Due Process Cases
Ermita-Malate Hotel & Motel Operators Association, Inc., et at vs. Manila October 23, 1967
[GRN L-24693 October 23, 1967]
ERMITA-MALATE HOTEL AND MOTEL OPERATORS ASSOCIATION, INC., HOTEL DEL MAR, INC. and GO CHIU, petitioners and appellees, v. THE HONORADLE CITY MAYOR OF MANILA, respondent and appellant. VICTOR ALABANZA, intervenor and appellee.
1. CONSTITUTIONAL LAW; ABSENCE OF INJURY TO RIGHTS BY OPERATION OF STATUTE OR ORDINANCE.- Unless a person is injuriously affected in any of his constitutional rights by the operation of statute or ordinance he has no standing, except perhaps as to the liberty to contract, which is part and parcel of their right to property.
2. ID.; FREEDOM OF CONTRACT, NOT A BAR TO POLICE POWER MEASURES.- In this jurisdiction, the liberty to contract, has never stood in the way of the enactment of police power measures when called for by circumstances. The same is true in the United States, where such concept has definitely fallen from its previously high estate under the impact of the Nebbia (291 US 502), West Coast Hotel Co. (300 US 379), and Olsen (313 US 1305) decisions.
3. ID.; DEPRIVATION OF PROPERTY ALLOWED PROVIDED DUE PROCESS IS OBSERVED.- One could, consistently with the fundamental law, be deprived of his property, as long as due process is observed.
4. ID.; CHALLENGED ORDINANCE DOES NOT DENY EQUAL PROTECTION CLAUSE.- Since the challenged ordinance applies to all the motels in Manila, an assertion that there is denial of equal protection would be extremely far-fetched.
5. ID.; LAISSEZ FAIRE CONCEPT AS BAR TO ENACTMENT OF REGULATORY MEASURES, MAY NOT BE INVOKED.- The invocation of the laissez faire concept as bar against the enactment of regulatory measures, which undoubtedly would result in the diminution of income and the less of business, does not occasion any misgiving as to the conformity of the decision arrived at by the Court with controlling constitutional law principles. The policy of laissez faire has to some extent given way to the assumption by the government of the right of intervention even in contractual relations affected with public interest, The state in order to promote the general welfare may interfere with personal liberty, with property, and with business and occupations. Persons and property may be subjected to all kinds of restraints and burdens, in order to secure the general comfort, health, and prosperity of the state. The mere fact that some individuals in the community may he deprived nf their present business or a particular mode of earning a living cannot prevent the exercise of police power. Persons licensed to pursue occupations which may in the public need and interest be affected by the exercise of the police power embark in those occupations subject to the disadvantages which may result from the legal exercise of that power.
MOTIONS FOR RECONSIDERATION of a decision of the Supreme Court.
The facts are stated in the opinion of the Court.
J. M. Aruego, A. Tenchavez and L. U. Go for petitioners and appellees.
Panganiban, Abad & Associates for respondent and appellant.
FERNANDO, J.:
A Motion for the reconsideration of our decision of July 31, 1967 was filed by petitioners, followed by a Motion for new trial. As the Motion for reconsideration is clearly without merit, there is no occasion for this sought-for new trial. Consequently, both motions are denied (1) No merit in the Motion for reconsideration.
In the decision of this Court of July 31, 1967, sought to be reconsidered, its basis was categorically set forth in the following language:
"As noted at the outset, the judgment must be reversed. A decent regard for constitutional doctrines of a fundamental character ought to have admonished the lower court against such a sweeping condemnation of the challenged ordinance. Its decision cannot be allowed to stand, consistently with what has hitherto been the accepted standards of constitutional adjudication, in both procedural and substantive aspects.
"Primarily what calls for a reversal of such a decision is the absence of any evidence to offset the presumption of validity that attaches to a challenged statute or ordinance. As was expressed categorically by Justice Malcolm: 'The presumption is all in favor of validity. . . . The action of the elected representatives of the people cannot be lightly set aside. The councilors must, in the very nature of things, be familiar with the necessities of their particular municipality and with all the facts and circumstances which surround the subject and necessitates action. The local legislative body, by enacting the ordinance, has in effect given notice that the regulations are essential to the well being of the people. . . . The Judiciary should not lightly set aside legislative action when there is not a clear invasion of personal or property rights under the guise of police regulations.'
"It admits of no doubt therefore that there being a presumption of validity, the necessity for evidence to rebut it is unavoidable, unless the statute or ordinance is void on its face, which is not the case here. The principle has been nowhere better expressed than in the leading case of O'Gorman & Young v. Hartford Fire Insurance Co., where the American Supreme Court through Justice Brandeis tersely and succinctly summed up the matter thus: 'The statute here questioned deals with a subject clearly within the scope of the police power. We are asked to declare it void on the ground that the specific method of regulation prescribed is unreasonable and hence deprives the plaintiff of due process of law. As underlying questions of fact may condition the constitutionality of legislation of this character, the presumption of constitutionality must prevail in the absence of some factual foundation of record for overthrowing the statute.' No such factual foundation being laid in the present case, the lower court deciding the matter on the pleadings and the stipulation of facts, the presumption of validity must prevail and the judgment against the ordinance set aside."
