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G.R. No.

L-63915 April 24, 1985 1050, 1060-1061, 1085, 1143, 1165, 1166, 1242, 1246, 1250, 1278,
1279, 1300, 1644, 1772, 1808, 1810, 1813-1817, 1819-1826, 1829-
LORENZO M. TAÑADA, ABRAHAM F. SARMIENTO, and MOVEMENT
1840, 1842-1847.
OF ATTORNEYS FOR BROTHERHOOD, INTEGRITY AND
NATIONALISM, INC. [MABINI], petitioners, b] Letter of Instructions Nos.: 10, 39, 49, 72, 107, 108, 116, 130, 136,
141, 150, 153, 155, 161, 173, 180, 187, 188, 192, 193, 199, 202, 204,
vs.
205, 209, 211-213, 215-224, 226-228, 231-239, 241-245, 248, 251,
HON. JUAN C. TUVERA, in his capacity as Executive Assistant to 253-261, 263-269, 271-273, 275-283, 285-289, 291, 293, 297-299,
the President, HON. JOAQUIN VENUS, in his capacity as Deputy 301-303, 309, 312-315, 325, 327, 343, 346, 349, 357, 358, 362, 367,
Executive Assistant to the President , MELQUIADES P. DE LA CRUZ, 370, 382, 385, 386, 396-397, 405, 438-440, 444- 445, 473, 486, 488,
in his capacity as Director, Malacañang Records Office, and 498, 501, 399, 527, 561, 576, 587, 594, 599, 600, 602, 609, 610, 611,
FLORENDO S. PABLO, in his capacity as Director, Bureau of 612, 615, 641, 642, 665, 702, 712-713, 726, 837-839, 878-879, 881,
Printing, respondents. 882, 939-940, 964,997,1149-1178,1180-1278.

c] General Orders Nos.: 14, 52, 58, 59, 60, 62, 63, 64 & 65.

ESCOLIN, J.: d] Proclamation Nos.: 1126, 1144, 1147, 1151, 1196, 1270, 1281,
1319-1526, 1529, 1532, 1535, 1538, 1540-1547, 1550-1558, 1561-
Invoking the people's right to be informed on matters of public 1588, 1590-1595, 1594-1600, 1606-1609, 1612-1628, 1630-1649,
concern, a right recognized in Section 6, Article IV of the 1973 1694-1695, 1697-1701, 1705-1723, 1731-1734, 1737-1742, 1744,
Philippine Constitution, 1 as well as the principle that laws to be 1746-1751, 1752, 1754, 1762, 1764-1787, 1789-1795, 1797, 1800,
valid and enforceable must be published in the Official Gazette 1802-1804, 1806-1807, 1812-1814, 1816, 1825-1826, 1829, 1831-
or otherwise effectively promulgated, petitioners seek a writ of 1832, 1835-1836, 1839-1840, 1843-1844, 1846-1847, 1849, 1853-
mandamus to compel respondent public officials to publish, 1858, 1860, 1866, 1868, 1870, 1876-1889, 1892, 1900, 1918, 1923,
and/or cause the publication in the Official Gazette of various 1933, 1952, 1963, 1965-1966, 1968-1984, 1986-2028, 2030-2044,
presidential decrees, letters of instructions, general orders, 2046-2145, 2147-2161, 2163-2244.
proclamations, executive orders, letter of implementation and
administrative orders. e] Executive Orders Nos.: 411, 413, 414, 427, 429-454, 457- 471,
474-492, 494-507, 509-510, 522, 524-528, 531-532, 536, 538, 543-
Specifically, the publication of the following presidential 544, 549, 551-553, 560, 563, 567-568, 570, 574, 593, 594, 598-604,
issuances is sought: 609, 611- 647, 649-677, 679-703, 705-707, 712-786, 788-852, 854-
857.
a] Presidential Decrees Nos. 12, 22, 37, 38, 59, 64, 103, 171, 179,
184, 197, 200, 234, 265, 286, 298, 303, 312, 324, 325, 326, 337, 355, f] Letters of Implementation Nos.: 7, 8, 9, 10, 11-22, 25-27, 39, 50,
358, 359, 360, 361, 368, 404, 406, 415, 427, 429, 445, 447, 473, 486, 51, 59, 76, 80-81, 92, 94, 95, 107, 120, 122, 123.
491, 503, 504, 521, 528, 551, 566, 573, 574, 594, 599, 644, 658, 661,
718, 731, 733, 793, 800, 802, 835, 836, 923, 935, 961, 1017-1030,
g] Administrative Orders Nos.: 347, 348, 352-354, 360- 378, 380- granted to a private individual only in those cases where he has
433, 436-439. some private or particular interest to be subserved, or some
particular right to be protected, independent of that which he
The respondents, through the Solicitor General, would have this
holds with the public at large," and "it is for the public officers
case dismissed outright on the ground that petitioners have no
exclusively to apply for the writ when public rights are to be
legal personality or standing to bring the instant petition. The
subserved [Mithchell vs. Boardmen, 79 M.e., 469]," nevertheless,
view is submitted that in the absence of any showing that
"when the question is one of public right and the object of the
petitioners are personally and directly affected or prejudiced by
mandamus is to procure the enforcement of a public duty, the
the alleged non-publication of the presidential issuances in
people are regarded as the real party in interest and the relator
question 2 said petitioners are without the requisite legal
at whose instigation the proceedings are instituted need not
personality to institute this mandamus proceeding, they are not
show that he has any legal or special interest in the result, it
being "aggrieved parties" within the meaning of Section 3, Rule
being sufficient to show that he is a citizen and as such
65 of the Rules of Court, which we quote:
interested in the execution of the laws [High, Extraordinary Legal
SEC. 3. Petition for Mandamus.—When any tribunal, Remedies, 3rd ed., sec. 431].
corporation, board or person unlawfully neglects the
Thus, in said case, this Court recognized the relator Lope
performance of an act which the law specifically enjoins as a
Severino, a private individual, as a proper party to the
duty resulting from an office, trust, or station, or unlawfully
mandamus proceedings brought to compel the Governor
excludes another from the use a rd enjoyment of a right or office
General to call a special election for the position of municipal
to which such other is entitled, and there is no other plain,
president in the town of Silay, Negros Occidental. Speaking for
speedy and adequate remedy in the ordinary course of law, the
this Court, Mr. Justice Grant T. Trent said:
person aggrieved thereby may file a verified petition in the
proper court alleging the facts with certainty and praying that We are therefore of the opinion that the weight of authority
judgment be rendered commanding the defendant, supports the proposition that the relator is a proper party to
immediately or at some other specified time, to do the act proceedings of this character when a public right is sought to
required to be done to Protect the rights of the petitioner, and be enforced. If the general rule in America were otherwise, we
to pay the damages sustained by the petitioner by reason of think that it would not be applicable to the case at bar for the
the wrongful acts of the defendant. reason 'that it is always dangerous to apply a general rule to a
particular case without keeping in mind the reason for the rule,
Upon the other hand, petitioners maintain that since the subject
because, if under the particular circumstances the reason for
of the petition concerns a public right and its object is to compel
the rule does not exist, the rule itself is not applicable and
the performance of a public duty, they need not show any
reliance upon the rule may well lead to error'
specific interest for their petition to be given due course.
No reason exists in the case at bar for applying the general rule
The issue posed is not one of first impression. As early as the 1910
insisted upon by counsel for the respondent. The circumstances
case of Severino vs. Governor General, 3 this Court held that
which surround this case are different from those in the United
while the general rule is that "a writ of mandamus would be
States, inasmuch as if the relator is not a proper party to these Respondents' argument, however, is logically correct only
proceedings no other person could be, as we have seen that it insofar as it equates the effectivity of laws with the fact of
is not the duty of the law officer of the Government to appear publication. Considered in the light of other statutes applicable
and represent the people in cases of this character. to the issue at hand, the conclusion is easily reached that said
Article 2 does not preclude the requirement of publication in the
The reasons given by the Court in recognizing a private citizen's
Official Gazette, even if the law itself provides for the date of its
legal personality in the aforementioned case apply squarely to
effectivity. Thus, Section 1 of Commonwealth Act 638 provides
the present petition. Clearly, the right sought to be enforced by
as follows:
petitioners herein is a public right recognized by no less than the
fundamental law of the land. If petitioners were not allowed to Section 1. There shall be published in the Official Gazette [1] all
institute this proceeding, it would indeed be difficult to conceive important legisiative acts and resolutions of a public nature of
of any other person to initiate the same, considering that the the, Congress of the Philippines; [2] all executive and
Solicitor General, the government officer generally empowered administrative orders and proclamations, except such as have
to represent the people, has entered his appearance for no general applicability; [3] decisions or abstracts of decisions
respondents in this case. of the Supreme Court and the Court of Appeals as may be
deemed by said courts of sufficient importance to be so
Respondents further contend that publication in the Official
published; [4] such documents or classes of documents as may
Gazette is not a sine qua non requirement for the effectivity of
be required so to be published by law; and [5] such documents
laws where the laws themselves provide for their own effectivity
or classes of documents as the President of the Philippines shall
dates. It is thus submitted that since the presidential issuances in
determine from time to time to have general applicability and
question contain special provisions as to the date they are to
legal effect, or which he may authorize so to be published. ...
take effect, publication in the Official Gazette is not
indispensable for their effectivity. The point stressed is anchored The clear object of the above-quoted provision is to give the
on Article 2 of the Civil Code: general public adequate notice of the various laws which are
to regulate their actions and conduct as citizens. Without such
Art. 2. Laws shall take effect after fifteen days following the
notice and publication, there would be no basis for the
completion of their publication in the Official Gazette, unless it
application of the maxim "ignorantia legis non excusat." It would
is otherwise provided, ...
be the height of injustice to punish or otherwise burden a citizen
The interpretation given by respondent is in accord with this for the transgression of a law of which he had no notice
Court's construction of said article. In a long line of decisions,4 whatsoever, not even a constructive one.
this Court has ruled that publication in the Official Gazette is
Perhaps at no time since the establishment of the Philippine
necessary in those cases where the legislation itself does not
Republic has the publication of laws taken so vital significance
provide for its effectivity date-for then the date of publication is
that at this time when the people have bestowed upon the
material for determining its date of effectivity, which is the
President a power heretofore enjoyed solely by the legislature.
fifteenth day following its publication-but not when the law itself
While the people are kept abreast by the mass media of the
provides for the date when it goes into effect.
debates and deliberations in the Batasan Pambansa—and for requirement of due process. It is a rule of law that before a
the diligent ones, ready access to the legislative records—no person may be bound by law, he must first be officially and
such publicity accompanies the law-making process of the specifically informed of its contents. As Justice Claudio
President. Thus, without publication, the people have no means Teehankee said in Peralta vs. COMELEC 7:
of knowing what presidential decrees have actually been
In a time of proliferating decrees, orders and letters of
promulgated, much less a definite way of informing themselves
instructions which all form part of the law of the land, the
of the specific contents and texts of such decrees. As the
requirement of due process and the Rule of Law demand that
Supreme Court of Spain ruled: "Bajo la denominacion generica
the Official Gazette as the official government repository
de leyes, se comprenden tambien los reglamentos, Reales
promulgate and publish the texts of all such decrees, orders and
decretos, Instrucciones, Circulares y Reales ordines dictadas de
instructions so that the people may know where to obtain their
conformidad con las mismas por el Gobierno en uso de su
official and specific contents.
potestad.5
The Court therefore declares that presidential issuances of
The very first clause of Section I of Commonwealth Act 638
general application, which have not been published, shall have
reads: "There shall be published in the Official Gazette ... ." The
no force and effect. Some members of the Court, quite
word "shall" used therein imposes upon respondent officials an
apprehensive about the possible unsettling effect this decision
imperative duty. That duty must be enforced if the
might have on acts done in reliance of the validity of those
Constitutional right of the people to be informed on matters of
presidential decrees which were published only during the
public concern is to be given substance and reality. The law
pendency of this petition, have put the question as to whether
itself makes a list of what should be published in the Official
the Court's declaration of invalidity apply to P.D.s which had
Gazette. Such listing, to our mind, leaves respondents with no
been enforced or implemented prior to their publication. The
discretion whatsoever as to what must be included or excluded
answer is all too familiar. In similar situations in the past this Court
from such publication.
had taken the pragmatic and realistic course set forth in Chicot
The publication of all presidential issuances "of a public nature" County Drainage District vs. Baxter Bank 8 to wit:
or "of general applicability" is mandated by law. Obviously,
The courts below have proceeded on the theory that the Act of
presidential decrees that provide for fines, forfeitures or
Congress, having been found to be unconstitutional, was not a
penalties for their violation or otherwise impose a burden or. the
law; that it was inoperative, conferring no rights and imposing
people, such as tax and revenue measures, fall within this
no duties, and hence affording no basis for the challenged
category. Other presidential issuances which apply only to
decree. Norton v. Shelby County, 118 U.S. 425, 442; Chicago, 1.
particular persons or class of persons such as administrative and
& L. Ry. Co. v. Hackett, 228 U.S. 559, 566. It is quite clear,
executive orders need not be published on the assumption that
however, that such broad statements as to the effect of a
they have been circularized to all concerned. 6
determination of unconstitutionality must be taken with
It is needless to add that the publication of presidential qualifications. The actual existence of a statute, prior to such a
issuances "of a public nature" or "of general applicability" is a determination, is an operative fact and may have
consequences which cannot justly be ignored. The past cannot that "publication is necessary to apprise the public of the
always be erased by a new judicial declaration. The effect of contents of [penal] regulations and make the said penalties
the subsequent ruling as to invalidity may have to be considered binding on the persons affected thereby. " The cogency of this
in various aspects-with respect to particular conduct, private holding is apparently recognized by respondent officials
and official. Questions of rights claimed to have become considering the manifestation in their comment that "the
vested, of status, of prior determinations deemed to have finality government, as a matter of policy, refrains from prosecuting
and acted upon accordingly, of public policy in the light of the violations of criminal laws until the same shall have been
nature both of the statute and of its previous application, published in the Official Gazette or in some other publication,
demand examination. These questions are among the most even though some criminal laws provide that they shall take
difficult of those which have engaged the attention of courts, effect immediately.
state and federal and it is manifest from numerous decisions that
WHEREFORE, the Court hereby orders respondents to publish in
an all-inclusive statement of a principle of absolute retroactive
the Official Gazette all unpublished presidential issuances which
invalidity cannot be justified.
are of general application, and unless so published, they shall
Consistently with the above principle, this Court in Rutter vs. have no binding force and effect.
Esteban 9 sustained the right of a party under the Moratorium
SO ORDERED.
Law, albeit said right had accrued in his favor before said law
was declared unconstitutional by this Court.

Similarly, the implementation/enforcement of presidential


decrees prior to their publication in the Official Gazette is "an
operative fact which may have consequences which cannot
be justly ignored. The past cannot always be erased by a new
judicial declaration ... that an all-inclusive statement of a
principle of absolute retroactive invalidity cannot be justified."

From the report submitted to the Court by the Clerk of Court, it


appears that of the presidential decrees sought by petitioners
to be published in the Official Gazette, only Presidential Decrees
Nos. 1019 to 1030, inclusive, 1278, and 1937 to 1939, inclusive,
have not been so published. 10 Neither the subject matters nor
the texts of these PDs can be ascertained since no copies
thereof are available. But whatever their subject matter may
be, it is undisputed that none of these unpublished PDs has ever
been implemented or enforced by the government. In Pesigan
vs. Angeles, 11 the Court, through Justice Ramon Aquino, ruled
G.R. No. 80718 January 29, 1988 to the weakened wall but the former failed to do so. On the
basis of the foregoing facts, the Regional Trial Court. First Judicial
Region, Branch XXXVIII, presided by the Hon. Antonio M. Belen,
FELIZA P. DE ROY and VIRGILIO RAMOS, petitioners, rendered judgment finding petitioners guilty of gross negligence
and awarding damages to private respondents. On appeal, the
vs. decision of the trial court was affirmed in toto by the Court of
Appeals in a decision promulgated on August 17, 1987, a copy
COURT OF APPEALS and LUIS BERNAL, SR., GLENIA BERNAL, LUIS
of which was received by petitioners on August 25, 1987. On
BERNAL, JR., HEIRS OF MARISSA BERNAL, namely, GLICERIA DELA
September 9, 1987, the last day of the fifteen-day period to file
CRUZ BERNAL and LUIS BERNAL, SR., respondents.
an appeal, petitioners filed a motion for extension of time to file
RESOLUTION a motion for reconsideration, which was eventually denied by
the appellate court in the Resolution of September 30, 1987.
CORTES, J.:
Petitioners filed their motion for reconsideration on September
This special civil action for certiorari seeks to declare null and 24, 1987 but this was denied in the Resolution of October 27,
void two (2) resolutions of the Special First Division of the Court 1987.
of Appeals in the case of Luis Bernal, Sr., et al. v. Felisa Perdosa This Court finds that the Court of Appeals did not commit a
De Roy, et al., CA-G.R. CV No. 07286. The first resolution grave abuse of discretion when it denied petitioners' motion for
promulgated on 30 September 1987 denied petitioners' motion extension of time to file a motion for reconsideration, directed
for extension of time to file a motion for reconsideration and entry of judgment and denied their motion for reconsideration.
directed entry of judgment since the decision in said case had It correctly applied the rule laid down in Habaluyas Enterprises,
become final; and the second Resolution dated 27 October Inc. v. Japzon, [G.R. No. 70895, August 5, 1985,138 SCRA 461,
1987 denied petitioners' motion for reconsideration for having that the fifteen-day period for appealing or for filing a motion
been filed out of time.
for reconsideration cannot be extended. In its Resolution
At the outset, this Court could have denied the petition outright denying the motion for reconsideration, promulgated on July
for not being verified as required by Rule 65 section 1 of the Rules 30, 1986 (142 SCRA 208), this Court en banc restated and
of Court. However, even if the instant petition did not suffer from clarified the rule, to wit:
this defect, this Court, on procedural and substantive grounds, Beginning one month after the promulgation of this Resolution,
would still resolve to deny it.
the rule shall be strictly enforced that no motion for extension of
The facts of the case are undisputed. The firewall of a burned- time to file a motion for reconsideration may be filed with the
out building owned by petitioners collapsed and destroyed the Metropolitan or Municipal Trial Courts, the Regional Trial Courts,
tailoring shop occupied by the family of private respondents, and the Intermediate Appellate Court. Such a motion may be
resulting in injuries to private respondents and the death of filed only in cases pending with the Supreme Court as the court
Marissa Bernal, a daughter. Private respondents had been of last resort, which may in its sound discretion either grant or
warned by petitioners to vacate their shop in view of its proximity deny the extension requested. (at p. 212)
Petitioners contend that the rule enunciated in the Habaluyas
case should not be made to apply to the case at bar owing to
Lacsamana v. Second Special Cases Division of the
the non-publication of the Habaluyas decision in the Official
intermediate Appellate Court, [G.R. No. 73146-53, August 26,
Gazette as of the time the subject decision of the Court of
1986, 143 SCRA 643], reiterated the rule and went further to
Appeals was promulgated. Contrary to petitioners' view, there
restate and clarify the modes and periods of appeal.
is no law requiring the publication of Supreme Court decisions in
Bacaya v. Intermediate Appellate Court, [G.R. No. 74824, Sept. the Official Gazette before they can be binding and as a
15, 1986,144 SCRA 161],stressed the prospective application of condition to their becoming effective. It is the bounden duty of
said rule, and explained the operation of the grace period, to counsel as lawyer in active law practice to keep abreast of
wit decisions of the Supreme Court particularly where issues have
been clarified, consistently reiterated, and published in the
In other words, there is a one-month grace period from the advance reports of Supreme Court decisions (G. R. s) and in
promulgation on May 30, 1986 of the Court's Resolution in the such publications as the Supreme Court Reports Annotated
clarificatory Habaluyas case, or up to June 30, 1986, within (SCRA) and law journals.
which the rule barring extensions of time to file motions for new
trial or reconsideration is, as yet, not strictly enforceable. This Court likewise finds that the Court of Appeals committed no
grave abuse of discretion in affirming the trial court's decision
Since petitioners herein filed their motion for extension on holding petitioner liable under Article 2190 of the Civil Code,
February 27, 1986, it is still within the grace period, which expired which provides that "the proprietor of a building or structure is
on June 30, 1986, and may still be allowed. responsible for the damage resulting from its total or partial
collapse, if it should be due to the lack of necessary repairs.
This grace period was also applied in Mission v. Intermediate
Appellate Court [G.R. No. 73669, October 28, 1986, 145 SCRA Nor was there error in rejecting petitioners argument that private
306].] respondents had the "last clear chance" to avoid the accident
if only they heeded the. warning to vacate the tailoring shop
In the instant case, however, petitioners' motion for extension of
and , therefore, petitioners prior negligence should be
time was filed on September 9, 1987, more than a year after the
disregarded, since the doctrine of "last clear chance," which
expiration of the grace period on June 30, 1986. Hence, it is no
has been applied to vehicular accidents, is inapplicable to this
longer within the coverage of the grace period. Considering the
case.
length of time from the expiration of the grace period to the
promulgation of the decision of the Court of Appeals on August
25, 1987, petitioners cannot seek refuge in the ignorance of their
counsel regarding said rule for their failure to file a motion for WHEREFORE, in view of the foregoing, the Court Resolved to
reconsideration within the reglementary period. DENY the instant petition for lack of merit.
G.R. No. 108461 October 21, 1996 b) Prescribed Export Undertaking Form (Annex B, Id.);

