 They are to be used to finance the retirement, disability
and life insurance benefits of the employees and the administrative and operational expenses of the
GSIS.35 Excess funds, however, are are allowed to be invested in business and other ventures for the
benefit of the employees.36 It is thus contended that the GSIS' investment in the Manila Hotel
Corporation is a simple business venture, hence, an act beyond the contemplation of Section 10,
paragraph 2 of Article XII of the Constitution.
The submission is unimpressive, The GSIS is not a pure private corporation. It is essentially a
public corporation created by Congress and granted an original charter to serve a public purpose. It
is subject to the jurisdictions of the Civil Service Commission37and the Commission on Audit.38 As a
state-owned and controlled corporation, it is skin-bound to adhere to the policies spelled out in the
policies is the Filipino First Policy which the people elevated as a constitutional command.
The fourth issue demands that we look at the content of the phrase qualified Filipinos and
their preferential right. The Constitution desisted from defining their contents. This is as it ought
to be for a Constitution only lays down flexible policies and principles which.can be bent to meet
todays manifest needs and tomorrows unmanifested demands. Only a constitution strung with
elasticity can grow as a living constitution.
Thus, during the deliberations in the Constitutional Commission, Commissioner Nolledo
brushed aside a suggestion to define the phrase qualified Filipinos. He explained that
________________
34 Beronilla v. Government Service Insurance System, 36 SCRA 44, 53 [1970]; Social Security
System Employees Association v. Soriano, 7 SCRA 1016, 1023 [1963].
35 Id., Secs. 28 and 29.
36 Id., Sec. 30.
37 Constitution, Article K(B), section 2(1).
38 Constitution, Article K(D), section 2(1).
481
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Manila Prince Hotel vs. Government Service
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present and prospective laws will take care of the problem of its interpretation, viz:
x x x
THE PRESIDENT. What is the suggestion of Commissioner Rodrigo? Is it to remove the word
QUALIFIED?"
MR. RODRIGO. No, no, but say definitely TO QUALIFIED FILIPINOS" as against whom? As
against aliens over aliens?
MR. NOLLEDO. Madam President, I think that is understood We use the word QUALIFIED"
because the existing laws or the prospective laws will always lay down conditions under which
business may be done. For example, qualifications on capital, qualifications on the setting up of
other financial structures, et cetera.
MR. RODRIGO. It is just a matter of style.
MR. NOLLEDO. Yes.
MR. NOLLEDO. If we say, PREFERENCE TO QUALIFIED FILIPINOS," it can be understood
as giving preference to qualified Filipinos as against Filipinos who are not qualified.
 MR. NOLLEDO. Madam President, that was the intention of the proponents. The committee
has accepted the amendment.
xxx
As previously discussed, the constitutional command to enforce the Filipino First Policy is addressed
to the State and not to Congress alone. Hence, the word laws should not be understood as limited
to legislations but all state actions which include applicable rules and regulations adopted by
agencies and instrumentalities of the State in the exercise of their rule-making power. In the case at
bar, the bidding rules and regulations set forth the standards to measure the qualifications of
bidders, Filipinos and foreigners alike. It is not seriously disputed that petitioner qualified to bid as
did Renong Berhad.39
________________
39 It is meet to note that our laws do not debar foreigners from engaging in the hotel business.
Republic Act No. 7042, entitled the Foreign Investments Act of 1991" was enacted by Congress to
attract, promote and welcome x x x foreign investments x x x in activities which significantly
contribute to national industrialization
482
482 SUPREME COURT REPORTS
ANNOTATED
Manila Prince Hotel vs. Government Service
Insurance System
Thus, we come to the critical issue of the degree of preference which GSIS should have accorded
petitioner, a qualified Filipino, over Renong Berhad, a foreigner, in the purchase of the controlling
shares of the Manila Hotel Petitioner claims that after losing the bid, this right of preference gives it
a second-chance to match the highest bid of Renong Berhad.
With due respect, I cannot sustain petitioners submission. I prescind from the premise that the
second paragraph of Section 10, Article XII of the Constitution is pro-Filipino but not anti-alien. It is
pro-Filipino for it gives preference to Filipinos. It is not, however, anti-alien per se for it does not
absolutely bar aliens in the grant of rights, privileges and concessions covering the national economy
and patrimony. Indeed, in the absence of qualified Filipinos, the State is not prohibited from
granting these rights, privileges and concessions to foreigners if the act will promote the weal of the
nation.
In implementing the policy articulated in Section 10, Article XII of the Constitution, the stellar
task of our State policymakers is to maintain a creative tension between two desideratafirst, the
need to develop our economy and patrimony with the help of foreigners if necessary, and, second, the
need to keep our economy controlled by Filipinos. Rightfully, the framers of the Constitution did not
define the degree of the right of preference to be given to qualified Filipinos.They knew that for the
right to serve the general welfare, it must have a malleable content that can be adjusted by our
policymakers to meet the changing needs of our people. In fine, the right of preference of qualified
Filipinos is to be determined by degree as time dictates and circumstances warrant. The lesser
________________
and socio-economic development to the extent that foreign investment is allowed by the
Constitution and relevant laws. The law contains a list, called the Negative List, specifying areas of
economic activity where foreign participation is limited or prohibited. Areas of economic activity not
included in the Negative List are open to foreign participation up to one hundred per cent (Secs. 6
and 7). Foreigners now own and run a great number of our five-star hotels.
483
VOL. 267, FEBRUARY 3, 1997 483
Manila Prince Hotel vs. Government Service
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the need for alien assistance, the greater the degree of the right of preference can be given to
Filipinos and vice versa.
Again, it should be stressed that the right and the duty to determine the degree of this privilege
at any given time is addressed to the entire State. While under our constitutional scheme, the right
primarily belongs to Congress as the lawmaking department of our government, other branches of
government, and all their agencies and instrumentalities, share the power to enforce this state
policy. Within the limits of their authority, they can act or promulgate rules and regulations defining
the degree of this right of preference in cases where they have to make grants involving the national
economy and judicial duty. On the other hand, our duty is to strike down acts of the State that violate
the policy.
To date, Congress has not enacted a law defining the degree of the preferential right.
Consequently, we must turn to the rules and regulations of respondents Committee on Privatization
and GSIS to determine the degree of preference that petitioner is entitled to as a qualified Filipino in
the subject sale. A tearless look at the rules and regulations will show that they are silent on the
degree of preferential right to be accorded a qualified Filipino bidder. Despite their silence, however,
they cannot be read to mean that they do not grant any degree of preference to petitioner for
paragraph 2, Section 10, Article XII of the Constitution is deemed part of said rules and regulations.
Pursuant to legal hermeneutics which demand that we interpret rules to save them from
unconstitutionality, I submit that the right of preference of petitioner arises only if it tied the bid of
Renong Berhad. In that instance, all things stand equal, and petitioner, as a qualified
Filipinobidder, should be preferred.
It is with deep regret that I cannot subscribe to the view that petitioner has a right to match the
bid of Renong Berhad. Petitioners submission must be supported by the rules but even if we examine
the rules inside-out a thousand times, they can not justify the claimed right. Under the rules, the
right to match the highest bid arises only if for any reason, the highest bidder cannot be awarded
the block of shares x x x. No
484
484 SUPREME COURT REPORTS
ANNOTATED
Manila Prince Hotel vs. Government Service
Insurance System
reason has arisen that will prevent the award to Renong Berhad. It qualified as a bidder. It complied
with the procedure of bidding. It tendered the highest bid. It was declared as the highest bidder by
the GSIS and tke rules say this decision is final. deserves the award as a matter of right for the rules
clearly did not give to the petitioner as a qualified Filipino the privilege to match the higher bid of a
foreigner. What the rules did not grant, petitioner cannot demand. Our sympathies may be with
petitioner but the court has no power to extend the latitude and longtitude of the right of preference as
defined by the rules. The parameters of the right of preference depend on a galaxy of facts and factors
whose determination belongs to the province of the policy-making branches and agencies of the
State. We are duty-bound to respect that determination even if we differ with the wisdom of their
judgment. The right they grant may be little but we must uphold the grant for as long as the right of
preference is not denied. It is only when a State action amounts to a denial of the right that the Court
can come in and strike down the denial as unconstitutional.
Finally, I submit that petitioner is estopped from assailing the winning bid of Renong Berhad.
Petitioner was aware of the rules and regulations of the bidding. It knew that the rules and
regulations do not provide that a qualified Filipino bidder can match the winning bid after
submitting an inferior bid. It knew that the bid was open to foreigners and that foreigners qualified
even during the first bidding. Petitioner cannot be allowed to repudiate the rules which it agreed to
respect. It cannot be allowed to obey the rules when it wins and disregard them when it loses. If
sustained, petitioners stance will wreak havoc on the essence of bidding. Our laws, rules and
regulations require highest bidding to raise as much funds as possible for the government to
maximize its capacity to deliver essential services to our people. This is a duty that must be
discharged by Filipinos and foreigners participating in a bidding contest and the rules are carefully
written to attain this objective. Among others, bidders are prequalified to insure their financial
capability. The bidding is secret and the bids are sealed to prevent collusion among the parties. This
485
VOL. 267, FEBRUARY 3, 1997 485

Manila Prince Hotel vs. Government Service
Insurance System
objective will be undermined if we grant petitioner the privilege to know the winning bid and a
chance to match it. For plainly, a second chance to bid will encourage a bidder not to strive to give
the highest bid in the first bidding.
We support the Filipino First Policy without any reservation. The visionary nationalist Don
Claro M. Recto has warned us that the greatest tragedy that can befall a Filipino is to be an alien in
his own land. The Constitution has embodied Rectos counsel as a state policy and our decision
should be in sync with this policy. But while the Filipino First Policy requires that we incline to a
Filipino, it does not demand that we wrong an alien. Our policy makers can write laws and rules
giving favored treatment to the Filipino but we are not free to be unfair to a foreigner after writing
the laws and the rules. After the laws are written, they must be obeyed as written, by Filipinos and
foreigners alike. The equal protection clause of the Constitution protects all against unfairness. We
can be pro-Filipino without unfairness to foreigners.
I vote to dismiss the petition.
SEPARATE DISSENTING OPINION
PANGANIBAN, J.:
I regret I cannot join the majority. To the incisive Dissenting Opinion of Mr. Justice Reynato S.
Puno, may I just add: 1. The majority contends the Constitution should be interpreted to mean that,
after a bidding process is concluded the losing Filipino bidder should be given the right to equal the
highest foreign bid, and thus to win. However, the Constitution [Sec. 10(2), Art, XII] simply states
that in the grant of rights x x x covering the national economy and patrimony, the State shall give
preference to qualified Filipinos. The majority concedes that there is no law defining the extent or
degreeof such preference. Specifically, no statute empowers a losing Filipino bidder to increase his
bid and equal that of the winning foreigner. In the absence of such empowering law, the majoritys
strained interpretation, I respectfully submit, constitutes unadulterated judicial legislation, which
makes bid-
486
486 SUPREME COURT REPORTS
ANNOTATED
Manila Prince Hotel vs. Government Service
Insurance System
ding a ridiculous sham where no Filipino can lose and where no foreigner can win. Only in the
Philippines!
2. Aside from being prohibited by the Constitution, such judicial legislation is short-sighted and,
viewed properly, gravely prejudicial to long-term Filipino interests. It encourages other countries
in the guise of reverse comity or worse, unabashed retaliationto discriminate against us in their
own jurisdictions by authorizing their own nationals to similarly equal and defeat the higher bids of
Filipino enterprises solely, while on the other hand, allowing similar bids of other foreigners to
remain unchallenged by their nationals. The majoritys thesis will thus marginalize Filipinos as
pariahs in the global marketplace with absolutely no chance of winning any bidding outside our
country. Even authoritarian regimes and hermit kingdoms have long ago found out that unfairness,
greed and isolation are self-defeating and in the long-term, self-destructing.
The moral lesson here is simple: Do not do unto others what you do not want others to do unto
you.
3. In the absence of a law specifying the degree or extent of the Filipino First policy of the
Constitution, the constitutional preference for the qualified Filipinos may be allowed only where all
the bids are equal. In this manner, we put the Filipino ahead without self-destructing him and
without being unfair to the foreigner.
In short, the Constitution mandates a victory for the qualified Filipino only when the scores are
tied. But not when the ballgame is over and the foreigner clearly posted the highest score.
Respondents directed to cease and desist from selling 51% of shares if the Manila Hotel
Corporation to Renong Berhad, and accept matching bid of petitioner.
Notes.The postulates of our Constitution are not mere platitudes which we should honor only
in rhetorics but not in reality. In fine, the power to contract a foreign loan does not carry with it the
authority to bargain away the ideals of our
487
VOL. 267, FEBRUARY 3, 1997 487
Gatmaytan vs. Court of Appeals
Constitution. (National Housing Corporation vs. Commission on Audit, 226 SCRA 55 [1993])
R.A. No. 7181 does not mandate any sequencing for the disposition of shares in government-
owned corporations being privatized. (Bagatsing vs. Committee on Privatization,246 SCRA
334 [1995])
o0o
Copyright 2017 Central Book Supply, Inc. All rights reserved.
Aids to Interpretation and Construction A. Intrinsic Aids
i. Title
Ebarle v. Sucaldito, G.R. No. L-33628, 29 December 1987, 156 SCRA 803
VOL. 156, DECEMBER 29, 1987 803
Ebarle vs. Sucaldito
No. L-33628. December 29, 1987.*
BIENVENIDO A. EBARLE, SANTIAGO EISMA, MIRUFO CELERIAN, JOSE SAYSON, CESAR
TABILIRAN, and MAXIMO ADLAWAN, petitioners, vs.HON. JUDGE MELQUIADES B.
SUCALDITO, RUFINO LABANG, MENELEO MESINA, ARTURO GUILLERMO, IN THEIR
RESPECTIVE CAPACITIES AS JUDGE OF THE COURT OF FIRST INSTANCE OF
ZAMBOANGA DEL SUR, CITY FISCAL OF PAGADIAN CITY AND STATE PROSECUTOR, and
ANTI-GRAFT LEAGUE OF THE PHILIPPINES, INC., respondents.
No. L-34162. December 29, 1987.*
BIENVENIDO A. EBARLE, petitioner, vs. HON. JUDGE ASAALI S. ISNANI, RUFINO LABANG,
ALBERTO S. LIM, JR., JESUS ACEBES, IN THEIR RESPECTIVE CAPACITIES AS JUDGE OF
THE COURT OF FIRST INSTANCE OF ZAMBOANGA DEL SUR, CITY FISCAL OF PAGADIAN
CITY AND STATE PROSECUTORS, ANTIGRAFT LEAGUE OF THE PHILIPPINES, INC., and
ARTEMIO ROMANILLOS, respondents.
Anti-Graft and Corrupt Practices Act (Republic Act No. 3019); Anti-Graft League of the
Philippines is not an "offended party" within the meaning of Sec. 2, Rule 110, of the Rules of Court
(now Section 3 of the 1985 Rules on Criminal Procedure).The challenge the petitioner presents
against the personality of the Anti-Graft League of the Philippines to bring suit is equally without
merit. That the Anti-Graft League is not an "offended party" within the meaning of Section 2, Rule
110, of the Rules of Court (now Section 3 of the 1985 Rules on Criminal Procedure), cannot abate the
complaints in question.
Same; Same; Executive Order No. 264 (October 6, 1970) has exclusive application to
administrative, not criminal complaints.lt is plain from the very wordings of the Order that it has
exclusive application to administrative, not criminal complaints. The Order itself
_______________
*SECOND DIVISION.
804
8 SUPREME COURT REPORTS
04 ANNOTATED
Ebarle vs. Sucaldito
shows why. The very title speaks of "COMMISSION' OF IRREGULARITIES." There is no
mention, not even by implication, of criminal "offenses," that is to say, "crimes." While "crimes"
amount to "irregularities," the Executive Order could have very well referred to the more specific
term had it intended to make itself applicable thereto.
Same; Same; Same; Statutes; Construction: Executive Order No. 264 makes reference to
"erring officials and employees x x x removed or otherwise vindicated" and does not employ such
technical terms as "accused, " "convicted" and "acquitted, " hence it was not intended to apply to
criminal prosecutions.It is moreover significant that the Executive Order in question makes
specific reference to "erring officials or employees x x x removed or otherwise vindicated." If it were
intended to apply to criminal prosecutions, it would have employed such technical terms as
"accused," "convicted," or "acquitted." While this is not necessarily a controlling parameter for all
cases, it is here material in construing the intent of the measure.
Same; Same; Same; Criminal Procedure; Rule: Unless the offense subject thereof is one that
cannot be prosecuted de oficio, the same may be filed for preliminary investigation purposes, by any
competent person.A complaint for purposes of preliminary investigation by the fiscal need not be
filed by the "offended party." The rule has been that, unless the offense subject thereof is one that
cannot be prosecuted de oficio, the same may be filed, for preliminary investigation purposes, by any
competent person. The "complaint" referred to in the Rule 110 contemplates one filed in court, not
with the fiscal. In that case, the proceeding must be started by the aggrieved party himself.
Same; Same; Same; Same; Injunction; General Rule: Injunction does not lie to enjoin criminal
prosecutions; Exceptions, stated.It is not our business to resolve complaints the disposition of
which belongs to another agency, in this case, the respondent Fiscal. But more than that, and as a
general rule, injunction does not lie to enjoin criminal prosecutions. The rule is subject to exceptions,
to wit: (1) for the orderly administration of justice; (2) to prevent the use of the strong arm of the law
in an oppressive and vindictive manner; (3) to avoid multiplicity of actions; (4) to afford adequate
protection to constitutional rights; and (5) because the statute relied on is constitutionally infirm or
otherwise void. We cannot perceive any of the exceptions applicable here. The petitioner cries foul, in
a manner of
805
VOL. 156, DECEMBER 29, 1987 8 Company; which was to expire on November 2, 1969; that nevertheless the said amount was paid
05
Ebarle vs. Sucaldito
speaking, with respect to the deluge of complaints commenced by the private respondent
below, but whether or not they were filed for harassment purposes is a question we are not in a
position to decide. The proper venue, we believe, for the petitioner's complaint is precisely in the
preliminary investigations he wishes blocked here.
SARMIENTO, J.:
The petitioner, then provincial Governor of Zamboanga del Sur and a candidate for reelection in the
local elections of 1971, seeks injunctive relief in two separate petitions, to enjoin further proceedings
in Criminal Cases Nos. CCC XVI-4-ZDS, CCC XVI-6-ZDS, and CCC XVI-8-ZDS of the then Circuit
Criminal Court sitting in Pagadian City, as well as I.S. Nos. 1-70, 2-71, 4-71, 5-71, 6-71, and 7-71 of
the respondent Fiscal's office of the said city, all in the nature of prosecutions for violation of certain
provisions of the Anti-Graft and Corrupt Practices Act (Republic Act No. 3019) and various
provisions of the Revised Penal Code, commenced by the respondent Anti-Graft League of the
Philippines, Inc.
On June 16, 1971 and October 8, 1971, respectively, we issued temporary restraining orders
directing the respondents (in both petitions) to desist from further proceedings in the cases in
question until further orders from the Court. At the same time, we gave due course to the petitions
and accordingly, required the respondents to answer.
The petitions raise pure question of law. The facts are hence, undisputed.