The O'Gorman principle 1 fails to meet the approval of counsel of petitioners. They would restrain unduly and unjustifiably its operation. In the language of the motion for reconsideration: "The U.S. Supreme Court was not laying down as a general rule in constitutional cases that there must be a factual foundation of record to offset the presumption of constitutionality of any and every law."
To paraphrase Justice Brandeis, this interpretation is without support in authority or reason and rests upon a misconception. It is to betray an almost total lack of awareness of the import and significance of the O'Gorman doctrine in American constitutional law. Authorities on the subject of proven competence and knowledge flatly reject such a view. Dodd, 2 Dowling, 3 Freund, Sutherland, De Wolfe Howe, and Brown, 4 and Kauper 5 in their standard casebooks quote the same excerpt from O'Gorman v. Hartford Fire Ins, Co. appearing in the opinion of this Court. Dodd entertained no doubt: "The accepted view is that stated by Mr. Justice Brandeis in the O'Gorman case." 6
Frankfurter and Landis were equally explicit in their appreciation of what the O'Gorman dictum means. "As doctrine, there is nothing new in the avowal of a need for concreteness in passing judgment upon the legislative judgment. But perhaps last term marks a more sedulous attention to its observance. Certainly the procedure followed by the Court in O'Gorman & Young v. Hartford Fire Ins. Co., if regularly observed, will affect not a little the fate of legislation. If insisted upon, it will compel the bar to argue questions of legislative validity in the perspective of the circumstances which gave rise to a particular statute." 7 The late Professor Hamilton of the Yale Law School, one of the most distinguished constitutionalist, would have been appalled by the unorthodoxy of the view of counsel of petitioners. For him, the OGorman opinion was a manifestation of the jurist's art at its best:
"If the jurists have the feelings of other men, Monday, the fifth of January, nineteen hundred and thirty-one, must have been a day of consequence in the fife of Mr. Justice Brandeis. On that-day he handed down the judgment of the United States Supreme Court in the O'Gorman case. The cause was a simple suit in contract: the result depended upon the validity of a New Jersey statute regulating the commissions to be paid by insurance companies to their agents for securing business. The more general question was the tolerance to be accorded to legislative price-fixing under the Fourteenth Amendment, And, as the fortunes of litigation broke, the issue came to be the intellectual procedure by which the constitutionality of the acts which make up the public control of business are to be determined. Upon that day the views of Brandeis became 'the opinion of the court,' and a new chapter in judicial history began to be written.
"In form 'the opinion of the court' is a very simple and unpretentious document. It begins with a statement of the issue and a history of the case, continues with a brief summary of the reasons for the statute and a statement that 'the business of insurance is so affected with a public interest that the state may regulate the rates,' and concludes with a declaration of the test for validity. As 'underlying questions of fact may condition the constitutionality of legislation of this character,' it follows that 'the presumption of constitutionality must prevail in the absence of some factual foundation of record for overthrowing the statute.' It did not appear 'upon the face of the statute, or from any facts of which the court must take judicial notice, that in New Jersey 'evils did not exist,' for which the statute was 'an appropriate remedy.' Accordingly the court was compelled to declare the statute valid; in fact it was left with no alternative.
"Yet the simple lines of a short opinion present a superb example of the jurist's art. . . ." 8
This is not to discount the possibility of a situation where the nullity of a statute, executive order, or ordinance may not be readily apparent but the threat to constitutional rights, especially those involving the freedom of the mind, present and ominous. That in such an event there should not be a rigid insistence on the requirement that evidence be presented does not argue against the force of the above excerpts and the weight to be accorded the O'Gorman doctrine in this case.
The prop here failing, is there anything else in the Motion for reconsideration that calls for a modification of the decision of this Court? The answer must be in the negative. It ought not to have escaped petitioners that the opinion of the Court after noting the lack of factual foundation to offset the presumption of constitutionality went on to discuss the due process aspect to make clear that on its face, the Ordinance cannot be considered void.
"Nor may petitioners assert with plausibility that on its face the ordinance is fatally defective as being repugnant to the due process clause of the Constitution. The mantle of protection associated with the due process guaranty does not cover petitioners. This particular manifestation of a police power measure being specifically aimed to safeguard public morals is immune from such imputation of nullity resting purely on conjecture and unsupported by anything of substance. To hold otherwise would be to unduly restrict and narrow the scope of police power which has been properly characterized as the most essential, insistent and the least limitable of powers, extending as it does 'to all the great public needs.' It would be, to paraphrase another leading decision, to destroy the very purpose of the state if it could be deprived or allowed itself to be deprived of its competence to promote public health, public morals, public safety and the general welfare. Negatively put, police power is 'that inherent and plenary power in the State which enables it to prohibit all that is hurtful to the comfort, safety, and welfare of society.'