PHILIPPINE INTERNATIONAL TRADING CORPORATION, petitioner, c) Prescribed Importer-Exporter Agreement Form for non-
exporter-importer (Annex C, Id.);
vs.
d) Memorandum dated April 16, 1990 relative to
HON. PRESIDING JUDGE ZOSIMO Z. ANGELES, BRANCH 58, RTC,
amendments of Administrative Order No. SOCPEC 89-08-01
MAKATI; REMINGTON INDUSTRIAL SALES CORPORATION; AND
(Annex D, Id.);
FIRESTONE CERAMIC, INC., respondents.
e) Memorandum dated May 6, 1991 relative to Revised
TORRES, JR., J.:p
Schedule of Fees for the processing of import applications
The PHILIPPINE INTERNATIONAL TRADING CORPORATION (PITC, (Annexes E, E-1., Ind.);
for brevity) filed this Petition for Review on Certiorari, seeking the
f) Rules and Regulations relative to liquidation of unfulfilled
reversal of the Decision dated January 4, 1993 of public
Undertakings and expired export credits (Annex Z,
respondent Hon. Zosimo Z. Angeles, Presiding Judge of the
Supplemental Petition),
Regional Trial Court of Makati, Branch 58, in Civil Case No. 92-
158 entitled Remington Industrial Sales Corporation, et. al. vs. the foregoing being all null and void and unconstitutional; and,
Philippine Industrial Trading Corporation.
2) Commanding respondent to approve forthwith all the
The said decision upheld the Petition for Prohibition and pending applications of, and all those that may hereafter be
Mandamus of REMINGTON INDUSTRIAL SALES CORPORATION filed by, the petitioner and the Intervenor, free from and without
(Remington, for brevity) and FIRESTONE CERAMICS, INC. the requirements prescribed in the above-mentioned issuances.
(Firestone, for brevity), and, in the process, declared as null and
IT IS SO ORDERED.
void and unconstitutional, PITC's Administrative Order No.
SOCPEC 89-08-01 and its appurtenant regulations. The The controversy springs from the issuance by the PITC of
dispositive portion of the decision reads: Administrative Order No. SOCPEC 89-08-01,1 under which,
applications to the PITC for importation from the People's
WHEREFORE, premises considered, judgment is hereby rendered
Republic of China (PROC, for brevity) must be accompanied by
in favor of Petitioner and Intervenor and against the
a viable and confirmed Export Program of Philippine Products
Respondent, as follows:
to PROC carried out by the improper himself or through a tie-up
1) Enjoining the further implementation by the respondent with a legitimate importer in an amount equivalent to the value
of the following issuances relative to the applications for of the importation from PROC being applied for, or, simply, at
importation of products from the People's Republic of China, to one is to one ratio.
wit:
Pertinent provisions of the questioned administrative order read:
a) Administrative Order No. SOCPEC 89-08-01 dated
3. COUNTERPART EXPORTS TO PROC
August 30, 1989 (Annex A, Amended Petition);
In addition to existing requirements for the processing of import c) IMPORTER-EXPORTER AGREEMENT for non-exporter
application for goods and commodities originating from PROC, IMPORTER (PITC Form No. M-1006). This form should be used if
it is declared that: IMPORTER has tie-up with an exporter for the export of Philippine
Products to PROC.
3.1 All applications covered by these rules must be
accompanied by a viable and confirmed EXPORT PROGRAM of 4. EXPORT GUARANTEE
Philippine products to PROC in an amount equivalent to the
To ensure that the export commitments of the IMPORTER are
value of the importation from PROC being applied for. Such
carried out in accordance with these rules, all IMPORTERS
export program must be carried out and completed within six
concerned are required to submit an EXPORT PERFORMANCE
(6) months from date of approval of the Import Application by
GUARANTEE (the "Guarantee") at the time of filing of the Import
PITC. PITC shall reject/deny any application for importation from
Application. The amount of the guarantee shall be as follows:
PROC without the accompanying export program mentioned
above. For essential commodities: 15% of the value of the imports
applied for.
3.2 The EXPORT PROGRAM may be carried out by any of the
following: For other commodities: 50% of the value of the imports applied
for.
a. By the IMPORTER himself if he has the capabilities and
facilities to carry out the export of Philippine products to PROC 4.1 The guarantee may be in the form of (i) a non-interest
in his own name; or bearing cash deposit; (ii) Bank hold-out in favor of PITC (PITC
Form No. M-1007) or (iii) a Domestic Letter of Credit (with all bank
b. Through a tie-up between the IMPORTER and a
opening charges for account of Importer) opened in favor of
legitimate exporter (of Philippine products) who is willing to carry
PITC as beneficiary.
out the export commitments of the IMPORTER under these rules.
The tie-up shall not make the IMPORTER the exporter of the 4.2 The guarantee shall be made in favor of PITC and will be
goods but shall merely ensure that the importation sought to be automatically forfeited in favor of PITC, fully or partially, if the
approved is matched one-to-one (1:1) in value with a required export program is not completed by the importer within
corresponding export of Philippine products to PROC.2 six (6) months from date of approval of the Import Application.
3.3 EXPORT PROGRAM DOCUMENTS which are to be 4.3 Within the six (6) months period above stated, the
submitted by the improper together with his Import Application IMPORTER is entitled to a (i) refund of the cash deposited without
are as follows: interest; (ii) cancellation of the Bank holdout or (iii) Cancellation
of the Domestic Letter of Credit upon showing that he has
a) Firm Contract, Sales Invoice or Letter of Credit.
completed the export commitment pertaining to his importation
b) Export Performance Guarantee (See Article 4 hereof). and provided further that the following documents are
submitted to PITC:
a) Final Sales Invoice hand, imported Calcine Vauxite, which it used for the
manufacture of fire bricks, one of its products.
b) Bill of lading or Airway bill
Subsequently, for failing to comply with their undertakings to
c) Bank Certificate of Inward Remittance
submit export credits equivalent to the value of their
d) PITC EXPORT APPLICATION FOR NO. M-1005 importations, further import applications were withheld by
petitioner PITC from private respondents, such that the latter
5. MISCELLANEOUS were both barred from importing goods from PROC.3
5.1 All other requirements for importations of goods and Consequently, Remington filed a Petition for Prohibition and
commodities from PROC must be complied with in addition to Mandamus, with prayer for issuance of Temporary Restraining
the above. Order and/or Writ of Preliminary Injunction on January 20, 1992,
against PITC in the RTC Makati Branch 58.4 The court issued a
5.2 PITC shall have the right to disapprove any and all import
Temporary Restraining Order on January 21, 1992, ordering PITC
applications not in accordance with the rules and regulations
to cease from exercising any power to process applications of
herein prescribed.
goods from PROC.5 Hearing on the application for writ of
5.3 Should the IMPORTER or any of his duly authorized preliminary injunction ensued.
representatives make any false statements or fraudulent
Private respondent Firstone was allowed to intervene in the
misrepresentations in the Import/Export Application, or falsify,
petition on July 2, 1992,6 thus joining Remington in the latter's
forge or simulate any document required under these rules and
charges against PITC. It specifically asserts that the questioned
regulations, PITC is authorized to reject all pending and future
Administrative Order is an undue restriction of trade, and hence,
import/export applications of said IMPORTER and/or disqualify
unconstitutional.
said IMPORTER from doing any business with SOCPEC through
PITC. Upon trial, it was agreed that the evidence adduced upon the
hearing on the Preliminary Injunction was sufficient to
Desiring to make importations from PROC, private respondents
completely adjudicate the case, thus, the parties deemed it
Remington and Firestone, both domestic corporations,
proper that the entire case be submitted for decision upon the
organized and existing under Philippine laws, individually
evidence so far presented.
applied for authority to import from PROC with the petitioner.
They were granted such authority after satisfying the The court rendered its Decision7 on January 4, 1992. The court
requirements for importers, and after they executed respective ruled that PITC's authority to process and approve applications
undertakings to balance their importations from PROC with for imports from SOCPEC and to issue rules and regulations
corresponding export of Philippine products to PROC. pursuant to LOI 444 and P.D. No. 1071, has already been
repealed by EO No. 133, issued on February 27, 1987 by
Private respondent Remington was allowed to import tools,
President Aquino.
machineries and other similar goods. Firestone, on the other
The court observed: Sec. 1. The goals of the national economy are a more equitable
distribution of opportunities, income and wealth; a sustained
Given such obliteration and/or withdrawal of what used to be
increase in the amount of goods and services produced by the
PITC's regulatory authority under the Special provisions
nation for the benefit of the people; and, an expanding
embodied in LOI 444 from the enumeration of power that it
productivity as the key to raising the equality of life for all,
could exercise effective February 27, 1987 in virtue of Section 16
especially the underprivileged.
(d), EO No. 133, it may now be successfully argued that the PITC
can no longer exercise such specific regulatory power in Sec. 19. The State shall regulate or prohibit monopolies
question conformably with the legal precept "expresio unius est when the public interest so requires. No combination in restraint
exclusio alterius." of trade or unfair competition shall be allowed.

Moreover, the court continued, none of the Trade protocols of Lastly, the court declared the Administrative Order to be null
1989, 1990 or 1991, has empowered the PITC, expressly or and void, since the same was not published, contrary to Article
impliedly to formulate or promulgate the assailed Administrative 2 of the New Civil Code which provides, that:
Order. This fact, makes the continued exercise by PITC of the
Art. 2. Laws shall take effect fifteen (15) days following the
regulatory powers in question unworthy of judicial approval.
completion of their publication in the Official Gazette, unless the
Otherwise, it would be sanctioning an undue exercise of
law otherwise provides. . . .
legislative power vested solely in the Congress of the Philippines
by Section, 1, Article VII of the 1987 Philippine Constitution. Petitioner now comes to use on a Petition for Review on
Certiorari,8 questioning the court's decision particularly on the
The lower court stated that the subject Administrative Order and
propriety of the lower court's declarations on the validity of
other similar issuances by PITC suffer from serious constitutional
Administrative Order No. 89-08-01. The Court directed the
infirmity, having been promulgated in pursuance of an
respondents to file their respective Comments.
international agreement (the Memorandum of Agreement
between the Philippines and PROC), which has not been Subsequent events transpired, however, which affect to some
concurred in by at least 2/3 of all the members of the Philippine extent, the submissions of the parties to the present petition.
Senate as required by Article VII, Section 21, of the 1987
Constitution, and therefore, null and void. Following President Fidel V. Ramos' trip to Beijing, People's
Republic of China (PROC), from April 25 to 30, 1993, a new trade
Sec. 21. No treaty or international agreement shall be valid and agreement was entered into between the Philippines and
effective unless concurred in by at least two-thirds of all the PROC, encouraging liberalization of trade between the two
Members of the Senate. countries. In line therewith, on April 20, 1993, the President,
through Chief Presidential Legal Counsel Antonio T. Carpio,
Furthermore, the subject Administrative Order was issued in
directed the Department of Trade and Industry and the PITC to
restraint of trade, in violation of Sections 1 and 19, Article XII of
cease implementing Administrative Order No. SOCPEC 89-08-
the 1987 Constitution, which reads:
01, as amended by PITC Board Resolution Nos. 92-01-05 and 92- NOW, THEREFORE, I, FIDEL V. RAMOS, President of the Republic
03-08.9 of the Philippines, by virtue of the powers vested in me by law,
do hereby order;
In the implementation of such order, PITC President Jose Luis U.
Yulo, Jr. issued a corporate Memorandum10 instructing that all
import applications for the PROC filed with the PITC as of April
The Committee on Scientific and Technical Cooperation with
20, 1993 shall no longer be covered by the trade balancing
Socialist Countries to delete the People's Republic of China from
program outlined in the Administrative Order.
the list of countries covered by Letter of Instructions No. 444.
Forthwith, the PITC allowed the private respondents to import
Done in the City of Manila, this 12th day of May in the year of
anew from the PROC, without being required to comply
Our Lord, Nineteen Hundred and Ninety-Five.
anymore with the lifted requirement of balancing its imports with
exports of Philippine products to PROC.11 In its Constancia12 PITC filed its own Manifestation15 on December 15, 1993,
filed with the Court on November 22, 1993, Remington wherein it adopted the arguments raised in its Petition as its
expressed its desire to have the present action declared moot Memorandum. PITC disagrees with Remington on the latter's
and academic considering the new supervening submission that the case has become moot and academic as
developments. For its part, respondent Firestone made a a result of the abrogation of Administrative Order SOCPEC No.
Manifestation13 in lieu of its Memorandum, informing the court 89-08-01, since respondent Remington had incurred obligations
of the aforesaid developments of the new trade program of the to the petitioner consisting of charges for the 0.5% Counter
Philippines with China, and prayed for the court's early resolution Export Development Service provided by PITC to Remington,
of the action. which obligations remain outstanding. 16 The propriety of such
charges must still be resolved, petitioner argues, thereby
To support its submission that the present action is now moot and
maintaining the issue of the validity of SOCPEC Order No. 89-08-
academic, respondent Remington cites Executive Order No.
01, before it was abrogated by Executive fiat.
244,14 issued by President Ramos on May 12, 1995. The Executive
Order states: There is no question that from April 20, 1993, when trading
balancing measures with PROC were lifted by the President,
WHEREAS, continued coverage of the People's Republic of
Administrative Order SOCPEC No. 89-08-01 no longer has force
China by Letter of Instructions No. 444 is no longer consistent with
and effect, and respondents are thus entitled anew to apply for
the country's national interest, as coursing Republic of the
authority to import from the PROC, without the trade balancing
Philippines-People's Republic China Trade through the Philippine
requirements previously imposed on proposed importers.
International Trading Corporations as provided for under Letter
Indeed, it appears that since the lifting of the trade balancing
of Instructions No. 444 is becoming an unnecessary barrier to
measures, Remington had been allowed to import anew from
trade;
PROC.
There remains, however, the matter of the outstanding LETTER OF INSTRUCTION 444
obligations of the respondent for the charges relating to the
xxx xxx xxx
0.5% Counter Export Development Service in favor of PITC, for
the period when the questioned Administrative Order remained II. CHANNELS OF TRADE
in effect. Is the obligation still subsisting, or are the respondents
freed from it? 1. The trade, direct or indirect, between the Philippines and
any of the Socialist and other centrally-planned economy
To resolve this issue, we are tasked to consider the countries shall upon issuance hereof, be undertaken by or
constitutionality of Administrative Order No. SOCPEC 89-08-01, coursed through the Philippine International Trading
based on the arguments set up by the parties in their Petition Corporation. This shall apply to the export and import of all
and Comment. In so doing, we must inquire into the nature of commodities of products including those specified for export or
the functions of the PITC, in the light of present realities. import by expressly authorized government agencies.
The PITC is a government owned or controlled corporation xxx xxx xxx
created under P.D. No. 25217 dated August 6, 1973. P.D. No.
1071,18 issued on May 9, 1977 which revised the provisions of 4. The Philippine International Trading Corporation shall
P.D. 252. The purposes and powers of the said governmental participate in all official trade and economic discussions
entity were enumerated under Section 5 and 6 thereof.19 between the Philippines and other centrally-planned economy
countries.
On August 9, 1976, the late President Ferdinand Marcos issued
Letter of Instruction (LOI) No. 444,20 directing, inter alia, that xxx xxx xxx
trade (export or import of all commodities), whether direct or
indirect, between the Philippines and any of the Socialist and
other Centrally Planned Economy Countries (SOCPEC), V. SPECIAL PROVISIONS
including the People's Republic of China (PROC) shall be
undertaken or coursed through the PITC. Under the LOI, PITC The Philippine International Trading Corporation shall adopt
was mandated to: 1) participate in all official trade and such measures and issue such rules and regulations as may be
economic discussions between the Philippines and SOCPEC; 2) necessary for the effective discharge of its functions under these
adopt such measures and issue such rules and regulations as instructions. In this connection, the processing and approval of
may be necessary for the effective discharge of its functions applications for export to or import from the Socialist and other
under its instructions; and, 3) undertake the processing and centrally-planned economy countries shall, henceforth, be
performed by the said Corporation. (Emphasis ours)
approval of all applications for export to or import from the
SOCPEC. After the EDSA Revolution, or more specifically on February 27,
1987, then President Corazon C. Aquino promulgated Executive
Pertinent provisions of the Letter of Instruction are herein
reproduced: Order (EO) No.
13321 reorganizing the Department of Trade and Industry (DTI) or foreign, in the fields of production, marketing, procurement,
empowering the said department to be the "primary and other relate businesses; and provide technical advisory,
coordinative, promotive, facilitative and regulatory arm of the investigatory, consultancy and management services with
government for the country's trade, industry and investment respect to any and all of the functions, activities, and operations
activities" (Sec. 2, EO 133). The PITC was made one of DTI's line of the corporation.
agencies.22

The Executive Order reads in part:


Sometime in April, 1988, following the State visit of President
EXECUTIVE ORDER NO. 133 Aquino to the PROC, the Philippines and PROC entered into a
Memorandum of Understanding 23 (MOU) wherein the two
xxx xxx xxx
countries agreed to make joint efforts within the next five years
Sec. 16. Line Corporate Agencies and Government to expand bilateral trade to US $600 — US $800 Million by 1992,
Entities. and to strive for a steady progress towards achieving a balance
between the value of their imports and exports during the
The following line corporate agencies and government entities period, agreeing for the purpose that upon the signing of the
defined in Section 9 (c) of this Executive Order that will perform Memorandum, both sides shall undertake to establish the
their specific regulatory functions, particularly developmental necessary steps and procedures to be adopted within the
responsibilities and specialized business activities in a manner framework of the annual midyear review meeting under the
consonant with the Department mandate, objectives, policies, Trade Protocol, in order to monitor and ensure the
plans and programs: implementation of the MOU.
xxx xxx xxx Conformably with the MOU, the Philippines and PROC entered
into a Trade Protocol for the years 1989, 1990 and 1991,24 under
d) Philippine International Trading Corporation. — This
which was specified the commodities to be traded between
corporation, which shall be supervised by the Undersecretary for
them. The protocols affirmed their agreement to jointly
International Trade, shall only engage in both export and
endeavor between them. The protocols affirmed their
trading on new or non-traditional products and markets not
agreement to jointly endeavor to achieve more or less a
normally pursued by the private business sector; provide a wide
balance between the values of their imports and exports in their
range of export oriented auxiliary services to the private sector;
bilateral trade.
arrange for or establish comprehensive system and physical
facilities for handling the collection, processing, and distribution It is allegedly in line with its powers under LOI 444 and in keeping
of cargoes and other commodities; monitor or coordinate risk with the MOU and Trade Protocols with PROC that PITC issued its
insurance services for existing institutions; promote and organize, now assailed Administrative Order No. SOCPEC 89-08-0125 on
whenever warranted, production enterprises and industrial August 30, 1989 (amended in March, 1992).
establishments and collaborate or associate in joint venture with
any person, association, company or entity, whether domestic
Undoubtedly, President Aquino, in issuing EO 133, is empowered repealed or modified accordingly, cannot operate to abolish
to modify and amend the provisions of LOI 444, which was issued the grant of regulatory powers to the PITC. There can be no
by then President Marcos, both issuances being executive repeal of the said powers, absent any cogency of irreconcilable
directives. As observed by us in Philippine Association of Services inconsistency or repugnancy between the issuances, relating to
Exporters, Inc. vs. Torres,26 the regulatory power of the PITC.