On September 26, 1970, the private respondent Anti-Graft League of the Philippines, Inc., filed
a complaint with the respondent City Fiscal, docketed as Criminal Case No. 1-70 thereof, for
violation of the provisions of the Anti-Graft Law as well as Article 171 of the Revised Penal Code, as
follows:
xxx xxx xxx
SPECIFICATION NO. I
That on or about October 10, 1969, above-named respondents, conspiring and confabulating
together, allegedly conducted a bidding for the supply of gravel and sand for the Province of
Zamboanga del Sur; that it was made to appear that Tabiliran Trucking Company
806
806 SUPREME COURT REPORTS
ANNOTATED
Ebarle vs. Sucaldito
won the bidding; that, thereafter, the award and contract pursuant to the said simulated bidding
were effected and executed in favor of Tabiliran Trucking Company; that, in truth and in fact, the
said bidding was really simulated and the papers on the same were falsified to favor Tabiliran
Trucking Company, represented by the private secretary of respondent Bienvenido Ebarle, formerly
confidential secretary of the latter; that said awardee was given wholly unwarranted advantage and
preference by means of manifest partiality; that respondent officials are hereby also charged with
interest for personal gain for approving said award which was manifestly irregular and grossly
unlawful because the same was facilitated and committed by means of falsification of of ficial
documents.
SPECIFICATION NO. II
That after the aforecited award and contract, Tabiliran Trucking Company, represented by
respondent Cesar Tabiliran, attempted to collect advances under his trucking contract in the under
his trucking contract in the amount of P4,823.95 under PTA No. 3654; that the same was not passed
in audit by the Provincial Auditor in view of the then subsisting contract with Teoson Trucking
and it was made to appear that it was collected by Teoson Trucking Company, although there was
nothing due from the latter and the voucher was never indorsed or signed by the operator of Teoson
Trucking; and that in facilitating and consummating the aforecited collection, respondent officials,
hereinabove cited, conspired and connived to the great prejudice and damage of the Provincial
Government of Zamboanga del Sur.1
xxx xxx xxx
On the same date, the private respondent commenced Criminal Case No. 2-71 of the respondent City
Fiscal, another proceeding for violation of Republic Act No. 3019 as well as Article 171 of the Revised
Penal Code. The complaint reads as follows:
xxx xxx xxx
That on or about April 8, 1970, a bidding was held for the construction of the right wing portion
of the Capitol Building of the Province of Zamboanga del Sur, by the Bidding Committee composed of
respondents cited hereinabove; that the said building was
_______________
1Rollo, G.R. No. 33628, 40-41.
807
VOL. 156, DECEMBER 29, 1987 807

Ebarle vs. Sucaldito
maliciously manipulated so as to give wholly unwarranted advantage and preference in favor of the
supposed winning bidder, Codeniera Construction, allegedly owned and managed by Wenceslao
Codeniera, brother-in-law of the wife of respondent Bienvenido Ebarle; that respondent official is
interested for personal gain because he is responsible for the approval of the manifestly irregular
and unlawful award and contract aforecited; and that, furthermore, respondent, being a Member of
the Bidding Committee, also violated Article 171 of the Revised Penal Code, by making it appear in
the very abstract of bids that another interested bidder, was not interested in the bidding, when in
truth and in fact, it was not so.2
xxx xxx xxx
On January 26, 1971, the private respondent instituted I.S. No. 4-71 of the respondent Fiscal, a
prosecution for violation of Articles 182, 183, and 318 of the Revised Penal Code, as follows:
xxx xxx xxx
That on or about April 4, 1967, in Pagadian City, said respondent testified falsely under oath in
Cadastral Case No. N-17, LRC CAD REC. NO. N-468, for registration of title to Lot No. 2545 in
particular;
That respondent BIENVENIDO EBARLE testified falsely under oath during the hearing and
reception of evidence that he acquired said lot by purchase from a certain Brigido Sanchez and that
he is the owner, when in truth and in fact Lot 2545 had been previously acquired and is owned by
the provincial Government of Zamboanga del Sur, where the provincial jail building is now located.
2. That aforesaid deceit, false testimony and untruthful statement of respondent in said
Cadastral case were made knowingly to the great damage and prejudice of the Provincial
Government of Zamboanga del Sur in violation of aforecited provisions of the Revised Penal Code. 3
On February 10, 1971, finally, the private respondent filed a complaint, docketed as I.S. No. 5-71 of
the respondent Fiscal, an action for violation of Republic Act No. 3019 and Articles 171 and 213 of
the Revised Penal Code, as follows:
_______________
2Id., No. 42.
3Id., No. 43.
808
808 SUPREME COURT REPORTS
ANNOTATED
Ebarle vs. Sucaldito
xxx xxx xxx
We hereby respectfully charge the above-named respondents for violation of Sec. 3, R.A. No.
3019, otherwise known as the Anti-Graft and Corrupt Practices Act, Articles 171 and 213, Revised
Penal Code and the rules and regulations of public bidding, committed as follows:
The petitioner initially moved to dismiss the aforesaid preliminary investigations, but the same
having been denied, he went to the respondent Court of First Instance of Zamboanga del Sur, the
Honorable Melquiades Sucaldito presiding, on prohibition and mandamus (Special Case No. 1000)
praying at the same time, for a writ of preliminary injunction to enjoin further proceedings therein.
The court granted preliminary injunctive relief (restraining order) for which the Anti-Graft League
filed a motion to have the restraining order lifted and to have the petition itself dismissed.
_______________
4Id., 45-46.
809
VOL. 156, DECEMBER 29, 1987 809
Ebarle vs. Sucaldito
On May 14, 1971, the respondent, Judge Sucaldito, handed down the first of the two challenged
orders, granting AntiGraft League's motion and dismissing Special Case No. 1000.
On June 11, 1971, the petitioner came to this Court on certiorari with prayer for a temporary
restraining order (G.R. No. 33628). As we said, we issued a temporary restraining order on June 16,
1971.
Meanwhile, and in what would begin yet another series of criminal prosecutions, the private
respondent, on April 26, 1971, filed three complaints, subsequently docketed as Criminal Cases Nos.
CCC XVI-4-ZDS, CCC XVI-6-ZDS, and CCC XV1-8-ZDS of the Circuit Criminal Court of Pagadian
City, for violation of various provisions of the Anti-Graft Law as well as Article 171(4) of the Revised
Penal Code, as follows:
xxx xxx xxx
That on or about December 18, 1969, in Pagadian City, and within the jurisdiction of this
Honorable Court, BIENVENIDO A. EBARLE, Provincial Governor of Zamboanga del Sur, did then
and there unlawfully and feloniously extended and gave ELIZABETH EBARLE MONTESCLAROS,
daughter of his brother, his relative by consanguinity within the third degree, and appointment as
Private Secretary in the Office of the Provincial Governor of Zamboanga del Sur, although he well
know that the latter is related with him within the third degree by consanguinity.
CONTRARY TO LAW.5
xxx xxx xxx
xxx xxx xxx
That on or about December 18, 1969, in Pagadian City, and within the jurisdiction of this
Honorable Court, BIENVENIDO A. EBARLE, then and there unlawfully and feloniously made
untruthful statements in a narration of facts by accomplishing and issuing a certificate, to wit: '
"c. That the provisions of law and rules on promotion, seniority and nepotism have been
observed." required by law in such cases, in support of the appointment he extended to ELIZABETH
EBARLE-MONTESCLAROS, as Private Secretary in the Office of the Provincial Governor of
Zamboanga del
_______________

1. 1.That on June 16, 1970, without publication, respondents conducted the so-called 5Rollo, G.R. No. 34162, 98 (Crim. Case No. CCC XVI-4-ZDS).
"bidding" for the supply of gravel and sand for the province of Zamboanga del Sur; that
810
said respondents, without any valid or legal ground, did not include or even open the bid
of one Jesus Teoson that was seasonably submitted, despite the fact that he is a 810 SUPREME COURT REPORTS
registered duly qualified operator of "Teoson Trucking Service," and notwithstanding his
compliance with all the rules and requirements on public bidding; that, instead, ANNOTATED
aforecited respondents illegally and irregularly awarded said contract to Cesar Ebarle vs. Sucaldito
Tabiliran, an associate of respondent Governor Bienvenido Ebarle; and
Sur, although he well know that the latter is related with him within the third degree of
2. 2.That in truth and in fact, aforesaid "bidding" was really simulated and papers were
consanguinity.
falsified or otherwise "doctored" to favor respondent Cesar Tabiliran thereby giving him
CONTRARY TO LAW.6
wholly unwarranted advantage, preference and benefits by means of manifest partiality;
xxx xxx xxx
and that there is a statutory presumption of interest for personal gain because the
xxx xxx xxx
transaction and award were manifestly irregular and contrary to applicable law, rules
That on or about December 18, 1969, in Pagadian City, and within the jurisdiction of this
and regulations.4 x x x xxx xxx
Honorable Court, BIENVENIDO A. EBARLE, then and there unlawfully and feloniously made
untruthful statements in a narration of facts by accomplishing and issuing a certificate, to wit:
 "c. That the provisions of law and rules on promotion, seniority and nepotism have been
observed."
required by law in such cases, in support of the appointment he extended to TERESITO
MONTESCLAROS, husband of his niece Elizabeth Ebarle, as Motor Pool Dispatcher, Office of the
Provincial ovincial Engineer of Zamboanga del Sur, although he well knew that the latter is related
with him within the third degree affinity.
CONTRARY TO LAW.7
xxx xxx xxx
Subsequently, on August 23, 1971, the private respondent brought I.S. No. 6-71 of the
respondent Pagadian City Fiscal against the petitioner, still another proceeding for violation of
Republic Act No. 3019 and Article 171 (4) of the Revised Penal Code, thus:
xxx xxx xxx
First Count:
That on or about December 1, 1969, in Pagadian City BIENVENIDO A. EBARLE, Provincial
Governor of Zamboanga del Sur, did then and there unlawfully and feloniously extended and gave
MARIO EBARLE, son of his brother, his relative by consanguinity within the third degree, an
appointment as SECURITY GUARD in the Office of the Provincial Engineer of Zambaonga del Sur
although he well knew that the latter is related with him in the third degree by consanguinity and is
not qualif ied under the Civil Service Law.
_______________
6Id, 99 (Crim. Case No. CCC XVI-6-ZDS).
7Id., 100 (Crim. Case No. CCC XV1-8-ZDS).
811
VOL. 156, DECEMBER 29, 1987 811
Ebarle vs. Sucaldito
Second Count:
That in January, 1970, at Pagadian City, Gov. BIENVENIDO A. EBARLE replaced JOHNNY
ABABONwho was then the incumbent Motor Pool Dispatcher in the Office of the Provincial
Engineer of Zamboanga del Sur with his nephew-in-law TERESITO MONTESCLAROS relative by
affinity within the third Civil degree, in violation of the Civil Service Law, this knowingly causing
undue injury in the discharge of his administrative function through manifest partiality against said
complaining employee.
Third Count:
That on or about December 18, 1969, in Pagadian City, BIENVENIDO A. EBARLE, Provincial
Governor of Zamboanga del Sur, did then and there unlawfully and feloniously extended and gave
ELIZABETH EBARLE MONTESCLAROS, daughter of his brother, his relative by consanguinity
within the third degree, an appointment as Private Secretary in the Office of the Provincial
Governor of Zamboanga del Sur, although he well know that the latter is related with him within the
third degree of consanguinity, and said appointment is in violation of the Civil Service Law.
Fourth Count
That on or about January 22, 1970, in Pagadian City, BIENVENIDO A. EBARLE, Provincial
Governor of Zamboanga del Sur, did then and there unlawfully and feloniously extended and gave
ZACARIAS UGSOD, JR., son of the younger sister of Governor Ebarle, his relative by consanguinity
within the third degree, an appointment as Architectural Draftsman in the Office of the Provincial
Engineer of Zamboanga del Sur although he well know that the latter is related with him in the
third degree of consanguinity.
Fifth Count:
That on February 5, 1970, at Pagadian City, BIENVENIDO A. EBARLE, Provincial Governor of
Zamboanga del Sur, did then and there unlawfully and feloniously extended and gave TERESITO
MONTESCLAROS, husband of his niece ELIZABETH EBARLE, his relative by affinity within the
third degree, an appointment as Motor Pool Dispatcher, Office of the Provincial Engineer of
Zamboanga del Sur, although he well knew then that the latter was not qualified to such
appointment as it was in violation of the Civil Service Law, thereby knowingly granting and giving
unwarranted advantage and preference in the discharge of his administrative function through
manifest partiality.
812
812 SUPREME COURT REPORTS
ANNOTATED
Ebarle vs. Sucaldito
II. SPECIFICATION FOR VIOLATION OF SECTION 4 (b), R.A. 3019
That on August 19, 1967, respondent BIENVENIDO A. EBARLE, Governor of Zamboanga del Sur,
taking advantage of his position caused, persuaded, induced, or influence the Presiding Judge to
perform irregular and felonious act in violation of applicable law or constituting an offense into
awarding and decreeing Lot 2545 of the Pagadian Public Lands subdivision to him who, according to
the records of the case, failed to establish his rights of ownership pursuant to the provisions of the
Land Registration Law and the Public Land Act, it appearing that the Provincial Government of
Zamboanga del Sur as and is a claimant and in adverse possession of Lot 2545 whereon the
Provincial Jail Building thereon still stands.
III. SPECIFICATION FOR VIOLATION OF ARTICLE 171 (4), REVISED [ENAL CODE
First Count
That on or about December 18, 1969, in Pagadian City, BIENVENIDO A. EBARLE, then and
there unlawfully and feloniously made untruthful statement in a narration of facts by accomplishing
and issuing a certificate, to wit:
"c. That the provisions of law and rules on promotion, seniority and nepotism have been
observed." required by law in such cases, in support of the appointment he extended to TERESITO
MONTESCLAROS, husband of his niece ELIZABETH EBARLE, as Motor Pool Dispatcher, Office of
the Provincial Engineer of Zamboanga del Sur, although he well knew that the latter is related with
him within the third degree of affinity and is in violation of the Civil Service Law.
Second Count:
That on or about December 18, 1969, in Pagadian City, BIENVENIDO A. EBARLE, then and
there unlawfully and f eloniously made untruthful statements a certificate, to wit:
"c. That the provisions of the law and rules on promotion, seniority and nepotism have been
observed." required by law in such cases, in support of the appointment he extended to ELIZABETH
EBARLE-MONTESCLAROS, as Private Secretary in the Office of the Provincial Governor of
Zamboanga del Sur, although he well knew that the latter is related with him within
813
VOL. 156, DECEMBER 29, 1987 813
Ebarle vs. Sucaldito
the third degree of consanguinity, and is in violation of the Civil Service Law.
CONTRARY to aforecited laws.8
xxx xxx xxx
On September 21, 1971, the private respondent instituted I.S. No. 7-71 of the said City Fiscal, again
charging the petitioner with further violations of Republic Act No. 3019 thus:
xxx xxx xxx THE PROCEDURE BY WHICH COMPLAINANTS CHARGING GOVERNMENT OFFICIALS AND
EMPLOYEES WITH COMMISSION OF IRREGULARITIES SHOULD BE GUIDED,"10preliminary
First Count: to their criminal recourses. At the same time, he assails the standing of the respondent Anti-Graft
League to commence the series of prosecutions below (G.R. No. 33628). He likewise contends that the
respondent Fiscal (in G.R. No. 34162), in giving due course to the complaints notwithstanding the
That on or about December 2, 1969, in Pagadian City, BIENVENIDO EBARLE, Provincial restraining order we had issued (in G.R. No. 33628), which he claims applies as well thereto,
Governor of Zamboanga del Sur, did then and there unlawfully and feloniously extend and give committed a grave abuse of discretion.
unwarranted benefits and privileges BONINDA EBARLE, wife of his brother Bertuldo Ebarle, the _______________
former being his relative by affinity within the second civil degree, an appointment as
LABORATORY TECHNICIAN in Pagadian City, although he well knew that the latter is related to
him in the second degree by affinity and is not qualified under the Civil Service Law.
9Id., 94-95.
10Exec. Order No. 264 (1970), 66 O.G. 9344 (Oct., 1970).
815
Second Count:
VOL, 156, DECEMBER 29, 987 815
That on or about January 1, 1970, at Pagadian City, BIENVENIDO EBARLE, Provincial Ebarle vs. Sucaldito
Governor of Zamboanga del Sur, did then and there unlawfully and feloniously extend and give He likewise submits that the prosecutions in question are politically motivated, initiated by his
unwarranted benefits and privileges JESUS EBARLE, nephew of said respondent, an appointment rivals, he being, as we said, a candidate for reelection as Governor of Zamboanga del Sur.
as DRIVER of the Provincial Engineer's Office, Pagadian City, although he well knew that Jesus We dismiss these petitions.
Ebarle is related to him within the third civil degree by consanguinity and is not qualified under the The petitioner's reliance upon the provisions of Executive Order No. 264 has no merit. We
Civil Service Law. reproduce the Order in toto:
MALACAANG
Third Count: RESIDENCE OF THE PRESIDENT
OF THE PHILIPPINES
That on or about November 1, 1969, at Pagadian City, BIENVENIDO EBARLE, Provincial MANILA
Governor of Zamboanga del Sur, did then and there unlawfully and feloniously extend and give
unwarranted benefits and privileges PHENINA CODINERA, sisterin-law of said respondent, an BY THE PRESIDENT OF THE PHILIPPINES
appointment as CONFIDENTIAL ASSISTANT in the Office of the Provincial Governor, Pagadian
City, although he well knew that Phenina Codinera is related to him in the second civil degree of EXECUTIVE ORDER NO. 264
consanguinity and is not qualified under the Civil Service Law.
_______________
OUTLINING THE PROCEDURE BY WHICH COMPLAINANTS CHARGING GOVERNMENT
OFFICIALS AND EMPLOYEES WITH COMMISSION OF IRREGULARITIES SHOULD BE
8Id., 32-35. GUIDED.
814
814 SUPREME COURT REPORTS WHEREAS, it is necessary that the general public be duly informed or reminded of the procedure
provided by law and regulations by which complaints against public officials and employees should
ANNOTATED
be presented and prosecuted;
Ebarle vs. Sucaldito WHERE AS, actions on complaints are at times delayed because of the failure to observe the
formal requisites therefor, to indicate with sufficient clearness and particularity the charges or
offenses being aired or denounced, and to file the complaint with the proper office or authority;
ALL CONTRARY TO AFORECITED LAW. WHEREAS, without in any way curtailing the constitutional guarantee of freedom of
expression, the Administration believes that many complaints or grievances could be resolved at the
Please give due course to the above complaint and please set the case for immediate preliminary lower levels of government if only the provisions of law and regulations on the matter are duly
investigation pursuant to the First Indorsement dated August 27, 1971 of the Secretary of Justice, observed by the parties concerned; and
and in the paramount interest of good government.9 WHEREAS, while all sorts of officials misconduct should be eliminated and punished, it is
xxx xxx xxx equally compelling that public officials and employees be given opportunity afforded them by the
The petitioner thereafter went to the respondent Court of First Instance of Zamboanga del Sur, the constitution and law to defend themselves in accordance with the procedure prescribed by law and
Honorable Asaali Isnani presiding, on a special civil action (Special Civil Case No. 1048) for regulations;
prohibition and certiorari with preliminary injunction. The respondent Court issued a restraining NOW, THEREFORE, I, FERDINAND E. MARCOS, Presi-
order. The respondent Anti-Graft League moved to have the same lifted and the case itself 816
dismissed.