"There is no question but that the challenged ordinance was precisely enacted to minimize certain practices hurtful to public morals. The explanatory note of the then Councilor Herminio Astorga included as annex to the stipulation of facts speaks of the alarming increase in the rate of prostitution, adultery and fornication in Manila, traceable in great part to the existence of motels, which 'provide a necessary atmosphere for clandestine entry, presence and exit' and thus become the 'ideal haven for prostitutes and thrill seekers.' The challenged ordinance then 'proposes to check the clandestine harboring of transients and guests of these establishments by requiring these transients and guests to fill up a registration form, prepared for the purpose, in a lobby open to public view at all times, and by introducing several other amendatory provisions calculated to shatter the privacy that characterizes the registration of transients and guests.' Moreover, the increase in the license fees was intended to discourage 'establishments of the kind from operating for purpose other than legal' and at the same time, to increase 'the income of the city government.' It would appear therefore that the stipulation of facts, far from sustaining any attack against the validity of the ordinance, argues eloquently for it."
There is nothing in the Motion for reconsideration that in any wise affects adversely or impairs the force of the above conclusion. The task of proving that the challenged Ordinance is void on its face is one attended with difficulty. Nonetheless, with the persistence worthy of a better cause, petitioners would cite as fatal infirmity the alleged invasion of the rights against unreasonable search and seizure, to liberty, and to property.
As the unchallenged rule, to paraphrase Laurel, is that Unless a person is injuriously affected in any of his constitutional rights by the operation of statute or ordinance, 9 he has no standing, the invocation of petitioners as motel operators of their alleged right to being free from unreasonable search and seizure need not be taken seriously. Nor does their claim of the alleged infringement of their liberty deserve any further thought, its implausibility being selfevident, except perhaps as to the liberty to contract, which is part and parcel of their right to property. Unfortunately for them, in this jurisdiction the liberty to contract, except in the Pomar 10 case as noted in the decision, has never stood in the way of the enactment of police power measures when called for by circumstances such as undoubtedly exist in this case. The same is true in the United States, where such a concept has definitely fallen from its previously high state tinder the impact of the Nebbia, 11 West Coast Hotel Co. 12 and Olsen decisions.13
That leaves only the alleged grievance that there was an unconstitutional invasion of property rights. It goes without saying that petitioners themselves cannot ignore that one could, consistently with the fundamental law, be deprived of his property as long as due process is observed. The decision makes clear that such indeed was the case as far as this Ordinance was concerned. To that aspect, a considerable portion of the opinion was devoted, citing a number of applicable decisions of this Court, all tending to demonstrate that there was no due process infraction. The Motion for reconsideration is conspicuously barren of any attempt to show that under our previous decisions referred to, the challenged Ordinance could be successfully assailed. It would follow then that this reiteration of an argument, previously shown to be far from persuasive, is deserving of a similar fate.
That is all there is to the Motion for reconsideration. That and what Justice Cardozo aptly referred to as reference to "grotesque or fanciful situations," which if they would arise could then be appropriately dealt with. As the famed jurist aptly noted: "That they are conceivable though improbable ought not to govern our construction." 14 That is not the way then to impugn the validity of an ordinance. Neither could it be rightfully looked upon as laying a foundation for setting aside a decision. The Motion for reconsideration, to repeat, is palpably lacking in merit.
2. No occasion for new trial.
Subsequently, a supplemental Motion fur new trial dated September 25, 1967, was filed the same day. As earlier pointed out, with the Motion for reconsideration having been shown to be devoid of merit, the supplemental Motion for new trial should likewise be denied. In the main, what was so unsuccessfully put forth by counsel for petitioners was adhered to. Additional counsel would bring in new points, namely, the alleged denial of equal protection and the repugnancy to "the laissez faire principle underlying our economic system, as it would substantially reduce return on the investment." Neither suffices to justify any modification of the decision, much less its reconsideration. A new trial would therefore be an exercise in futility. The alleged denial of equal protection was predicated on the greater advantages that the motels in the suburbs of Manila would enjoy as against those within the city limits. On its face, such argument is clearly unfounded. If the legislative power of the Municipal Board of the City of Manila were not limited to its boundaries, if it could apply to the suburban area, then perhaps plausibility could be imparted to such a claim. Since, as is undeniable, the challenged Ordinance applies to all the motels in Manila, an assertion that there is denial of equal protection would. to put it at its mildest, be extremely far-fetched.