there is no need for legislative delegation of power to the The President, in promulgating EO 133, had not intended to
President to revoke the Letter of Instruction by way of an overhaul the functions of the PITC. The DTI was established, and
Executive Order. This is notwithstanding the fact that the subject was given powers and duties including those previously held by
LOI 1190 was issued by President Marcos, when he was the PITC as an independent government entity, under P.D. 1071
extraordinarily empowered to exercise legislative powers, and LOI 444. The PITC was thereby attached to the DTI as an
whereas EO 450 was issued by Pres. Aquino when her transitional implementing arm of the said department.
legislative powers have already ceased, since it was found that
EO 133 established the DTI as the primary coordinative,
LOI 1190 was a mere administrative directive, hence, may be
promotive, facilitative and regulatory arm of government for the
repealed, altered, or modified by EO 450.
country's trade, industry and investment activities, which shall
We do not agree, however, with the trial court's ruling PITC's act as a catalyst for intensified private sector activity in order to
authority to issue rules and regulations pursuant to the Special accelerate and sustain economic growth.27 In furtherance of
Provision of LOI 444 and P.D. No. 1071, have already been this mandate, the DTI was empowered, among others, to plan,
repealed by EO 133. implement, and coordinate activities of the government related
to trade industry and investments; to formulate and administer
While PITC's power to engage in commercial import and export
policies and guidelines for the investment priorities plan and the
activities is expressly recognized and allowed under Section 16
delivery of investment incentives; to formulate country and
(d) of EO 133, the same is not limited only to new or non-
product export strategies which will guide the export promotion
traditional products and markets not normally pursued by the
and development thrusts of the government.28 Corollarily, the
private business sector. There is not indication in the law of the
Secretary of Trade and Industry is given the power to
removal of the powers of the PITC to exercise its regulatory
promulgate rules and regulations necessary to carry out the
functions in the area of importations from SOCPEC countries.
department's objectives, policies, plans, programs and projects.
Though it does not mention the grant of regulatory power, EO
133, as worded, is silent as to the abolition or limitation of such The PITC, on the other hand, was attached as an integral part
powers, previously granted under P.D. 1071, from the PITC. to the said department as one of its line agencies,29 and given
the focal task of implementing the department's programs.30
The absence of the regulatory power formerly enshrined in the
Likewise, the general repealing clause in EO 133 stating that "all Special Provision of LOI 444, from Section 16 of EO 133, and the
laws, ordinances, rules, and regulations, or other parts thereof, limitation of its previously wide range of functions, is noted. This
which are inconsistent with the Executive Order are hereby does not mean, however, that PITC has lost the authority to issue
the questioned Administrative Order. It is our view that PITC still Similarly, the grant of quasi-legislative powers in administrative
holds such authority, and may legally exercise it, as an bodies is not unconstitutional. Thus, as a result of the growing
implementing arm, and under the supervision of, the complexity of the modern society, it has become necessary to
Department of Trade and Industry. create more and more administrative bodies to help in the
regulation of its ramified activities. Specialized in the particular
Furthermore, the lower court's ruling to the effect that the PITC's
field assigned to them, they can deal within the problems
authority to process and approve applications for imports from
thereof with more expertise and dispatch than can be
SOCPEC and to issue rules and regulations pursuant to LOI 444
expected from the legislature or the courts of justice. This is the
and P.D. 1071 has been repealed by EO 133, is misplaced, and
reason for the increasing vesture of quasi-legislative and quasi-
did not consider the import behind the issuance of the later
judicial powers in what is now not unreasonably called the
presidential edict.
fourth department of the government.34 Evidently, in the
The President could not have intended to deprive herself of the exercise of such powers, the agency concerned must
power to regulate the flow of trade between the Philippines and commonly interpret and apply contracts and determine the
PROC under the two countries' Memorandum of Understanding, rights of private parties under such contracts. One thrust of the
a power which necessarily flows from her office as Chief multiplication of administrative agencies is that the
Executive. In issuing Executive Order 133, the President intended interpretation of contracts and the determination of private
merely to reorganize the Department of Trade and Industry to rights thereunder is no longer uniquely judicial function,
cope with the need of a streamlined bureaucracy.31 exercisable only by our regular courts. (Antipolo Realty
Corporation vs. National Housing Authority, G.R. No.
Thus, there is not real inconsistency between LOI 444 and EO
133. There is, admittedly, a rearranging of the administrative L-50444, August 31, 1987, 153 SCRA 399).
functions among the administrative bodies affective by the
edict, but not an abolition of executive power. Consistency in
statutes as in executive issuances, is of prime importance, and, With global trade and business becoming more intricate may
in the absence of a showing to the contrary, all laws are even with new discoveries in technology and electronics
presumed to be consistent with each other. Where it is possible notwithstanding, the time has come to grapple with legislations
to do so, it is the duty of courts, in the construction of statutes, to and even judicial decisions aimed at resolving issues affecting
harmonize and reconcile them, and to adopt a construction of not only individual rights but also activities of which foreign
a statutory provision which harmonizes and reconciles it with governments or entities may have interests. Thus, administrative
other statutory provisions.32 The fact that a later enactment policies and regulations must be devised to suit these changing
may relate to the same subject matter as that of an earlier business needs in a faster rate than to resort to traditional acts
statute is not of itself sufficient to cause an implied repeal of the of the legislature.
latter, since the law may be cumulative or a continuation of the
This tendency finds support in a well-stated work on the subject,
old one.33
viz.:
Since legislatures had neither the time nor the knowledge to was not published in the Official Gazette or in a newspaper of
create detailed rules, however, it was soon clear that new general circulation. The questioned Administrative Order,
governmental arrangements would be needed to handle the legally, until it is published, is invalid within the context of Article
job of rule-making. The courts, moreover, many of them already 2 of Civil Code, which reads:
congested, would have been swamped if they had to
Art. 2. Laws shall take effect fifteen days following the
adjudicate all the controversies that the new legislation was
completion of their publication in the Official Gazette (or in a
bound to create; and the judges, already obliged to handle a
newspaper of general circulation in the Philippines), unless it is
great diversity of cases, would have been hard pressed to
otherwise provided. . . .
acquire the knowledge they needed to deal intelligently with all
the new types of controversy.

So the need to "create a large number of specialized The fact that the amendments to Administrative Order No.
administrative agencies and to give them broader powers than SOCPEC 89-08-01 were filed with, and published by the UP Law
administrators had traditionally exercised. These included the Center in the National Administrative Register, does not cure the
power to issue regulations having the force of law, and the defect related to the effectivity of the Administrative Order.
power to hear and decide cases — powers that had previously
been reserved to the legislatures and the courts. This court, in Tanada vs. Tuvera 36 stated, thus:
(Houghteling/Pierce, Lawmaking by Administrative Agencies, p.
We hold therefore that all statutes, including those of local
166)
application and private laws, shall be published as a condition
The respondents likewise argue that PITC is not empowered to for their effectivity, which shall begin fifteen days after
issue the Administrative Order because no grant of such power publication unless a different effectivity is fixed by the
was made under the Trade Protocols of 1989, 1990 or 1991. We legislature.
do not agree. The Trade Protocols aforesaid, are only the
Covered by this rule are presidential decrees and executive
enumeration of the products and goods which signatory
orders promulgated by the President in the exercise of legislative
countries have agreed to trade. They do not bestow any
powers or, at present, directly conferred by the Constitution.
regulatory power, for executive power is vested in the Executive
Administrative Rules and Regulations must also be published if
Department,35 and it is for the latter to delegate the exercise of
their purpose is to enforce or implement existing law pursuant
such power among its designated agencies.
also to a valid delegation.
In sum, the PITC was legally empowered to issue Administrative
Interpretative regulations and those merely internal in nature,
Orders, as a valid exercise of a power ancillary to legislation.
that is, regulating only the personnel of the administrative
This does not imply however, that the subject Administrative agency and not the public, need not be published. Neither is
Order is a valid exercise of such quasi-legislative power. The publication required of the so-called letters of instructions issued
original Administrative Order issued on August 30, 1989, under by administrative superiors concerning the rules or guidelines to
which the respondents filed their applications for importation,
be followed by their subordinates in the performance of their Conformably with such avowed policy, any remnant of the
duties restrained atmosphere of trading between the Philippines and
PROC should be done away with, so as to allow economic
xxx xxx xxx
growth and renewed trade relations with our neighbors to
We agree that the publication must be in full or it is no flourish and may be encouraged.
publication at all since its purpose is to inform the public of the
ACCORDINGLY, the assailed decision of the lower court is
contents of the laws.
hereby AFFIRMED, to the effect that judgment is hereby
The Administrative Order under consideration is one of those rendered in favor of the private respondents, subject to the
issuances which should be published for its effectivity, since its following MODIFICATIONS:
purpose is to enforce and implement an existing law pursuant
1) Enjoining the petitioner:
to a valid delegation, i.e., P.D. 1071, in relation to LOI 444 and
EO 133. a) From further charging the petitioners the Counter Export
Development Service fee of 0.5% of the total value of the
Thus, even before the trade balancing measures issued by the
unliquidated or unfulfilled Undertakings of the private
petitioner were lifted by President Fidel V. Ramos, the same were
respondents;
never legally effective, and private respondents, therefore,
cannot be made subject to them, because Administrative b) From further implementing the provisions of
Order 89-08-01 embodying the same was never published, as Administrative Order No. SOCPEC 89-08-01 and its appurtenant
mandated by law, for its effectivity. It was only on March 30, rules; and,
1992 when the amendments to the said Administrative Order
2) Requiring petitioner to approve forthwith all the pending
were filed in the UP Law Center, and published in the National
applications of, and all those that may hereafter be filed by, the
Administrative Register as required by the Administrative Code
petitioner and the Intervenor, free from and without complying
of 1987.
with the requirements prescribed in the above-stated issuances.
Finally, it is the declared Policy of the Government to develop
SO ORDERED.
and strengthen trade relations with the People's Republic of
China. As declared by the President in EO 244 issued on May 12,
1995, continued coverage of the People's Republic of China by
Letter of Instructions No. 444 is no longer consistent with the
country's national interest, as coursing RP-PROC trade through
the PITC as provided for under Letter of Instructions No. 444 is
becoming an unnecessary barrier to trade.3 7
G.R. No. L-65894 September 24, 1987 Whether or not the above provisions are applicable to the case
at bar is the lone issue in this petition which assails the resolution
THE MUNICIPAL GOVERNMENT OF CORON, PALAWAN, duly
of the respondent appellate court dated July 29, 1983.
represented by MAYOR RICARDO F. LIM, petitioner,
The dispositive part of the questioned resolution reads:
vs.
WHEREFORE, notwithstanding the foregoing, in the broader
JOSE CARINO, VICTORIANO DACULLA, BEN GUMASING, LUCENA
interest of justice and considering that under the present Interim
CRUZ, HILARIA YALON, PEPITO YAMBAO, RIC GACUTAN, ANDRES
Rules a record on appeal is no longer necessary for taking an
DACULLA, FELICISIMA URSAIS, PASTOR JOSOL, TEDDY ACTANG,
appeal, the Court resolved to order the recall of the records of
CANDIDA MANALO, LETICIA RAMAL, ASSOCIATE JUSTICES
this case from the Regional Trial Court of Palawan Branch I,
PORFIRIO V. SISON, ABDULWAHID A. BIDIN, MARCELINO R.
Puerto Princess for further proceedings before this Court. (Rollo,
VELOSO and DESIDERIO P. JURADO, respondents.
pp. 12-13)
GUTIERREZ, JR., J.:
Following are the pertinent facts of the case as culled from the
The second paragraph of Section 39, Batas Pambansa Bilang records.
129 provides that:
Sometime in 1976, an action was filed by the petitioner before
No record on appeal shall be required to take an appeal. In lieu the Court of First Instance of Palawan and Puerto Princess City,
thereof, the entire original record shall be transmitted with all the Branch IV where it was docketed as Civil Case No. 35. The action
pages prominently numbered consecutively, together with an sought authority from the court to demolish the structures built
index of the contents thereof. by the private respondents alongside the rock causeway of the
petitioner's wharf. The complaint alleged, among others:
Likewise, Sections 18 and 19(b) of the Interim Rules of Court
promulgated on January 11, 1983 provide that: that the defendants' houses were constructed more than 3
years before the filing of instant action (par. 2, Complaint),: that
Sec. 18. The filing of a record on appeal shall be on August 19, 1974 the herein defendants undertook to remove
dispensed with, except in the cases referred to in sub- their structures on space where they were then at that time and
paragraph (b) of paragraph (1) hereof. are presently standing, when it will be needed by the
government (par. 3, Ibid); that the space or area is needed by
No appeal bond shall be required for an appeal.
the plaintiff for the docking or berthing of pumpboats
xxx xxx xxx (motorized bancas) and fishing boats and for the loading and
unloading of cargoes along the pier on both sides thereof (par.
Sec. 19 (b) In appeals in special proceedings in 4, Ibid); and also to ease the congested traffic along it (par. 10,
accordance with Rule 109 of the Rules of Court and other cases Ibid); that his Excellency, President Ferdinand E. Marcos had the
wherein multiple appeals are allowed, the period of appeal Mayor of plaintiff-municipality to demolish and remove all
shall be thirty (30) days, a record of appeal being required.
constructions along the pier after giving the defendants one
month notice (par. 5, Ibid) and aside from this directive of the On March 20, 1979, despite proper notice, the private
President, the mayor of the plaintiff-municipality is also respondents and their counsel failed to appear at the
authorized to remove the defendants' illegal constructions scheduled hearing. Consequently, the petitioner moved that
under LOI 19 (par. 7, Ibid); that despite said mayor's desire to private respondents' non-appearance be considered as a
comply immediately with the said presidential directive, the waiver on their part of their right to cross-examine the petitioner's
defendants had already been given 3 extensions thereby witnesses and their right to present evidence. The lower court
delaying their ejectment therefrom (par. 6, Ibid); that most of issued an order granting the petitioner's motion and considered
the defendants are affluent squatters (par. 9, Ibid); and that for the case submitted for decision.
the indigent defendants, a surveyed area has already been
In view of the above order, the private respondents went to the
made ready for their relocation (par. 12, Ibid). (Decision CFI,
appellate court on certiorari. On June 9, 1979, the appellate
Palawan and Puerto Princess City, Branch IV, p. 2; Reno, p. 15).
court dismissed for lack of merit CA G.R. SP-09389-R captioned
On the other hand, the private respondents, in their answer, "Jose Carino, et al., petitioners v. Mayor Ricardo Lim and Hon.
counter-alleged, among others: Benjamin Vega, Judge CFI, Palawan, Branch IV."

that their structures when made were covered by building On May 15, 1979, after the main case had been submitted for
permits with the approval of the Bureau of Public Highways (par, decision as aforestated, the private respondents filed a notice
2, Answer); that the area where their structures were located is to take deposition which the lower court disregarded for being
a foreshore area (Par. 4, Ibid); that a meeting was convened "irrelevant and for other obvious reasons."
and presided by Governor Socrates at Coron, the same having
On October 10, 1980, the lower court rendered its decision, the
been attended by the local representatives of the Philippine
dispositive portion of which reads:
Constabulary, the Philippine Coast Guard, the Department
(now Ministry) of Social Services and Development, the IN VIEW OF THE FOREGOING, judgment is hereby rendered in
Sangguniang Bayan and the defendants and it was agreed in favor of the plaintiff-municipality of Coron, Palawan and against
this meeting that the demolition of the defendants' houses will all the herein defendants as follows:
be suspended pending action of the Office of the President
(par. 15, 16, 17, Ibid); and that the Chairman of the National 1. Dismissing the defendants'counterclaim for lack of merit;
Housing Authority had sent a letter-advice to the mayor of the
2. Confirming the power of plaintiff-municipality and
plaintiff-municipality to suspend the demolition of the houses of
authority of its incumbent mayor to demolish the defendants'
the defendants (par. 18, Ibid). (Rollo, pp. 15-16)
structures along the rock causeway or pier of Coron; and
After a series of postponements, the trial court, on January 16,
3. Ordering the said defendants to remove their structures
1979, reset the hearing of the case for the last time for three
in the area in question within thirty (30) days from receipt of this
consecutive dates, March 20, 21, and 22, 1979 with further
decision and for their failure to do so, authorizing the herein
warning to the private respondents that no more
plaintiff represented by its incumbent mayor to demolish the
postponements shall be allowed.
said structures at the expense of the said defendants.
Costs against all the defendants. (Rollo, pp. 28-29) motion, the private respondents argued that since under the
present law, printed records on appeal are no longer required,
On appeal, the private respondents on February 2, 1982 were
their right to be heard on appeal must be upheld instead of the
required "to submit the forty (40) printed copies of their record
rule on technicalities.
on appeal together with the proof of service of fifteen (15)
copies thereof upon the appellee" within fifteen (15) days from In its opposition to the private respondents' motion, the
receipt of the notice of the appellate court's Acting Clerk of Petitioner pointed out that although the newly promulgated
Court regarding their appeal. (Rollo, p. 32) procedural rules invoked by the private respondents may be
given retroactive effect, their applicability only covers pending
Upon motion by the private respondents, the appellate court
actions and does not extend to those which had already
granted an extension of sixty (60) days from April 7, 1982 within
become final and executory.
which the required printed copies of the record on appeal may
be submitted. However, despite the extended period given, the
private respondents were not able to comply with the appellate
As a consequence of the private respondents' motion to recall
court's requirement.
the records of the case, a temporary restraining order dated
In a resolution dated July 19, 1982, the appellate court required April 29, 1983 was issued by the appellate court directing the
the private respondents to show cause why their appeal should Provincial Sheriff of Palawan to desist from executing the
not be dismissed for failure to file the printed copies of the October 10, 1980 decision.
record on appeal.
On July 29, 1983, the appellate court issued the disputed
On August 31, 1982, the appellate court resolved to dismiss the resolution. The subsequent denial of the petitioner's motion for
private respondents' appeal docketed as CA G.R. No. 69052-R reconsideration prompted the filing of this petition.
for failure to file the required record on appeal.
The petitioner maintains that the Interim Rules of Court
On December 6, 1982, the Acting Clerk of Court of the promulgated on January 11, 1983 to implement the provisions
appellate court, in an Entry of Judgment, certified that the of Batas Pambansa Bilang 29 cannot apply to the case at bar
above resolution dismissing the private respondents' appeal for the simple reason that to revive or recall appealed cases
had become final and executory on September 27, 1982. which had been dismissed or which had become final and
executory would cause a great injustice to those in whose favor
Accordingly, on February 1, 1983, a writ of execution was issued
these cases had been decided. It is further contended that to
to enforce the October 10, 1980 decision of the Court of First
allow its application would put no end to those appealed cases
Instance of Palawan and Puerto Princesa City, Branch IV.
which are otherwise considered as closed ones.
Before the Provincial Sheriff could proceed with the execution
We find merit in the petitioner's contentions.
of the judgment, the private respondents, in a motion dated
April 12, 1983 asked the appellate court that the records of the
case be recalled from the court of origin. In their supplemental
We have resolved the issue as to the extent of the retroactive law. (See United CMC Textile Workers Union vs. Clave, 137 SCRA
application of section 18 of the Interim Rules of Court in Alday v. 346).
Camilon (120 SCRA 521). We reiterated the rule that:
For a proper exercise of their right to appeal, the private
Statutes regulating the procedure of the courts will be construed respondents should have complied with Section 5, Rule 46 of the
as applicable to actions pending and undetermined at the time Rules of Court, as amended by our resolution en banc dated
of their passage. Procedural laws are retrospective in that sense September 17, 1974, which partly provides that:
and to that extent. (People vs. Sumilang, 77 Phil. 764 [1946])
Sec. 5. Duty of Appellant upon Receipt of Notice. — It shall be
Emphasis supplied.
the duty of the appellant, within fifteen (15) days from the date
The appellate court should have followed this time-honoured of the notice referred to in the preceding section, to pay to the
rule instead of issuing its July 29, 1983 resolution seeking to revive Clerk of the Court of Appeals the fee for the docketing of the
a case already long final as evidenced by the entry of judgment appeal, and within sixty (60) days from such notice to submit to
made by its Acting Clerk of Court on December 6, 1982. the court twelve (12) printed copies of the record on appeal, or
twelve (12) typewritten or mimeographed (on one side of good
The records of the instant case show that despite the 60-day
quality paper, eleven inches in length by eight and a half inches
extension period given to the private respondents within which
in width — commonly known as letter size — written double
they could file their printed record of appeal as then required,
spaced) copies of said record on appeal together with proof of
they still failed to do so. It was only after a writ of execution had
service of two (2) printed, typewritten or mimeographed copies
been issued on February 1, 1983 that the private respondents
thereof upon the appellee.
responded to the appellate court's resolution dated July 19,
1982 requiring them to show cause why their appeal should not Thus, upon failure of the appellant to comply with the above
be dismissed for failure to file the printed record on appeal. They rule, the Court of Appeals may dismiss his appeal. Said provision
claimed that the court's resolution must have been a result of implicitly grants the Court of Appeals the power to do so. (See
oversight because they actually filed a record on appeal. Pfleider vs. Victoriano, 98 SCRA 491). The private respondents in
this case did not submit printed copies of their record on
As a general rule, our policy towards an invocation of the right
appeal. When the appellate court issued its July 19, 1982
to appeal has been one of liberality. (Castro vs. Court of
resolution, it was to afford the private respondents a chance to
Appeals, 123 SCRA 782 citing De Las Alas vs. Court of Appeals,
explain why they failed to comply with the applicable rule. After
83 SCRA 200). This is so because an appeal is an essential part
having failed to submit the required printed copies of their
of our judicial system and every party-litigant should be
record on appeal, they cannot now rectify a clear non-
afforded the amplest opportunity for the proper and just
compliance with the law by invoking the court's liberality insofar
disposition of his cause freed from the constraints of
as the application of remedial laws is concerned. The private
technicalities. (See Siguenza vs. Court of Appeals, 137 SCRA
respondents even faulted the appellate court as having issued
570). However, it is an equally established doctrine that the right
the July 19, 1982 resolution through oversight. They alleged that
to appeal is merely a statutory privilege and may be exercised
they had filed the required record on appeal when in fact what
only in the manner and in accordance with the provisions of
they referred to was the record on appeal from the lower court G.R. No. L-15127 May 30, 1961
to the appellate court and not the printed record on appeal.
EMETERIO CUI, plaintiff-appellant,
Since the private respondents failed to submit the required
vs.
printed record on appeal, the lower court's judgment in favor of
the petitioner became final. and executory as an eventual ARELLANO UNIVERSITY, defendant-appellee.
result of the dismissal of the appeal. Once a judgment becomes
final the prevailing party, the petitioner in the instant case, is G.A.S. Sipin, Jr., for plaintiff-appellant.
entitled as a matter of right to the execution of the judgment in
E. Voltaire Garcia for defendant-appellee.
his favor. For the court, it becomes its ministerial duty to order
the execution of said judgment. (Santos, Jr. vs. Court of Appeals, CONCEPCION, J.:
et al., G.R. No. 56614, promulgated July 28, 1987 citing
Agricultural and Industrial Marketing, Inc. vs. Court of Appeals, Appeal by plaintiff Emeterio Cui from a decision of the Court of
118 SCRA 49; Balintawak Construction Supply Corporation vs. First Instance of Manila, absolving defendant Arellano University
Valenzuela, 124 SCRA 331; Rizal Commercial Banking from plaintiff's complaint, with costs against the plaintiff, and
Corporation vs. Dayrit, 123 SCRA 203; Gonzales vs. Sayo, 122 dismissing defendant's counter claim, for insufficiency of proof
SCRA 607). thereon.