On September 27, 1971, Judge Isnani issued an order, dismissing the case. 816 SUPREME COURT REPORTS
On October 6, 1971, the petitioner instituted G.R. No. 34162 of this Court, a special civil action ANNOTATED
for certiorari with preliminary injunction. As earlier noted, we on October 8, 1971, stayed the
implementation of dismissal order. Ebarle vs. Sucaldito
Subsequently, we consolidated both petitions and considered the same submitted for decision. dent of the Philippines, by virtue of the powers vested in me by law, do hereby order:
Principally, the petitioner relies (in both petitions) on the failure of the respondents City Fiscal
and the Anti-Graft League to comply with the provisions of Executive Order No. 264, "OUTLINING
 1. 1.Complaints against public officials and employees shall be in writing, subscribed and
sworn to by the complainants, describing in sufficient detail and particularity the acts or
conduct complained of, instead of generalizations.
2. 2.Complaints against presidential appointees shall be filed with the Office of the President
or the Department Head having direct supervision or control over the of ficial involved.
3. 3.Those against subordinate officials and employees shall be lodged with the proper
department or agency head.
4. 4.Those against elective local officials shall be filed with the Office of the President in case
of provincial and city officials, with the provincial governor or board secretary in case of
municipal officials, and with the municipal or city mayor or secretary in case of barrio
officials.
5. 5.Those against members of police forces shall be filed with the corresponding local board
of investigators headed by the city or municipal treasurer, except in the case of those
appointed by the President which should be filed with the Office of the President.
6. 6.Complaints against public officials and employees shall be promptly acted upon and
disposed of by the officials or authorities concerned in accordance with pertinent laws
and regulations so that the erring officials or employees can be soonest removed or
otherwise disciplined and the innocent, exonerated or vindicated in like manner, and to
the end also that other remedies, including court action, may be pursued forthwith by
the interested parties after administrative remedies shall have been exhausted.
Done in the City of Manila, this 6th day of October, in the year of Our Lord, nineteen hundred
and seventy.
(Sgd.) FERDINAND E. MARCOS
President of the Philippines
By the President:
(Sgd.) ALEJANDRO MELCHOR
Executive Secretary11
It is plain from the very wording of the Order that it has exclusive application to administrative, not
criminal com-
_______________
11Supra, 9394-9395.
817
VOL. 156, DECEMBER 29, 1987 817
Ebarle us. Sucaldito
plaints. The Order itself shows why.
The very title speaks of "COMMISSION OF IRREGULARITIES." There is no mention, not even
by implication, of criminal "offenses," that is to say, "crimes." While "crimes" amount to
"irregularities," the Executive Order could have very well referred to the more specific term had it
intended to make itself applicable thereto.
The first perambulatory clause states the necessity for informing the public "of the procedure
provided by law and regula-tions by which complaints against public officials and employees should
be presented and prosecuted."12To our mind, the "procedure provided by law and regulations"
referred to pertains to existing procedural rules with respect to the presentation of administrative
charges against erring government officials. And in fact, the aforequoted paragraphs are but
restatements thereof. That presidential appointees are subject to the disciplinary jurisdiction of the
President, for instance, is a reecho of the long-standing doctrine that the President exercises the
power of control over his appointees.13 Paragraph 3, on the other hand, regarding subordinate
officials, is a mere reiteration of Section 33 of Republic Act No. 2260, the Civil Service Act (of 1959)
then in force, placing jurisdiction upon "the proper Head of Department, the chief of a bureau or
office"14to investigate and decide on matters involving disciplinary action.
Paragraph 4, which refers to complaints filed against elective local officials, reiterates, on the
other hand, the Decentralization Act of 1967, providing that "charges against any elective provincial
and city officials shall be preferred before the President of the Philippines; against any elective
municipal official before the provincial governor or the secretary of the provincial board concerned;
and against any elective barrio official before the municipal or secretary concerned." 15
_______________
12 Supra, 9394.
13 See supra, par. 2; Ang-Angco v. Castillo, No, L-17169, November 30, 1963, 9 SCRA 619 (1963).
14 Rep. Act No. 2260, sec. 33 (1959).
15 Rep. Act No. 5185, sec. 5 (1967).
818
818 SUPREME COURT REPORTS
ANNOTATED
Ebarle vs. Sucaldito
Paragraph 5, meanwhile, is a reproduction of the provisions of the Police Act of 1966, vesting upon a
"Board of Investigators"16 the jurisdiction to try and decide complaints against members of the
Philippine police.
Clearly, the Executive Order simply consolidates these existing rules and streamlines the
administrative apparatus in the matter of complaints against public officials. Furthermore, the fact
is that there is no reference therein to judicial or prejudicial (like a preliminary investigation
conducted by the fiscal) recourse, not because it makes such a resort a secondary measure, but
because it does not intend to serve as a condition precedent to, much less supplant, such a court
resort.
To be sure, there is mention therein of "court action[s] [being] pursued forthwith by the
interested parties,"17 but that does not, so we hold, cover proceedings such as criminal actions, which
do not require a prior administrative course of action. It will indeed be noted that the term is closely
shadowed by the qualification, "after administrative remedies shall have been exhausted," 18which
suggests civil suits subject to previous administrative action.
It is moreover significant that the Executive Order in question makes specific reference to
"erring officials or employees x x x removed or otherwise vindicated." 19 If it were intended to apply to
criminal prosecutions, it would have employed such technical terms as "accused," "convicted," or
"acquitted." While this is not necessarily a controlling parameter for all cases, it is here material in
construing the intent of the measure.
What is even more compelling is the Constitutional implications if the petitioner's arguments
were accepted. For Executive Order No. 264 was promulgated under the 1935 Constitution in which
legislative power was vested exclusively in Congress. The regime of Presidential lawmaking was to
usher in yet some seven years later. If we were to consider the Ex-
_______________
16 Rep. Act No. 4864, sec. 15 (1966).
17 Supra, par. 6.
18 Supra.
19 Supra.
819
VOL. 156, DECEMBER 29, 1987 819
Ebarle vs. Sucaldito
ecutive Order law, we would be forced to say that it is an amendment to Republic Act No. 5180, the
law on preliminary investigations then in effect, a situation that would give rise to a Constitutional
anomaly. We cannot accordingly countenance such a view.
The challenge the petitioner presents against the personality of the Anti-Graft League of the
Philippines to bring suit is equally without merit. That the Anti-Graft League is not an "offended
party" within the meaning of Section 2, Rule 110, of the Rules of Court (now Section 3 of the 1985
Rules on Criminal Procedure), cannot abate the complaints in question. A complaint for purposes of
preliminary investigation by the fiscal need not be filed by the "offended party." The rule has been
that, unless the offense subject thereof is one that cannot be prosecuted de oficio, the same may be
filed, for preliminary investigation purposes, by any competent person. 20 The "complaint" referred to
in the Rule 110 contemplates one filed in court, not with the fiscal, In that case, the proceeding must
be started by the aggrieved party himself.21
For as a general rule, a criminal action is commenced by complaint or information, both of which
are filed in court. In case of a complaint, it must be filed by the offended party; with respect to an
information, it is the fiscal who files it. But a "complaint" filed with the fiscal prior to a judicial
action may be filed by any person.
The next question is whether or not the temporary restraining order we issued in G.R. No.
33628embraced as well the complaint subject of G.R. No. 34162.
It is noteworthy that the charges levelled against the petitionerwhether in G.R. No. 33628 or
34162refer invariably to violations of the Anti-Graft Law or the Revised Penal Code. That does
not, however, make such charges identical to one another.
The complaints involved in G.R. No. 34162 are, in general,
_______________
WHEREFORE, the petitions are DISMISSED. The temporary restraining orders are LIFTED
and SET ASIDE. Costs against the petitioners.
It is so ORDERED.
Yap (Chairman), Melencio-Herrera, Paras,and Padilla, JJ., concur.
Petitions dismissed. Orders lifted and set aside.
Notes.Preliminary investigation of a criminal complaint conducted by a Fiscal, not a
"contract" or "transaction" provided in Republic Act No. 3019. (Soriano us. Sandiganbayan,131
SCRA 184.)
Informations charged against the petitioners for violation of the Anti-Graft and Corrupt
Practices Act are within the jurisdiction of the Sandiganbayan. (Orap us. Sandiganbayan, 139 SCRA
252.)
oOo

20Hernandez v. Albano, No. L-17081, May 31, 1961, 2 SCRA 607(1961). _______________
21Supra.
820
Supra.
23

820 SUPREME COURT REPORTS 822

Copyright 2017 Central Book Supply, Inc. All rights reserved.
ANNOTATED

Ebarle vs. Sucaldito

nepotism under Sections 3(c) and (j) of Republic Act No. 3019; exerting influence upon the presiding
Judge of the Court of First Instance of Zamboanga del Sur to award a certain parcel of land in his
favor, over which the provincial government itself lays claims, contrary to the provisions of Section
4(b) of Republic Act No. 3019; and making untruthful statements in the certificates of appointment
of certain employees in his office. On the other hand, the complaints subject matter of G.R. No.
33628 involve charges of simulating bids for the supply of gravel and sand for certain public works
projects, in breach of Section 3 of the Anti-Graft statute; manipulating bids with respect to the
construction of the capitol building; testifying falsely in connection with Cadastral Case No. N-17,
LRC Cad. Rec. N-468, in which the petitioner alleged that he was the owner of a piece of land, in
violation of Articles 182, 183, and 318 of the Revised Penal Code; and simulating bids for the supply
of gravel and sand in connection with another public works project.
It is clear that the twin sets of complaints are characterized by major differences. When,
therefore, we restrained further proceedings in I.S. Nos. 1-71, 2-71, and 4-71, subject of G.R. No.
33628, we did not consequently stay the proceedings in CCC-XVI-4-ZDS, CCC XVI-6-ZDS, CCC XVI-
8-ZDS, and I.S. Nos. 6-71 and 7-71, the same proceedings we did restrain in G.R. No. 34162.
This brings us to the last issue: whether or not the complaints in question are tainted with a
political color. It is not our business to resolve complaints the disposition of which belongs to another
agency, in this case, the respondent Fiscal. But more than that, and as a general rule, injunction
does not lie to enjoin criminal prosecutions.22 The rule is subject to exceptions, to wit: (1) for the
orderly administration of justice; (2) to prevent the use of the strong arm of the law in an oppressive
and vindictive manner; (3) to avoid multiplicity of actions; (4) to afford adequate protection to Aids to Interpretation and Construction A. Intrinsic Aids
constitutional rights; and (5) because the statute relied on is constitutionally
_______________

i. Title
Asutilla v. Philippine National Bank, No. L-51354, January 15; 1986, 141 SCRA
22

40 (1986); Guingona, Jr. v. City Fiscal of Manila No. L-60033, April 4,1984,128 SCRA 577 (1984).
821
City of Baguio v. Marcos, G.R. No. 26100, 28 February 1969, 27 SCRA 342
VOL. 156, DECEMBER 29, 1987 821

Ebarle vs. Sucaldito

342 SUPREME COURT REPORTS
infirm or otherwise void.23We cannot perceive any of the exceptions applicable here. The petitioner
cries foul, in a manner of speaking, with respect to the deluge of complaints commenced by the ANNOTATED
private respondent below, but whether or not they were filed for harassment purposes is a question
we are not in a position to decide. The proper venue, we believe, for the petitioner's complaint is City of Baguio vs. Marcos
precisely in the preliminary investigations he wishes blocked here.
No. L-26100. February 28, 1969.
CITY OF BAGUIO, REFORESTATION ADMINISTRATION, FRANCISCO G. JOAQUIN, SR.,
FRANCISCO G. JOAQUIN, JR., and TERESITA J. BUCHHOLZ, petitioners, vs. HON. PIO R.
MARCOS, Judge of the Court of First Instance of Baguio, BELONG LUTES, and the HONORABLE
COURT OF APPEALS, respondents.
Torrens system; Cadastral proceedings; Limitation on right of claimant; Lease of portions of
land claimed.The case at bar involves a special statute, Rep. Act 931, which allows a petition for
reopening on lands about to be declared or already declared land of the public domain by virtue of
judicial proceedings. Such right, however, is made to cover limited cases, i.e., only with respect to
such of said parcels of land as have not been alienated, reserved, leased, granted, or otherwise
provisionally or permanently disposed of by the Government. The lessees right is thus impliedly
recognized by Rep. Act 931. This statutory phrase steers the present case clear from the impact of
the precept forged by Leyva vs.Jandoc, (L-16965, Feb. 28, 1962) case. So it is, that if the land subject
of a petition to reopen has already been leased by the government, that petition can no longer
prosper.
343
VOL. 27, FEBRUARY 28, 1969 3 The facts are stated in the opinion of the Court.
43
City of Baguio vs. Marcos
Same; Same; Same; Parties; Where private petitioners in the case at bar have personality to
intervene in the reopening proceeding.The right of private petitioners to oppose a reopening
petition here becomes the more patent when the Supreme Court takes into consideration their
averment that they have introduced improvements on the land affected. It would seem that lessees,
insofar as Rep. Act 931 is concerned, come within the purview of those who, according to Rule 143 of
the Rules Court, may intervene in an action. For, they are persons who have legal interest in the
matter in litigation, or in the success of either of the parties. In the event herein private petitioners
are able to show that they, are legitimate lessses, then their lease will continue. And this, because it
is sufficient that it be proved that the land is leased to withdraw it from the operation of Rep. Act
931 and place it beyond the reach of a petition for reopening.
Same; Same; Publication; When reopening need not be published.The subject matter of the
petition for reopening was already embraced in the cadastral proceedings filed by the Director of
Lands. Consequently, the Baguio cadastral court already acquired jurisdiction over the said
property. The petition, therefore, need not be published. The power of the cadastral court over
petitions to reopen, as in this case, is not jurisdictionally tainted by want of publication.
Constitutional law; Issue of constitutionality; May be entertained by courts when raised before
them.Well-entrenched in constitutional law is the precept that constitutional questions will not be
entertained by courts unless they are specifically raised, insisted upon and adequately argued. At
any rate, it cannot be seriously disputed that ,the subject of Rep. Act 931 is expressed in its title.
Same; Same; Statutory construction; Object of interpretation.The true object of all
interpretation is to ascertain the meaning and will of the law-making body, to the end that it may be
enforced. In varying language, the purpose of all rules or maxims in interpretation is to discover
the true intention of the law. (82 C.J.S. 526) They are only valuable when they subserve this
purpose. In fact, the spirit or intention of a statute prevails over the letter thereof. A statute
should be construed according to its spirit and reason, disregard. as as far as necessary, the letter of
the law. By this, the Supreme Court does not correct the act of the Legislature ture, but rather x x
x carry out and give due course to its true in-tent. .
Same; Same; Same; Title of act may be resorted in the ascertainment of congressional will.
When engaged the task of construing an obscure expression the law (82 C.J.S. 731) or where exact or
literal rendering of the words would not
344
3 SUPREME COURT REPORTS
44 ANNOTATED
City of Baguio vs. Marcos
carry out the legislative intent, the title thereof may be resorted to in the ascertainment of
congressional will. Reason therefor is that the title of the law may properly be regarded as an index
of or clue or guide to legislative intention. (82 C.J.S. 734) This is especially true in this jurisdiction.
For the reason that by specific constitutional precept, no bill which may be enacted into law shall
embrace more than one subject which shall be expressed in the title of the bill. (Sec. 21 [1], Art. VI,
Const.) In such case, courts are compelled by the Constitution to consider both the body and the
title in order to arrive at the legislative intention. (37 A.L.R. 952)
Same; Same; Same; Title of Rep. Act 931 authorizes court proceedings of claims to parcels of
land declared public land.The title now under scrutiny possesses the strength of clarity and
positiveness. It recites that it authorizes court proceedings of claims to parcels of land declared
public land by virtue of judicial decisions rendered within the forty years next preceding the
approval of this Act. That title is written in capital letters"by Congress itself; such kind of a title
then is not to be classed with words or titles used by compilers of statutes because it is the
legislature speaking. Accordingly, it is not hard to come to a deduction that the phrase last quoted
from Rep. Act 931"by virtue of judicial decisions rendered"was but inadvertently omitted from
the body. Parting from this premise, there is, at bottom, no contradiction between title and body.
Therefore, by that statute, the petition of respondent to reopen Civil Reservation Case No. 1, GLRO
Record No. 211 of the cadastral court of Baguio, comes within the 40-year period.
ORIGINAL PETITION in the Supreme Court. Certiorari.
1st Assistant City Fiscal Dionisio C. Claridad, Augusto Tobias and Feria, Feria, Lugtu &
LaO for petitioners.
Bernardo C. Ronquillofor respondents.
SANCHEZ, J.:
Petitioners attack the jurisdiction of the Court of First Instance of Baguio to reopen cadastral
proceedings under Republic Act 931. Private petitioners specifically question the ruling of the Court
of Appeals that they have no personality to oppose reopening. The three-pronged contentions of all
the petitioners are: (1) the reopening petition was filed outside the 40-year period next preceding the
approval of Republic Act 931; (2) said petition
345
VOL. 27, FEBRUARY 28, 1969 345
City of Baguio vs. Marcos
was not published; and (3) private petitioners, as lessees of the public land in question, have court
standing under Republic Act 931. The facts follow:
On April 12, 1912, the cadastral proceedings sought to be reopened, Civil Reservation Case No.
1, GLRO Record No. 211, Baguio Townsite, were instituted by the Director of Lands in the Court of
First Instance of Baguio. It is not disputed that the land here involved (described in Plan Psu-
186187) was amongst those declared public lands by final decision rendered in that case
on November 13, 1922.
On July 25, 1961,respondent Belong Lutes petitioned the cadastral court to reopen said Civil
Reservation Case No. 1 as to the parcel of land he claims. His prayer was that the land be registered
in his name upon the grounds that: (1) he and his predecessors have been in actual, open, adverse,
peaceful and continuous possession and cultivation of the land since Spanish times, or before July
26, 1894, paying the taxes thereon; and (2) his predecessors were illiterate Igorots without personal
notice of the cadastral proceedings aforestated and were not able to file their claim to the land in
question within the statutory period.
On December 18, 1961, private petitioners Francisco G. Joaquin, Sr., Francisco G. Joaquin, Jr.,
and Teresita J. Buchholz registered opposition to the reopening. Ground: They are tree farm lessees
upon agreements executed by the Bureau of Forestry in their favor for 15,395.65 square meters on
March 16, 1959, for 12,108 square meters on July 24, 1959, and for 14,771 square meters on July 17,
1959, respectively.
On May 5, 1962, the City of Baguio likewise opposed reopening.
On May 8, 1962, upon Lutes opposition, the cadastral court denied private petitioners right to
intervene in the case because of a final declaratory relief judgment dated March 9, 1962 in Yaranon
vs. Castrillo [Civil Case 946, Court of First Instance of Baguio] which declared that such tree farm
leases were null and void.
346
346 SUPREME COURT REPORTS

ANNOTATED
City of Baguio vs. Marcos
On May 18,1962, private petitioners moved to reconsider. They averred that said declaratory relief
judgment did not bind them, for they were not parties to that action.
On September 14, 1962, the cadastral court reversed its own ruling of May 8, 1962, allowed
petitioners to crossexamine the witnesses of respondent Lutes.
On October 16, 1962, Lutes replied to and moved to dismiss private petitioners opposition to his
reopening petition. On October 25, 1962, private petitioners rejoinder was filed.
On August 5, 1963, the cadastral court dismissed private petitioners opposition to the
reopening. A motion to reconsider was rejected by the court on November 5, 1963.
On January 6, 1964, it was the turn of the City of Baguio to lodge a motion to dismiss the
petition to reopen. This motion was adopted as its own by the Reforestation Administration. They
maintained the position that the declaratory judgment in Civil Case 946 was not binding on those
not parties thereto. Respondent Lutes opposed on February 24, 1964. On April 6, 1964, private
petitioners reiterated their motion to dismiss on jurisdictional grounds.
On September 17, 1964, the court denied for lack of merit the Citys motion as well as the April
6, 1964 motion to dismiss made by private petitioners.