Nor does the invocation of the laissez faire concept as bar against the enactment of regulatory measures, which undoubtedly would result in the diminution of income and the loss of business, occasion any misgiving as to the conformity of the decision arrived at by this Court with controlling constitutional law principles. Did nut petitioners take note of the view announced by Justice Laurel quoted in the decision to the effect that the policy "of laissez faire has to some extent given way to the assumption by the government of the right of intervention even in contractual relations affected with public interest." The decision likewise cited this jurist, speaking for the Court in Calalang v. Williams: 15 "Public welfare, then, lies at the bottom of the enactment of said law, and the state in order to promote the general welfare may interfere with personal liberty, with property, and with business and occupations. Persons and property may be subjected to all kinds of restraints and burdens, in order to secure the general comfort, health, and prosperity of the state.... To this fundamental aim of our Government the rights of the individual are subordinated." That was in 1940. Then in 1955, came Co Kiam v. City of Manila, 16 where Justice Reyes, A., for a unanimous Court categorically declared: "And surely, the mere fact that some individuals in the community may be deprived of their present business or a particular mode of earning a living cannot prevent the exercise of the police power. As was said in a case, persons licensed to pursue occupations which may in the public need and interest be affected by the exercise of the police power embark in those occupations subject to the disadvantages which may result from the legal exercise of that power. (City of New Orleans v. Stafford, 27 L. Ann. 417)."
Nor does the reference by new counsel to American state court decisions call for a different conclusion. The United States Supreme Court in the leading case of West Virginia Inc., et al. vs. The Hon. City Mayor of Manila State Board of Education v. Barnette, 17 decided in 1943, was equally explicit, saying "the laissez-faire concept or principle of non-interference has withered at least as to economic affairs, and social advancements are increasingly sought through closer integration of society and through expanded and strengthened governmental controls." Two names of great repute, Freund and Learned Hand, were cited by petitioners. Neither, if properly understood, could help their cause at all. According to Freund: "In short, when freedom of the mind is imperiled by law, it is freedom that commands a momentum of respect, when property is imperiled, it is the lawmakers' judgment that commands respect. This dual standard may not precisely reverse the presumption of constitutionality in civil liberties cases, but obviously it does set up a hierarchy of values within the due process clause." 18 The illustrious Learned Hand writing on Chief Justice Stone's concept of the judicial function had occasion to note the "discredited attitude" of what he referred to "as the old apostles of the institution of property ...." 19
What then is left? Clearly nothing to call for the reconsideration of our decision of July 31, 1967. Nor is there the least justification for a new trial and reception of evidence.
Wherefore, the Motion for reconsideration of petitioners of September 16, 1967 and supplemental Motion for new trial of September 25, 1967, are denied.
Concepcion, C.J., Reyes, J.B.L., Dizon, Makalintal, Bengzon, J.P., Zaldivar, Sanchez, Castro and Angeles, JJ., concur.
Motions denied.
1. Justice Brandeis in Pacific States Box v. White (1935) 296 US 176, 185, further elaborated on the above doctrine: "The order here in question deals with a subject clearly within the scope of the police power. See Turner v. Maryland, 107 US 38, 27 L. ed. 370, 2 S. Ct. 44. When such legislative action 'is called in question, if any state of facts reasonably can be conceived that would sustain it there is a presumption of the existence of that state of facts, and one who assails the classification must carry the burden of showing by a resort to common knowledge or other matters which may be judicially noticed, or to other legitimate proof, that the action is arbitrary.' Borden's Farm Products Co. v. Baldwin, 293 US 194, 209, 79 L. ed. 281, 288, 55 S. Ct. 187. The burden is not sustained by making allegations which are merely the general conclusions of law or fact. See Public Service Commission v. Great Northern Utilities Co., 289 US 130, 136, 137, 77 L ed.1080, 1085, 1086, 53,S. Ct. 546. Facts relied upon to rebut the presumption of constitutionality must be specifically set forth. See Aetna Ins. Co. v. Hyde, 275 US 440, 72 L ed., 357, 48 S. Ct. 174; O'Gorman & Young v. Hartford F. In& Co., 282 US 251, 75 L.
2. Dodd, Cases on Constitutional Law (1949) 4th ed., p. 86.
3. Dowling, Cases on Constitutional Law (1950) 4th ed., p. 769.
4. Freund, Sutherland, De Wolfe Howe, and Brown, Constitutional Law: Cases and Other Problems (1954), p. 122.
5. Kauper, Constitutional Law: Cases and Materials (1960) p. 62.
6. Dodd, op. cit., p. 87. 7. Frankfurter and Landis, lie Business of the Supreme Court at October Term, 1930. (1931) 45 Har v. Law Rev., 271, 325.
8. Harmilton, The Jurist's Art (1931), 31 Col. Law Rev. 1073-1075.
9. People v. Vera (1937) 65 Phil. 56, 89.
10. 46 Phil. 440 (1924).
11. 291 US 502 (1934).
12. 300 US 379 (1937).
13. 313 US 1305 (1942).
14. Gaines v. City of New York (1915) 109 N. E. 594, 596.
15. 70 Phil. 726, 733. 1696 Phil. 649, 654.
17. 319 US 624.
18. Freund, On Understanding the Supreme Court (1950) p. 11.
19. 46 Columbia Law Rev. 698 (1946).
Villegas vs. Hiu Chiong Tsai Pao Ho
November 10, 1978
[GRN L-29646 November 10, 1978*]
MAYOR ANTONIO J. VILLEGAS, petitioner, vs. HIU CHIONG TSAI PAO HO and JUDGE FRANCISCO ARCA, respondents.