In the language of the decision appealed from:


WHEREFORE, the petition is hereby GRANTED. The resolution of
respondent appellate court dated July 29, 1983 is SET ASIDE. Let The essential facts of this case are short and undisputed. As
the records of this case be remanded to the court of origin for established by the agreement of facts Exhibits X and by the
enforcement of the writ of execution of the judgment. This respective oral and documentary evidence introduced by the
decision is immediately executory. parties, it appears conclusive that plaintiff, before the school
SO ORDERED. year 1948-1949 took up preparatory law course in the
defendant University. After finishing his preparatory law course
plaintiff enrolled in the College of Law of the defendant from
the school year 1948-1949. Plaintiff finished his law studies in the
defendant university up to and including the first semester of the
fourth year. During all the school years in which plaintiff was
studying law in defendant law college, Francisco R. Capistrano,
brother of the mother of plaintiff, was the dean of the College
of Law and legal counsel of the defendant university. Plaintiff
enrolled for the last semester of his law studies in the defendant
university but failed to pay his tuition fees because his uncle
Dean Francisco R. Capistrano having severed his connection
with defendant and having accepted the deanship and
chancellorship of the College of Law of Abad Santos University, subject of "Scholarship," addressed to "All heads of private
plaintiff left the defendant's law college and enrolled for the last schools, colleges and universities," reading:
semester of his fourth year law in the college of law of the Abad
1. School catalogs and prospectuses submitted to this, Bureau
Santos University graduating from the college of law of the latter
show that some schools offer full or partial scholarships to
university. Plaintiff, during all the time he was studying law in
deserving students — for excellence in scholarship or for
defendant university was awarded scholarship grants, for
leadership in extra-curricular activities. Such inducements to
scholastic merit, so that his semestral tuition fees were returned
poor but gifted students should be encouraged. But to stipulate
to him after the ends of semester and when his scholarship
the condition that such scholarships are good only if the
grants were awarded to him. The whole amount of tuition fees
students concerned continue in the same school nullifies the
paid by plaintiff to defendant and refunded to him by the latter
principle of merit in the award of these scholarships.
from the first semester up to and including the first semester of
his last year in the college of law or the fourth year, is in total 2. When students are given full or partial scholarships, it is
P1,033.87. After graduating in law from Abad Santos University understood that such scholarships are merited and earned. The
he applied to take the bar examination. To secure permission to amount in tuition and other fees corresponding to these
take the bar he needed the transcripts of his records in scholarships should not be subsequently charged to the
defendant Arellano University. Plaintiff petitioned the latter to recipient students when they decide to quit school or to transfer
issue to him the needed transcripts. The defendant refused until to another institution. Scholarships should not be offered merely
after he had paid back the P1,033 87 which defendant to attract and keep students in a school.
refunded to him as above stated. As he could not take the bar
examination without those transcripts, plaintiff paid to 3. Several complaints have actually been received from
defendant the said sum under protest. This is the sum which students who have enjoyed scholarships, full or partial, to the
plaintiff seeks to recover from defendant in this case. effect that they could not transfer to other schools since their
credentials would not be released unless they would pay the
Before defendant awarded to plaintiff the scholarship grants as fees corresponding to the period of the scholarships. Where the
above stated, he was made to sign the following contract Bureau believes that the right of the student to transfer is being
covenant and agreement: denied on this ground, it reserves the right to authorize such
transfer.
"In consideration of the scholarship granted to me by the
University, I hereby waive my right to transfer to another school that defendant herein received a copy of this memorandum;
without having refunded to the University (defendant) the that plaintiff asked the Bureau of Private Schools to pass upon
equivalent of my scholarship cash. the issue on his right to secure the transcript of his record in
defendant University, without being required to refund the sum
(Sgd.) Emeterio Cui".
of P1,033.87; that the Bureau of Private Schools upheld the
It is admitted that, on August 16, 1949, the Director of Private position taken by the plaintiff and so advised the defendant;
Schools issued Memorandum No. 38, series of 1949, on the and that, this notwithstanding, the latter refused to issue said
transcript of records, unless said refund were made, and even
recommended to said Bureau that it issue a written order We do not deem it necessary or advisable to consider as the
directing the defendant to release said transcript of record, "so lower court did, the question whether plaintiff had sufficient
that the case may be presented to the court for judicial action." reasons or not to transfer from defendant University to the Abad
As above stated, plaintiff was, accordingly, constrained to pay, Santos University. The nature of the issue before us, and its far
and did pay under protest, said sum of P1,033.87, in order that reaching effects, transcend personal equations and demand a
he could take the bar examination in 1953. Subsequently, he determination of the case from a high impersonal plane. Neither
brought this action for the recovery of said amount, aside from do we deem it essential to pass upon the validity of said
P2,000 as moral damages, P500 as exemplary damages, P2,000 Memorandum No. 38, for, regardless of the same, we are of the
as attorney's fees, and P500 as expenses of litigation. opinion that the stipulation in question is contrary to public
policy and, hence, null and void. The aforesaid memorandum
In its answer, defendant reiterated the stand it took, vis-a-vis the
merely incorporates a sound principle of public policy. As the
Bureau of Private Schools, namely, that the provisions of its
Director of Private Schools correctly pointed, out in his letter,
contract with plaintiff are valid and binding and that the
Exhibit B, to the defendant,
memorandum above-referred to is null and void. It, likewise, set
up a counterclaim for P10,000.00 as damages, and P3,000 as There is one more point that merits refutation and that is whether
attorney's fees. or not the contract entered into between Cui and Arellano
University on September 10, 1951 was void as against public
The issue in this case is whether the above quoted provision of
policy. In the case of Zeigel vs. Illinois Trust and Savings Bank, 245
the contract between plaintiff and the defendant, whereby the
Ill. 180, 19 Ann. Case 127, the court said: 'In determining a public
former waived his right to transfer to another school without
policy of the state, courts are limited to a consideration of the
refunding to the latter the equivalent of his scholarships in cash,
Constitution, the judicial decisions, the statutes, and the
is valid or not. The lower court resolved this question in the
practice of government officers.' It might take more than a
affirmative, upon the ground that the aforementioned
government bureau or office to lay down or establish a public
memorandum of the Director of Private Schools is not a law; that
policy, as alleged in your communication, but courts consider
the provisions thereof are advisory, not mandatory in nature;
the practices of government officials as one of the four factors
and that, although the contractual provision "may be unethical,
in determining a public policy of the state. It has been
yet it was more unethical for plaintiff to quit studying with the
consistently held in America that under the principles relating to
defendant without good reasons and simply because he
the doctrine of public policy, as applied to the law of contracts,
wanted to follow the example of his uncle." Moreover,
courts of justice will not recognize or uphold a transaction which
defendant maintains in its brief that the aforementioned
its object, operation, or tendency is calculated to be prejudicial
memorandum of the Director of Private Schools is null and void
to the public welfare, to sound morality or to civic honesty (Ritter
because said officer had no authority to issue it, and because it
vs. Mutual Life Ins. Co., 169 U.S. 139; Heding vs. Gallaghere 64
had been neither approved by the corresponding department
L.R.A. 811; Veazy vs. Allen, 173 N.Y. 359). If Arellano University
head nor published in the official gazette.
understood clearly the real essence of scholarships and the
motives which prompted this office to issue Memorandum No.
38, s. 1949, it should have not entered into a contract of waiver whom society has an established interest or a first lien. (Emphasis
with Cui on September 10, 1951, which is a direct violation of our supplied.)
Memorandum and an open challenge to the authority of the
WHEREFORE, the decision appealed from is hereby reversed
Director of Private Schools because the contract was
and another one shall be entered sentencing the defendant to
repugnant to sound morality and civic honesty. And finally, in
pay to the plaintiff the sum of P1,033.87, with interest thereon at
Gabriel vs. Monte de Piedad, Off. Gazette Supp. Dec. 6, 1941,
the legal rate from September 1, 1954, date of the institution of
p. 67 we read: 'In order to declare a contract void as against
this case, as well as the costs, and dismissing defendant's
public policy, a court must find that the contract as to
counterclaim. It is so ordered.
consideration or the thing to be done, contravenes some
established interest of society, or is inconsistent with sound policy
and good morals or tends clearly to undermine the security of
individual rights. The policy enunciated in Memorandum No. 38,
s. 1949 is sound policy. Scholarship are awarded in recognition
of merit not to keep outstanding students in school to bolster its
prestige. In the understanding of that university scholarships
award is a business scheme designed to increase the business
potential of an education institution. Thus conceived it is not only
inconsistent with sound policy but also good morals. But what is
morals? Manresa has this definition. It is good customs; those
generally accepted principles of morality which have received
some kind of social and practical confirmation. The practice of
awarding scholarships to attract students and keep them in
school is not good customs nor has it received some kind of
social and practical confirmation except in some private
institutions as in Arellano University. The University of the
Philippines which implements Section 5 of Article XIV of the
Constitution with reference to the giving of free scholarships to
gifted children, does not require scholars to reimburse the
corresponding value of the scholarships if they transfer to other
schools. So also with the leading colleges and universities of the
United States after which our educational practices or policies
are patterned. In these institutions scholarships are granted not
to attract and to keep brilliant students in school for their
propaganda mine but to reward merit or help gifted students in
G.R. No. L-68470 October 8, 1985 acknowledged that he and petitioner had "no community
property" as of June 11, 1982. The Court below denied the
ALICE REYES VAN DORN, petitioner,
Motion to Dismiss in the mentioned case on the ground that the
vs. property involved is located in the Philippines so that the Divorce
Decree has no bearing in the case. The denial is now the subject
HON. MANUEL V. ROMILLO, JR., as Presiding Judge of Branch CX, of this certiorari proceeding.
Regional Trial Court of the National Capital Region Pasay City
and RICHARD UPTON respondents. Generally, the denial of a Motion to Dismiss in a civil case is
interlocutory and is not subject to appeal. certiorari and
MELENCIO-HERRERA, J.:\ Prohibition are neither the remedies to question the propriety of
an interlocutory order of the trial Court. However, when a grave
In this Petition for certiorari and Prohibition, petitioner Alice Reyes
abuse of discretion was patently committed, or the lower Court
Van Dorn seeks to set aside the Orders, dated September 15,
acted capriciously and whimsically, then it devolves upon this
1983 and August 3, 1984, in Civil Case No. 1075-P, issued by
Court in a certiorari proceeding to exercise its supervisory
respondent Judge, which denied her Motion to Dismiss said
authority and to correct the error committed which, in such a
case, and her Motion for Reconsideration of the Dismissal Order,
case, is equivalent to lack of jurisdiction. 1 Prohibition would then
respectively.
lie since it would be useless and a waste of time to go ahead
The basic background facts are that petitioner is a citizen of the with the proceedings. 2 Weconsider the petition filed in this case
Philippines while private respondent is a citizen of the United within the exception, and we have given it due course.
States; that they were married in Hongkong in 1972; that, after
For resolution is the effect of the foreign divorce on the parties
the marriage, they established their residence in the Philippines;
and their alleged conjugal property in the Philippines.
that they begot two children born on April 4, 1973 and
December 18, 1975, respectively; that the parties were divorced Petitioner contends that respondent is estopped from laying
in Nevada, United States, in 1982; and that petitioner has re- claim on the alleged conjugal property because of the
married also in Nevada, this time to Theodore Van Dorn. representation he made in the divorce proceedings before the
American Court that they had no community of property; that
Dated June 8, 1983, private respondent filed suit against
the Galleon Shop was not established through conjugal funds,
petitioner in Civil Case No. 1075-P of the Regional Trial Court,
and that respondent's claim is barred by prior judgment.
Branch CXV, in Pasay City, stating that petitioner's business in
Ermita, Manila, (the Galleon Shop, for short), is conjugal property For his part, respondent avers that the Divorce Decree issued by
of the parties, and asking that petitioner be ordered to render the Nevada Court cannot prevail over the prohibitive laws of
an accounting of that business, and that private respondent be the Philippines and its declared national policy; that the acts
declared with right to manage the conjugal property. Petitioner and declaration of a foreign Court cannot, especially if the
moved to dismiss the case on the ground that the cause of same is contrary to public policy, divest Philippine Courts of
action is barred by previous judgment in the divorce jurisdiction to entertain matters within its jurisdiction.
proceedings before the Nevada Court wherein respondent had
For the resolution of this case, it is not necessary to determine There can be no question as to the validity of that Nevada
whether the property relations between petitioner and private divorce in any of the States of the United States. The decree is
respondent, after their marriage, were upon absolute or relative binding on private respondent as an American citizen. For
community property, upon complete separation of property, or instance, private respondent cannot sue petitioner, as her
upon any other regime. The pivotal fact in this case is the husband, in any State of the Union. What he is contending in this
Nevada divorce of the parties. case is that the divorce is not valid and binding in this jurisdiction,
the same being contrary to local law and public policy.
The Nevada District Court, which decreed the divorce, had
obtained jurisdiction over petitioner who appeared in person It is true that owing to the nationality principle embodied in
before the Court during the trial of the case. It also obtained Article 15 of the Civil Code, 5 only Philippine nationals are
jurisdiction over private respondent who, giving his address as covered by the policy against absolute divorces the same
No. 381 Bush Street, San Francisco, California, authorized his being considered contrary to our concept of public police and
attorneys in the divorce case, Karp & Gradt Ltd., to agree to the morality. However, aliens may obtain divorces abroad, which
divorce on the ground of incompatibility in the understanding may be recognized in the Philippines, provided they are valid
that there were neither community property nor community according to their national law. 6 In this case, the divorce in
obligations. 3 As explicitly stated in the Power of Attorney he Nevada released private respondent from the marriage from
executed in favor of the law firm of KARP & GRAD LTD., 336 W. the standards of American law, under which divorce dissolves
Liberty, Reno, Nevada, to represent him in the divorce the marriage. As stated by the Federal Supreme Court of the
proceedings: United States in Atherton vs. Atherton, 45 L. Ed. 794, 799:

xxx xxx xxx The purpose and effect of a decree of divorce from the bond
of matrimony by a court of competent jurisdiction are to
You are hereby authorized to accept service of Summons, to file
change the existing status or domestic relation of husband and
an Answer, appear on my behalf and do an things necessary
wife, and to free them both from the bond. The marriage tie
and proper to represent me, without further contesting, subject
when thus severed as to one party, ceases to bind either. A
to the following:
husband without a wife, or a wife without a husband, is unknown
1. That my spouse seeks a divorce on the ground of to the law. When the law provides, in the nature of a penalty.
incompatibility. that the guilty party shall not marry again, that party, as well as
the other, is still absolutely freed from the bond of the former
2. That there is no community of property to be marriage.
adjudicated by the Court.
Thus, pursuant to his national law, private respondent is no
3. 'I'hat there are no community obligations to be longer the husband of petitioner. He would have no standing to
adjudicated by the court. sue in the case below as petitioner's husband entitled to
exercise control over conjugal assets. As he is bound by the
xxx xxx xxx 4
Decision of his own country's Court, which validly exercised
jurisdiction over him, and whose decision he does not repudiate, G.R. No. 138322 October 2, 2001
he is estopped by his own representation before said Court from
GRACE J. GARCIA, a.k.a. GRACE J. GARCIA-RECIO, petitioner,
asserting his right over the alleged conjugal property.
vs.
To maintain, as private respondent does, that, under our laws,
petitioner has to be considered still married to private REDERICK A. RECIO, respondents.
respondent and still subject to a wife's obligations under Article
109, et. seq. of the Civil Code cannot be just. Petitioner should PANGANIBAN, J.:
not be obliged to live together with, observe respect and
A divorce obtained abroad by an alien may be recognized in
fidelity, and render support to private respondent. The latter
our jurisdiction, provided such decree is valid according to the
should not continue to be one of her heirs with possible rights to
national law of the foreigner. However, the divorce decree and
conjugal property. She should not be discriminated against in
the governing personal law of the alien spouse who obtained
her own country if the ends of justice are to be served.
the divorce must be proven. Our courts do not take judicial
WHEREFORE, the Petition is granted, and respondent Judge is notice of foreign laws and judgment; hence, like any other
hereby ordered to dismiss the Complaint filed in Civil Case No. facts, both the divorce decree and the national law of the alien
1075-P of his Court. must be alleged and proven according to our law on evidence.

Without costs. The Case

SO ORDERED. Before us is a Petition for Review under Rule 45 of the Rules of


Court, seeking to nullify the January 7, 1999 Decision1 and the
March 24, 1999 Order2 of the Regional Trial Court of
Cabanatuan City, Branch 28, in Civil Case No. 3026-AF. The
assailed Decision disposed as follows:

"WHEREFORE, this Court declares the marriage between Grace


J. Garcia and Rederick A. Recio solemnized on January 12, 1994
at Cabanatuan City as dissolved and both parties can now
remarry under existing and applicable laws to any and/or both
parties."3