On November 13, 1964, all the petitioners went to the Court of Appeals on certiorari,
prohibition, and mandamus with preliminary injunction.1 They there questioned the cadastral
courts jurisdiction over the petition to reopen and the latters order of August 5, 1963 dismissing
private petitioners opposition. The appellate court issued a writ of preliminary injunction upon a
P500-bond.
Then came the judgment of the Court of Appeals of September 30, 1965. The court held that
petitioners were not bound by the declaratory judgment heretofore stated. Nevertheless, the
appellate court ruled that as lessees,
_______________
1 City of Baguio, et al, Petitioners, versus Hon. Pio R. Marcos, et al., Respondents, CA-G.R. No.
34909-R.
347
VOL. 27, FEBRUARY 28, 1969 347
City of Baguio vs. Marcos
private petitioners had no right to oppose the reopening of the cadastral case. Petitioners moved to
reconsider. It was thwarted on May 6, 1966.
Petitioners now seek redress from this Court. On July 6, 1966, respondents moved to dismiss
the petition before us. On August 5, 1966, petitioners opposed. On August 12, 1966, we gave due
course.
1. Do private petitioners have personality to appear in the reopening proceedings?
First, to the controlling statute, Republic Act 931, effective June 20, 1953.
The title of the Act reads
AN ACT TO AUTHORIZE THE FILING IN THE PROPER COURT, UNDER CERTAIN
CONDITIONS, OF CERTAIN CLAIMS OF TITLE TO PARCELS OF LAND THAT HAVE
BEEN DECLARED PUBLIC LAND, BY VIRTUE OF JUDICIAL DECISIONS RENDERED
WITHIN THE FORTY YEARS NEXT PRECEDING THE APPROVAL OF THIS ACT."
Section 1 thereof provides
SECTION 1. All persons claiming title to parcels of land that have been the object of cadastral
proceedings, who at the time of the survey were in actual possession of the same, but for some
justifiable reason had been unable to file their claim in the proper court during the time limit
established by law, in case such parcels of land, on account of their failure to file such claims, have
been, or are about to be declared land of the public domain, by virtue of judicial proceedings
instituted within the forty years next preceding the approval of this Act, are hereby granted the right
within five years2 after the date on which this Act shall take effect, to petition for a reopening of the
judicial proceedings under the provisions of Act Numbered Twenty-two hundred and fifty-nine, as
amended, only with respect to such of said parcels of land as have not been alienated,
reserved, leased, granted, or otherwise provisionally or permanently disposed of by the Government,
and the competent Court of First Instance, upon receiving such petition, shall notify the Government
through the Solicitor General, and if after hearing the parties, said court shall find that all
conditions herein established have been complied with, and that all taxes, interests and penalties
thereof have been paid from the time when land tax should have been collected until the day when
the motion is pre
_______________
2Extended until December 31, 1968 by Republic Act 2061, effective June 13, 1958.
348
348 SUPREME COURT REPORTS
ANNOTATED
City of Baguio vs. Marcos
sented, it shall order said judicial proceedings reopened as if no action has been taken on such
parcels."3
We concede that in Leyva vs. Jandoc, L-16965, February 28, 1962, a land registration case where
oppositors were foreshore lessees of public land, a principle was hammered out that although
Section 34, Land Registration Act,4apparently authorizes any person claiming any kind of interest
to file an opposition to an application for registration, x x x nevertheless x x x the opposition must be
based on a right of dominion or some other real right independent of, and not at all subordinate to,
the rights of the Government."5 The opposition, according to the Leyva decision, must necessarily be
predicated upon the property in question being part of the public domain. Leyva thus pronounced
that it is incumbent upon the duly authorized representatives of the Government to represent its
interests as well as private claims intrinsically dependent upon it.
But the Leyva case concerned an ordinary land registration proceeding under the provisions of
the Land Registration Act. Normally and logically, lessees cannot there present issues of ownership.
The case at bar, however, stands on a different footing. It involves a special statute, R.A. 931, which
allows a petition for reopening on lands about to be declared or already declared land of the public
domain by virtue of judicial proceedings. Such right, however, is made to cover limited cases, i.e.,
onlywith respect to such of said parcels of land as have not been alienated,
reserved, leased, granted, or otherwise provisionally or permanentlydisposed of by the
Government."6 The lessees right is thus impliedly recognized
_______________
3Italics supplied.
4The text of Section 34, Act No. 496, as amended, reads: Any person claiming an interest,
whether named in the notice or not, may appear and file an answer on or before the return day, or
within such further time as may be allowed by the court. The answer shall state all the objections to
the application, and shall set forth the interest claimed by the party filing the same and apply for
the remedy desired, and shall be signed and sworn to by him or by some person in his behalf.
5 See also: Aduan vs. Alba, L-17046, April 25, 1961.
6 Italics supplied.
349
VOL. 27, FEBRUARY 28, 1969 349
City of Baguio vs. Marcos
by R.A. 931. This statutory phrase steers the present case clear from the impact of the precept forged
by Leyvs.So it-is, that if the land subject of a petition to reopen has already been leased by the
government, that petition can no longer prosper.
This was the holding in Director of Lands vs. Benitez,L-21368, March 31, 1966. The reopening
petition there filed was opposed by the Director of Lands in behalf of 62 lessees of public land holding
revocable permits issued by the government. We struck down the petition in that case because the
public land, subject-matter of the suit, had already been leased by the government to private persons.
Of course, the Benitezruling came about not by representations of the lessees alone, but through
the Director of Lands. But we may well scale the heights of injustice or abet violations of R.A. 931 if
we entertain the view that only the Director of Lands7 can here properly oppose the reopening
petition. Suppose the lands office fails to do so? Will legitimate lessees be left at the mercy of
government officials? Should the cadastral court close its eyes to the fact of lease that may be proved
by the lessees themselves, and which is enough to bar the reopening petition? R.A. 931 could not
have intended that this situation should happen. The point is that, with the fact of lease, no question
of ownership need be inquired into pursuant to R.A. 931. From this standpoint, lessees have
sufficient legal interest in the proceedings.
The right of private petitioners to oppose a reopening petition here becomes the more patent
when we take stock of their averment that they have introduced improvements on the land affected.
It would seem to us that lessees, insofar as R.A. 931 is concerned, come within the purview
_______________
7 On the Director of Lands is primarily lodged the power of executive control, administration,
management, distribution and disposition of public lands, Director of Lands vs. Lim, 91 Phil.
912; Mari vs. Secretary, 92 Phil. 410, 414; Kiamko vs. Maceren, 92 Phil. 1057, 1060; Lubugan vs.
Castrillo, 101 Phil. 1229, 1230; Municipality of San Carlos vs. Morfe, L-17990, July 24,
1962; Jamisola vs. Ballesteros, L-17466, September 18, 1965; Ganitano vs. Secretary, L-21167,
March 31, 1966.
350
350 SUPREME COURT REPORTS
ANNOTATED
City of Baguio vs. Marcos
of those who, according to the Rules of Court,8 may intervene in an action. For, they are persons who
have legal interest in the matter in litigation, or in the success of either of the parties." 9 In the
event herein private petitioners are able to show that they are legitimate lessees, then their
lease will continue. And this, because it is sufficient that it be proven that the land is leased to
withdraw it from the operation of Republic Act 931 and place it beyond the reach of a petition for
reopening.10
In line with the Court of Appeals conclusion, not disputed by respondent Lutes herein, the
cadastral court should have ruled on the validity of private petitioners tree farm leaseson the
merits. Because there is need for Lutes right to reopen and petitioners right to continue as lessees
to be threshed out in that court.
We, accordingly, hold that private petitioners, who aver that they are lessees, have the
necessary personality to intervene in and oppose respondent Lutes petition for reopening.
2. Petitioners next contend that the reopening petition below, filed under R.A. 931, should have
been published in accordance with the Cadastral Act,
To resolve this contention, we need but refer to a very recent decision of this Court in De Castro
vs. Marcos, supra, involving exactly the same set of facts bearing upon the question. We there held,
after a discussion of law and jurisprudence, that: In sum, the subject matter of the petition for
reopeninga parcel of land claimed by respondent Akiawas already embraced in the cadas-tral
proceedings filed by the Director of Lands. Consequently, the Baguio cadastral court already
acquired jurisdiction over the said property. The petition, there-
_______________
8Rule 143, Rules of Court, provides: These rules shall not apply to land
registration, cadastraland election cases, naturalization and insolvency proceedings, and other cases
not herein provided for, except by analogy or in a suppletory character and whenever practicable and
convenient Italics supplied.
9 Section 2, Rule 12, Rules of Court.
10 See: De Castro vs. Marcos, L-26093, January 27, 1969.
351
VOL. 27, FEBRUARY 28, 1969 351
City of Baguio vs. Marcos
fore, need not be published. We find no reason to break away from such conclusion.
Respondent Lutes attached to the record a certified true copy of the November 13, 1922 decision
in the Baguio Townsite Reservation case to show, amongst others, that the land here involved was
part of that case. Petitioners do not take issue with respondent Lutes on this point of fact.
We here reiterate our ruling in De Castro, supra,that the power of the cadastral court below
over petitions to reopen, as in this case, is not jurisdictionally tainted by want of publication.
3. A question of transcendental importance is this: Does the cadastral court have power to
reopen the cadastral proceedings upon the application of respondent Lutes?
The facts are: The cadastral proceedings sought to be reopened were instituted on April
12, 1912.Final decision was rendered on November 13, 1922. Lutes filed the petition to reopen on
July 25, 1961.
It will be noted that the title of R.A. 931, heretofore transcribed, authorizes the filing in the
proper court, under certain conditions, of certain claims of title to parcels of land that have been
declared public land, by virtue of judicial decisions rendered within the forty years next preceding
the approval of this Act. The body of the statute, however, in its Section 1, speaks of parcels of land
that have been, or are about to be declared land of the public domain, by virtue of judicial
proceedings instituted within the forty years next preceding the approval of this Act. There thus
appears to be a seeming inconsistency between title and body.
It must be stressed at this point that R.A. 931 is not under siege on constitutional grounds. No
charge has been made here or in the courts below that the statute offends the constitutional
injunction that the subject of legislation must be expressed in the title thereof. Well-entrenched in
constitutional law is the precept that constitutional questions will not be entertained by courts
unless they are specifically raised, insisted upon and adequately
352
352 SUPREME COURT REPORTS
ANNOTATED
City of Baguio vs. Marcos
argued."11 At any rate, it cannot be seriously disputed that the subject of R.A. 931 is expressed in its
title.
This narrows our problem down to one of legal hermeneutics.
Many are the principles evolved in the interpretation of laws. It is thus not difficult to stray
away from the true path of construction, unless we constantly bear in mind the goal we seek. The
office of statutory interpretation, let us not for a moment forget, is to determine legislative intent. In
the words of a well-known authority, "[t]he true object of all interpretation is to ascertain the
meaning and will of the law-making body, to the end that it may be enforced."12 In varying language,
the purpose of all rules or maxims in interpretation is to discover the true intention of the
law."13 They are only valuable when they subserve this purpose."14 In fact, the spirit or intention of
a statute prevails over the letter thereol."15 A statute should be construed according to its spirit and
reason, disregarding as f ar as necessary, the letter of the law." 16 By this, we do not correct the act
of the Legislature, but rather x x x carry out and give due course to its true Intent. 17
It should be certain by now that when engaged in the task of construing an obscure expression
in the law18 or where exact or literal rendering of the words would not carry out the legislative
intent,19 the title thereof may be
________________
11 I Taada and Carreon, Political Law of the Philippines, 1961 ed., p. 412, citing Santiago vs.
Far Eastern, 73 Phil. 438 and Phil. Assn. of Coll. & Univ. vs. Secretary of Education, 51 O.G. 6230.
12 Black, Construction and Interpretation of the Laws, 2nd ed., p. 11.
13 82 C J.S., p. 526.
14 Sedalia vs. Smith, 104 S.W. 15, 19.
15 Taada vs. Cuenco, L-10520, February 23, 1957, citing 82 C.J.S., p. 613.
16 Lopez & Sons, Inc. vs. Court of Tax Appeals, 100 Phil. 850, 855.
17 Id.
18 C.J.S., p. 731. See:Commissioner of Customs vs. Relunia, L-11860. May 29, 1959.
19 Bell vs. New York, 11 N.E. 495, 497. citing Smith vs. People, 47 N.Y. 330: People vs.
Davenport, 91 N.Y., 574.
353
VOL. 27, FEBRUARY 28, 1969 353
City of Baguio vs. Marcos
resorted to in the ascertainment of congressional will. Reason therefor is that the title of the law
may properly be regarded as an index of or clue or guide to legislative intention. 20 This is especially
true in this jurisdiction. For the reason that by specific constitutional precept, "[n]o bill which may
be enacted into law shall embrace more than one subject which shall be expressed in the title of the
bill."21 In such case, courts are compelled by the Constitution to consider both the body and the title
in order to arrive at the legislative intention."22
With the foregoing guideposts on hand, let us go back to the situation that confronts us. We take
another look at the title of R.A. 931, viz: AN ACT TO AUTHORIZE THE FILING IN THE PROPER
COURT, UNDER CERTAIN CONDITIONS, OF CERTAIN CLAIMS OF TITLE TO PARCELS OF
LAND THAT HAVE BEEN DECLARED PUBLIC LAND, BY VIRTUE OF JUDICIAL DECISIONS
RENDERED WITHIN THE F O R T Y YEARS NEXT PRECEDING THE APPROVAL OF THIS
ACT." Readily to be noted is that the title is not merely composed of catchwords. 23 It expresses in
language clear the very substance of the law itself. From this, it is easy to see that Congress intended
to give some effect to the title of R.A. 931.
To be carefully noted is that the same imperfection in the language of R.A. 931 aforesaidfrom
which surfaces a seeming inconsistency between the title and the bodyattended Commonwealth
Act 276, the present statutes predecessor. That prior law used the very same language in the body
thereof and in its title. We attach meaning
_______________
20 82 C.J.S., p. 734, See: Pruitt vs. Sebastian Country Cole and Mining Co., 222 S.W. 2d. 50,
57, citing Reynaldo vs. Holland, 35 Ark. 56.
21 Section 21(1), Article VI, Constitution; italics supplied.
22 37 A.L.R., p. 952, citing Joyce vs. Woods, 78 Ky. 386. See also p. 937, referring to OConnor vs.
Nova Scotia Teleph. Co., 22 Can. S.C. 276, reversing 23 N.S. 509.
23 Cf. People vs. Yabut, 58 Phil. 499, 504, which in substance held that mere catchwords
cannot control the body of the statute, which is otherwise unambiguous.
354
354 SUPREME COURT REPORTS
ANNOTATED
City of Baguio vs. Marcos
to this circumstance. Had the legislature meant to shake off any legal effects that the title of the
statute might have, it had a chance to do so in the reenactment of the law. Congress could have
altered with great facility the wording of the title of R.A. 931. The fact is that it did not.
It has been observed that in modern practice the title is adopted by the Legislature, more
thoroughly read than the act itself, and in many states is the subject of constitutional
regulation."24 The constitutional injunction that the subject of the statute must be expressed in the
title of the bill, breathes the spirit of command because the Constitution does not exact of Congress
the obligation to read during its deliberations the entire text of the bill." 25 Reliance, therefore, may
be placed on the title of a bill, which, while not an enacting part, no doubt is in some sort a part of
the act, although only a formal part."26 These considerations are all the more valid here because R.A.
931 was passed without benefit of congressional debate in the House from which it originated as
House Bill 1410,27 and in the Senate.28
The title now under scrutiny possesses the strength of clarity and positiveness. It recites that it
authorizes court proceedings of claims to parcels of land declared public land by virtue of
judicial decisions rendered within the forty years next preceding the approval of this Act. That title
is written in capital letters"by Congress itself; such kind of a title then is not to be classed with
words or titles used by compilers of statutes because it is the legislature speaking." 29Accordingly, it
is not hard to come to a deduction that the phrase last quoted from R.A. 931"by virtue of judicial
decisions rendered"was but
_______________
Sedalia vs. Smith, supra, at pp. 1920.
24
Lidasan vs. Commission on Elections, L-28089, October 25, 1967.
25
Sedalia vs. Smith, supra, at p. 20.
26
27 See: Congressional Record (House of Representatives), vol. II, Second Congress, Second
Regular Session, pp. 19211922.
28See: Congressional Record (Senate), vol. IV; Second Congress, Fourth Session, pp. 11081109.
29Berger vs. Jackson, 23 So. 2d. 265, 267.
355
VOL. 27, FEBRUARY 28, 1969 355
City of Baguio vs. Marcos
inadvertently omitted from the body. Parting from this premise, there is, at bottom, no contradiction
between title and-body. In line with views herein stated, the title belongs to that type of titles which
should be regarded as part of the rules or provisions expressed in the body. 30 At the very least, the
words by virtue of judicial decisions rendered in the title of the law stand in equal importance to
the phrase in Section 1 thereof, by virtue of judicial proceedings instituted.
Given the fact then that there are two phrases to consider, the choice of construction we must
give to the statute does not need such reflection. We lean towards a liberal view. And this, because of
the principle long accepted that remedial legislation should receive the blessings of liberal
construction.31 And, there should be no quibbling as to the f act that R.A. 931 is a piece of remedial
legislation. In essence, it provides a mode of relief to landowners who, before the Act, had no legal
means of perfecting their titles. This is plainly evident from the explanatory note thereof, which
reads:
This bill is intended to give an opportunity to any person or claimant who has any interest in any
parcel of land which has been declared as public land in cadastral proceeding for failure of said
person or claimant to present his claim within the time prescribed by law.
There are many meritorious cases wherein claimants to certain parcels of land have not had the
opportunity to answer or appear at the hearing of cases affecting .their claims in the corresponding
cadastral proceedings for lack of sufficient notice or for other reasons and circumstances which are
beyond their control. Under C.A. No. 276, said persons or claimants have no more legal remedy as
the effectivity of said Act expired in 1940.
This measure seeks to remedy the lack of any existing law within said persons or claimants with
meritorious claims or interests in parcels of land may seek justice and protection.
_______________
30 See: People vs. Lamphier, 172 N.Y.S. 247, 248249; Newman vs. Newman, 91 N.Y.S. 2d. 330,
331.
31 Manila Railroad Co. vs. Attorney General, 20 Phil. 523, 530; Rodrigo vs.
Cantor (unreported), L-4398, May 28, 1952, 91 Phil. 918; Maiego vs. Castelo, 101 Phil. 293,
296, citing Sibulo vs. Altar, 83 Phil. 513.
356
356 SUPREME COURT REPORTS
ANNOTATED
Vda. de Palanca vs. Chua Keng Kian
This bill proposes to give said persons or claimants their day in court. Approval of .this bill is
earnestly requested.
In fine, we say that lingual imperfections in the drafting of a statute should never be permitted
to hamstring judicial search for legislative intent, which can otherwise be discovered. Legal
technicalities should not abort the beneficent effects intended by legislation.
The sum of all the foregoing is that, as we now view Republic Act 931, claims of title that may be
filed thereunder embrace those parcels of land that have been declared public land by virtue
of judicial decisions rendered within the forty years next preceding the approval of this Act.
Therefore, by that statute, the July 25, 1961 petition of respondent Belong Lutes to reopen Civil
Reservation Case No. 1, GLRO Record No. 211 of the cadastral court of Baguio, the decision on
which was rendered on November 13, 1922, comes within the 40-year period.
FOR THE REASONS GIVEN, the petition for certiorari is hereby granted; the cadastral courts
orders of August 5, 1963, November 5, 1963 and September 17, 1964 are hereby declared null and
void and the cadastral court is hereby directed to admit petitioners oppositions and proceed
accordingly. No costs. So ordered.