SEPARATE OPINION
PETITION for certiorari to review the decision of the Court of First Instance of Manila. Area, J.
The facts are stated in the opinion of the Court.
Angel C. Cruz, Gregorio A. Ejercito, Felix C. Chaves & Jose Laureta for petitioner.
Sotero H. Laurel for respondents.
FERNANDEZ, J.:
This is a petition for certiorari to review the decision dated September 17, 1968 of respondent Judge Francisco Area of the Court of First Instance of Manila, Branch 1, in Civil Case No. 72797, the dispositive portion of which reads:
"Wherefore judgment is hereby rendered in favor of the peti. tioner and against the respondents, declaring ordinance No. 6537 of the City of Manila null and void. The preliminary injunction is hereby made permanent. No pronouncement as to cost.
SO ORDERED.
Manila, Philippines, September 17, 1968.
(SGD.) FRANCISCO ARCA
Judge"1
The controverted Ordinance No. 6537 was passed by the Municipal Board of Manila on February 22, 1968 and signed by the herein petitioner Mayor Antonio J. Villegas of Manila on March 27, 1968.2
City Ordinance No. 6537 is entitled:
"AN ORDINANCE MAKING IT UNLAWFUL FOR ANY PERSON NOT A CITIZEN OF THE PHILIPPINES TO BE EMPLOYED IN ANY PLACE OF EMPLOYMENT OR TO BE ENGAGED IN ANY KIND OF TRADE, BUSINESS OR OCCUPATION WITHIN THE CITY OF MANILA WITHOUT FIRST SECURING AN EMPLOYMENT PERMIT FROM THE MAYOR OF MANILA; AND FOR OTHER PURPOSES. "3
Section I of said Ordinance No. 65374 prohibits aliens from being employed or to engage or participate in any position of occupation or business enumerated therein, whether permanent, temporary or casual, without first securing an employment permit from the Mayor of Manila and paying the permit fee of P50.00 except persons employed in the diplomatic or consular missions of foreign countries, or in the technical assistance programs of both the Philippine Government and any foreign government, and those working in their respective households, and members of religious orders or congregations, sect or denomination, who are not paid monetarily or in kind.
Violations of this ordinance is punishable by an imprison. ment of not less than three (3) months to six (6) months or fine of not less than P100.00 but not more than P200.00 or both such fine and imprisonment, upon conviction.5
On May 4, 1968, private respondent Hiu Chiong Tsai Pao Ho, who was employed in Manila, filed a petition with the Court of First Instance of Manila, Branch I, denominated as Civil Case No. 72797, praying for the issuance of the writ of preliminary injunction and restraining order to stop the enforcement of Ordinance No. 6537 as well as for a judgment declaring said Ordinance No. 6537 null and void.6
In this petition, Hiu Chiong Tsai Pao Ho assigned the following as his grounds for wanting the ordinance declared null and void:
1) As a revenue measure imposed on aliens employed in the City of Manila, Ordinance No. 6537 is discriminatory and violative of the rule of the uniformity in taxation;
2) As a police power measure, it makes no distinction between useful and non-useful occupations, imposing a fixed P50.00 employment permit, which is out of proportion to the cost of registration and that it fails to prescribe any standard to guide and/or limit the action of the Mayor, thus, violating the fundamental principle on illegal delegation of legislative powers:
3) It is arbitrary, oppressive and unreasonable, being applied only to aliens who are thus, deprived of their rights to life, liberty and property and therefore, violates the due process and equal protection clauses of the Constitution.7
On May 24, 1968, respondent Judge issued the writ of preliminary injunction and on September 17, 1968 rendered judgment declaring Ordinance No. 6537 null and void and making permanent the writ of preliminary injunction.8 Contesting the aforecited decision of respondent Judge, then Mayor Antonio J. Villegas filed the present petition on March 27, 1969. Petitioner assigned the following as errors allegedly committed by respondent Judge in the latter's decision of September 17, 1968:9
THE RESPONDENT JUDGE COMMITTED A SERIOUS AND PATENT ERROR OF LAW IN RULING THAT ORDINANCE NO. 6537 VIOLATED THE CARDINAL RULE OF UNIFORMITY OF TAXATION.
II
RESPONDENT JUDGE LIKEWISE COMMITTED A GRAVE AND PATENT ERROR OF LAW IN RULING THAT OR DINANCE NO. 6537 VIOLATED THE PRINCIPLE AGAINST UNDUE DESIGNATION OF LEGISLATIVE POWER.
III
RESPONDENT JUDGE FURTHER COMMITTED A SERIOUS AND PATENT ERROR OF LAW IN RULING THAT ORDINANCE NO. 6537 VIOLATED THE DUE PROCESS AND EQUAL PROTECTION CLAUSES OF THE CONSTITUTION."