The assailed Order denied reconsideration of the above-


quoted Decision.
The Facts On July 7, 1998 – or about five years after the couple's wedding
and while the suit for the declaration of nullity was pending –
Rederick A. Recio, a Filipino, was married to Editha Samson, an
respondent was able to secure a divorce decree from a family
Australian citizen, in Malabon, Rizal, on March 1, 1987.4 They
court in Sydney, Australia because the "marriage ha[d]
lived together as husband and wife in Australia. On May 18,
irretrievably broken down."13
1989,5 a decree of divorce, purportedly dissolving the marriage,
was issued by an Australian family court. Respondent prayed in his Answer that the Complained be
dismissed on the ground that it stated no cause of action.14 The
On June 26, 1992, respondent became an Australian citizen, as
Office of the Solicitor General agreed with respondent.15 The
shown by a "Certificate of Australian Citizenship" issued by the
court marked and admitted the documentary evidence of
Australian government.6 Petitioner – a Filipina – and respondent
both parties.16 After they submitted their respective
were married on January 12, 1994 in Our Lady of Perpetual Help
memoranda, the case was submitted for resolution.17
Church in Cabanatuan City.7 In their application for a marriage
license, respondent was declared as "single" and "Filipino."8 Thereafter, the trial court rendered the assailed Decision and
Order.
Starting October 22, 1995, petitioner and respondent lived
separately without prior judicial dissolution of their marriage. Ruling of the Trial Court
While the two were still in Australia, their conjugal assets were
The trial court declared the marriage dissolved on the ground
divided on May 16, 1996, in accordance with their Statutory
that the divorce issued in Australia was valid and recognized in
Declarations secured in Australia.9
the Philippines. It deemed the marriage ended, but not on the
On March 3, 1998, petitioner filed a Complaint for Declaration basis of any defect in an essential element of the marriage; that
of Nullity of Marriage10 in the court a quo, on the ground of is, respondent's alleged lack of legal capacity to remarry.
bigamy – respondent allegedly had a prior subsisting marriage Rather, it based its Decision on the divorce decree obtained by
at the time he married her on January 12, 1994. She claimed respondent. The Australian divorce had ended the marriage;
that she learned of respondent's marriage to Editha Samson thus, there was no more martial union to nullify or annual.
only in November, 1997.
Hence, this Petition.18
In his Answer, respondent averred that, as far back as 1993, he
Issues
had revealed to petitioner his prior marriage and its subsequent
dissolution.11 He contended that his first marriage to an Petitioner submits the following issues for our consideration:
Australian citizen had been validly dissolved by a divorce
decree obtained in Australian in 1989;12 thus, he was legally "I
capacitated to marry petitioner in 1994.1âwphi1.nêt
The trial court gravely erred in finding that the divorce decree
obtained in Australia by the respondent ipso facto terminated
his first marriage to Editha Samson thereby capacitating him to
contract a second marriage with the petitioner.
"2 Petitioner assails the trial court's recognition of the divorce
between respondent and Editha Samson. Citing Adong v.
The failure of the respondent, who is now a naturalized
Cheong Seng Gee,20 petitioner argues that the divorce
Australian, to present a certificate of legal capacity to marry
decree, like any other foreign judgment, may be given
constitutes absence of a substantial requisite voiding the
recognition in this jurisdiction only upon proof of the existence of
petitioner' marriage to the respondent.
(1) the foreign law allowing absolute divorce and (2) the
"3 alleged divorce decree itself. She adds that respondent
miserably failed to establish these elements.
The trial court seriously erred in the application of Art. 26 of the
Family Code in this case. Petitioner adds that, based on the first paragraph of Article 26
of the Family Code, marriages solemnized abroad are
"4 governed by the law of the place where they were celebrated
(the lex loci celebrationist). In effect, the Code requires the
The trial court patently and grievously erred in disregarding Arts.
presentation of the foreign law to show the conformity of the
11, 13, 21, 35, 40, 52 and 53 of the Family Code as the applicable
marriage in question to the legal requirements of the place
provisions in this case.
where the marriage was performed.
"5
At the outset, we lay the following basic legal principles as the
The trial court gravely erred in pronouncing that the divorce take-off points for our discussion. Philippine law does not provide
gravely erred in pronouncing that the divorce decree obtained for absolute divorce; hence, our courts cannot grant it.21 A
by the respondent in Australia ipso facto capacitated the marriage between two Filipinos cannot be dissolved even by a
parties to remarry, without first securing a recognition of the divorce obtained abroad, because of Articles 1522 and 1723 of
judgment granting the divorce decree before our courts."19 the Civil Code.24 In mixed marriages involving a Filipino and a
foreigner, Article 2625 of the Family Code allows the former to
The Petition raises five issues, but for purposes of this Decision, we contract a subsequent marriage in case the divorce is "validly
shall concentrate on two pivotal ones: (1) whether the divorce obtained abroad by the alien spouse capacitating him or her
between respondent and Editha Samson was proven, and (2) to remarry."26 A divorce obtained abroad by a couple, who are
whether respondent was proven to be legally capacitated to both aliens, may be recognized in the Philippines, provided it is
marry petitioner. Because of our ruling on these two, there is no consistent with their respective national laws.27
more necessity to take up the rest.
A comparison between marriage and divorce, as far as
The Court's Ruling
pleading and proof are concerned, can be made. Van Dorn v.
The Petition is partly meritorious. Romillo Jr. decrees that "aliens may obtain divorces abroad,
which may be recognized in the Philippines, provided they are
First Issue: valid according to their national law."28 Therefore, before a
foreign divorce decree can be recognized by our courts, the
Proving the Divorce Between Respondent and Editha Samson
party pleading it must prove the divorce as a fact and an Australian family court. Therefore, it requires no further proof
demonstrate its conformity to the foreign law allowing it.29 of its authenticity and due execution.
Presentation solely of the divorce decree is insufficient.
Respondent is getting ahead of himself. Before a foreign
Divorce as a Question of Fact judgment is given presumptive evidentiary value, the document
must first be presented and admitted in evidence.30 A divorce
Petitioner insists that before a divorce decree can be admitted
obtained abroad is proven by the divorce decree itself. Indeed
in evidence, it must first comply with the registration
the best evidence of a judgment is the judgment itself.31 The
requirements under Articles 11, 13 and 52 of the Family Code.
decree purports to be a written act or record of an act of an
These articles read as follows:
officially body or tribunal of a foreign country.32
"ART. 11. Where a marriage license is required, each of the
Under Sections 24 and 25 of Rule 132, on the other hand, a
contracting parties shall file separately a sworn application for
writing or document may be proven as a public or official
such license with the proper local civil registrar which shall
record of a foreign country by either (1) an official publication
specify the following:
or (2) a copy thereof attested33 by the officer having legal
xxx xxx xxx custody of the document. If the record is not kept in the
Philippines, such copy must be (a) accompanied by a
"(5) If previously married, how, when and where the previous certificate issued by the proper diplomatic or consular officer in
marriage was dissolved or annulled; the Philippine foreign service stationed in the foreign country in
which the record is kept and (b) authenticated by the seal of
xxx xxx xxx
his office.34
"ART. 13. In case either of the contracting parties has been
The divorce decree between respondent and Editha Samson
previously married, the applicant shall be required to furnish,
appears to be an authentic one issued by an Australian family
instead of the birth of baptismal certificate required in the last
court.35 However, appearance is not sufficient; compliance
preceding article, the death certificate of the deceased spouse
with the aforemetioned rules on evidence must be
or the judicial decree of annulment or declaration of nullity of
demonstrated.
his or her previous marriage. x x x.
Fortunately for respondent's cause, when the divorce decree of
"ART. 52. The judgment of annulment or of absolute nullity of the
May 18, 1989 was submitted in evidence, counsel for petitioner
marriage, the partition and distribution of the properties of the
objected, not to its admissibility, but only to the fact that it had
spouses, and the delivery of the children's presumptive legitimes
not been registered in the Local Civil Registry of Cabanatuan
shall be recorded in the appropriate civil registry and registries
City.36 The trial court ruled that it was admissible, subject to
of property; otherwise, the same shall not affect their persons."
petitioner's qualification.37 Hence, it was admitted in evidence
Respondent, on the other hand, argues that the Australian and accorded weight by the judge. Indeed, petitioner's failure
divorce decree is a public document – a written official act of to object properly rendered the divorce decree admissible as a
written act of the Family Court of Sydney, Australia.38
Compliance with the quoted articles (11, 13 and 52) of the those matters that judges are supposed to know by reason of
Family Code is not necessary; respondent was no longer bound their judicial function.44 The power of judicial notice must be
by Philippine personal laws after he acquired Australian exercised with caution, and every reasonable doubt upon the
citizenship in 1992.39 Naturalization is the legal act of adopting subject should be resolved in the negative.
an alien and clothing him with the political and civil rights
Second Issue:
belonging to a citizen.40 Naturalized citizens, freed from the
protective cloak of their former states, don the attires of their Respondent's Legal Capacity to Remarry
adoptive countries. By becoming an Australian, respondent
severed his allegiance to the Philippines and the vinculum juris Petitioner contends that, in view of the insufficient proof of the
that had tied him to Philippine personal laws. divorce, respondent was legally incapacitated to marry her in
1994.
Burden of Proving Australian Law
Hence, she concludes that their marriage was void ab initio.
Respondent contends that the burden to prove Australian
divorce law falls upon petitioner, because she is the party Respondent replies that the Australian divorce decree, which
challenging the validity of a foreign judgment. He contends that was validly admitted in evidence, adequately established his
petitioner was satisfied with the original of the divorce decree legal capacity to marry under Australian law.
and was cognizant of the marital laws of Australia, because she
Respondent's contention is untenable. In its strict legal sense,
had lived and worked in that country for quite a long time.
divorce means the legal dissolution of a lawful union for a cause
Besides, the Australian divorce law is allegedly known by
arising after marriage. But divorces are of different types. The
Philippine courts: thus, judges may take judicial notice of foreign
two basic ones are (1) absolute divorce or a vinculo matrimonii
laws in the exercise of sound discretion.
and (2) limited divorce or a mensa et thoro. The first kind
We are not persuaded. The burden of proof lies with "the party terminates the marriage, while the second suspends it and
who alleges the existence of a fact or thing necessary in the leaves the bond in full force.45 There is no showing in the case
prosecution or defense of an action."41 In civil cases, plaintiffs at bar which type of divorce was procured by respondent.
have the burden of proving the material allegations of the
Respondent presented a decree nisi or an interlocutory decree
complaint when those are denied by the answer; and
– a conditional or provisional judgment of divorce. It is in effect
defendants have the burden of proving the material allegations
the same as a separation from bed and board, although an
in their answer when they introduce new matters.42 Since the
absolute divorce may follow after the lapse of the prescribed
divorce was a defense raised by respondent, the burden of
period during which no reconciliation is effected.46
proving the pertinent Australian law validating it falls squarely
upon him. Even after the divorce becomes absolute, the court may under
some foreign statutes and practices, still restrict remarriage.
It is well-settled in our jurisdiction that our courts cannot take
Under some other jurisdictions, remarriage may be limited by
judicial notice of foreign laws.43 Like any other facts, they must
statute; thus, the guilty party in a divorce which was granted on
be alleged and proved. Australian marital laws are not among
the ground of adultery may be prohibited from remarrying respondent, had he duly presented it in court. A duly
again. The court may allow a remarriage only after proof of authenticated and admitted certificate is prima facie evidence
good behavior.47 of legal capacity to marry on the part of the alien applicant for
a marriage license.50
On its face, the herein Australian divorce decree contains a
restriction that reads: As it is, however, there is absolutely no evidence that proves
respondent's legal capacity to marry petitioner. A review of the
"1. A party to a marriage who marries again before this decree
records before this Court shows that only the following exhibits
becomes absolute (unless the other party has died) commits the
were presented before the lower court: (1) for petitioner: (a)
offence of bigamy."48
Exhibit "A" – Complaint;51 (b) Exhibit "B" – Certificate of Marriage
This quotation bolsters our contention that the divorce obtained Between Rederick A. Recto (Filipino-Australian) and Grace J.
by respondent may have been restricted. It did not absolutely Garcia (Filipino) on January 12, 1994 in Cabanatuan City, Nueva
establish his legal capacity to remarry according to his national Ecija;52 (c) Exhibit "C" – Certificate of Marriage Between
law. Hence, we find no basis for the ruling of the trial court, which Rederick A. Recio (Filipino) and Editha D. Samson (Australian) on
erroneously assumed that the Australian divorce ipso facto March 1, 1987 in Malabon, Metro Manila;53 (d) Exhibit "D" –
restored respondent's capacity to remarry despite the paucity Office of the City Registrar of Cabanatuan City Certification
of evidence on this matter. that no information of annulment between Rederick A. Recto
and Editha D. Samson was in its records;54 and (e) Exhibit "E" –
We also reject the claim of respondent that the divorce decree Certificate of Australian Citizenship of Rederick A. Recto;55 (2)
raises a disputable presumption or presumptive evidence as to for respondent: (Exhibit "1" – Amended Answer;56 (b) Exhibit "S"
his civil status based on Section 48, Rule 3949 of the Rules of – Family Law Act 1975 Decree Nisi of Dissolution of Marriage in
Court, for the simple reason that no proof has been presented the Family Court of Australia;57 (c) Exhibit "3" – Certificate of
on the legal effects of the divorce decree obtained under Australian Citizenship of Rederick A. Recto;58 (d) Exhibit "4" –
Australian laws. Decree Nisi of Dissolution of Marriage in the Family Court of
Australia Certificate;59 and Exhibit "5" – Statutory Declaration of
Significance of the Certificate of Legal Capacity
the Legal Separation Between Rederick A. Recto and Grace J.
Petitioner argues that the certificate of legal capacity required Garcia Recio since October 22, 1995.60
by Article 21 of the Family Code was not submitted together
Based on the above records, we cannot conclude that
with the application for a marriage license. According to her, its
respondent, who was then a naturalized Australian citizen, was
absence is proof that respondent did not have legal capacity
legally capacitated to marry petitioner on January 12, 1994. We
to remarry.
agree with petitioner's contention that the court a quo erred in
We clarify. To repeat, the legal capacity to contract marriage is finding that the divorce decree ipso facto clothed respondent
determined by the national law of the party concerned. The with the legal capacity to remarry without requiring him to
certificate mentioned in Article 21 of the Family Code would adduce sufficient evidence to show the Australian personal law
have been sufficient to establish the legal capacity of
governing his status; or at the very least, to prove his legal G.R. No. 119602 October 6, 2000
capacity to contract the second marriage.
WILDVALLEY SHIPPING CO., LTD. petitioner,
Neither can we grant petitioner's prayer to declare her marriage
vs.
to respondent null and void on the ground of bigamy. After all,
it may turn out that under Australian law, he was really COURT OF APPEALS and PHILIPPINE PRESIDENT LINES INC.,
capacitated to marry petitioner as a direct result of the divorce respondents.
decree. Hence, we believe that the most judicious course is to
remand this case to the trial court to receive evidence, if any, DECISION
which show petitioner's legal capacity to marry petitioner.
BUENA, J.:
Failing in that, then the court a quo may declare a nullity of the
parties' marriage on the ground of bigamy, there being already This is a petition for review on certiorari seeking to set aside the
in evidence two existing marriage certificates, which were both decision of the Court of Appeals which reversed the decision of
obtained in the Philippines, one in Malabon, Metro Manila the lower court in CA-G.R. CV No. 36821, entitled "Wildvalley
dated March 1, 1987 and the other, in Cabanatuan City dated Shipping Co., Ltd., plaintiff-appellant, versus Philippine President
January 12, 1994. Lines, Inc., defendant-appellant."

WHEREFORE, in the interest of orderly procedure and substantial The antecedent facts of the case are as follows:
justice, we REMAND the case to the court a quo for the purpose
of receiving evidence which conclusively show respondent's Sometime in February 1988, the Philippine Roxas, a vessel owned
legal capacity to marry petitioner; and failing in that, of by Philippine President Lines, Inc., private respondent herein,
declaring the parties' marriage void on the ground of bigamy, arrived in Puerto Ordaz, Venezuela, to load iron ore. Upon the
as above discussed. No costs. completion of the loading and when the vessel was ready to
leave port, Mr. Ezzar del Valle Solarzano Vasquez, an official
SO ORDERED. pilot of Venezuela, was designated by the harbour authorities in
Puerto Ordaz to navigate the Philippine Roxas through the
Orinoco River.1 He was asked to pilot the said vessel on February
11, 19882 boarding it that night at 11:00 p.m.3

The master (captain) of the Philippine Roxas, Captain Nicandro


Colon, was at the bridge together with the pilot (Vasquez), the
vessel's third mate (then the officer on watch), and a helmsman
when the vessel left the port4 at 1:40 a.m. on February 12, 1988.5
Captain Colon left the bridge when the vessel was under way.6

The Philippine Roxas experienced some vibrations when it


entered the San Roque Channel at mile 172.7 The vessel
proceeded on its way, with the pilot assuring the watch officer "2. That defendant PPL was the owner of the vessel Philippine
that the vibration was a result of the shallowness of the Roxas at the time of the incident;
channel.8
"3. That defendant Pioneer Insurance was the insurance
Between mile 158 and 157, the vessel again experienced some underwriter for defendant PPL;
vibrations.9 These occurred at 4:12 a.m.10 It was then that the
"4. That plaintiff Wildvalley Shipping Co., Inc. is the owner of the
watch officer called the master to the bridge.11
vessel Malandrinon, whose passage was obstructed by the
The master (captain) checked the position of the vessel12 and vessel Philippine Roxas at Puerto Ordaz, Venezuela, as specified
verified that it was in the centre of the channel.13 He then went in par. 4, page 2 of the complaint;
to confirm, or set down, the position of the vessel on the chart.14
"5. That on February 12, 1988, while the Philippine Roxas was
He ordered Simplicio A. Monis, Chief Officer of the President
navigating the channel at Puerto Ordaz, the said vessel
Roxas, to check all the double bottom tanks.15
grounded and as a result, obstructed navigation at the
At around 4:35 a.m., the Philippine Roxas ran aground in the channel;
Orinoco River,16 thus obstructing the ingress and egress of
"6. That the Orinoco River in Puerto Ordaz is a compulsory
vessels.
pilotage channel;
As a result of the blockage, the Malandrinon, a vessel owned by
"7. That at the time of the incident, the vessel, Philippine Roxas,
herein petitioner Wildvalley Shipping Company, Ltd., was
was under the command of the pilot Ezzar Solarzano, assigned
unable to sail out of Puerto Ordaz on that day.
by the government thereat, but plaintiff claims that it is under
Subsequently, Wildvalley Shipping Company, Ltd. filed a suit the command of the master;
with the Regional Trial Court of Manila, Branch III against
"8. The plaintiff filed a case in Middleburg, Holland which is
Philippine President Lines, Inc. and Pioneer Insurance Company
related to the present case;
(the underwriter/insurer of Philippine Roxas) for damages in the
form of unearned profits, and interest thereon amounting to US "9. The plaintiff caused the arrest of the Philippine Collier, a vessel
$400,000.00 plus attorney's fees, costs, and expenses of litigation. owned by the defendant PPL;
The complaint against Pioneer Insurance Company was
dismissed in an Order dated November 7, 1988.17 "10. The Orinoco River is 150 miles long and it takes
approximately 12 hours to navigate out of the said river;
At the pre-trial conference, the parties agreed on the following
facts: "11. That no security for the plaintiff's claim was given until after
the Philippine Collier was arrested; and
"1. The jurisdictional facts, as specified in their respective
pleadings; "12. That a letter of guarantee, dated 12-May-88 was issued by
the Steamship Mutual Underwriters Ltd."18
The trial court rendered its decision on October 16, 1991 in favor The petitioner assigns the following errors to the court a quo:
of the petitioner, Wildvalley Shipping Co., Ltd. The dispositive
1. RESPONDENT COURT OF APPEALS SERIOUSLY ERRED IN
portion thereof reads as follows:
FINDING THAT UNDER PHILIPPINE LAW NO FAULT OR NEGLIGENCE
"WHEREFORE, judgment is rendered for the plaintiff, ordering CAN BE ATTRIBUTED TO THE MASTER NOR THE OWNER OF THE
defendant Philippine President Lines, Inc. to pay to the plaintiff "PHILIPPINE ROXAS" FOR THE GROUNDING OF SAID VESSEL
the sum of U.S. $259,243.43, as actual and compensatory RESULTING IN THE BLOCKAGE OF THE RIO ORINOCO;
damages, and U.S. $162,031.53, as expenses incurred abroad
2. RESPONDENT COURT OF APPEALS SERIOUSLY ERRED IN
for its foreign lawyers, plus additional sum of U.S. $22,000.00, as
REVERSING THE FINDINGS OF FACTS OF THE TRIAL COURT
and for attorney's fees of plaintiff's local lawyer, and to pay the
CONTRARY TO EVIDENCE;
cost of this suit.
3. RESPONDENT COURT OF APPEALS SERIOUSLY ERRED IN
"Defendant's counterclaim is dismissed for lack of merit.
FINDING THAT THE "PHILIPPINE ROXAS" IS SEAWORTHY;
"SO ORDERED."19
4. RESPONDENT COURT OF APPEALS SERIOUSLY ERRED IN
Both parties appealed: the petitioner appealing the non-award DISREGARDING VENEZUELAN LAW DESPITE THE FACT THAT THE
of interest with the private respondent questioning the decision SAME HAS BEEN SUBSTANTIALLY PROVED IN THE TRIAL COURT
on the merits of the case. WITHOUT ANY OBJECTION FROM PRIVATE RESPONDENT, AND
WHOSE OBJECTION WAS INTERPOSED BELATEDLY ON APPEAL;
After the requisite pleadings had been filed, the Court of
Appeals came out with its questioned decision dated June 14, 5. RESPONDENT COURT OF APPEALS SERIOUSLY ERRED IN
1994,20 the dispositive portion of which reads as follows: AWARDING ATTORNEY'S FEES AND COSTS TO PRIVATE
RESPONDENT WITHOUT ANY FAIR OR REASONABLE BASIS
"WHEREFORE, finding defendant-appellant's appeal to be
WHATSOEVER;
meritorious, judgment is hereby rendered reversing the Decision
of the lower court. Plaintiff-appellant's Complaint is dismissed 6. RESPONDENT COURT OF APPEALS SERIOUSLY ERRED IN NOT
and it is ordered to pay defendant-appellant the amount of FINDING THAT PETITIONER'S CAUSE IS MERITORIOUS HENCE,
Three Hundred Twenty-three Thousand, Forty-two Pesos and PETITIONER SHOULD BE ENTITLED TO ATTORNEY'S FEES, COSTS AND
Fifty-three Centavos (₱323,042.53) as and for attorney's fees plus INTEREST.
cost of suit. Plaintiff-appellant's appeal is DISMISSED.
The petition is without merit.
"SO ORDERED."21
The primary issue to be determined is whether or not Venezuelan
Petitioner filed a motion for reconsideration22 but the same was law is applicable to the case at bar.
denied for lack of merit in the resolution dated March 29,
It is well-settled that foreign laws do not prove themselves in our
1995.23
jurisdiction and our courts are not authorized to take judicial
Hence, this petition.
notice of them. Like any other fact, they must be alleged and "… Mr. Arthur W. Bolton, an attorney-at-law of San Francisco,
proved.24 California, since the year 1918 under oath, quoted verbatim
section 322 of the California Civil Code and stated that said
A distinction is to be made as to the manner of proving a written
section was in force at the time the obligations of defendant to
and an unwritten law. The former falls under Section 24, Rule 132
the plaintiff were incurred, i.e. on November 5, 1928 and
of the Rules of Court, as amended, the entire provision of which
December 22, 1928. This evidence sufficiently established the
is quoted hereunder. Where the foreign law sought to be
fact that the section in question was the law of the State of
proved is "unwritten," the oral testimony of expert witnesses is
California on the above dates. A reading of sections 300 and
admissible, as are printed and published books of reports of
301 of our Code of Civil Procedure will convince one that these
decisions of the courts of the country concerned if proved to be
sections do not exclude the presentation of other competent
commonly admitted in such courts.25
evidence to prove the existence of a foreign law.
Section 24 of Rule 132 of the Rules of Court, as amended,
"`The foreign law is a matter of fact …You ask the witness what
provides:
the law is; he may, from his recollection, or on producing and
"Sec. 24. Proof of official record. -- The record of public referring to books, say what it is.' (Lord Campbell concurring in
documents referred to in paragraph (a) of Section 19, when an opinion of Lord Chief Justice Denman in a well-known English
admissible for any purpose, may be evidenced by an official case where a witness was called upon to prove the Roman laws
publication thereof or by a copy attested by the officer having of marriage and was permitted to testify, though he referred to
the legal custody of the record, or by his deputy, and a book containing the decrees of the Council of Trent as
accompanied, if the record is not kept in the Philippines, with a controlling, Jones on Evidence, Second Edition, Volume 4,
certificate that such officer has the custody. If the office in which pages 3148-3152.) x x x."
the record is kept is in a foreign country, the certificate may be
We do not dispute the competency of Capt. Oscar Leon
made by a secretary of the embassy or legation, consul
Monzon, the Assistant Harbor Master and Chief of Pilots at Puerto
general, consul, vice consul, or consular agent or by any officer
Ordaz, Venezuela,28 to testify on the existence of the
in the foreign service of the Philippines stationed in the foreign
Reglamento General de la Ley de Pilotaje (pilotage law of
country in which the record is kept, and authenticated by the
Venezuela)29 and the Reglamento Para la Zona de Pilotaje No
seal of his office." (Underscoring supplied)
1 del Orinoco (rules governing the navigation of the Orinoco
River). Captain Monzon has held the aforementioned posts for
eight years.30 As such he is in charge of designating the pilots
The court has interpreted Section 25 (now Section 24) to include for maneuvering and navigating the Orinoco River. He is also in
competent evidence like the testimony of a witness to prove the charge of the documents that come into the office of the
existence of a written foreign law.26 harbour masters.31
In the noted case of Willamette Iron & Steel Works vs. Muzzal,27
it was held that:
Nevertheless, we take note that these written laws were not officer who had legal custody of those records made by a
proven in the manner provided by Section 24 of Rule 132 of the secretary of the embassy or legation, consul general, consul,
Rules of Court. vice consul or consular agent or by any officer in the foreign
service of the Philippines stationed in Venezuela, and
The Reglamento General de la Ley de Pilotaje was published in
authenticated by the seal of his office accompanying the copy
the Gaceta Oficial32 of the Republic of Venezuela. A
of the public document. No such certificate could be found in
photocopy of the Gaceta Oficial was presented in evidence as
the records of the case.
an official publication of the Republic of Venezuela.
With respect to proof of written laws, parol proof is
The Reglamento Para la Zona de Pilotaje No 1 del Orinoco is
objectionable, for the written law itself is the best evidence.
published in a book issued by the Ministerio de Comunicaciones
According to the weight of authority, when a foreign statute is
of Venezuela.33 Only a photocopy of the said rules was likewise
involved, the best evidence rule requires that it be proved by a
presented as evidence.
duly authenticated copy of the statute.37
Both of these documents are considered in Philippine
At this juncture, we have to point out that the Venezuelan law
jurisprudence to be public documents for they are the written
was not pleaded before the lower court.
official acts, or records of the official acts of the sovereign
authority, official bodies and tribunals, and public officers of A foreign law is considered to be pleaded if there is an
Venezuela.34 allegation in the pleading about the existence of the foreign
law, its import and legal consequence on the event or
transaction in issue.38
For a copy of a foreign public document to be admissible, the
A review of the Complaint39 revealed that it was never alleged
following requisites are mandatory: (1) It must be attested by the
or invoked despite the fact that the grounding of the M/V
officer having legal custody of the records or by his deputy; and
Philippine Roxas occurred within the territorial jurisdiction of
(2) It must be accompanied by a certificate by a secretary of
Venezuela.
the embassy or legation, consul general, consul, vice consular
or consular agent or foreign service officer, and with the seal of We reiterate that under the rules of private international law, a
his office.35 The latter requirement is not a mere technicality but foreign law must be properly pleaded and proved as a fact. In
is intended to justify the giving of full faith and credit to the the absence of pleading and proof, the laws of a foreign
genuineness of a document in a foreign country.36 country, or state, will be presumed to be the same as our own
local or domestic law and this is known as processual
It is not enough that the Gaceta Oficial, or a book published by
presumption.40
the Ministerio de Comunicaciones of Venezuela, was presented
as evidence with Captain Monzon attesting it. It is also required Having cleared this point, we now proceed to a thorough study
by Section 24 of Rule 132 of the Rules of Court that a certificate of the errors assigned by the petitioner.
that Captain Monzon, who attested the documents, is the
Petitioner alleges that there was negligence on the part of the The pertinent provisions of the said administrative order
private respondent that would warrant the award of damages. governing these persons are quoted hereunder:

There being no contractual obligation, the private respondent "Sec. 11. Control of Vessels and Liability for Damage. -- On
is obliged to give only the diligence required of a good father compulsory pilotage grounds, the Harbor Pilot providing the
of a family in accordance with the provisions of Article 1173 of service to a vessel shall be responsible for the damage caused
the New Civil Code, thus: to a vessel or to life and property at ports due to his negligence
or fault. He can be absolved from liability if the accident is
"Art. 1173. The fault or negligence of the obligor consists in the
caused by force majeure or natural calamities provided he has
omission of that diligence which is required by the nature of the
exercised prudence and extra diligence to prevent or minimize
obligation and corresponds with the circumstances of the
the damage.
persons, of the time and of the place. When negligence shows
bad faith, the provisions of articles 1171 and 2201, paragraph 2, "The Master shall retain overall command of the vessel even on
shall apply. pilotage grounds whereby he can countermand or overrule the
order or command of the Harbor Pilot on board. In such event,
"If the law or contract does not state the diligence which is to
any damage caused to a vessel or to life and property at ports
be observed in the performance, that which is expected of a
by reason of the fault or negligence of the Master shall be the
good father of a family shall be required."
responsibility and liability of the registered owner of the vessel
The diligence of a good father of a family requires only that concerned without prejudice to recourse against said Master.
diligence which an ordinary prudent man would exercise with
"Such liability of the owner or Master of the vessel or its pilots shall
regard to his own property. This we have found private
be determined by competent authority in appropriate
respondent to have exercised when the vessel sailed only after
proceedings in the light of the facts and circumstances of each
the "main engine, machineries, and other auxiliaries" were
particular case.
checked and found to be in good running condition;41 when
the master left a competent officer, the officer on watch on the
bridge with a pilot who is experienced in navigating the Orinoco
"x x x
River; when the master ordered the inspection of the vessel's
double bottom tanks when the vibrations occurred anew.42

The Philippine rules on pilotage, embodied in Philippine Ports "Sec. 32. Duties and Responsibilities of the Pilots or Pilots’
Authority Administrative Order No. 03-85, otherwise known as Association. -- The duties and responsibilities of the Harbor Pilot
the Rules and Regulations Governing Pilotage Services, the shall be as follows:
Conduct of Pilots and Pilotage Fees in Philippine Ports enunciate
the duties and responsibilities of a master of a vessel and its pilot, "x x x
among other things.
"f) A pilot shall be held responsible for the direction of a vessel
from the time he assumes his work as a pilot thereof until he
leaves it anchored or berthed safely; Provided, however, that the river. In his deposition, pilot Ezzar Solarzano Vasquez testified
his responsibility shall cease at the moment the Master neglects that he is an official pilot in the Harbour at Port Ordaz,
or refuses to carry out his order." Venezuela,44 and that he had been a pilot for twelve (12)
years.45 He also had experience in navigating the waters of the
The Code of Commerce likewise provides for the obligations
Orinoco River.46
expected of a captain of a vessel, to wit:
The law does provide that the master can countermand or
"Art. 612. The following obligations shall be inherent in the office
overrule the order or command of the harbor pilot on board.
of captain:
The master of the Philippine Roxas deemed it best not to order
"x x x him (the pilot) to stop the vessel,47 mayhap, because the latter
had assured him that they were navigating normally before the
"7. To be on deck on reaching land and to take command on grounding of the vessel.48 Moreover, the pilot had admitted
entering and leaving ports, canals, roadsteads, and rivers, unless that on account of his experience he was very familiar with the
there is a pilot on board discharging his duties. x x x." configuration of the river as well as the course headings, and
that he does not even refer to river charts when navigating the
The law is very explicit. The master remains the overall
Orinoco River.49
commander of the vessel even when there is a pilot on board.
He remains in control of the ship as he can still perform the duties Based on these declarations, it comes as no surprise to us that
conferred upon him by law43 despite the presence of a pilot the master chose not to regain control of the ship. Admitting his
who is temporarily in charge of the vessel. It is not required of limited knowledge of the Orinoco River, Captain Colon relied on
him to be on the bridge while the vessel is being navigated by the knowledge and experience of pilot Vasquez to guide the
a pilot. vessel safely.
However, Section 8 of PPA Administrative Order No. 03-85, "Licensed pilots, enjoying the emoluments of compulsory
provides: pilotage, are in a different class from ordinary employees, for
they assume to have a skill and a knowledge of navigation in
"Sec. 8. Compulsory Pilotage Service - For entering a harbor and
the particular waters over which their licenses extend superior to
anchoring thereat, or passing through rivers or straits within a
that of the master; pilots are bound to use due diligence and
pilotage district, as well as docking and undocking at any
reasonable care and skill. A pilot's ordinary skill is in proportion to
pier/wharf, or shifting from one berth or another, every vessel
the pilot's responsibilities, and implies a knowledge and
engaged in coastwise and foreign trade shall be under
observance of the usual rules of navigation, acquaintance with
compulsory pilotage.
the waters piloted in their ordinary condition, and nautical skill in
"xxx." avoiding all known obstructions. The character of the skill and
knowledge required of a pilot in charge of a vessel on the rivers
The Orinoco River being a compulsory pilotage channel of a country is very different from that which enables a
necessitated the engaging of a pilot who was presumed to be navigator to carry a vessel safely in the ocean. On the ocean,
knowledgeable of every shoal, bank, deep and shallow ends of
a knowledge of the rules of navigation, with charts that disclose compulsive upon the master to take a pilot, and, a fortiori, if he
the places of hidden rocks, dangerous shores, or other dangers is bound to do so under penalty, then, and in such case, neither
of the way, are the main elements of a pilot's knowledge and he nor the owner will be liable for injuries occasioned by the
skill. But the pilot of a river vessel, like the harbor pilot, is selected negligence of the pilot; for in such a case the pilot cannot be
for the individual's personal knowledge of the topography deemed properly the servant of the master or the owner, but is
through which the vessel is steered."50 forced upon them, and the maxim Qui facit per alium facit per
se does not apply." (Underscoring supplied)
We find that the grounding of the vessel is attributable to the
pilot. When the vibrations were first felt the watch officer asked Anent the river passage plan, we find that, while there was
him what was going on, and pilot Vasquez replied that "(they) none,52 the voyage has been sufficiently planned and
were in the middle of the channel and that the vibration was as monitored as shown by the following actions undertaken by the
(sic) a result of the shallowness of the channel."51 pilot, Ezzar Solarzano Vasquez, to wit: contacting the radio
marina via VHF for information regarding the channel, river
Pilot Ezzar Solarzano Vasquez was assigned to pilot the vessel
traffic,53 soundings of the river, depth of the river, bulletin on the
Philippine Roxas as well as other vessels on the Orinoco River due
buoys.54 The officer on watch also monitored the voyage.55
to his knowledge of the same. In his experience as a pilot, he
should have been aware of the portions which are shallow and We, therefore, do not find the absence of a river passage plan
which are not. His failure to determine the depth of the said river to be the cause for the grounding of the vessel.
and his decision to plod on his set course, in all probability,
The doctrine of res ipsa loquitur does not apply to the case at
caused damage to the vessel. Thus, we hold him as negligent
bar because the circumstances surrounding the injury do not
and liable for its grounding.
clearly indicate negligence on the part of the private
In the case of Homer Ramsdell Transportation Company vs. La respondent. For the said doctrine to apply, the following
Compagnie Generale Transatlantique, 182 U.S. 406, it was held conditions must be met: (1) the accident was of such character
that: as to warrant an inference that it would not have happened
except for defendant's negligence; (2) the accident must have
"x x x The master of a ship, and the owner also, is liable for any
been caused by an agency or instrumentality within the
injury done by the negligence of the crew employed in the ship.
exclusive management or control of the person charged with
The same doctrine will apply to the case of a pilot employed by
the negligence complained of; and (3) the accident must not
the master or owner, by whose negligence any injury happens
have been due to any voluntary action or contribution on the
to a third person or his property: as, for example, by a collision
part of the person injured.56
with another ship, occasioned by his negligence. And it will
make no difference in the case that the pilot, if any is employed, As has already been held above, there was a temporary shift of
is required to be a licensed pilot; provided the master is at liberty control over the ship from the master of the vessel to the pilot on
to take a pilot, or not, at his pleasure, for in such a case the a compulsory pilotage channel. Thus, two of the requisites
master acts voluntarily, although he is necessarily required to necessary for the doctrine to apply, i.e., negligence and
select from a particular class. On the other hand, if it is control, to render the respondent liable, are absent.
As to the claim that the ship was unseaworthy, we hold that it is Before we proceed to other matter, will you kindly tell us what is
not. (sic) the 'class +100A1 Strengthened for Ore Cargoes', mean?

The Lloyd’s Register of Shipping confirmed the vessel’s "WITNESS


seaworthiness in a Confirmation of Class issued on February 16,
"A Plus 100A1 means that the vessel was built according to
1988 by finding that "the above named ship (Philippine Roxas)
Lloyd's rules and she is capable of carrying ore bulk cargoes, but
maintained the class "+100A1 Strengthened for Ore Cargoes,
she is particularly capable of carrying Ore Cargoes with No. 2
Nos. 2 and 8 Holds may be empty (CC) and +LMC" from
and No. 8 holds empty.
31/12/87 up until the time of casualty on or about 12/2/88."57
The same would not have been issued had not the vessel been "x x x
built according to the standards set by Lloyd's.
"COURT
Samuel Lim, a marine surveyor, at Lloyd's Register of Shipping
testified thus: The vessel is classed, meaning?

"Q Now, in your opinion, as a surveyor, did top side tank have "A Meaning she is fit to travel, your Honor, or seaworthy."58
any bearing at all to the seaworthiness of the vessel?
It is not required that the vessel must be perfect. To be
"A Well, judging on this particular vessel, and also basing on the seaworthy, a ship must be reasonably fit to perform the services,
class record of the vessel, wherein recommendations were and to encounter the ordinary perils of the voyage,
made on the top side tank, and it was given sufficient time to contemplated by the parties to the policy.59
be repaired, it means that the vessel is fit to travel even with
As further evidence that the vessel was seaworthy, we quote the
those defects on the ship.
deposition of pilot Vasquez:
"COURT
"Q Was there any instance when your orders or directions were
What do you mean by that? You explain. The vessel is fit to travel not complied with because of the inability of the vessel to do
even with defects? Is that what you mean? Explain. so?

"WITNESS "A No.

"A Yes, your Honor. Because the class society which register (sic) "Q. Was the vessel able to respond to all your commands and
is the third party looking into the condition of the vessel and as orders?
far as their record states, the vessel was class or maintained, and
"A. The vessel was navigating normally."60
she is fit to travel during that voyage."
Eduardo P. Mata, Second Engineer of the Philippine Roxas
"x x x
submitted an accident report wherein he stated that on
"ATTY. MISA February 11, 1988, he checked and prepared the main engine,
machineries and all other auxiliaries and found them all to be in G.R. No. 122191 October 8, 1998
good running condition and ready for maneuvering. That same
SAUDI ARABIAN AIRLINES, petitioner,
day the main engine, bridge and engine telegraph and
steering gear motor were also tested.61 Engineer Mata also vs.
prepared the fuel for consumption for maneuvering and
checked the engine generators.62 COURT OF APPEALS, MILAGROS P. MORADA and HON. RODOLFO
A. ORTIZ, in his capacity as Presiding Judge of Branch 89,
Finally, we find the award of attorney’s fee justified.1âwphi1 Regional Trial Court of Quezon City, respondents.
Article 2208 of the New Civil Code provides that: QUISUMBING, J.:
"Art. 2208. In the absence of stipulation, attorney's fees and This petition for certiorari pursuant to Rule 45 of the Rules of Court
expenses of litigation, other than judicial costs, cannot be seeks to annul and set aside the Resolution1 dated September
recovered, except: 27, 1995 and the Decision2 dated April 10, 1996 of the Court of
Appeals3 in CA-G.R. SP No. 36533,4 and the Orders5 dated
"x x x
August 29, 1994 6 and February 2, 19957 that were issued by the
"(11) In any other case where the court deems it just and trial court in Civil Case No. Q-93-18394.8
equitable that attorney's fees and expenses of litigation should
The pertinent antecedent facts which gave rise to the instant
be recovered.
petition, as stated in the questioned Decision9, are as follows:
"x x x"
On January 21, 1988 defendant SAUDIA hired plaintiff as a Flight
Due to the unfounded filing of this case, the private respondent Attendant for its airlines based in Jeddah, Saudi Arabia. . . .
was unjustifiably forced to litigate, thus the award of attorney’s
On April 27, 1990, while on a lay-over in Jakarta, Indonesia,
fees was proper.
plaintiff went to a disco dance with fellow crew members
WHEREFORE, IN VIEW OF THE FOREGOING, the petition is DENIED Thamer Al-Gazzawi and Allah Al-Gazzawi, both Saudi nationals.
and the decision of the Court of Appeals in CA G.R. CV No. Because it was almost morning when they returned to their
36821 is AFFIRMED. hotels, they agreed to have breakfast together at the room of
Thamer. When they were in te (sic) room, Allah left on some
SO ORDERED.
pretext. Shortly after he did, Thamer attempted to rape plaintiff.
Fortunately, a roomboy and several security personnel heard
her cries for help and rescued her. Later, the Indonesian police
came and arrested Thamer and Allah Al-Gazzawi, the latter as
an accomplice.

When plaintiff returned to Jeddah a few days later, several


SAUDIA officials interrogated her about the Jakarta incident.
They then requested her to go back to Jakarta to help arrange asked to sign a document written in Arabic. They told her that
the release of Thamer and Allah. In Jakarta, SAUDIA Legal this was necessary to close the case against Thamer and Allah.
Officer Sirah Akkad and base manager Baharini negotiated As it turned out, plaintiff signed a notice to her to appear before
with the police for the immediate release of the detained crew the court on June 27, 1993. Plaintiff then returned to Manila.
members but did not succeed because plaintiff refused to
Shortly afterwards, defendant SAUDIA summoned plaintiff to
cooperate. She was afraid that she might be tricked into
report to Jeddah once again and see Miniewy on June 27, 1993
something she did not want because of her inability to
for further investigation. Plaintiff did so after receiving assurance
understand the local dialect. She also declined to sign a blank
from SAUDIA's Manila manager, Aslam Saleemi, that the
paper and a document written in the local dialect. Eventually,
investigation was routinary and that it posed no danger to her.
SAUDIA allowed plaintiff to return to Jeddah but barred her from
the Jakarta flights. In Jeddah, a SAUDIA legal officer brought plaintiff to the same
Saudi court on June 27, 1993. Nothing happened then but on
Plaintiff learned that, through the intercession of the Saudi
June 28, 1993, a Saudi judge interrogated plaintiff through an
Arabian government, the Indonesian authorities agreed to
interpreter about the Jakarta incident. After one hour of
deport Thamer and Allah after two weeks of detention.
interrogation, they let her go. At the airport, however, just as her
Eventually, they were again put in service by defendant SAUDI
plane was about to take off, a SAUDIA officer told her that the
(sic). In September 1990, defendant SAUDIA transferred plaintiff
airline had forbidden her to take flight. At the Inflight Service
to Manila.
Office where she was told to go, the secretary of Mr. Yahya
On January 14, 1992, just when plaintiff thought that the Jakarta Saddick took away her passport and told her to remain in
incident was already behind her, her superiors requested her to Jeddah, at the crew quarters, until further orders.
see Mr. Ali Meniewy, Chief Legal Officer of SAUDIA, in Jeddah,
On July 3, 1993 a SAUDIA legal officer again escorted plaintiff to
Saudi Arabia. When she saw him, he brought her to the police
the same court where the judge, to her astonishment and
station where the police took her passport and questioned her
shock, rendered a decision, translated to her in English,
about the Jakarta incident. Miniewy simply stood by as the
sentencing her to five months imprisonment and to 286 lashes.
police put pressure on her to make a statement dropping the
Only then did she realize that the Saudi court had tried her,
case against Thamer and Allah. Not until she agreed to do so
together with Thamer and Allah, for what happened in Jakarta.
did the police return her passport and allowed her to catch the
The court found plaintiff guilty of (1) adultery; (2) going to a
afternoon flight out of Jeddah.
disco, dancing and listening to the music in violation of Islamic
One year and a half later or on lune 16, 1993, in Riyadh, Saudi laws; and (3) socializing with the male crew, in contravention of
Arabia, a few minutes before the departure of her flight to Islamic tradition. 10
Manila, plaintiff was not allowed to board the plane and instead
Facing conviction, private respondent sought the help of her
ordered to take a later flight to Jeddah to see Mr. Miniewy, the
employer, petitioner SAUDIA. Unfortunately, she was denied any
Chief Legal Officer of SAUDIA. When she did, a certain Khalid of
assistance. She then asked the Philippine Embassy in Jeddah to
the SAUDIA office brought her to a Saudi court where she was
help her while her case is on appeal. Meanwhile, to pay for her
upkeep, she worked on the domestic flight of SAUDIA, while alleged that the trial court has no jurisdiction to hear and try the
Thamer and Allah continued to serve in the international case on the basis of Article 21 of the Civil Code, since the proper
law applicable is the law of the Kingdom of Saudi Arabia. On
flights. 11
October 14, 1994, Morada filed her Opposition 22 (To
Because she was wrongfully convicted, the Prince of Makkah Defendant's Motion for Reconsideration).
dismissed the case against her and allowed her to leave Saudi
In the Reply 23 filed with the trial court on October 24, 1994,
Arabia. Shortly before her return to Manila, 12 she was
SAUDIA alleged that since its Motion for Reconsideration raised
terminated from the service by SAUDIA, without her being
lack of jurisdiction as its cause of action, the Omnibus Motion
informed of the cause.
Rule does not apply, even if that ground is raised for the first time
on appeal. Additionally, SAUDIA alleged that the Philippines
does not have any substantial interest in the prosecution of the
On November 23, 1993, Morada filed a Complaint 13 for instant case, and hence, without jurisdiction to adjudicate the
damages against SAUDIA, and Khaled Al-Balawi ("Al-Balawi"), its same.
country manager.
Respondent Judge subsequently issued another Order 24 dated
On January 19, 1994, SAUDIA filed an Omnibus Motion To Dismiss February 2, 1995, denying SAUDIA's Motion for Reconsideration.
14 which raised the following grounds, to wit: (1) that the The pertinent portion of the assailed Order reads as follows:
Complaint states no cause of action against Saudia; (2) that
defendant Al-Balawi is not a real party in interest; (3) that the Acting on the Motion for Reconsideration of defendant Saudi
claim or demand set forth in the Complaint has been waived, Arabian Airlines filed, thru counsel, on September 20, 1994, and
abandoned or otherwise extinguished; and (4) that the trial the Opposition thereto of the plaintiff filed, thru counsel, on
court has no jurisdiction to try the case. October 14, 1994, as well as the Reply therewith of defendant
Saudi Arabian Airlines filed, thru counsel, on October 24, 1994,
On February 10, 1994, Morada filed her Opposition (To Motion to considering that a perusal of the plaintiffs Amended Complaint,
Dismiss) 15. Saudia filed a reply 16 thereto on March 3, 1994. which is one for the recovery of actual, moral and exemplary
damages plus attorney's fees, upon the basis of the applicable
On June 23, 1994, Morada filed an Amended Complaint 17
Philippine law, Article 21 of the New Civil Code of the Philippines,
wherein Al-Balawi was dropped as party defendant. On August
is, clearly, within the jurisdiction of this Court as regards the
11, 1994, Saudia filed its Manifestation and Motion to Dismiss
subject matter, and there being nothing new of substance
Amended Complaint 18.
which might cause the reversal or modification of the order
The trial court issued an Order 19 dated August 29, 1994 denying sought to be reconsidered, the motion for reconsideration of the
the Motion to Dismiss Amended Complaint filed by Saudia. defendant, is DENIED.