Reyes, J.B.L., Dizon, Makalintal, Zaldivar, Fernando. Teehankee and Barredo, JJ., concur.
Concepcion, C.J., Castro and Capistrano, JJ.,did not take part.
 Petition granted; cadastral courts orders declared null and void and same court directed to
admit petitioners oppositions and proceed accordingly.
_______________
Copyright 2017 Central Book Supply, Inc. All rights reserved.
Aids to Interpretation and Construction A. Intrinsic Aids
ii. Preamble
People v. Purisima, G.R. Nos. 402050-66, 20 November 1978, 86 SCRA 542
542 SUPREME COURT REPORTS
ANNOTATED
People vs. Purisima
No. L-42050-66. November 20, 1978.*
THE PEOPLE OF THE PHILIPPINES, petitioner,vs. HONORABLE JUDGE AM ANTE P.
PURISIMA, COURT OF FIRST INSTANCE OF MANILA, BRANCH VII, and PORFIRIO
CANDELOSAS, NESTOR BAES, ELIAS L. GARCIA, SIMEON BUNDALIAN, JR., JOSEPH C.
MAISO, EDUARDO A. LIBORDO, ROMEO L. SUGAY, FEDERICO T. DIZON, GEORGE M.
ALBINO, MARIANO COTIA, JR., ARMANDO L. DIZON, ROGELIO B. PARENO, RODRIGO V.
ESTRADA, ALFREDO A. REYES, JOSE A. BACARRA, REYNALDO BOGTONG, and EDGARDO
M. MENDOZA, respondents.
No. L-46229-32. November 20, 1978.*
THE PEOPLE OF THE PHILIPPINES, petitioner,vs. JUDGE MAXIMO A. MACEREN, COURT OF
FIRST INSTANCE OF MANILA, BRANCH XVIII, and REYNALDO LAQUI Y AQUINO, ELPIDIO
ARPON, VICTOR EUGENIO Y ROQUE and ALFREDO VERSOZA, respondents.
No. L-46313-16. November 20, 1978.*
THE PEOPLE OF THE PHILIPPINES, petitioner, vs. JUDGE MAXIMO A. MACEREN, COURT OF
FIRST INSTANCE OF MANILA, BRANCH XVIII, and JUANITO DE LA CRUZ Y NUEZ,
SABINO BUENO Y CACAL, TIRSO ISAGAN Y FRANCISCO and BEN CASTILLO Y. UBALDO,
respondents.
No. L-46997. November 20, 1978.*
THE PEOPLE OF THE PHILIPPINES, petitioner, vs. THE HONORABLE WENCESLAO M. POLO,
Judge of the Court of First Instance of Samar, and PANCHITO REFUNCION, respondents.
______________
* EN BANC.
543
VOL. 86, NOVEMBER 20, 1978 543
People vs. Purisima
Constitutional Law; Criminal Procedure; It is imperative under the Constitution and Rules of
Court, that an information should designate or mention the specific statute violated.It is a
constitutional right of any person who stands charged in a criminal prosecution to be informed of the
nature and cause of the accusation against him. Pursuant to the above, Section 5, Rule 110 of the
Rules of Court, expressly requires that for a complaint or information to be sufficient it most, inter
alia, state the designation of the offense by the statute, and the acts of omissions complained of as
constituting the offense. This is essential to avoid surprise on the accused and to afford him the
opportunity to prepare his defense accordingly. To comply with these fundamental requirements of
the Constitution and the Rules on Criminal Procedure, it is imperative for the specific statute
violated to be designated or mentioned in the charge. In fact, another compelling reason exists why a
specification of the statute violated is essential in these cases. As stated in the order of respondent
Judge Maceren the carrying of so-called deadly weapons is the subject of another penal statute and
a Manila City Ordinance.
Statutory Construction; Criminal Law; Local Governments; P.D. 9 did not repeal by
implication Act No. 1780 and City Ordinance No. 3820, as amended by Ordinance No. 3928 of
Manila which punish the carrying, concealed in ones body, of bladed or other deadly weapons.We
do not agree with petitioner that the above-mentioned statute and the city ordinance are deemed
repealed by P.D. 9 (3). P.D. 9 (3) does not contain any repealing clause or provision, and repeal by
implication is not favored. This principle holds true with greater force with regards to penal statutes
which as a rule are to be construed strictly against the state and liberally in favor of the accused. In
fact, Article 7 of the New Civil Code provides that laws are repealed only by subsequent ones and
their violation or non-observance shall not be excused by disuse, or custom or practice to the
contrary.
Same; Same; To constitute a violation of P.D. 9, the two elements of carrying bladed or pointed
weapons outside ones residence and of carrying such a weapon in furtherance of, or to abet, or in-
connection with subversion, lawless violence, chaos and the like must be present.We hold that
the offence carries two elements: first, the carrying outside ones residence of any bladed, blunt, or
pointed weapon, etc. not used as a necessary tool or implement for a livelihood; and second, that the
act of carrying the weapon was either in furtherance of, or to abet, or in connection with subversion,
rebellion, insurrection, lawless violence, criminality, chaos, or public disorder. It is the
544
5 SUPREME COURT REPORTS
44 ANNOTATED
People vs. Purisima
second element which removes the act of carrying a deadly weapon, if concealed, outside of
the scope of the statute or the city ordinance mentioned above. In other words, a simple act of
carrying any of the weapons described in the presidential decree is not a criminal offense in itself.
What makes the act criminal or punishable under the decree is the motivation behind it. Without
that motivation, the act falls within the purview of the city ordinance or some statute when the
circumstances so warrant.
Same; It becomes a judicial task to interpret the meaning and scope of a statute when an
ambiguity in its implementation presents itself.That there is ambiguity in the presidential decree
is manifest from the conflicting views which arise from its implementation. When ambiguity
exists, it becomes a judicial task to construe and interpret the true meaning and scope of the
measure, guided by the basic principle that penal statutes are to be construed and applied liberally
in favor of the accused and strictly against the state. In the construction or interpretation of a
legislative measurea presidential decree in these casesthe primary rule is to search for and
determine the intent and spirit of the law. Legislative intent is the controlling factor, for in the words
of this Court in Hidalgo v. Hidalgo, per Mr. Justice Claudio Teehankee, whatever is within the spirit
of a statute is within the statute, and this has to be so if strict adherence to the letter would result in
absurdity, injustice and contradictions.
Same; The preamble of a statute may be referred to determine what acts fall within the
purview of a penal statute.Because of the problem of determining what acts fall within the purview
of P.D. 9, it becomes necessary to inquire into the intent and spirit of the decree and this can be
found among others in the preamble or whereas clauses which enumerate the facts or events which
justify the promulgation of the decree and the stiff sanctions stated therein.
Same; The results or effects of a presidential decree must be within its reason or intent.From
the above it is clear that the acts penalized in P.D. 9 are those related to the desired result of
Proclamation 1081 and General Orders Nos. 6 and 7. General Orders Nos. 6 and 7 refer to firearms
and therefore have no relevance to P.D. 9 (3) which refers to blunt or bladed weapons. x x x It follows
that it is only that act of carrying a blunt or bladed weapon with a motivation connected with or
related to the afore-quoted desired result of Proclamation 1081 that is within the intent of P.D. 9 (3),
and nothing else.
545
VOL. 86, NOVEMBER 20, 1978 5 respectively, by the Office of the City Fiscal of Manila, the Office of the Provincial Fiscal of Samar,
45
People vs. Purisima
Same; It is to be presumed that undesirable consequences or oppressive results were never
intended by a legislative measure.It is a salutary principle in statutory construction that there
exists a valid presumption that undesirable consequences were never intended by a legislative
measure, and that a construction of which the statute is fairly susceptible is favored, which will
avoid all objectionable, mischievous, indefensible, wrongful, evil, and injurious consequences. It is to
be presumed that when P.D. 9 was promulgated by the President of the Republic there was no intent
to work a hardship or an oppressive result, a possible abuse of authority or act of oppression, arming
one person with a weapon to impose hardship on another, and so on.
Same; Reason why penal statutes are construed strictly against the state.American
jurisprudence sets down the reason for this rule to be the tenderness of the law for the rights of
individuals; the object is to establish a certain rule by conformity to which mankind would be safe,
and the discretion of the court limited. The purpose is not to enable a guilty person to escape
punishment through a technicality but to provide a precise definition of forbidden acts.
Criminal Procedures; Where the facts stated in the information are incomplete and do not
convey the elements of the crime, the quashing thereof is in order.The two elements of the offense
covered by P.D. 9 (3) must be alleged in the information in order that the latter may constitute a
sufficiently valid charge. The sufficiency of an Information is determined solely by the facts alleged
therein. Where the facts are incomplete and do not convey the elements of the crime, the quashing of
the accusation is in order. Section 2(a), Rule 117 of the Rules of Court provides that the defendant
may move to quash the complaint or information when the facts charged do not constitute an
offense.
Same; If an information is ordered quash the state may either file an amended information or
file another information for a crime penalized by another statute as the facts may warrant.Two
courses of action were open to Petitioner upon the quashing of the Informations in these cases, viz:
First, if the evidence on hand so warranted, the People could have filed an amended information to
include the second element of the offense as defined in the disputed orders of respondent Judges. We
have ruled that if the facts alleged in the Information do not constitute a punishable offense, the
case should not be dismissed but the prosecution should be given an opportunity to amend the
Information. Second, if the facts so justified, the People
546
5 SUPREME COURT REPORTS
46 ANNOTATED
People vs. Purisima
could have filed a complaint either under Section 26 of Act No. 1780, quoted earlier, or Manila
City Ordinance No. 3820, as amended by Ordinance No. 3928, especially since in most if not all of
the cases, the dismissal was made prior to arraignment of the accused and on a motion to quash.
PETITIONS for review of the decisions of the Courts of First of Manila and Samar.
The facts are stated in the opinion of the Court.
Jose L. Gamboa, Fermin Martin, Jr. & Jose D. Cajucom, Office of the City of Fiscal of Manila
and the Office of Provincial Fiscal of Samar for petitioners.
Norberto Parto for respondents Candelosas, Baes and Garcia.
Amado C. de la Marced for respondents Simeon Bundalian Jr., et al.
Manuel F. de Jesus for all the respondents in L-46229-32 and L-46313-16.
Norberto L. Apostol for respondent Panchito Refuncion.
Hon. Amante P. Purisima for and in his own behalf.
MUOZ PALMA, J.:
These twenty-six (26) Petitions for Review filed by the People of the Philippines represented,
and joined by the Solicitor General, are consolidated in this one Decision as they involve one basic
question of law.
These Petitions or appeals involve three Courts of First Instance, namely: the Court of First
Instance of Manila, Branch VII, presided by Hon. Amante P. Purisima (17 Petitions), the Court of
First Instance of Manila, Branch XVIII, presided by Hon. Maximo A. Maceren (8 Petitions) and, the
Court of First Instance of Samar, with Hon. Wenceslao M. Polo, presiding, (1 Petition).
Before those courts, Informations were filed charging the respective accused with illegal
possession of deadly weapon in violation of Presidential Decree No. 9. On a motion to quash
547
VOL. 86, NOVEMBER 20, 1978 547
People vs. Purisima
filed by the accused, the three Judges mentioned above issued in the respective cases filed before
themthe details of which will be recounted belowan Order quashing or dismissing the
Informations, on a common ground, viz, that the Information did not allege facts which constitute
the offense penalized by Presidential Decree No. 9 because it failed to state one essential element of
the crime.
Thus, are the Informations filed by the People sufficient in form and substance to constitute the
offense of illegal possession of deadly weapon penalized under Presidential Decree (PD for short)
No. 9? This is the central issue which we shall resolve and dispose of, all other corollary matters not
being indispensable for the moment.
A The Information filed by the People
1. In L-42050-66, one typical Information filed with the Court presided by Judge Purisima
follows:
THE PEOPLE OF THE PHILIPPINES, plaintiff, versus PORFIRIO CANDELOSAS Y DURAN,
accused.
Crim. Case No. 19639
VIOLATION OF PAR. 3, PRES. DECREE No. 9 OF PROCLAMATION 1081
INFORMATION
The undersigned accuses PORFIRIO CANDELOSAS Y DURAN of a violation of paragraph 3,
Presidential Decree No. 9 of Proclamation 1081, committed as follows:
That on or about the 14th day of December, 1974, in the City of Manila, Philippines, the said
accused did then and there wilfully, unlawfully, feloniously and knowingly have in his possession
and under his custody and control one (1) carving knife with a blade of 6-1/2 inches and a wooden
handle of 5-1/4 inches, or an overall length of 11-3/4 inches, which the said accused carried outside of
his residence, the said weapon not being used as a tool or implement necessary to earn his livelihood
nor being used in connection therewith.
Contrary to law. (p. 32, rollo of L-42050-66)
The other Informations are similarly worded except for the name of the accused, the date and place
of the commission of the crime, and the kind of weapon involved.
548
548 SUPREME COURT REPORTS
ANNOTATED
People vs. Purisima
2. In L-46229-32 and L-46313-16, the Information filed with the Court presided by Judge Maceren
follows:
THE PEOPLE OF THE PHILIPPINES, plaintiff, versus REYNALDO LAQUI Y AQUINO, accused.
CRIM. CASE NO. 29677
VIOL. OF PAR. 3,
PD 9 IN REL. TO LOI
 No. 266 of the Chief And while there is no proof of it before the Court, it is not difficult to believe the murmurings of
Executive dated April 1, 1975 detained persons brought to Court upon a charge of possession of bladed weapons under P.D. No.
550
INFORMATION 550 SUPREME COURT REPORTS
ANNOTATED
The undersigned accuses REYNALDO LAQUI Y AQUINO of a VIOLATION OF PARAGRAPH
3, PRESIDENTIAL DECREE NO. 9 in relation to Letter of Instruction No. 266 of the Chief People vs. Purisima
Executive dated April 1, 1975, committed as follows: 9, that more than ever before, policemenof course not all can be so heartlessnow have in their
That on or about the 28th day of January, 1977, in the City of Manila, Philippines, the said hands P.D. No. 9 as a most convenient tool for extortion, what with the terrifying risk of being
accused did then and there wilfully, unlawfully and knowingly carry outside of his residence a sentenced to imprisonment of five to ten years for a rusted kitchen knife or a pair of scissors, which
bladed and pointed weapon, to wit: an ice pick with an overall length of about 8 1/2 inches, the same only God knows where it came from. Whereas before martial law an extortion-minded peace officer
not being used as a necessary tool or implement to earn his livelihood nor being used in connection had to have a stock of the cheapest paltik, and even that could only convey the coercive message of
therewith. one year in jail, now anything that has the semblance of a sharp edge or pointed object, available
Contrary to law. (p. 14, rollo of L-46229-32) even in trash cans, may already serve the same purpose, and yet five to ten times more
The other Informations are likewise similarly worded except for the name of the accused, the date incriminating than the infamous paltik.
and place of the commission of the crime, and the kind of weapon involved. For sure, P.D. No. 9 was conceived with the best of intentions and wisely applied, its necessity
3. In L-46997, the Information before the Court of First Instance of Samar is quoted hereunder: can never be assailed. But it seems it is back-firing, because it is too hot in the hands of policemen
PEOPLE OF THE PHILIPPINES, complainant, versus PANCHITO REFUNCION, accused. who are inclined to backsliding.
CRIM. CASE NO. 933 The checkvalves against abuse of P.D. No. 9 are to be found in the heart of the Fiscal and the
For: conscience of the Court, and hence this resolution, let alone technical legal basis, is prompted by the
ILLEGAL POSSESSION OF desire of this Court to apply said checkvalves. (pp. 55-57, rollo of L-42050-66)
DEADLY WEAPON 2. Judge Maceren in turn gave his grounds for dismissing the charges as follows:
(VIOLATION OF PD NO. 9) xx xx xx
As earlier noted the desired result sought to be attained by Proclamation No. 1081 is the
INFORMATION maintenance of law and order throughout the Philippines and the prevention and suppression of all
forms of lawless violence as well as any act of insurrection or rebellion. It is therefore reasonable to
The undersigned First Assistant Provincial Fiscal of Samar, accuses PANCHITO conclude from the foregoing premises that the carrying of bladed, pointed or blunt weapons outside
REFUNCJON of the crime of ILLEGAL of ones residence which is made unlawful and punishable by said par. 3 of P.D. No. 9 is one
549 that abets subversion, insurrection or rebellion, lawless violence, criminality, chaos and public
disorder or is intended to bring about these conditions. This conclusion is further strengthened by
VOL. 86, NOVEMBER 20, 1978 549 the fact that all previously existing laws that also made the carrying of similar weapons punishable
have not been repealed, whether expressly or impliedly. It is noteworthy that Presidential Decree
People vs. Purisima No. 9 does not contain any repealing clause or provisions.
POSSESSION OF DEADLY WEAPON or VIOLATION OF PD NO. 9 issued by the President of the xx xx xx
Philippines on Oct. 2, 1972, pursuant to Proclamation No. 1081 dated Sept. 21 and 23, 1972, The mere carrying outside of ones residence of these deadly weapons if not concealed in ones
committed as follows: person and if not carried in any of
That on or about the 6th day of October, 1976, in the evening at Barangay Barruz, Municipality 551
of Matuginao, Province of Samar Philippines, and within the jurisdiction of this Honorabe Court, the
abovenamed accused, knowingly, wilfully, unlawfully and feloniously carried with him outside of his VOL. 86, NOVEMBER 20, 1978 551
residence a deadly weapon called socyatan, an instrument which from its very nature is no such as
People vs. Purisima
could be used as a necessary tool or instrument to earn a livelihood, which act committed by the
accused is a Violation of Presidential Decree No. 9. the aforesaid specified places, would appear to be not unlawful and punishable by law.