Petitioner Mayor Villegas argues that Ordinance No. 6537 cannot be declared null and void on the ground that it violated the rule on uniformity of taxation because the rule on uniformity of taxation applies only to purely tax or revenue measures and that Ordinance No. 6537 is not a tax or revenue measure but is an exercise of the police power of the state, it being principally a regulatory measure in nature.
The contention that Ordinance No. 6537 is not a purely tax or revenue measure because its principal purpose is regulatory in nature has no merit. While it is true that the first part which requires that the alien shall secure an employment permit from the Mayor involves the exercise of discretion and judgment in the processing and approval or disapproval of applications for employment permits and therefore is regulatory in character the second part which requires the payment of P50.00 as employee's fee is not regulatory but a revenue measure. There is no logic or justification in exacting P50.00 from aliens who have been cleared for employment. It is obvious that the purpose of the ordinance is to raise money under the guise of regulation.
The P50.00 fee is unreasonable not only because it is excessive but because it fails to consider valid substantial differences in situation among individual aliens who are required to pay it. Although the equal protection clause of the Constitution dopes not forbid classification, it is imperative that the classification should be based on real and substantial differences having a reasonable relation to the subject of the particular legislation. The same amount of P50.00 is being collected from every employed alien, whether he is casual or permanent, part time or full time or whether he is a lowly employee or a highly paid executive. Ordinance No. 6537 does not lay down any criterion or standard to guide the Mayor in the exercise of his discretion. It has been held that where an ordinance of a municipality fails to state any policy or to set up any standard to guide or limit the mayor's action, expresses no purpose to be attained by requiring a permit, enumerates no conditions for its grant or refusal, and entirely lacks standard, thus conferring upon the Mayor arbitrary and unrestricted power to grant or deny the issuance of building permits, such ordinance is invalid, being an undefined and unlimited delegation of power to allow or prevent an activity per se lawful.10
In Chinese Flour Importers Association vs. Price Stabilization Board,11 where a law granted a government agency power to determine the allocation of wheat flour among importers, the Supreme Court ruled against the interpretation of uncontrolled power as it vested in the administrative officer an arbitrary discretion to be exercised without a policy, rule, or standard from which it can be measured or controlled.
It was also held in Primicias vs. Fugoso12 that the authority and discretion to grant and refuse permits of all classes conferred upon the Mayor of Manila by the Revised Charter of Manila is not uncontrolled discretion but legal discretion to be exercised within the limits of the law.
Ordinance No. 6537 is void because it does not contain or suggest any standard or criterion to guide the mayor in the exercise of the power which has been granted to him by the ordinance.
The ordinance in question violates the due process of law and equal protection rule of the Constitution.
Requiring a person before he can be employed to get a permit from the City Mayor of Manila who may withhold or refuse it at will is tantamount to denying him the basic right of the people in the Philippines to engage in a means of livelihood. While it is true that the Philippines as a State is not obliged to admit aliens within its territory, once an alien is admitted, he cannot be deprived of life without due process of law. This guarantee includes the means of livelihood. The shelter of protection under the due process and equal protection clause is given to all persons, both aliens and citizens.13
The trial court did not commit the errors assigned.
WHEREFORE, the decision appealed from is hereby affirmed, without pronouncement as to costs.
SO ORDERED.
Barredo, Makasiar, Muñoz Palma, Santos, and Guerrero, JJ., concur.
Castro, CJ., Antonio and Aquino, JJ., concur in the result. Fernando, J., concurring in the result, relies primarily on the ultra vires character of the ordinance and expresses comformity with the concurring opinion of Justice Teehankee.
Teehankee, J., concurs on a separate opinion.
Concepcion Jr., J., did not take part.
TEEHANKEE, J., concurring.
I concur in the decision penned by Mr. Justice Fernandez which affirms the lower court's judgment declaring Ordinance No, 6537 of the City of Manila null and void for the reason that the employment of aliens within the country is a matter of national policy and regulation, which properly pertain to the national government officials and agencies concerned and not to local governments, such as the City of Manila, which after all are mere creations of the national government.
The national policy on the matter has been determined in the statutes enacted by the legislature, viz, the various Philippine nationalization laws which on the whole recognize the right of aliens to obtain gainful employment in the country with the exception of certain specific fields and areas. Such national policies may not be interfered with, thwarted or in any manner negated by any local government or its officials since they are not separate from and independent of the national government.
As stated by the Court in the early case of Phil. Coop. Livestock Ass'n. vs. Earnshaw, 59 Phil. 129: "The City of Manila is a subordinate body to the Insular (National Government ...... ). When the Insular (National) Government adopts a policy, a municipality is without legal authority to nullify and set at naught the action of the superior authority." Indeed, "not only must all municipal powers be exercised within the limits of the organic laws, but they must be consistent with the general law and public policy of the particular state. . . " (I McQuillin, Municipal Corporations, 2nd sec. 367, P. 1011).
With more reason are such national policies binding on local governments when they involve our foreign relations with other countries and their nationals who have been lawfully admitted here, since in such matters the views and decisions of the Chief of State and of the legislature must prevail over those of subordinate and local governments and officials who have no authority whatever to take official acts to the contrary.