From the Order of respondent Judge 20 denying the Motion to


Dismiss, SAUDIA filed on September 20, 1994, its Motion for
SO ORDERED. 25
Reconsideration 21 of the Order dated August 29, 1994. It
Consequently, on February 20, 1995, SAUDIA filed its Petition for proceeded to trial, and in case of an adverse ruling, find
Certiorari and Prohibition with Prayer for Issuance of Writ of recourse in an appeal.
Preliminary Injunction and/or Temporary Restraining Order 26
with the Court of Appeals.
On May 7, 1996, SAUDIA filed its Supplemental Petition for
Review with Prayer for Temporary Restraining Order 31 dated
Respondent Court of Appeals promulgated a Resolution with April 30, 1996, given due course by this Court. After both parties
Temporary Restraining Order 27 dated February 23, 1995, submitted their Memoranda, 32 the instant case is now deemed
prohibiting the respondent Judge from further conducting any submitted for decision.
proceeding, unless otherwise directed, in the interim.
Petitioner SAUDIA raised the following issues:
In another Resolution 28 promulgated on September 27, 1995,
I
now assailed, the appellate court denied SAUDIA's Petition for
the Issuance of a Writ of Preliminary Injunction dated February The trial court has no jurisdiction to hear and try Civil Case No.
18, 1995, to wit: Q-93-18394 based on Article 21 of the New Civil Code since the
proper law applicable is the law of the Kingdom of Saudi Arabia
The Petition for the Issuance of a Writ of Preliminary Injunction is
inasmuch as this case involves what is known in private
hereby DENIED, after considering the Answer, with Prayer to
international law as a "conflicts problem". Otherwise, the
Deny Writ of Preliminary Injunction (Rollo, p. 135) the Reply and
Republic of the Philippines will sit in judgment of the acts done
Rejoinder, it appearing that herein petitioner is not clearly
by another sovereign state which is abhorred.
entitled thereto (Unciano Paramedical College, et. Al., v. Court
of Appeals, et. Al., 100335, April 7, 1993, Second Division).

SO ORDERED. II
On October 20, 1995, SAUDIA filed with this Honorable Court the Leave of court before filing a supplemental pleading is not a
instant Petition 29 for Review with Prayer for Temporary jurisdictional requirement. Besides, the matter as to absence of
Restraining Order dated October 13, 1995. leave of court is now moot and academic when this Honorable
Court required the respondents to comment on petitioner's April
However, during the pendency of the instant Petition,
30, 1996 Supplemental Petition For Review With Prayer For A
respondent Court of Appeals rendered the Decision 30 dated
Temporary Restraining Order Within Ten (10) Days From Notice
April 10, 1996, now also assailed. It ruled that the Philippines is an
Thereof. Further, the Revised Rules of Court should be construed
appropriate forum considering that the Amended Complaint's
with liberality pursuant to Section 2, Rule 1 thereof.
basis for recovery of damages is Article 21 of the Civil Code, and
thus, clearly within the jurisdiction of respondent Court. It further III
held that certiorari is not the proper remedy in a denial of a
Motion to Dismiss, inasmuch as the petitioner should have
Petitioner received on April 22, 1996 the April 10, 1996 decision
in CA-G.R. SP NO. 36533 entitled "Saudi Arabian Airlines v. Hon.
Under the factual antecedents obtaining in this case, there is no
Rodolfo A. Ortiz, et al." and filed its April 30, 1996 Supplemental
dispute that the interplay of events occurred in two states, the
Petition For Review With Prayer For A Temporary Restraining
Philippines and Saudi Arabia.
Order on May 7, 1996 at 10:29 a.m. or within the 15-day
reglementary period as provided for under Section 1, Rule 45 of
the Revised Rules of Court. Therefore, the decision in CA-G.R. SP
NO. 36533 has not yet become final and executory and this As stated by private respondent in her Amended Complaint 38
Honorable Court can take cognizance of this case. 33 dated June 23, 1994:

From the foregoing factual and procedural antecedents, the 2. Defendant SAUDI ARABIAN AIRLINES or SAUDIA is a
following issues emerge for our resolution: foreign airlines corporation doing business in the Philippines. It
may be served with summons and other court processes at
I. Travel Wide Associated Sales (Phils.). Inc., 3rd Floor, Cougar
Building, 114 Valero St., Salcedo Village, Makati, Metro Manila.
WHETHER RESPONDENT APPELLATE COURT ERRED IN HOLDING
THAT THE REGIONAL TRIAL COURT OF QUEZON CITY HAS xxx xxx xxx
JURISDICTION TO HEAR AND TRY CIVIL CASE NO. Q-93-18394
ENTITLED "MILAGROS P. MORADA V. SAUDI ARABIAN AIRLINES". 6. Plaintiff learned that, through the intercession of the
Saudi Arabian government, the Indonesian authorities agreed
II. to deport Thamer and Allah after two weeks of detention.
Eventually, they were again put in service by defendant
WHETHER RESPONDENT APPELLATE COURT ERRED IN RULING THAT
SAUDIA. In September 1990, defendant SAUDIA transferred
IN THIS CASE PHILIPPINE LAW SHOULD GOVERN.
plaintiff to Manila.
Petitioner SAUDIA claims that before us is a conflict of laws that
7. On January 14, 1992, just when plaintiff thought that the
must be settled at the outset. It maintains that private
Jakarta incident was already behind her, her superiors
respondent's claim for alleged abuse of rights occurred in the
reauested her to see MR. Ali Meniewy, Chief Legal Officer of
Kingdom of Saudi Arabia. It alleges that the existence of a
SAUDIA in Jeddah, Saudi Arabia. When she saw him, he brought
foreign element qualifies the instant case for the application of
her to the police station where the police took her passport and
the law of the Kingdom of Saudi Arabia, by virtue of the lex loci
questioned her about the Jakarta incident. Miniewy simply
delicti commissi rule. 34
stood by as the police put pressure on her to make a statement
On the other hand, private respondent contends that since her dropping the case against Thamer and Allah. Not until she
Amended Complaint is based on Articles 19 35 and 21 36 of the agreed to do so did the police return her passport and allowed
Civil Code, then the instant case is properly a matter of her to catch the afternoon flight out of Jeddah.
domestic law. 37
8. One year and a half later or on June 16, 1993, in Riyadh, The court found plaintiff guilty of (1) adultery; (2) going to a
Saudi Arabia, a few minutes before the departure of her flight disco, dancing, and listening to the music in violation of Islamic
to Manila, plaintiff was not allowed to board the plane and laws; (3) socializing with the male crew, in contravention of
instead ordered to take a later flight to Jeddah to see Mr. Islamic tradition.
Meniewy, the Chief Legal Officer of SAUDIA. When she did, a
12. Because SAUDIA refused to lend her a hand in the case,
certain Khalid of the SAUDIA office brought her to a Saudi court
plaintiff sought the help of the Philippines Embassy in Jeddah.
where she was asked to sigh a document written in Arabic. They
The latter helped her pursue an appeal from the decision of the
told her that this was necessary to close the case against
court. To pay for her upkeep, she worked on the domestic flights
Thamer and Allah. As it turned out, plaintiff signed a notice to
of defendant SAUDIA while, ironically, Thamer and Allah freely
her to appear before the court on June 27, 1993. Plaintiff then
served the international flights. 39
returned to Manila.
Where the factual antecedents satisfactorily establish the
9. Shortly afterwards, defendant SAUDIA summoned
existence of a foreign element, we agree with petitioner that
plaintiff to report to Jeddah once again and see Miniewy on
the problem herein could present a "conflicts" case.
June 27, 1993 for further investigation. Plaintiff did so after
receiving assurance from SAUDIA's Manila manger, Aslam A factual situation that cuts across territorial lines and is affected
Saleemi, that the investigation was routinary and that it posed by the diverse laws of two or more states is said to contain a
no danger to her. "foreign element". The presence of a foreign element is
inevitable since social and economic affairs of individuals and
10. In Jeddah, a SAUDIA legal officer brought plaintiff to the
associations are rarely confined to the geographic limits of their
same Saudi court on June 27, 1993. Nothing happened then but
birth or conception. 40
on June 28, 1993, a Saudi judge interrogated plaintiff through an
interpreter about the Jakarta incident. After one hour of The forms in which this foreign element may appear are many.
interrogation, they let her go. At the airport, however, just as her 41 The foreign element may simply consist in the fact that one
plane was about to take off, a SAUDIA officer told her that the of the parties to a contract is an alien or has a foreign domicile,
airline had forbidden her to take that flight. At the Inflight Service or that a contract between nationals of one State involves
Office where she was told to go, the secretary of Mr. Yahya properties situated in another State. In other cases, the foreign
Saddick took away her passport and told her to remain in element may assume a complex form. 42
Jeddah, at the crew quarters, until further orders.
In the instant case, the foreign element consisted in the fact that
11. On July 3, 1993 a SAUDIA legal officer again escorted private respondent Morada is a resident Philippine national, and
plaintiff to the same court where the judge, to her astonishment that petitioner SAUDIA is a resident foreign corporation. Also, by
and shock, rendered a decision, translated to her in English, virtue of the employment of Morada with the petitioner Saudia
sentencing her to five months imprisonment and to 286 lashes. as a flight stewardess, events did transpire during her many
Only then did she realize that the Saudi court had tried her, occasions of travel across national borders, particularly from
together with Thamer and Allah, for what happened in Jakarta.
Manila, Philippines to Jeddah, Saudi Arabia, and vice versa, Although Article 19 merely declares a principle of law, Article 21
that caused a "conflicts" situation to arise. gives flesh to its provisions. Thus, we agree with private
respondent's assertion that violations of Articles 19 and 21 are
We thus find private respondent's assertion that the case is
actionable, with judicially enforceable remedies in the
purely domestic, imprecise. A conflicts problem presents itself
municipal forum.
here, and the question of jurisdiction 43 confronts the court a
quo. Based on the allegations 46 in the Amended Complaint, read in
the light of the Rules of Court on jurisdiction 47 we find that the
After a careful study of the private respondent's Amended
Regional Trial Court (RTC) of Quezon City possesses jurisdiction
Complaint, 44 and the Comment thereon, we note that she
over the subject matter of the suit. 48 Its authority to try and hear
aptly predicated her cause of action on Articles 19 and 21 of
the case is provided for under Section 1 of Republic Act No.
the New Civil Code.
7691, to wit:

Sec. 1. Section 19 of Batas Pambansa Blg. 129, otherwise known


On one hand, Article 19 of the New Civil Code provides: as the "Judiciary Reorganization Act of 1980", is hereby
amended to read as follows:

Sec. 19. Jurisdiction in Civil Cases. — Regional Trial Courts


Art. 19. Every person must, in the exercise of his rights and in the shall exercise exclusive jurisdiction:
performance of his duties, act with justice give everyone his due
and observe honesty and good faith. xxx xxx xxx

On the other hand, Article 21 of the New Civil Code provides: (8) In all other cases in which demand, exclusive of interest,
damages of whatever kind, attorney's fees, litigation expenses,
Art. 21. Any person who willfully causes loss or injury to another in and cots or the value of the property in controversy exceeds
a manner that is contrary to morals, good customs or public One hundred thousand pesos (P100,000.00) or, in such other
policy shall compensate the latter for damages. cases in Metro Manila, where the demand, exclusive of the
above-mentioned items exceeds Two hundred Thousand pesos
Thus, in Philippine National Bank (PNB) vs. Court of Appeals, 45
(P200,000.00). (Emphasis ours)
this Court held that:
xxx xxx xxx
The aforecited provisions on human relations were intended to
expand the concept of torts in this jurisdiction by granting And following Section 2 (b), Rule 4 of the Revised Rules of Court
adequate legal remedy for the untold number of moral wrongs — the venue, Quezon City, is appropriate:
which is impossible for human foresight to specifically provide in
the statutes. Sec. 2 Venue in Courts of First Instance. — [Now Regional Trial
Court]

(a) xxx xxx xxx


(b) Personal actions. — All other actions may be Cautelam dated February 20, 1995. What is very patent and
commenced and tried where the defendant or any of the explicit from the motions filed, is that SAUDIA prayed for other
defendants resides or may be found, or where the plaintiff or reliefs under the premises. Undeniably, petitioner SAUDIA has
any of the plaintiff resides, at the election of the plaintiff. effectively submitted to the trial court's jurisdiction by praying for
the dismissal of the Amended Complaint on grounds other than
Pragmatic considerations, including the convenience of the
lack of jurisdiction.
parties, also weigh heavily in favor of the RTC Quezon City
assuming jurisdiction. Paramount is the private interest of the As held by this Court in Republic vs. Ker and Company, Ltd.: 51
litigant. Enforceability of a judgment if one is obtained is quite
We observe that the motion to dismiss filed on April 14, 1962,
obvious. Relative advantages and obstacles to a fair trial are
aside from disputing the lower court's jurisdiction over
equally important. Plaintiff may not, by choice of an
defendant's person, prayed for dismissal of the complaint on the
inconvenient forum, "vex", "harass", or "oppress" the defendant,
ground that plaintiff's cause of action has prescribed. By
e.g. by inflicting upon him needless expense or disturbance. But
interposing such second ground in its motion to dismiss, Ker and
unless the balance is strongly in favor of the defendant, the
Co., Ltd. availed of an affirmative defense on the basis of which
plaintiffs choice of forum should rarely be disturbed. 49
it prayed the court to resolve controversy in its favor. For the
Weighing the relative claims of the parties, the court a quo court to validly decide the said plea of defendant Ker & Co.,
found it best to hear the case in the Philippines. Had it refused Ltd., it necessarily had to acquire jurisdiction upon the latter's
to take cognizance of the case, it would be forcing plaintiff person, who, being the proponent of the affirmative defense,
(private respondent now) to seek remedial action elsewhere, should be deemed to have abandoned its special appearance
i.e. in the Kingdom of Saudi Arabia where she no longer and voluntarily submitted itself to the jurisdiction of the court.
maintains substantial connections. That would have caused a
Similarly, the case of De Midgely vs. Ferandos, held that;
fundamental unfairness to her.
When the appearance is by motion for the purpose of objecting
Moreover, by hearing the case in the Philippines no unnecessary
to the jurisdiction of the court over the person, it must be for the
difficulties and inconvenience have been shown by either of
sole and separate purpose of objecting to the jurisdiction of the
the parties. The choice of forum of the plaintiff (now private
court. If his motion is for any other purpose than to object to the
respondent) should be upheld.
jurisdiction of the court over his person, he thereby submits
Similarly, the trial court also possesses jurisdiction over the himself to the jurisdiction of the court. A special appearance by
persons of the parties herein. By filing her Complaint and motion made for the purpose of objecting to the jurisdiction of
Amended Complaint with the trial court, private respondent has the court over the person will be held to be a general
voluntary submitted herself to the jurisdiction of the court. appearance, if the party in said motion should, for example, ask
for a dismissal of the action upon the further ground that the
The records show that petitioner SAUDIA has filed several
court had no jurisdiction over the subject matter. 52
motions 50 praying for the dismissal of Morada's Amended
Complaint. SAUDIA also filed an Answer In Ex Abundante
Clearly, petitioner had submitted to the jurisdiction of the 59 These "test factors" or "points of contact" or "connecting
Regional Trial Court of Quezon City. Thus, we find that the trial factors" could be any of the following:
court has jurisdiction over the case and that its exercise thereof,
justified.
(1) The nationality of a person, his domicile, his residence,
As to the choice of applicable law, we note that choice-of-law
his place of sojourn, or his origin;
problems seek to answer two important questions: (1) What
legal system should control a given situation where some of the (2) the seat of a legal or juridical person, such as a
significant facts occurred in two or more states; and (2) to what corporation;
extent should the chosen legal system regulate the situation. 53
(3) the situs of a thing, that is, the place where a thing is, or
Several theories have been propounded in order to identify the is deemed to be situated. In particular, the lex situs is decisive
legal system that should ultimately control. Although ideally, all when real rights are involved;
choice-of-law theories should intrinsically advance both notions
of justice and predictability, they do not always do so. The forum (4) the place where an act has been done, the locus actus,
is then faced with the problem of deciding which of these two such as the place where a contract has been made, a
important values should be stressed. 54 marriage celebrated, a will signed or a tort committed. The lex
loci actus is particularly important in contracts and torts;
Before a choice can be made, it is necessary for us to determine
under what category a certain set of facts or rules fall. This (5) the place where an act is intended to come into effect,
process is known as "characterization", or the "doctrine of e.g., the place of performance of contractual duties, or the
qualification". It is the "process of deciding whether or not the place where a power of attorney is to be exercised;
facts relate to the kind of question specified in a conflicts rule."
(6) the intention of the contracting parties as to the law that
55 The purpose of "characterization" is to enable the forum to
should govern their agreement, the lex loci intentionis;
select the proper law. 56
(7) the place where judicial or administrative proceedings
Our starting point of analysis here is not a legal relation, but a
are instituted or done. The lex fori — the law of the forum — is
factual situation, event, or operative fact. 57 An essential
particularly important because, as we have seen earlier,
element of conflict rules is the indication of a "test" or
matters of "procedure" not going to the substance of the claim
"connecting factor" or "point of contact". Choice-of-law rules
involved are governed by it; and because the lex fori applies
invariably consist of a factual relationship (such as property
whenever the content of the otherwise applicable foreign law
right, contract claim) and a connecting factor or point of
is excluded from application in a given case for the reason that
contact, such as the situs of the res, the place of celebration,
it falls under one of the exceptions to the applications of foreign
the place of performance, or the place of wrongdoing. 58
law; and
Note that one or more circumstances may be present to serve
(8) the flag of a ship, which in many cases is decisive of
as the possible test for the determination of the applicable law.
practically all legal relationships of the ship and of its master or
owner as such. It also covers contractual relationships conflicts case, we find that the Philippines could be said as a
particularly contracts of affreightment. 60 (Emphasis ours.) situs of the tort (the place where the alleged tortious conduct
took place). This is because it is in the Philippines where
After a careful study of the pleadings on record, including
petitioner allegedly deceived private respondent, a Filipina
allegations in the Amended Complaint deemed admitted for
residing and working here. According to her, she had honestly
purposes of the motion to dismiss, we are convinced that there
believed that petitioner would, in the exercise of its rights and in
is reasonable basis for private respondent's assertion that
the performance of its duties, "act with justice, give her due and
although she was already working in Manila, petitioner brought
observe honesty and good faith." Instead, petitioner failed to
her to Jeddah on the pretense that she would merely testify in
protect her, she claimed. That certain acts or parts of the injury
an investigation of the charges she made against the two
allegedly occurred in another country is of no moment. For in
SAUDIA crew members for the attack on her person while they
our view what is important here is the place where the over-all
were in Jakarta. As it turned out, she was the one made to face
harm or the totality of the alleged injury to the person,
trial for very serious charges, including adultery and violation of
reputation, social standing and human rights of complainant,
Islamic laws and tradition.
had lodged, according to the plaintiff below (herein private
There is likewise logical basis on record for the claim that the respondent). All told, it is not without basis to identify the
"handing over" or "turning over" of the person of private Philippines as the situs of the alleged tort.
respondent to Jeddah officials, petitioner may have acted
beyond its duties as employer. Petitioner's purported act
contributed to and amplified or even proximately caused Moreover, with the widespread criticism of the traditional rule of
additional humiliation, misery and suffering of private lex loci delicti commissi, modern theories and rules on tort liability
respondent. Petitioner thereby allegedly facilitated the arrest, 61 have been advanced to offer fresh judicial approaches to
detention and prosecution of private respondent under the arrive at just results. In keeping abreast with the modern theories
guise of petitioner's authority as employer, taking advantage of on tort liability, we find here an occasion to apply the "State of
the trust, confidence and faith she reposed upon it. As the most significant relationship" rule, which in our view should
purportedly found by the Prince of Makkah, the alleged be appropriate to apply now, given the factual context of this
conviction and imprisonment of private respondent was case
wrongful. But these capped the injury or harm allegedly inflicted
In applying said principle to determine the State which has the
upon her person and reputation, for which petitioner could be
most significant relationship, the following contacts are to be
liable as claimed, to provide compensation or redress for the
taken into account and evaluated according to their relative
wrongs done, once duly proven.
importance with respect to the particular issue: (a) the place
Considering that the complaint in the court a quo is one where the injury occurred; (b) the place where the conduct
involving torts, the "connecting factor" or "point of contact" causing the injury occurred; (c) the domicile, residence,
could be the place or places where the tortious conduct or lex nationality, place of incorporation and place of business of the
loci actus occurred. And applying the torts principle in a
parties, and (d) the place where the relationship, if any, burden was on it [petitioner] to plead and to establish what the
between the parties is centered. 62 law of Saudi Arabia is". 66