CONTRARY TO LAW. (p. 8, rollo of L-46997) With the promulgation of Presidential Decree No. 9, however, the prosecution, through
BThe Orders of dismissal Assistant Fiscal Hilario H. Laqui, contends in his opposition to the motion to quash, that this act is
In dismissing or quashing the Informations the trial courts concurred with the submittal of the now made unlawful and punishable, particularly by paragraph 3 thereof, regardless of the intention
defense that one essential element of the offense charged is missing from the Information, viz: that of the person carrying such weapon because the law makes it mala prohibita. If the contention of
the carrying outside of the accuseds residence of a bladed, pointed or blunt weapon is in furtherance the prosecution is correct, then if a person happens to be caught while on his way home by law
or on the occasion of, connected with or related to subversion, insurrection, or rebellion, organized enforcement officers carrying a kitchen knife that said person had just bought from a store in order
lawlessness or public disorder. that the same may be used by ones cook for preparing the meals in ones home, such person will be
1. Judge Purisima reasoned out, inter alia, in this manner: liable for punishment with such a severe penalty as imprisonment from five to ten years under the
x x x the Court is of the opinion that in order that possession of bladed weapon or the like outside decree. Such person cannot claim that said knife is going to be used by him to earn a livelihood
residence may be prosecuted and tried under P.D. No. 9, the information must specifically allege because he intended it merely for use by his cook in preparing his meals.
that the possession of bladed weapon charged was for the purpose of abetting, or in furtherance of This possibility cannot be discounted if Presidential Decree No. 9 were to be interpreted and
the conditions of rampant criminality, organized lawlessness, public disorder, etc. as are applied in the manner that the prosecution wants it to be done. The good intentions of the President
contemplated and recited in Proclamation No. 1081, as justification therefor. Devoid of this specific in promulgating this decree may thus be perverted by some unscrupulous law enforcement officers.
allegation, not necessarily in the same words, the information is not complete, as it does not allege It may be used as a tool of oppression and tyranny or of extortion.
sufficient facts to constitute the offense contemplated in P.D. No. 9. The information in these cases xx xx xx
under consideration suffer from this defect. It is therefore the considered and humble view of this Court that the act which the President
xx xx xx intended to make unlawful and punishable by Presidential Decree No. 9, particularly by paragraph 3
thereof, is one that abets or is intended to abet subversion, rebellion, insurrection, lawless violence,
criminality, chaos and public disorder. (pp. 28-30, rollo of L-46229-32)
3. Judge Polo of the Court of First Instance of Samar expounded his order dismissing the
Information filed before him, thus:
x x x We believe that to constitute an offense under the aforecited Presidential Decree, the same
should be or there should be an allegation that a felony was committed in connection or in
furtherance of subversion, rebellion, insurrection, lawless violence and public disorder. Precisely
Proclamation No. 1081 declaring a state of martial law throughout the country was issued because of
wanton destruction to lives and properties widespread lawlessness and anar-
552
552 SUPREME COURT REPORTS
ANNOTATED
People vs. Purisima
chy. And in order to restore the tranquility and stability of the country and to secure the people from
violence and loss of lives in the quickest possible manner and time, carrying firearms, explosives and
deadly weapons without a permit unless the same would fall under the exception is prohibited. This
conclusion becomes more compelling when we consider the penalty imposable, which is from five
years to ten years. A strict enforcement of the provision of the said law would mean the imposition of
the Draconian penalty upon the accused.
xx xx xx
It is public knowledge that in rural areas, even before and during martial law, as a matter of
status symbol, carrying deadly weapons is very common, not necessarily for committing a crime nor
as their farm implement but for self-preservation or self-defense if necessity would arise specially in
going to and from their farm. (pp. 18-19, rollo of L-46997)
In most if not all of the cases, the orders of dismissal were given before arraignment of the accused.
In the criminal case before the Court of (First Instance of Samar the accused was arraigned but at
the same time moved to quash the Information. In all the cases where the accused were under
arrest, the three Judges ordered their immediate release unless held on other charges.
CThe law under which the Informations in question were filed by the People.
As seen from the Informations quoted above, the accused are charged with illegal possession of
deadly weapon in violation of Presidential Decree No. 9, Paragraph 3.
We quote in full Presidential Decree No. 9, to wit:
PRESIDENTIAL DECREE NO. 9
DECLARING VIOLATIONS OF GENERAL ORDERS NO. 6 and NO. 7 DATED SEPTEMBER 22,
1972, AND SEPTEMBER 23, 1972, RESPECTIVELY, TO BE UNLAWFUL AND PROVIDING
PENALTIES THEREFORE.
WHEREAS, pursuant to Proclamation No. 1081 dated September 21, 1972, the Philippines has
been placed under a state of martial law;
553
VOL. 86, NOVEMBER 20, 1978 553
People vs. Purisima
WHEREAS, by virtue of said Proclamation No. 1081, General Order No. 6 dated September 22,
1972 and General Order No. 7 dated September 23, 1972, have been promulgated by me;
WHEREAS, subversion, rebellion, insurrection, lawless violence, criminality, chaos and public
disorder mentioned in the aforesaid Proclamation No. 1081 are committed and abetted by the use of
firearms, explosives and other deadly weapons;
NOW, THEREFORE, I, FERDINAND E. MARCOS, Commander-in-Chief of all the Armed
Forces of the Philippines, in order to attain the desired result of the aforesaid Proclamation No. 1081
and General Orders Nos. 6 and 7, do hereby order and decree that:
1. Any violation of the aforesaid General Orders Nos. 6 and 7 is unlawful and the violator shall,
upon conviction suffer:
1. (a)The mandatory penalty of death by a firing squad or electrocution as a Military
Court/Tribunal/Commission may direct, if the firearm involved in the violation is
unlicensed and is attended by assault upon, or resistance to persons in authority or their
agents in the performance of their official functions resulting in death to said persons in
authority or their agent; or if such unlicensed firearm is used in the commission of
crimes against persons, property or chastity causing the death of the victim, or used in
violation of any other General Orders and/or Letters of Instructions promulgated under
said Proclamation No. 1081:
2. (b)The penalty of imprisonment ranging from twenty years to life imprisonment as a
Military Court/Tribunal/Commission may direct, when the violation is not attended by
any of the circumstances enumerated under the preceding paragraph;
3. (c)The penalty provided for in the preceding paragraphs shall be imposed upon the owner,
president, manager, members of the board of directors or other responsible officers of
any public or private firms, companies, corporations or entities who shall willfully or
knowingly allow any of the firearms owned by such firm, company, corporation or entity
concerned to be used in violation of said General Orders Nos. 6 and 7.
2. It is unlawful to possess deadly weapons, including hand grenades, rifle grenades and other
explosives, including, but not limited to, pill box bombs, molotov cocktail bombs, fire bombs, or
554
554 SUPREME COURT REPORTS
ANNOTATED
People vs. Purisima
other incendiary device consisting of any chemical, chemical compound, or detonating agents
containing combustible units or other ingredients in such proportion, quantity, packing, or bottling
that ignites by fire, by friction, by concussion, by percussion, or by detonation of all or part of the
compound or mixture which may cause such a sudden generation of highly heated gases that the
resultant gaseous pressures are capable of producing destructive effects on continguous objects or of
causing injury or death of a person; and any person convicted thereof shall be punished by
imprisonment ranging from ten to fifteen years as a Military Court/Tribunal/Commission may
direct.
3. It is unlawful to carry outside of residence any bladed, pointed or blunt weapon such as fan
knife, spear, dagger, bolo, balisong, barong, kris, or club, except where such articles are being
used as necessary tools or implements to earn a livelihood and while being used in connection
therewith; and any person found guilty thereof shall suffer the penalty of imprisonment ranging
from five to ten years as a Military Court/Tribunal/Commission may direct.
4. When the violation penalized in the preceding paragraphs 2 and 3 is committed during the
commission of or for the purpose of committing, any other crime, the penalty shall be imposed upon
the offender in its maximum extent, in addition to the penalty provided for the particular offenses
committed or intended to be committed.
Done in the City of Manila, this 2nd day of October in the year of Our Lord, nineteen hundred
and seventy-two.
(SGD) FERDINAND E. MARCOS
President
Republic of the Philippines
D The arguments of the People
In the Comment filed in these cases by the Solicitor General who as stated earlier joins the City
Fiscal of Manila and the Provincial Fiscal of Samar in seeking the setting aside of the questioned
orders of dismissal, the main argument advanced on the issue now under consideration is that a
perusal of paragraph 3 of P.D. 9 shows that the prohibited acts need not be related to subversive
activities; that the act proscribed is essentially a malum prohibitium penalized for reasons of public
policy.1
_______________
1p. 118, rollo of L-42050-66.
555
VOL. 86, NOVEMBER 20, 1978 555

People vs. Purisima
The City Fiscal of Manila in his brief adds further that in statutory offenses the intention of the
accused who commits the act is immaterial; that it is enough if the prohibited act is voluntarily
perpetuated; that P.D. 9 provides and condemns not only the carrying of said weapon in connection
with the commission of the crime of subversion or the like, but also that of criminality in general,
that is, to eradicate lawless violence which characterized pre-martial law days. It is also argued that
the real nature of the criminal charge is determined not from the caption or preamble of the
information nor from the specification of the provision of law alleged to have been violated but by the
actual recital of facts in the complaint or information.2
K Our Ruling on the matter
1. It is a constitutional right of any person who stands charged in a criminal prosecution to be
informed of the nature and cause of the accusation against him.3
Pursuant to the above, Section 5, Rule 110 of the Rules of Court, expressly requires that for a
complaint or information to be sufficient it must, inter alia, state the designation of the offense by
the statute, and the acts or omissions complained of as constituting the offense. This is essential to
avoid surprise on the accused and to afford him the opportunity to prepare his defense accordingly. 4
To comply with these fundamental requirements of the Constitution and the Rules on Criminal
Procedure, it is imperative for the specific statute violated to be designated or mentioned in the
charge. In fact, another compelling reason exists why a specification of the statute violated is
essential in these cases. As stated in the order of respondent Judge Maceren the carrying of so-called
deadly weapons is the subject of another penal statute and a Manila city ordinance. Thus, Section
26 of Act No. 1780 provides:
_____________
2 pp. 10-11, brief of Petitioner at p. 218, ibid.
3 Art. IV, Sec. 19, 1973 Constitution.
4 Francisco on the Revised Rules of Court, 1989 Ed., Vol. on Criminal Procedure, p. 86.
556
556 SUPREME COURT REPORTS
ANNOTATED
People vs. Purisima
Section 26. It should be unlawful for any person to carry concealed about his person any bowie
knife, dirk, dagger, kris, or other deadly weapon: x x x. Any person violating the provisions of this
section shall, upon conviction in a court of competent jurisdiction, be punished by a fine not
exceeding five hundred pesos, or by imprisonment for a period not exceeding six months, or both
such fine and imprisonment, in the discretion of the court.
Ordinance No. 3820 of the City of Manila as amended by Ordinance No. 3928 which took effect on
December 4, 1957, in turn penalizes with a fine of not more than P200.00 or imprisonment for not
more than one months, or both, at the discretion of the court, anyone who shall carry concealed in
his person in any manner that would disguise its deadly character any kind of firearm, bowie knife,
or other deadly weapon . . . in any public place. Consequently, it is necessary that the particular law
violated be specified as there exists a substantial difference between the statute and city ordinance
on the one hand and P.D. 9 (3) on the other regarding the circumstances of the commission of the
crime and the penalty imposed for the offense.
We do not agree with petitioner that the above-mentioned statute and the city ordinance are
deemed repealed by P.D. 9 (3).5 P. D. 9(3) does not contain any repealing clause or provision, and
repeal by implication is not favored.6This principle holds true with greater force with regards to
penal statutes which as a rule are to be construed strictly against the state and liberally in favor of
the accused.7 In fact, Article 7 of the New Civil Code provides that laws are repealed only by
subsequent ones and their violation or non-observance shall not be excused by disuse, or custom or
practice to the contrary.
_______________
pp. 33-34 brief of Petitioner filed by the City Fiscal of Manila.
5
Valera v. Tuason, Jr., et al., 80 Phil. 823, citing U.S. v. Palacio 33 Phil. 208; Quimsing v.
6
Lachica, 2 SCRA 182; Almeda v. Florentino, 15 SCRA 514; Lechoco v. Civil Aeronautics Board, 43
SCRA 670.
7 People v. Elkanish, 1951, 90 Phil. 53, 57 People v. Yadao, 1954, 94 Phil. 726, 728.
557
VOL. 86, NOVEMBER 20, 1978 557
People vs. Purisima
Thus we are faced with the situation where a particular act may be made to fall, at the discretion of
a police officer or a prosecuting fiscal, under the statute, or the city ordinance, or the presidential
decree. That being the case, the right becomes more compelling for an accused to be confronted with
the facts constituting the essential elements of the offense charged against him, if he is not to
become an easy pawn of oppression and harassment, or of negligent or misguided official actiona
fear understandably shared by respondent Judges who by the nature of their judicial functions are
daily exposed to such dangers.
2. In all the Informations filed by petitioner the accused are charged in the caption as well as in
the body of the Information with a violation of paragraph 3, P.D, 9. What then are the elements of the
offense treated in the presidential decree in question?
We hold that the offense carries two elements: first, the carrying outside ones residence of any
bladed, blunt, or pointed weapon, etc. not used as a necessary tool or implement for a livelihood;
and second, that the act of carrying the weapon was either in furtherance of, or to abet, or in
connection with subversion, rebellion, insurrection, lawless violence, criminality, chaos, or public
disorder.
It is the second element which removes the act of carrying a deadly weapon, if concealed, outside
of the scope of the statute or the city ordinance mentioned above. In other words, a simple act of
carrying any of the weapons described in the presidential decree is not a criminal offense in itself.
What makes the act criminal or punishable under the decree is the motivation behind it Without
that motivation, the act falls within the purview of the city ordinance or some statute when the
circumstances so warrant.
Respondent Judges correctly ruled that this can be the only reasonably, logical, and valid
construction given to P.D. 9(3).
3. The position taken by petitioner that P.D. 9(3) covers one and all situations where a person
carries outside his residence any of the weapons mentioned or described in the decree irrespective of
motivation, intent, or purpose, converts these cases into one of statutory construction. That there is
558
558 SUPREME COURT REPORTS
ANNOTATED
People vs. Purisima
ambiguity in the presidential decree is manifest from the conflicting views which arise from its
implementation. When ambiguity exists, it becomes a judicial task to construe and interpret the true
meaning and scope of the measure, guided by the basic principle that penal statutes are to be
construed and applied liberally in favor of the accused and strictly against the state.
4. In the construction or interpretation of a legislative measurea presidential decree in these
casesthe primary rule is to search for and determine the intent and spirit of the law. Legislative
intent is the controlling factor, for in the words of this Court in Hidalgo v. Hidalgo, per Mr. Justice
Claudio Teehankee, whatever is within the spirit of a statute is within the statute, and this has to be
so if strict adherence to the letter would result in absurdity, injustice and contradictions. 8
There are certain aids available to Us to ascertain the intent or reason for P.D. 9(3).
First, the presence of events which led to or precipitated the enactment of P.D. 9. These events are
clearly spelled out in the Whereas clauses of the presidential decree, thus: (1) the state of martial
law in the country pursuant to Proclamation 1081 dated September 21, 1972; (2) the desired result of
Proclamation 1081 as well as General Orders Nos. 6 and 7 which are particularly mentioned in P.D.
9; and (3) the alleged fact that subversion, rebellion, insurrection, lawless violence, criminality,
chaos, and public disorder mentioned in Proclamation 1081 are committed and abetted by the use of
firearms and explosives and other deadly weapons.
 The Solicitor General however contends that apreamble of a statute usually introduced by the
word whereas, is not an essential part of an act and cannot enlarge or confer powers, or cure
inherent defects in the statute (p. 120, rollo of L-42050-
_______________
833 SCRA 105. See also 73 Am Jur 2d 351 citing: United States v. N.E. Rosenblum Truck Lines,
Inc., 315 US 50, 86 L Ed 671; United States v. Stone & Downer Co., 274 US 225, 71 L Ed 1013; Ebert
v. Poston, 266 US 548, 69 L Ed 435; Wisconsin C.R. Co. v. Forsythe, 159 US 46, 40 L Ed 71.
559
VOL. 86, NOVEMBER 20, 1978 559
People vs. Purisima
66); that the explanatory note or enacting clause of the decree, if it indeed limits the violation of the
decree, cannot prevail over the text itself inasmuch as such explanatory note merely states or
explains the reason which prompted the issuance of the decree. (pp. 114-115, rollo of 46997)
We disagree with these contentions. Because of the problem of determining what acts fall within
the purview of P.D. 9, it becomes necessary to inquire into the intent and spirit of the decree and this
can be found among others in the preamble or whereas clauses which enumerate the facts or
events which justify the promulgation of the decree and the stiff sanctions stated therein.
A preamble is the key of the statute, to open the minds of the makers as to the mischiefs which are
to be remedied, and objects which are to be accomplished, by the provisions of the statute. (West
Norman Timber v. State, 224 P. 2d 635, 639, cited in Words and Phrases, Preamble; emphasis
supplied)
While the preamble of a statute is not strictly a part thereof, it may, when the statute is in
itself ambiguous and difficult of interpretation, be resorted to, but not to create a doubt or
uncertainty which otherwise does not exist, (James v. Du Bois, 16 N.J.L. (1 Har.) 285, 294, cited in
Words and Phrases, Preamble)
In Aboitiz Shipping Corporation, et al., v. The City of Cebu, et al., this Court had occasion to state
that (L)egislative intent must be ascertained from a consideration of the statute as a whole, and not
of an isolated part or a particular provision alone. This is a cardinal rule of statutory construction.
For taken in the abstract, a word or phrase might easily convey a meaning quite different from the
one actually intended and evident when the word or phrase is considered with those with which it is
associated. Thus, an apparently general provision may have a limited application if read together
with other provisions.9
Second, the result or effects of the presidential decree must be within its reason or intent.
In the paragraph immediately following the last Whereas clause, the presidential decree
states:
_______________
913 SCRA 449, 453; Emphasis supplied.
560
560 SUPREME COURT REPORTS
ANNOTATED
People vs. Purisima
NOW, THEREFORE, I, FERDINAND E. MARCOS, Commander-in-Chief of all the Armed Forces of
the Philippines, in order to attain the desired result of the aforesaid Proclamation No. 1081 and
General Orders Nos. 6 and 7, do hereby order and decree that:
xxx xxx xxx
From the above it is clear that the acts penalized in P.D. 9 are those related to the desired result of
Proclamation 1081 and General Orders Nos. 6 and 7. General Orders Nos. 6 and 7 refer to firearms
and therefore have no relevance to P.D. 9(3) which refers to blunt or bladed weapons. With respect to
Proclamation 1081 some of the underlying reasons for its issuance are quoted hereunder:
WHEREAS, these lawless elements having taken up arms against our duly constituted government
and against our people, and having committed and are still committing acts of armed insurrection
and rebellion consisting of armed raids, forays, sorties, ambushes, wanton acts of murders, spoilage,
plunder, looting, arsons, destruction of public and private buildings, and attacks against innocent
and defenseless civilian lives and property, all of which activities have seriously endangered and
continue to endanger public order and safety and the security of the nation, x x x.
xxx xxx xxx
WHEREAS, it is evident that there is throughout the land a state of anarchy and lawlessness,
chaos and disorder, turmoil and destruction of a magnitude equivalent to an actual war between the
forces of our duly constituted government and the New Peoples Army and their satellite
organizations because of the unmitigated forays, raids, ambuscades, assaults, violence, murders,
assassinations, acts of terror, deceits, coercions, threats, intimidations, treachery, machinations,
arsons, plunders and depredations committed and being committed by the aforesaid lawless
elements who have pledged to the whole nation that they will not stop their dastardly effort and
scheme until and unless they have fully attained their primary and ultimate purpose of forcibly
seizing political and state power in this country by overthrowing our present duly constituted
government, x x x. (See Book I, Vital Documents on the Declaration of Martial Law in the
Philippines by the Supreme Court of the Philippines, pp. 13-39)
561
VOL. 86, NOVEMBER 20, 1978 561
People vs. Purisima
It follows that it is only that act ot carrying a blunt or bladed weapon with a motivation connected
with or related to the afore-quoted desired result of Proclamation 1081 that is within the intent of
P.D. 9(3), and nothing else.
Statutes are to be construed in the light of purposes to be achieved and the evils sought to be
remedied (U.S. v. American Tracking Association, 310 U.S. 534, cited in LVN Pictures v. Philippine
Musicians Guild, 110 Phil. 725, 731; emphasis supplied)
When construing a statute, the reason for its enactment should be kept in mind, and the statute
should be construed with reference to its intended scope and purpose. (Statutory Construction by
E.T. Crawford, pp. 604-605, cited in Commissioner of Internal Revenue v. Filipinas Compaia de
Seguros, 107 Phil. 1055, 1060; emphasis supplied)
5. In the construction of P.D. 9(3) it becomes relevant to inquire into the consequences of the
measure if a strict adherence to the letter of the paragraph is followed.