Decision affirmed.
1. Annex "F", Petition, Rollo, p. 64.
2. Petition, Rollo, p. 28. 3. Annex "A" of Petition, Rollo, pp. 37-38.
4. Section 1. It shall be unlawful for any person not a citizen of the Philippines to be employed in any kind of position or occupation or allowed directly or indirectly to participate in the functions, administration or management in any office, corporation, store, restaurant, factory, business firm, or any other place of employment either as consultant, adviser, clerk, employee, technician, teacher, actor, actress, acrobat, singer or other theatrical performer, laborer, cook, etc., whether temporary, casual. permanent or otherwise and irrespective of the source or origin or his compensation or number of hours spent in said office, store, restaurant, factory, corporation or any other place of employment, or to engage in any kind of business and trade within the City of Manila, without first securing an employment permit from the Mayor of Manila, and paying the necessary fee therefor to the City the City Treasurer: PROVIDED, HOWEVER, That persons employed in diplomatic and consular missions of foreign countries and in technical assistance programs agreed upon by the Philippine Government and any foreign government, and those working in their respective households, and members of different congregations or religious orders of any religion, sect or denomination, who are not paid either monetarily or in kind shall be exempted from the provisions of this Ordinance.
5. Section 4. Any violation of this Ordinance shall, upon conviction, be punished by imprisonment of not less than three (3) months but not more than six (6) months or by a fine of not less than one hundred pesos (P100.00) but not more than two hundred pesos (P200.00), or by both such fine and imprisonment, in the discretion of the Court: PROVIDED, HOWEVER, That in case of juridical persons, the President, the VicePresident or the person in charge shall be liable.
6. Annex "B ", Petition, Rollo, p. 39.
7. Ibid.
8. Annex "F", Petition, Rollo, pp. 75-83.
9. Petition, Rollo, p. 3 1.
10. People vs. Fajardo, 104 Phil. 443, 446.
11. 89 Phil. 439, 459-460.
12. 80 Phil. 86.
13. Kwong Sing vs. City of Manila, 41 Phil. 103.
Dimalub P. Namil, et al. Vs. Commission on Elections, et al.,
G.R. No. 150540., 28 October 2003
EN BANC
[G.R. No. 150540. October 28, 2003]
DIMALUB P. NAMIL, ABDULNASSER TIMAN, TERESITA G. AKOB, MALIGA AMILUDIN and EPAS GUIAMEL, petitioners, vs. COMMISSION ON ELECTIONS, public respondent.
JOENIME B. KAPINA, MONIB B. WALINGWALING, MAULANA G. KARNAIN, ABDULGAPHAR M. MUSTAPHA, ABDULRAKMAN TALIKOP and WILSON SABIWANG, private respondents.
D E C I S I O N
CALLEJO, SR., J.:
This is a special civil action for certiorari under Rule 65 of the 1997 Rules of Civil Procedure, as amended, to set aside the November 6, 2001 Resolution No. 4615,1 promulgated by the Commission on Elections (COMELEC) en banc2 installing the private respondents as members of the Sangguniang Bayan of Palimbang, Sultan Kudarat, although the petitioners had already taken their respective oaths and assumed offices in the same elective positions.
The antecedents are as follows:
On May 14, 2001, the election for the members of the Sangguniang Bayan was held in Palimbang, Sultan Kudarat.
On May 20, 2001, the Municipal Board of Canvassers of Palimbang issued Certificate of Canvass of Votes and Proclamation (COCVP) No. 80311083 which contained, inter alia, the petitioners and the Sangguniang Bayan winning candidates:
1. NOREN B. APIL
2. MALOD B. MOSADI
3. DIMALUB P. NAMIL
4. ABDULNASSER A. TIMAN 5. TERESITA G. AKOB
6. MABANING P. SAMAMA
7. EPAS T. GUIAMEL
8. MALIGA M. AMILUDIN
The above-named candidates took their oath, and assumed their offices on June 30, 20014 as members of the Sangguniang Bayan of Palimbang.
The next day, May 21, 2001, the Municipal Board of Canvassers of Palimbang issued COCVP No. 8031109 which listed the private respondents as winners, namely:
1. JOENIME B. KAPINA
2. MONIB B. WALINGWALING
3. MAULANA G. KARNAIN
4. ABDULGAPHAR M. MUSATAPHA
5. MALOD B. MOSADI
6. ABDULRAKMAN A. TALIKOP
7. WILSON K. SABIWANG
8. MABANING P. SAMAMA
Thereafter, private respondent Joenime B. Kapina wrote the COMELEC requesting that she and the others who were proclaimed as winners on May 21, 2001 be recognized as the winning candidates and the new members of the Sangguniang Bayan of Palimbang, Sultan Kudarat. Appended to said letter was a certification issued by Regional Election Director Clarita N. Callar, Region XII, Cotabato City, that the private respondents named in the COCVP No. 8031109, issued on May 21, 2001, were duly proclaimed as the winning candidates for the said municipality. When apprised of the said letter, the Commissioner-in-Charge for Region XII, Mehol K. Sadain, conducted an investigation on the matter of having two (2) sets of winning candidates as members of the Sangguniang Bayan for Palimbang. He issued Memorandum No. 2001-09-005 requiring the Law Department, the Regional Election Registrar and the Provincial Election Supervisor to submit their respective reports/comments on the letter. The said officers submitted their respective memorandum, thus: 1. Memo dated September 11, 2001 of Atty. Jose Balbuena, Director Law Department, to the effect that, “our Comelec field officials in Region XII who directly participated in the canvassing who were named in (Memo No. 2001-09-001) could best provide the needed explanation and information” on the double proclamation of Sangguniang Bayan winners in Palimbang, Sultan Kudarat.