As already discussed, there is basis for the claim that over-all Lastly, no error could be imputed to the respondent appellate
injury occurred and lodged in the Philippines. There is likewise no court in upholding the trial court's denial of defendant's (herein
question that private respondent is a resident Filipina national, petitioner's) motion to dismiss the case. Not only was jurisdiction
working with petitioner, a resident foreign corporation engaged in order and venue properly laid, but appeal after trial was
here in the business of international air carriage. Thus, the obviously available, and expeditious trial itself indicated by the
"relationship" between the parties was centered here, although nature of the case at hand. Indubitably, the Philippines is the
it should be stressed that this suit is not based on mere labor law state intimately concerned with the ultimate outcome of the
violations. From the record, the claim that the Philippines has the case below, not just for the benefit of all the litigants, but also for
most significant contact with the matter in this dispute, 63 raised the vindication of the country's system of law and justice in a
by private respondent as plaintiff below against defendant transnational setting. With these guidelines in mind, the trial
(herein petitioner), in our view, has been properly established. court must proceed to try and adjudge the case in the light of
relevant Philippine law, with due consideration of the foreign
Prescinding from this premise that the Philippines is the situs of
element or elements involved. Nothing said herein, of course,
the tort complained of and the place "having the most interest
should be construed as prejudging the results of the case in any
in the problem", we find, by way of recapitulation, that the
manner whatsoever.
Philippine law on tort liability should have paramount
application to and control in the resolution of the legal issues WHEREFORE, the instant petition for certiorari is hereby
arising out of this case. Further, we hold that the respondent DISMISSED. Civil Case No. Q-93-18394 entitled "Milagros P.
Regional Trial Court has jurisdiction over the parties and the Morada vs. Saudi Arabia Airlines" is hereby REMANDED to
subject matter of the complaint; the appropriate venue is in Regional Trial Court of Quezon City, Branch 89 for further
Quezon City, which could properly apply Philippine law. proceedings.
Moreover, we find untenable petitioner's insistence that "[s]ince
SO ORDERED.
private respondent instituted this suit, she has the burden of
pleading and proving the applicable Saudi law on the matter."
64 As aptly said by private respondent, she has "no obligation to
plead and prove the law of the Kingdom of Saudi Arabia since
her cause of action is based on Articles 19 and 21" of the Civil
Code of the Philippines. In her Amended Complaint and
subsequent pleadings, she never alleged that Saudi law should
govern this case. 65 And as correctly held by the respondent
appellate court, "considering that it was the petitioner who was
invoking the applicability of the law of Saudi Arabia, then the
G.R. No. 124110 April 20, 2001 The cause of the non-boarding of the Fontanillas on United
Airlines Flight No. 1108 makes up the bone of contention of this
UNITED AIRLINES, INC., Petitioner
controversy.1âwphi1.nêt
vs.
Private respondents’ version is as follows:
COURT OF APPEALS, ANICETO FONTANILLA, in his personal
Aniceto Fontanilla and his son Mychal claim that on May 5, 1989,
capacity and in behalf of his minor son MYCHAL ANDREW
upon their arrival at the los Angeles Airport for their flight, they
FONTANILLA, Respondents.
proceeded to united Airlines counter where they were
KAPUNAN, J.: attended by an employee wearing a nameplate bearing the
name "LINDA." Linda examined their tickets, punched
On March 1, 1989, private respondent Aniceto Fontanilla something into her computer and then told them that boarding
purchased from petitioner United Airlines, through the Philippine would be in fifteen minutes.4
Travel Bureau in Manila three (3) "Visit the U.S.A." tickets for
himself, his wife and his minor son Mychal for the following When the flight was called, the Fontanillas proceeded to the
routes: plane. To their surprise, the stewardess at the gate did not allow
them to board the plane, as they had no assigned seat
a. San Francisco to Washinton (15 April 1989); numbers. They were then directed to go back to the "check-in"
counter where Linda subsequently informed them that the flight
b. Washington to Chicago (25 April 1989);
had been overbooked and asked them to wait.5
c. Chicago to Los Angeles (29 April 1989);
The Fontanillas tried to explain to Linda the special
d. Los Angeles to San Francisco (01 may 1989 for petitioner’s wife circumstances of their visit. However, Linda told them in
and 05 May 1989 for petitioner and his son). 1 arrogant manner, "So what, I can not do anything about it."6

All flights had been confirmed previously by United Airlines. 2 Subsequently, three other passengers with Caucasian features
were graciously allowed to baord, after the Fontanillas were
The Fontanillas proceeded to the United States as planned, told that the flight had been overbooked.7
where they used the first coupon from San Francisco to
Washington. On April 24, 1989, Aniceto Fontanilla bought two The plane then took off with the Fontanillas’ baggage in tow,
(2) additional coupons each for himself, his wife and his son from leaving them behind.8
petitioner at its office in Washington Dulles Airport. After paying
The Fontanillas then complained to Linda, who in turn gave
the penalty for rewriting their tickets, the Fontanillas were issued
them an ugly stare and rudely uttered, "it’s not my fault. It’s the
tickets with corresponding boarding passes with the words
fault of the company. Just sit down and wait."9 When Mr.
"CHECK-IN REQUIRED," for United Airlines Flight No. 1108, set to
Fontanilla reminded Linda of the inconvenience being caused
leave from Los Angeles to San Francisco at 10:30 a.m. on May
to them, she bluntly retorted, "Who do you think you are? You
5, 1989.3
lousy Flips are good for nothing beggars. You always ask for
American aid." After which she remarked "Don’t worry about Representative at the counter informed them that the flight was
your baggage. Anyway there is nothing in there. What are you overbooked. She booked them on the next available flight and
doing here anyway? I will report you to immigration. You Filipinos offered them denied boarding compensation. Allen
should go home."10 Such rude statements were made in front vehemently denies uttering the derogatory and racist words
of other people in the airport causing the Fontanillas to suffer attributed to her by the Fontanillas.14
shame, humiliation and embarrassment. The chastening
The incident prompted the Fontanillas to file Civil Case No. 89-
situation even caused the younger Fontanilla to break into
4268 for damages before the Regional Trial Court of Makati.
tears.11
After trial on the merits, the trial court rendered a decision, the
dispositive portion of which reads as follows:

After some time, Linda, without any explanation, offered the WHEREFORE, judgment is rendered dismissing the complaint. The
Fontanillas $50.00 each. She simply said "Take it or leave it." This, counterclaim is likewise dismissed as it appears that plaintiffs
the Fontanillas declined.12 were not actuated by legal malice when they filed the instant
complaint.15

On appeal, the Court of Appeals ruled in favor of the Fontanillas.


The Fontanillas then proceeded to the United Airlines customer
The appellate court found that there was an admission on the
service counter to plead their case. The male employee at the
part of United Airlines that the Fontanillas did in fact observe the
counter reacted by shouting that he was ready for it and left
check-in requirement. It ruled further that even assuming there
without saying anything.13
was a failure to observe the check-in requirement, United
The Fontanillas were not booked on the next flight, which Airlines failed to comply with the procedure laid down in cases
departed for San Francisco at 11:00 a.m. It was only at 12:00 where a passenger is denied boarding. The appellate court
noon that they were able to leave Los Angeles on United Airlines likewise gave credence to the claim of Aniceto Fontanilla that
Flight No. 803. the employees of United Airlines were discourteous and arbitrary
and, worse, discriminatory. In light of such treatment, the
Petitioner United Airlines has a different version of what occurred Fontanillas were entitled to moral damages. The dispositive
at the Los Angeles Airport on May 5, 1989. portion of the decision of the respondent Court of Appeals
dated 29 September 1995, states as follows:
According to United Airlines, the Fontanillas did not initially go to
the check-in counter to get their seat assignments for UA Flight WHEREFORE, in view of the foregoing, judgment appealed
1108. They instead proceeded to join the queue boarding the herefrom is hereby REVERSED and SET ASIDE, and a new
aircraft without first securing their seat assignments as required judgment is entered ordering defendant-appellee to pay
in their ticket and boarding passes. Having no seat assignments, plaintiff-appellant the following:
the stewardess at the door of the plane instructed them to go
to the check-in counter. When the Fontanillas proceeded to the P200,000.00 as moral damages;
check-in counter, Linda Allen, the United Airlines Customer
P200,000.00 as exemplary damages; RESPONDENT COURT OF APPEALS GRAVELY ERRED IN RULING
THAT PRIVATE RESPONDENT IS ENTITLED TO ATTORNEY’S FEES OF
P50,000.00 as attorney’s fees;
P50,000.17
No pronouncement as to costs.
On the first issue raised by the petitioner, the respondent Court
SO ORDERED.16 of Appeals ruled that when Rule 9, Section 1 of the Rules of
Court,18 there was an implied admission in petitioner’s answer
Petitioner United Airlines now comes to this Court raising the in the allegations in the complaint that private respondent and
following assignments of errors; his son observed the "check-in requirement at the Los Angeles
Airport." Thus:
I
A perusal of the above pleadings filed before the trial court
RESPONDENT COURT OF APPEALS GRVAELY ERRED IN RULING
disclosed that there exist a blatant admission on the part of the
THAT THE TRIAL COURT WAS WRONG IN FAILING TO CONSIDER
defendant-appellee that the plaintiffs-appellants indeed
THE ALLEGED ADMISSION THAT PRIVATE RESPONDENT OBSERVED
observed the "check-in" requirement at the Los Angeles Airport
THE CHECK-IN REQUIREMENT.
on May 5, 1989. In view of defendant-appellee’s admission of
II plaintiffs-appellants’ material averment in the complaint. We
find no reason why the trial court should rule against such
RESPONDENT COURT OF APPEALS GRAVELY ERRED IN RULING admission.19
THAT PRIVATE RESPONDENT’S FAILURE TO CHECK-IN WILL NOT
DEFEAT HIS CLAIMS BECAUSE THE DENIED BOARDING RULES WERE We disagree with the above conclusion reached by respondent
NOT COMPLIED WITH. Court of Appeals. Paragraph 7 of private respondents’
complaint states:
III
7. On May 5, 1989 at 9:45 a.m., plaintiff and his son checked in
RESPONDENT COURT OF APPEALS GRAVELY ERRED IN RULING at defendant’s designated counter at the airport in Los Angeles
THAT PRIVATE RESPONDENT IS ENTITLED TO MORAL DAMAGES OF for their scheduled flight to San Francisco on defendant’s Flight
P200,000. No. 1108.20
IV
Responding to the above allegations, petitioner averred in
RESPONDENT COURT OF APPEALS GRAVELY ERRED IN RULING paragraph 4 of its answer, thus:
THAT PRIVATE RESPONDENT IS ENTITLED TO EXEMPLARY DAMAGES 4. Admits the allegation set forth in paragraph 7 of the
OF P200,000.
complaint except to deny that plaintiff and his son checked in
V at 9:45 a.m., for lack of knowledge or information at this point in
time as to the truth thereof.21
The rule authorizing an answer that the defendant has no the part of the petitioner in not allowing the Fontanillas to board
knowledge or information sufficient to form a belief as to the United Airlines Flight 1108.
truth of an averment giving such answer is asserted is so plainly
It must be remembered that the general rule in civil cases is that
and necessarily within the defendant’s knowledge that his
the party having the burden of proof of an essential fact must
averment of ignorance must be palpably untrue.22 Whether or
produce a preponderance of evidence thereon.24 Although
not private respondents checked in at petitioner’s designated
the evidence adduced by the plaintiff is stronger than that
counter at the airport at 9:45 a.m. on May 5, 1989 must
presented by the defendant, a judgment cannot be entered in
necessarily be within petitioner’s knowledge.
favor of the former, if his evidence is not sufficient to sustain his
While there was no specific denial as to the fact of compliance cause of action. The plaintiff must rely on the strength of his own
with the "check-in" requirement by private respondents, evidence and not upon the weakness of the defendant’s.25
petitioner presented evidence to support its contention that Proceeding from this, and considering the contradictory
there indeed was no compliance. findings of facts by the Regional Trial Court and the Court of
Appeals, the question before this Court is whether or not private
Private respondents then are said to have waived the rule on
respondents were able to prove with adequate evidence his
admission. It not only presented evidence to support its
allegations of breach of contract in bad faith.
contention that there was compliance with the check-in
requirement, it even allowed petitioner to present rebutal We rule in the negative.
evidence. In the case of Yu Chuck vs. "Kong Li Po," we ruled that:
Time and again, the Court has pronounced that appellate
courts should not, unless for strong and cogent reasons, reverse
the findings of facts of trial courts. This is so because trial judges
The object of the rule is to relieve a party of the trouble and
are in better position to examine real evidence and at a
expense in proving in the first instance an alleged fact, the
vantage point to observe the actuation and the demeanor of
existence or non-existence of which is necessarily within the
the witnesses.26 While not the sole indicator of the credibility of
knowledge of the adverse party, and of the necessity (to his
a witness, it is of such weight that it has been said to be the
opponent’s case) of establishing which such adverse party is
touchstone of credibility.27
notified by his opponent’s pleadings.
Aniceto Fontanilla’s assertion that upon arrival at the airport at
The plaintiff may, of course, waive the rule and that is what must
9:45 a.m., he immediately proceeded to the check-in counter,
be considered to have done (sic) by introducing evidence as
and that Linda Allen punched in something into the computer
to the execution of the document and failing to object to the
is specious and not supported by the evidence on record. In
defendant’s evidence in refutation; all this evidence is now
support of their allegations, private respondents submitted a
competent and the case must be decided thereupon.23
copy of the boarding pass. Explicitly printed on the boarding
The determination of the other issues raised is dependent on pass are the words "Check-In Required." Curiously, the said pass
whether or not there was a breach of contract in bad faith on did not indicate any seat number. If indeed the Fontanillas
checked in at the designated time as they claimed, why then
were they not assigned seat numbers? Absent any showing that In the case of Zalanea vs. Court of Appeals,30 this Court applied
Linda was so motivated, we do not buy into private the doctrine of lex loci contractus. According to the doctrine,
respondents’ claim that Linda intentionally deceived him, and as a general rule, the law of the place where a contract is made
made him the laughing stock among the passengers.28 Hence, or entered into governs with respect to its nature and validity,
as correctly observed by the trial court: obligation and interpretation. This has been said to be the rule
even though the place where the contract was made is
different from the place where it is to be performed, and
Plaintiffs fail to realize that their failure to check in, as expressly particularly so, if the place of the making and the place of
required in their boarding passes, is they very reason why they performance are the same. Hence, the court should apply the
were not given their respective seat numbers, which resulted in law of the place where the airline ticket was issued, when the
their being denied boarding.29 passengers are residents and nationals of the forum and the
ticket is issued in such State by the defendant airline.
Neither do we agree with the conclusion reached by the
appellate court that private respondents’ failure to comply with The law of the forum on the subject matter is Economic
the check-in requirement will not defeat his claim as the denied Regulations No. 7 as amended by Boarding Priority and Denied
boarding rules were not complied with. Notably, the appellate Board Compensation of the Civil Aeronautics Board which
court relied on the Code of Federal Regulation Part on provides that the check-in requirement be complied with
Oversales which states: before a passenger may claim against a carrier for being
denied boarding:
250.6 Exceptions to eligibility for denied boarding
compensation. Sec. 5. Amount of Denied Boarding Compensation Subject to
the exceptions provided hereinafter under Section 6, carriers
A passenger denied board involuntarily from an oversold flight shall pay to passengers holding confirmed reserved space and
shall not be eligible for denied board compensation if: who have presented themselves at the proper place and time
and fully complied with the carrier’s check-in and
The passenger does not comply with the carrier’s contract of
reconfirmation procedures and who are acceptable for
carriage or tariff provisions regarding ticketing, reconfirmation,
carriage under the Carrier’s tariff but who have been denied
check-in, and acceptability for transformation.
boarding for lack of space, a compensation at the rate of: xxx
The appellate court, however, erred in applying the laws of the
United States as, in the case at bar, Philippine law is the
applicable law. Although, the contract of carriage was to be Private respondents’ narration that they were subjected to
performed in the United States, the tickets were purchased harsh and derogatory remarks seems incredulous. However, this
through petitioner’s agent in Manila. It is true that the tickets Court will not attempt to surmise what really happened, suffice
were "rewritten" in Washington, D.C. however, such fact did not to say, private respondent was not able to prove his cause of
change the nature of the original contract of carriage entered action, for as the trial court correctly observed:
into by the parties in Manila.
xxx plaintiffs claim to have been discriminated against and However, the Court’s ruling in said case should be read in
insulted in the presence of several people. Unfortunately, consonance with existing laws, particularly, Economic
plaintiffs limited their evidence to the testimony of Aniceto Regulations No. 7, as amended, of the Civil Aeronautics Board:
Fontanilla, without any corroboration by the people who saw or
Sec. 3. Scope. – This regulation shall apply to every Philippine
heard the discriminatory remarks and insults; while such limited
and foreign air carrier with respect to its operation of flights or
testimony could possibly be true, it does not enable the Court to
portions of flights originating from or terminating at, or serving a
reach the conclusion that plaintiffs have, by a preponderance
point within the territory of the Republic of the Philippines insofar
of evidence, proven that they are entitled to P1,650,000.00
as it denies boarding to a passenger on a flight, or portion of a
damages from defendant.31
flight inside or outside the Philippines, for which he holds
As to the award of moral and exemplary damages, we find error confirmed reserved space. Furthermore, this Regulation is
in the award of such by the Court of Appeals. For the plaintiff to designed to cover only honest mistakes on the part of the
be entitled to an award of moral damages arising from a carriers and excludes deliberate and willful acts of non-
breach of contract of carriage, the carrier must have acted accommodation. Provided, however, that overbooking not
with fraud or bad faith. The appellate court predicated its exceeding 10% of the seating capacity of the aircraft shall not
award on our pronouncement in the case of Zalanea vs. Court be considered as a deliberate and willful act of non-
of Appeals, supra, where we stated: accommodation.

Existing jurisprudence explicitly states that overbooking amounts


to bad faith, entitling passengers concerned to an award of
What this Court considers as bad faith is the willful and
moral damages. In Alitalia Airways vs. Court of Appeals, where
deliberate overbooking on the part of the airline carrier. The
passengers with confirmed booking were refused carriage on
above-mentioned law clearly states that when the overbooking
the last minute, this Court held that when an airline issues a ticket
does not exceed ten percent (10%), it is not considered as
to a passenger confirmed on a particular flight, on a certain
deliberate and therefore does not amount to bad faith. While
date, a contract of carriage arises, and the passenger has every
there may have been overbooking in this case, private
right to except that he would fly on that flight and on that date.
respondents were not able to prove that the overbooking on
If he does not, then the carrier opens itself to a suit for breach of
United Airlines Flight 1108 exceeded ten percent.
contract of carriage. Where an airline had deliberately
overbooked, it took the risk of having to deprive some
passengers of their seats in case all of them would show up for
check in. For the indignity and inconvenience of being refused As earlier stated, the Court is of the opinion that the private
a confirmed seat on the last minute, said passenger is entitled respondents were not able to prove that they were subjected
to moral damages. (Emphasis supplied). to coarse and harsh treatment by the ground crew of united
Airlines. Neither were they able to show that there was bad faith
on part of the carrier airline. Hence, the award of moral and
exemplary damages by the Court of Appeals is improper.
Corollarily, the award of attorney’s fees is, likewise, denied for
lack of any legal and factual basis.

WHEREFORE, the petition is GRANTED. The decision of the Court


of Appeals in CA-G.R. CV No. 37044 is hereby REVERSED and SET
ASIDE. The decision of the Regional Trial Court of Makati City in
Civil Case No. 89-4268 dated April 8, 1991 is hereby REINSTATED.

SO ORDERED.

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