It is a salutary principle in statutory construction that there exists a valid presumption that
undesirable consequences were never intended by a legislative measure, and that a construction of
which the statute is fairly susceptible is favored, which will avoid all objectionable, mischievous,
indefensible, wrongful, evil, and injurious consequences.9a
It is to be presumed that when P.D. 9 was promulgated by the President of the Republic there
was no intent to work a hardship or an oppressive result, a possible abuse of authority or act of
oppression, arming one person with a weapon to impose hardship on another, and so on.10
At this instance We quote from the order of Judge Purisima the following:
And while there is no proof of it before the Court, it is not difficult to believe the murmurings of
detained persons brought to Court upon a charge of possession of bladed weapons under P.D. No.
_______________
9a73 Am Jur 2d 428.
10See 73 Am Jur 2d 432-433 for cases on the foregoing undesirable consequences.
562
562 SUPREME COURT REPORTS
ANNOTATED
People vs. Purisima
9, that more than ever before, policemenof course not all can be so heartlessnow have in their
hands P.D. No. 9 as a most convenient tool for extortion, what with the terrifying risk of being
sentenced to imprisonment of five to ten years for a rusted kitchen knife or a pair of scissors, which
only God knows where it came from. Whereas before martial law an extortion-minded peace officer
had to have a stock of the cheapest paltik, and even that could only convey the coercive message of
one year in jail, now anything that has the semblance of a sharp edge or pointed object, available
even in trash cans, may already serve the same purpose, and yet five to ten times more
incriminating than the infamous paltik. (pp. 72-73, rollo L-42050-66)
And as respondent Judge Maceren points out, the peoples interpretation of P.D. 9(3) results in
absurdity at times. To his example We may add a situation where a law-abiding citizen, a lawyer by
profession, after gardening in his house remembers to return the bolo used by him to his neighbor
who lives about 30 meters or so away and while crossing the street meets a policeman. The latter
upon seeing the bolo being carried by that citizen places him under arrest and books him for a
violation of P.D. 9(3). Could the presidential decree have been conceived to produce such absurd,
unreasonable, and insensible results?
6. Penal statutes are to be construed strictly against the state and liberally in favor of an
accused.
American jurisprudence sets down the reason for this rule to be the tenderness of the law of the
rights of individuals; the object is to establish a certain rule by conformity to which mankind would
be safe, and the discretion of the court limited.11 The purpose is not to enable a guilty person to
escape punishment through a technicality but to provide a precise definition of forbidden acts.12
________________
11 United States v. Harris, 177 US 305, 44 L Ed 780, 20 S Ct 609; Braffith v. Virgin
Islands (CA3) 26 F2d 646; Caudill v. State, 224 Ind 531, 69 NE2d 549; Jennings v. Commonwealth,
109 Va 821, 63 SE 1080, all cited in 73 Am Jur 2d 452.
12 State v. Zazzaro, 20 A 2d 737, quoted in Martins Handbook on Statutory Construction, Rev.
Ed. pp. 183-184.
563
VOL. 86, NOVEMBER 20, 1978 563
People vs. Purisima
Our own decisions have set down the same guidelines in this manner, viz:
Criminal statutes are to be construed strictly. No person should be brought within their terms who
is not clearly within them, nor should any act be pronounced criminal which is not made clearly so
by the statute. (U.S. v. Abad Santos, 36 Phil. 243, 246)
The rule that penal statutes are given a strict construction is not the only factor controlling the
interpretation of such laws, instead, the rule merely serves as an additional, single factor to be
considered as an aid in determining the meaning of penal laws. (People v. Manantan, 5 SCRA 684,
692)
F. The Informations filed by petitioner are fatally defective.
The two elements of the offense covered by P.D. 9(3) must be alleged in the Information in order
that the latter may constitute a sufficiently valid charged. The sufficiency of an Information is
determined solely by the facts alleged therein,13 Where the facts are incomplete and do not convey
the elements of the crime, the quashing of the accusation is in order.
Section 2(a), Rule 117 of the Rules of Court provides that the defendant may move to quash the
complaint or information when the facts charged do not constitute an offense.
In U.S. v. Gacutan, 1914, it was held that where an accused is charged with knowingly
rendering an unjust judgment under Article 204 of the Revised Penal Code, failure to allege in the
Information that the judgment was rendered knowing it to be unjust, is fatal.14
In People v. Yadao, 1954, this Court through then Justice Cesar Bengzon who later became
Chief Justice of the Court affirmed an order of the trial court which quashed an Information wherein
the facts recited did not constitute a public offense as defined in Section 1, Republic Act 145.15
________________
13 People v. Supnad, 7 SCRA 603, 606.
14 28 Phil. See Moran, Comments on the Rules of Court, 1970 Ed., Vol. 4, p. 222.
15 94 Phil. 726.
564
5 SUPREME COURT REPORTS
64 ANNOTATED
People vs. Purisima
GThe filing of these Petitions was unnecessary because the People could have availed itself of
other available remedies below.
Pertinent provisions of the Rules of Court follow:
Rule 117, Section 7. Effect of sustaining the motion to quash.If the motion to quash is sustained
the court may order that another information be filed. If such order is made the defendant, if in
custody, shall remain so unless he shall be admitted to bail. If such order is not made or if having
been made another information is not filed with on time to be specified in the order, or within such
further time as the court may allow for good cause shown, the defendant, if in custody, shall be
discharged therefrom, unless he is in custody on some other charge.
Rule 110, Section 13. Amendment.The information or complaint may be amended, in
substance or form, without leave of court, at any time before the defendant pleads; and thereafter
and during the trial as to all matters of form, by leave and at the discretion of the court, when the
same can be done without prejudice to the rights of the defendant.
xxx xxx xxx
Two courses of action were open to Petitioner upon the quashing of the Informations in these cases,
viz:
First, if the evidence on hand so warranted, the People could have filed an amended Information
to include the second element of the offense as defined in the disputed orders of respondent Judges.
We have ruled that if the facts alleged in the Information do not constitute a punishable offense, the
case should not be dismissed but the prosecution should be given an opportunity to amend the
Information.16
Second, if the facts so justified, the People could have filed a complaint either under Section 26
of Act No. 1780, quoted earlier, or Manila City Ordinance No. 3820, as amended by Ordinance No.
3928, especially since in most if not all of the cases, the dismissal was made prior to arraignment of
the accused and on a motion to quash.
_____________
16People v. Plaza, 7 SCRA 617.
565
VOL. 86, NOVEMBER 20, 1978 565
People vs. Purisima
Section 8. Rule 117 states that:
An order sustaining the motion to quash is not a bar to another prosecution for the same offense
unless the motion was based on the grounds specified in section 2, subsections (f) and (h) of this
rule.
Under the foregoing, the filing of another complaint or Information is barred only when the criminal
action or liability had been extinguished (Section 2[f]) or when the motion to quash was granted for
reasons of double jeopardy. (ibid., [h])
As to whether or not a plea of double jeopardy may be successfully invoked by the accused in all
these cases should new complaints be filed against them, is a matter We need not resolve for the
present.
HWe conclude with high expectations that police authorities and the prosecuting arm of the
government true to the oath of office they have taken will exercise utmost circumspection and good
faith in evaluating the particular circumstances of a case so as to reach a fair and just conclusion if a
situation falls within the purview of P.D. 9(3) and the prosecution under said decree is warranted
and justified. This obligation becomes a sacred duty in the face of the severe penalty imposed for the
offense.
On this point, We commend the Chief State Prosecutor Rodolfo A. Nocon on his letter to the City
Fiscal of Manila on October 15, 1975, written for the Secretary, now Minister of Justice, where he
stated the following:
In any case, please study well each and every case of this nature so that persons accused of carrying
bladed weapons, specially those whose purpose is not to subvert the duly constituted authorities,
may not be unduly indicted for the serious offenses falling under P.D. No. 9. 17
Yes, while it is not within the power of courts of justice to inquire into the wisdom of a law, it is
however a judicial task and
________________
 17 This letter which was addressed to the City Fiscal of Manila referred to a decision of the
Court of First Instance of Manila, Branch III, in Criminal Case No. 21178, People vs. Conrado C.
Petate, for violation of Presidential Decree No. 9.
566
566 SUPREME COURT REPORTS
ANNOTATED
People vs. Purisima
prerogative to determine if official action is within the spirit and letter of the law and if basic
fundamental rights of an individual guaranteed by the Constitution are not violated in the process of
its implementation. We have to face the fact that it is an unwise and unjust application of a law,
necessary and justified under prevailing circumstances, which renders the measure an instrument of
oppression and evil and leads the citizenry to lose their faith in their government.
WHEREFORE, We DENY these 26 Petitions for Review and We AFFIRM the Orders of
respondent Judges dismissing or quashing the Information concerned, subject however to Our
observations made in the preceding pages 23 to 25 of this Decision regarding the right of the State or
Petitioner herein to file either an amended Information under Presidential Decree No. 9, paragraph
3, or a new one under other existing statute or city ordinance as the facts may warrant.
Without costs.
SO ORDERED.
Fernando, Teehankee, Santos, Fernandez and Guerrero, JJ., concur.
Castro, C.J., and Antonio, J., in the result.
Barredo, J., concurs with the qualification that under existing jurisprudence conviction is
possible, without the need of amending the information, for violation of other laws or ordinances on
concealment of deadly weapons.
Makasiar, J., concurs with Justice Barredo in that under the information, the accused can
be validly convicted of violating Sec. 26 of Act No. 1780 or the city or town ordinances on carrying
consuled weapons.
Aquino, J., no part.
Concepcion Jr., J., concurs with the additional observation that accused could properly be
convicted of a violation of Act 1780 of the Philippine Commission or of the ordinance.
Petitions denied Orders affirmed.
567
VOL. 86, NOVEMBER 20, 1978 567
People vs. Purisima
Notes.A person charged with an offense but found to be a youthful offender could be
provisionally released on recognizance at the discretion of the Court. Courts, whenever possible,
should give vitality and force to the youth and welfare code to implement the Constitutional
mandate recognizing the vital role of youth in nation-building. (Virtuoso, Jr. vs. MJ of Mariveles,
Bataan, 82 SCRA 191.)
It is the duty of a judge to protect the constitutional rights of the accused and to observe the
constitutional ban against the requirements of excessive bail upon the accused. (Ibid.)
Any objection to the regularity of the issuance of a warrant of arrest must be made right after
the arrest, otherwise the same will be deemed waived. (De A sis vs. Romero, 41 SCRA 235; People vs.
Bongo, 55 SCRA 547.)
The death of an accused-appellant after final judgment of a trial court but before the judgment
has become final and executory due to the pendency of an appeal extinguishes his criminal liability,
but his civil liability survives (People v. Sendaydiego, 81 SCRA 120).
The crime of illegal possession of a deadly weapon cannot be adjudged in the absence of an
intention of the accused to carry, possess and conceal in his body the bolo which he used to drive
away his supposed aggressor. (Gopoy vs. Adil, 81 SCRA 739).
The rule that penal statutes are given a strict construction is not the only factor controlling the
interpretation of such laws; instead, the rule merely serves as an additional, single factor to be
considered as an aid in determining the meaning of penal law. (Sutherland, Statutory Construction,
p. 56). The court may consider the spirit and reason of a statute, as in this particular instance, where
a literal meaning would lead to absurdity, contradiction, injustice, or would defeat the clear purpose
of the lawmakers (Crawford, Interpretation of Laws, Sec. 78, p. 294.) (People vs. Manantan, 5 SCRA
684.)
In fact every statute should receive such construction as will make it harmonize with the pre-
existing body of laws. Antagonism between the Act to be interpreted and existing or previous laws is
to be avoided, unless it was clearly the intention of the legislature that such antagonism should arise
and
568
568 SUPREME COURT REPORTS
ANNOTATED
People vs. Sabio, Sr.
one amends or repeals the other, either expressly or by implication. (Commissioner of Customs vs.
Esso Standard Eastern, Inc., 66 SCRA 113.)
o0o
Copyright 2017 Central Book Supply, Inc. All rights reserved.
Aids to Interpretation and Construction A. Intrinsic Aids
iii. Punctuation Marks
People v. Subido, G.R. No. 21734, 5 September 1975, 66 SCRA 545
VOL. 66, SEPTEMBER 5, 1975 545
People vs. Subido
No. L-21734. September 5, 1975.*
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee, vs. ABELARDO SUBIDO, defendant-
appellant.
Criminal law; Libel; In libel cases under Art. 355 of the Revised Penal Code, the court is given
discretion to impose the penalty of fine or imprisonment or both.It is evident from the foregoing
provision that the court is given the discretion to impose the penalty of imprisonment or fine or both
for the crime of libel.
Judgments; Statutory construction; Meaning of sentence in Court of Appeals decision, to wit
WHEREUPON, with the modifications above indicated, the appealed judgment is hereby affirmed at
appellants costs is that it covers only those matters specifically referred to in the dispositive portion
of its decision.To Us it is clear that when the Court of Appeals provided in the concluding portion
of its decision: WHEREUPON, with the modifications above-indicated, the appealed judgment is
hereby affirmed at appellants costs the alluded modification could mean no less than the
elimination of the three months of arresto mayor and the reduction of the indemnity to the offended
party, Mayor Arsenio Lacson, from P10,000.00 to P5,000.00. All the rest of the punishment remains
including the subsidiary imprisonment in case of insolvency. Had the Court wanted to do away with
the subsidiary imprisonment in case of insolvency of accused-appellants to pay the fine and the
indemnity it would have so expressly provided.
Judgments; Same; Effect of use of a comma in a sentence of conviction for libel regarding
liability for subsidiary imprisonment in case of non-payment of civil indemnity and fine.A careful
scrutiny of the decision of the trial court reveals that the clause with
_______________
 *FIRST DIVISION.
546
5 SUPREME COURT REPORTS
46 ANNOTATED
People vs. Subido
subsidiary imprisonment in case of insolvency is separated by a comma from the preceding
clause is hereby sentenced to three months of arresto mayor with the accessory penalties of the law,
to pay a fine of five hundred pesos, to indemnify the offended party, Mayor Arsenio Lacson, in the
sum of Ten Thousand Pesos (P10,000.00) pesos. The use of a comma in the part of the sentence is to
make the subsidiary imprisonment in case of insolvency refer not only to non-payment of the
indemnity, but also to non-payment of the fine.
Same; Criminal law; Subsidiary imprisonment; R.A. 5465 amending Article 39 of the Revised
Penal Code exempts an accused from subsidiary imprisonment in case of insolvency to pay his civil
liability. Said statute may be applied retroactively in favor of accused.Fortunately, however,
accused-appellants is favored by the retroactive force of Article 39 of the Revised Penal Code, as
amended by R.A. 5465 which exempts an accused person from subsidiary imprisonment in case of
insolvency to pay his civil liability. x x x Considering that Article 39 of the Revised Penal Code, as
amended, is favorable to the accused-appellant, the same should be made applicable to him. It is so
provided in Article 22 of the Revised Penal Code.
APPEAL from the orders of the Court of First Instance of Manila. Perez, J.
The facts are stated in the opinion of the Court.
Solicitor General Edilberto Barot and Solicitor Ceferino Padua for plaintiff-appellee.
Estanislao A. Fernandez for defendant-appellant.
MARTIN, J.:
Appeal on questions of law from the Orders of the Court of First Instance of Manila in Criminal Case
No. 23041, entitled People of the Philippines versus Abelardo Subido, denying defendant-appellants
motion for the cancellation of his appeal bond and declaring him to suffer subsidiary imprisonment
in case of failure to pay the fine and indemnity.
From an adverse decision in said case, the dispositive portion of which reads:
From the facts above stated the Court finds the accused guilty of libel and he is hereby sentenced to
three (3) months of arresto mayor with the accessory penalties of the law, to pay a fine of five
hundred (P500.00) pesos, to indemnify the offended party, Mayor
547
VOL. 66, SEPTEMBER 5, 1975 547
People vs. Subido
Arsenio Lacson, in the sum of ten thousand (P10,000.00) pesos, with subsidiary imprisonment in
case of insolvency, and to pay the costs.
defendant-appellant Abelardo Subido has taken an appeal to the Court of Appeals, which modified
the said judgment in the following tenor:
However, in the application of the penalty provided for the violation of the libel law, the courts are
given discretion of whether or not both fine and imprisonment are to be imposed upon the offender.
In the instant case, we believe, considering the attendant circumstances of the case, that the
imposition of the corresponding penalty should be tempered with judicial discretion. For this reason,
we impose upon accused-appellant a fine of P500.00.
Similarly, the amount of the indemnity to be paid by appellant to the offended party is reduced
to P5,000.00.
WHEREFORE, with the modifications above indicated, the appealed judgment is hereby
affirmed at appellants costs.
In due time the case was remanded to the trial court for execution of the judgment.
On September 27, 1958, the accused-appellant filed a motion with the trial court praying that
(1) the court enter of record that the judgment of the Court of Appeals has been promulgated and (2)
that his appeal bond be cancelled. Accused-appellant argued that although he could not pay the fine
and the indemnity prescribed in the judgment of the Court of Appeals, he could not be required to
serve the amount of fine and indemnity in the form of subsidiary imprisonment because said
judgment did not expressly and specifically provide that he should serve the fine and indemnity in
form of subsidiary imprisonment in case of insolvency.
On December 20, 1958, upon motion of the offended party the lower court issued a writ of
execution of its judgment. However, the writ was returned unsatisfied.
On February 25, 1959, the Sheriff of the City of Manila, armed with an alias writ of execution,
attached whatever rights, interests, or participation, if any, defendant Abelardo Subido may have
in a two-storey building situated at No. 2313 Suter, Sta. Ana, Manila, covered by Transfer
Certificate of Title No. 54170 of the Register of Deeds of Manila. However, it turned out that the
property levied upon by the sheriff was registered in the name of Agapito Subido who, upon learning
of the levy, immediately filed a Third party claim with the sheriffs office and instituted an action in
the lower court (Civil Case No. 41731)
548
548 SUPREME COURT REPORTS
ANNOTATED
People vs. Subido
to enjoin the Sheriff of Manila from proceeding with the sale of his property. In the meantime the
lower court issued a writ of preliminary injunction enjoining the sale of property levied upon by the
sheriff.
On December 10, 1959, the offended party registered its opposition to accused-appellants
motion for cancellation of appeal bond and asked the lower court to require accused-appellant to pay
the fine of P500.00 and the indemnity of P5,000.00 with subsidiary imprisonment in case of
insolvency.
On December 19, 1959, the lower court issued an order denying the accused-appellants motion
and declared that in accordance with the terms of the judgment of the Court of Appeals the accused-
appellant has to suffer subsidiary imprisonment in case he could not pay the fine and indemnity
prescribed in the decision. Accused-appellant moved for reconsideration, but the same was denied on
December 26, 1959.
Hence this appeal from the lower courts orders of December 19 and 26:
In his appeal, accused-appellant presses that the lower court erred
I
IN HOLDING THAT UNDER THE TERMS OF THE DECISION OF THE COURT OF APPEALS
ACCUSED-APPELLANT IS LIABLE TO SUBSIDIARY IMPRISONMENT IN CASE OF
INSOLVENCY.
II
IN NOT HOLDING THAT THE CIVIL LIABILITY OF ACCUSED-APPELLANT HAS BEEN
SATISFIED WITH THE ATTACHMENT SECURED BY THE OFFENDED PARTY.1
The threshold issue in this appeal is whether or not the accused-appellant can be required to serve
the fine and indemnity prescribed in the judgment of the Court of Appeals in form of subsidiary
imprisonment in case of insolvency. Under Article 355 of the Revised Penal Code a libel committed
by means of writing, printing, litography, engraving, radio, phonograph, paintings, theatrical
exhibition, cinematographic exhibition or any similar means, shall be punished by prision
_______________
1 As the errors assigned involved purely questions of law, the Honorable Court of Appeals
certified the case to Us, pursuant to Section 17, par. 16, in relation to Section 31 of the Judiciary Act
of 1948.
549
VOL. 66, SEPTEMBER 5, 1975 549
People vs. Subido
correccional in its minimum and medium period or a fine ranging from 200 to 6000 pesos or both, in
addition to the civil action which may be brought by the offended party. It is evident from the
foregoing provision that the court is given the discretion to impose the penalty of imprisonment or
fine or both for the crime of libel. It will be noted that the lower court chose to impose upon the
accused: three months of arresto mayor; a fine of P500.00; indemnification of the offended party in
the sum of P10,000.00; subsidiary imprisonment in case of insolvency; and the payment of the costs.
On the other hand, the Court of Appeals in the exercise of its discretion decided to eliminate the
penalty of three (3) months arresto mayor and to reduce the indemnity of P10,000.00 to P5,000.00.
Thus the Court of Appeals resolved:
However, in the application of the penalty provided for in the violation of the libel law, the
courts are given discretion of whether or not both fine and imprisonment are to be imposed upon the
offender. In the instant case, we believe, considering the attendant circumstances of the same, that
the imposition of the corresponding penalty should be tempered with judicial discretion. For this
reason we impose the accused a fine of P500.00.
Similarly, the amount of the indemnity to be paid by appellant to the offended party is reduced
to P5,000.00.
WHEREUPON, with the modifications above indicated, the appealed judgment is hereby
affirmed at appellants cost.
To Us it is clear that when the Court of Appeals provided in the concluding portion of its decision:
WHEREUPON, with the modifications above indicated, the appealed judgment is hereby affirmed
at appellants costs
the alluded modifications could mean no less than the elimination of the three months of arresto
mayor and the reduction of the indemnity to the offended party, Mayor Arsenio Lacson, from
P10,000.00 to P5,000.00. All the rest of the punishment remains including the subsidiary
imprisonment in case of insolvency. Had the Court wanted to do away with the subsidiary
imprisonment in case of insolvency of accused-appellant to pay the fine and the indemnity it would
have so expressly provided.
A careful scrutiny of the decision of the trial court reveals that the clause with subsidiary
imprisonment in case of insolvency is separated by a comma (,) from the preceding clause is hereby
sentenced to three months of arresto mayor
550
550 SUPREME COURT REPORTS
ANNOTATED
People vs. Subido
with the accessory penalties of the law, to pay a fine of five hundred (P500.00) pesos, to indemnify
the offended party, Mayor Arsenio Lacson, in the sum of Ten Thousand Pesos (P10,000.00) pesos.
The use of a comma (,) in the part of the sentence is to make the subsidiary imprisonment in case of
insolvency refer not only to non-payment of the indemnity, but also to non-payment of the fine.
If the lower court intended to make the phrase with subsidiary imprisonment in case of
insolvency refer to non-payment of indemnity only and not to the non-payment of the fine, it would
have omitted the comma (,), after the phrase to indemnify the offended party, Mayor Arsenio Lacson
in the amount of P10,000.00 pesos, so that the decision of the lower court would read:
From the facts above stated the Court finds the accused guilty of libel and he is hereby sentenced to
three (3) months of arresto mayor, to pay a fine of five hundred (P500.00) pesos, to indemnify the
offended party, Mayor Arsenio Lacson, in the sum of ten thousand (P10,000.00) pesos with
subsidiary imprisonment in case of insolvency, and to pay the costs.
As thus worded and punctuated there would be no doubt that the lower court would want to make
accused-appellant serve the subsidiary imprisonment in case of non-payment of the indemnity only.
Besides, We see no plausible reason why the lower court would want accused-appellant to suffer
subsidiary imprisonment in case of insolvency to pay the indemnity only and not to suffer subsidiary
imprisonment in case of non-payment of the fine. Accordingly if according to the lower courts
decision, the accused-appellant should suffer subsidiary imprisonment in case of insolvency to pay
the fine and the indemnity and the only modifications made by the Court of Appeals are to eliminate
the three (3) months of arresto mayor and to reduce the indemnity to the offended party, Mayor
Arsenio Lacson, from P10,000.00 to P5,000.00, then by force of logic and reason, the fine of P5000.00,
the reduced indemnity of P5,000.00 and the subsidiary imprisonment in case of insolvency should
stand.
Fortunately, however, accused-appellant is favored by the retroactive force of Article 39 of the
Revised Penal Code, as amended by Republic Act No. 5465 which exempts an accused person from
subsidiary imprisonment in case of insolvency to
551
VOL. 68, SEPTEMBER 5, 1975 551
People vs. Subido
pay his civil liability.2
It is a well known rule of legal hermeneutics that penal statutes are to be strictly construed
against the government and liberally in favor of the accused.3 In the interpretation of a penal
statute, the tendency is to give it careful scrutiny, and to construe it with such strictness as to
safeguard the rights of the defendant.4Considering that Article 39 of the Revised Penal Code, as
amended, is favorable to the accused-appellant, the same should be made applicable to him. It is so
provided in Article 22 of the Revised Penal Code that:
Penal laws shall have a retroactive effect in so far as they favor the person guilty of a felony, who is
not a habitual criminal, as this term is defined in Rule 5 of Article 62 of this Code, although at the
time of the publication of such laws a final sentence has been pronounced and the convict is serving
sentence.
_______________
2 Art. 39. Subsidiary penalty.If the convict has no property with which to meet the fine
mentioned in paragraph 3 of the next preceding article, he shall be subject to a subsidiary personal
liability at the rate of one day for each eight pesos, subject to the following rules:
1. 1.If the principal penalty imposed be prision correccional or arresto and fine, he shall
remain under confinement until his fine referred in the preceding paragraph is satisfied,
but his subsidiary imprisonment shall not exceed one-third of the term of the sentence,
and in no case shall it continue for more than one year, and no fraction or part of a day
shall be counted against the prisoner.
2. 2.When the principal penalty imposed be only a fine, the subsidiary imprisonment shall
not exceed six months, if the culprit shall have been prosecuted for a grave or less grave
felony, and shall not exceed fifteen days, if for a light felony.
3. 3.When the principal penalty imposed is higher than prision correccional no subsidiary
imprisonment shall be imposed upon the culprit.
4. 4.If the principal penalty imposed is not to be executed by confinement in a penal
institution, but such penalty is of fixed duration, the convict, during the period of time
established in the preceding rules, shall continue to suffer the same deprivations as
those of which the principal penalty consists.
5. 5.The subsidiary personal liability which the convict may have suffered by reason of his
insolvency shall not relieve him from the fine in case his financial circumstances should
improve.
3U.S. vs. Abad Santos, 36 Phil. 243; People vs. Yu Hai, 99 Phil. 728
4People vs. Ahearn, 196 N.Y. 221, 89 NE 930, 26 LRA (NS) 1153.
552
552 SUPREME COURT REPORTS
ANNOTATED
People vs. Subido
Thus applying Article 39 of the Revised Penal Code, as amended, to the accused-appellant, he cannot
also be required to serve his civil liability to the offended party in form of subsidiary imprisonment
in case of insolvency because this is no longer required by the aforesaid article.
Accused-appellant contends that he cannot be made to suffer subsidiary imprisonment because
his civil liability has been satisfied with the attachment secured by the offended party on the
property of Agapito Subido, wherein he is supposed to have an interest. He therefore argues that
until the final determinations of Civil Case No. 71731 which Agapito Subido filed to enjoin the
Sheriff of Manila from proceeding with the sale of his property, accused-appellants liability for
subsidiary imprisonment cannot attach as the determination of whether the accused is solvent or not
is a prejudicial question which must first be determined before subsidiary imprisonment may be
imposed.
We cannot agree. Attachment does not operate as a satisfaction of the judgment on civil liability
and the accused must suffer subsidiary imprisonment in case of non-payment thereof. Subsidiary
imprisonment applies when the offender is insolvent as shown in the present case. There is nothing
in the law that before subsidiary imprisonment may attach, there must be prior determination of the
question of solvency of the accused. The moment he cannot pay the fine, that means he is insolvent
and he must serve the same in form of subsidiary imprisonment. So accused-appellant has to choose
to pay the fine or serve in jail.
IN VIEW OF THE FOREGOING except with the modification that accused-appellant may no
longer be required to suffer subsidiary imprisonment in case of insolvency to pay the indemnity
provided for in the judgment below, the Orders of the lower court dated December 19 and 26, 1959
denying defendant-appellants motion for cancellation of appeal bond and sentencing him to suffer
the subsidiary imprisonment in case of insolvency to pay the fine imposed by said judgment, are
hereby affirmed.
SO ORDERED.
Castro, (Chairman), Teehankee, Makasiar, Esguerra and Muoz Palma, JJ., concur.
553
VOL. 66, SEPTEMBER 5, 1975 553
Balmaceda vs. Corominas & Company, Inc.
Orders affirmed with modification.
Notes.When the principal penalty imposed is higher than prison correccional, as when the
penalty is 10 years, 11 months and 5 days, the prisoner is not obligated to serve subsidiary
imprisonment for the unpaid indemnities. The apparent theory of the law is that no prisoner shall be
held in jail for more than 6 years by reason of insolvency. Hence, the aggregate penalties should be
considered in bulk, not separately. (Toledo vs. Superintendent, Correctional Institution for Women, 1
SCRA 349).
For purposes of applying the rule on subsidiary imprisonment, the correct rule is to multiply the
highest principal penalty by 3 and the result will be the aggregate principal penalty which the
prisoner has to serve, plus the payment of all the indemnities which he has been sentenced to pay,
with or without subsidiary imprisonment depending upon whether or not the principal penalty
exceeds 6 years. (Bagtas vs. Director of Prisons, 84 Phil. 692).
Rep. Act No. 5465 which took effect on April 21, 1969 amended Article 39 of the Revised Penal
Code by abolishing the subsidiary imprisonment for the indemnity. (People vs. Doria,55 SCRA 436).
o0o 1721 dated October 6, 1954, in the amount of P22,896.33 by virtue of Republic Act No. 897 approved
Copyright 2017 Central Book Supply, Inc. All rights reserved.
Aids to Interpretation and Construction A. Intrinsic Aids
iii. Punctuation Marks
Florentino v. PNB, G.R. No. L-8782, 28 April 1956, 98 Phil. 959
[No. L-8782. April 28, 1956]
MARCELINO B. FLORENTINO and LOURDES T. ZANDUETA, petitioners and
appellants, vs. PHILIPPINE NATIONAL BANK, respondent and appellee.
BACKPAY CERTIFICATES ; ACCEPTANCE OF CERTIFICATES IN PAYMENT OF DEBTS
OBLIGATORY UPON GOVERNMENT AND ITS AGENCIES; PRIVATE CREDITORS MAY NOT
BE COMPELLED TO ACCEPT CERTIFICATES.The qualifying clause who may be willing to
accept the same for settlement found in section 2 of Republic Act No. 897, refers only to any citizen
of the Philippines or any association or corporation organized under the laws of the Philippines, and
not to the Government, or any of its agencies. To make the acceptance of the backpay certificates
obligatory upon any citizen, association, or corporation, which are not government entities or owned
or controlled by the government, would render said section unconstitutional, far it would amount to
an impairment of the obligation of contracts by compelling private creditors to accept a sort of
promissory note payable within ten years with interest at a rate very much lower than the current or
even the legal one.
APPEAL from a judgment of the Court of First Instance of La Union. Reyes, J.
960
960 PHILIPPINE REPORTS ANNOTATED
Florentino and Zandueta vs. P.N. B.
The facts are stated in the opinion of the Court.
Marcelino B. Florentinofor appellants.
Ramon de los Reyes for appellee.
JUGO, J.:
The petitioners and appellants filed with the Court of First Instance of La Union a petition for
mandamus against respondent and appellee, Philippine National Bank, to compel it to accept the
backpay certificate of petitioner Marcelino B. Florentino issued to him by the Republic of the
Philippines, to pay an indebtedness to the Philippine National Bank in the sum of P6,800 secured by
a real estate mortgage on certain properties.
The case was submitted on an agreed statement of facts, which reads as follows:
Parties herein represented by counsel, have agreed on the following facts:
1. That the petitioners are indebted to the respondent bank in the amount of P6,800 plus
interest, the same having been incurred on January 2, 1953, which is due on January 2, 1954;
2. That the said loan is secured by a mortgage of real properties;
3. That the petitioner Marcelino B. Florentino is a holder of Backpay Acknowledgment No.
on June 20, 1953; and
4. That on December 27, 1953, petitioners offered to pay their loan with the respondent bank
with their backpay certificate, but the respondent bank, on December 29, 1953, refused to accept
petitioners offer to pay the said indebtedness with the latters backpay certificate;
The legal provision involved is section 2 of Republic Act No. 897, which provides:
SEC. 2. Section two of the said Act (Republic Act 304) as amended by Republic Act Numbered Eight
hundred, is further amended to read:
SEC. 2. The Treasurer of the Philippines shall, upon application of all persons specified in
section one hereof and within one year from the approval of this Act, and under such rules and
regulations
961
VOL. 98, APRIL 28, 1956 961
Florentino and Zandueta vs. P.N. B.
as may be promulgated by the Secretary of Finance, acknowledge and file requests for the
recognition of the right to the salaries or wages as provided in section one hereof, and notice of such
acknowledgment shall be issued to the applicant which shall state the total amount of such salaries
or wages due the applicant, and certify that it shall be redeemed by the Government of the
Philippines within ten years from the date of their issuance without interest: Provided, That upon
application and subject to such rules and regulations as may be approved by the Secretary of
Finance a certificate of indebtedness may be issued by the Treasurer of the Philippines covering the
whole or a part of the total salaries or wages the right to which has been duly acknowledged and
recognized, provided that the face value of such certificate of indebtedness shall not exceed the
amount that the applicant may need for the payment of (1) obligations subsisting at the time of the
approval of this amendatory Act for which the applicant may directly be liable to the Government or
to any of its branches or instrumentalities, or the corporations owned or controlled by the
Government, or to any citizen of the Philippines, or to any association or corporation organized
under the laws of the Philippines, who may be willing to accept the same for such settlement.
The question raised is whether the clause who may be willing to accept the same for settlement
refers to all antecedents the Government, any of its branches or instrumentalities, the corporations
owned or controlled by the Government, etc.," or onlythe last antecedent any citizen of the
Philippines, or any association or corporation organized under the laws of the Philippines.
The contention of the respondent-appellee, Philippine National Bank is that said qualifying
clause refers to all the antecedents, whereas the appellants contention is that it refers only to the
last antecedent.
Incidentally, it may be stated that one of the purposes of Republic Act No. 897 was to include
veterans of the Philippine Army and their wives or orphans among the beneficiaries of the Backpay
Law, Republic Act No. 304, in recognition of their great sacrifices in the resistance movement, as
shown by the following quotation from the Congressional Record:
"* * * This particular bill, House Bill No. 1228, has been filed by this public servant for three
objectives: First, to serve
962
962 PHILIPPINE REPORTS ANNOTATED
Florentino and Zandueta vs. P.N. B.
as a source of financial aid to needy veterans, like crippled or disabled veterans, and to their wives or
orphans. Secondly, to give recognition to the sacrifices of those who joined the last war, and
particularly to those who have given their all for the cause of the last war. And thirdly, to eliminate
the discrimination that has been committed either through oversight, or on purpose, against the
members of the Philippine Army, the Philippine Scouts, and guerillas or the so-called civilian
volunteers, who joined the resistance movement. (Congressional Record No. 61, 2nd Congress, 4th
Regular Session, May 6, 1953, page 74; quoted in Appellants brief, pages 1314.)
Grammatically, the qualifying clause refers only to the last antecedent; that is, any citizen of the
Philippines or any association or corporation organized under the laws of the Philippines. It should
be noted that there is a comma before the words or to any citizen, etc.," which separates said phrase
from the preceding ones.
But even disregarding the grammatical construction, as done by the appellee, still there are
cogent and powerful reasons why the qualifying clause should be limited to the last antecedent- In
the first place, to make the acceptance of the backpay certificates obligatory upon any citizen,
association, or corporation, which are not government entities or owned or controlled by the
government, would render section 2 of Republic Act No. 897 unconstitutional, for it would amount to
an impairment of the obligation of contracts by compelling private creditors to accept a sort of
promissory note payable within ten years with interest at a rate very much lower than the current or
even the legal one.
The other reason is found in the Congressional Record, which says:
Mr. TIBLE: On page 4, line 17, between the words this and act, insert the word amendatory.
Mr. ZOSA: What is the purpose of the amendment?
Mr. TIBLE: The purpose of the amendment is to clarify the provision of section 2. I believe,
gentleman from Cebu, that section 2, as amended in this amendatory bill permits the use of backpay
certificates as payment for obligations and indebtedness in favor of the government. (Congressional
Record No. 64, 2nd Congress,
963
VOL. 98, APRIL 28, 1956 963
Florentino and Zandueta vs. P.N. B.
4th Regular Session, May 11, 1953, page 41; quoted in Appellants brief, p. 15.)
As there would have been no need to permit by law the use of backpay certificates in payment of
debts to private persons, if they are willing to accept them, the permission necessarily refers to the
Government of the Philippines, its agencies or other instrumentalities, etc.
Another reason is that it is matter of general knowledge that many officials and employees of
the Philippine Government, who had served during the Japanese Occupation, have already received
their backpay certificates and used them for the payment of obligations to the Government and its
entities for debts incurred before the approval of Republic Act No. 304.
The case of Diokno vs.Rehabilitation Finance Corporation, 91 Phil., 608(July 11, 1952), is
different from the present one. In the Diokno case, his debt to the Rehabilitation Finance
Corporation was incurred on January 27, 1950. He brought the action on November 10, 1950, under
the provisions of Republic Act No. 304 (section 2), which was approved on June 18, 1948; that is, one
year and almost eight months before Diokno incurred the debt. Diokno could not avail himself of the
provisions of section 2 of Act No. 304, because said section provides that the application for
recognition of backpay must have been filed within one year after the approval of said Act No. 304,
and the debt must be subsisting at the time of said approval, Diokno having incurred the debt on
January 27, 1950, and brought action on November 10, 1950. It was, therefore, discretionary in the
Diokno case for the Rehabilitation Finance Corporation to accept or not his backpay certificate in
payment.
The Secretary of Justice, in his Opinion No. 226, series of 1948, held that the phrase who may
be willing to accept the same f or such settlement qualifies only its immediate antecedent and does
not apply to the Government or its agencies.
964
964 PHILIPPINE REPORTS ANNOTATED
Javellana, et al. vs. Public Service Commission, et
al.
The appellee asserts in his brief that the Secretary of Justice, in his letter of June 19, 1953,
remarked that the clause who may be willing to accept such settlement refers to all the
antecedents, including the Government and its agencies- We are not impressed with this observation
of the Secretary, for we believe that his Opinion No. 226, series of 1948, is correct for the reasons we
have stated above.
In the present case, Marcelino B. Florentino incurred his debt to the Philippine National Bank
on January 2, 1953; hence, the obligation was subsisting when the Amendatory Act No. 897 was
approved. Consequently, the present case falls squarely under the provisions of section 2 of
the Amendatory Act No. 897.
In view of the foregoing, the decision appealed from is reversed, and the appellee is ordered to
accept the backpay certificate above mentioned of the appellant, Marcelino B. Florentino, in payment
of his above cited debt to the appellee, without interest from December 27, 1953, the date when he
offered said backpay certificate in payment. Without pronouncement as to costs. It is ordered.
Pars, C.J., Bengzon, Montemayor, Reyes, A., Jugo, Bautista Angelo, Concepcion, Reyes, J.B.
L.and Endencia, JJ., concur.
Judgment reversed.
_____________
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