2. Memo dated September 6, 2001 of Atty. Clarita Callar, Regional Election Director, Region XII, to the effect that the Election Assistant Amy Laguda who issued the certification on the proclamation based on Certificate No. 8031109 dated May 21, 2001 verified the genuineness of her signature on the said certification, and further said that at the time she issued the certification the PES had not yet received a copy of Certificate No. 8031108 dated May 20, 2001. Further, Atty. Callar referred to the verification of Ms. Celia Romero that per records of the RSD, “the names appearing as elected members of the Sangguniang Bayan for the Municipality of Sultan Kudarat ... are those proclaimed in Certificate of Canvass of Votes & Proclamation No. 8031109.” Incidentally, Ms. Romero also issued a certification that the serial numbers of the Certificates of Canvass of Votes and Proclamation were 8031108 for Lambayong, SK and 8031109 for Palimbang, SK.
3. Memo filed on September 6, 2001 by Atty. Lintang H. Bedol, PES, Sultan Kudarat, recommending that the parties should file the appropriate case/s before the Commission, instead of coursing their redress through the PES of Sultan Kudarat or the RED of Region XII.
4. A confidential certification of EO Malic Sansarona dated September 12, 2001 to the effect that “the Certificate of Canvass of Votes and Proclamation ... No. 8031109 dated June 21, 2001 is [the] genuine and valid proclamation of elected Municipal Officials of the Municipality of Palimbang, Sultan Kudarat,” and that the other proclamation [No. 8031108] “is fictitious and falsified.
Acting on the said Memoranda, Commissioner Sadain submitted his Recommendation5 to the COMELEC, thus:
1. Finds that there was a VALID PROCLAMATION of the winning candidates for positions of Members of the Sangguniang Bayan of Palimbang, Sultan Kudarat as contained in Certificate of Canvass of Votes and Proclamation No. 8031109;
2. That there being a VALID PROCLAMATION, there is NO NEED for adjudication on this matter; and therefore
3. Respectfully RECOMMENDS to the Commission En Banc, the adoption of the following recommendation [Annex “D”] of Atty. Jose P. Balbuena, Dir., Law Department and Atty. Gregorio T. Saraos, Attorney II, IPD, Law Department. PREMISES CONSIDERED, the Law Department RECOMMENDS to issue an Order for the immediate installation of the winning members of the Sangguniang Bayan [of Palimbang, Sultan Kudarat], namely: JOENIME B. KAPINA, MONIB B. WALINGWALING, MAULANA G. KARNAIN, ABDULGAPHAR M. MUSTAPHA, MALOD B. MOSADI, ABDULRAKMAN A. TALIKOP, WILSON K. SABIWANG, AND MABANING P. SAMAMA... and for said purpose, to direct the Brigade Commander, 60 1st Brigade Pulutana of General Santos City, Saranggani Province, to effect and enforce the said Order and to submit his compliance within five (5) days from notice hereof.
Acting on the recommendation of Commissioner Sadain, the public respondent issued on November 6, 2001 the assailed Resolution No. 4615. The dispositive portion reads:
WHEREFORE, in view of the foregoing, the Commission RESOLVED, as it hereby RESOLVES, (1) that the proclamation of the winning candidates contained in Certificate of Canvass of Votes and Proclamation No. 8031109 is a valid proclamation; (2) to adopt the recommendation of the Law Department which is in accordance with the result of the investigation conducted by the Commissioner-in-Charge; and herein orders the immediate installation of JOENIME B. KAPINA, MONIB B. WALINGWALING, MAULANA G. KARNAIN, ABDULGAPHAR M. MUSTAPHA, MALOD B. MOSADI, ABDULRAKMAN A. TALIKOP, WILSON K. SABIWANG, AND MABANING P. SAMAMA as the duly elected members of the Sangguniang Bayan of Palimbang, Sultan Kudarat.6
The petitioners contend that the public respondent’s Resolution No. 4615 is null and void since it was issued without according them due notice and hearing, contrary to the enshrined principle of due process. The public respondent thus committed a grave abuse of discretion amounting to lack or excess of jurisdiction.
The petitioners allege that they were never accorded the chance to present their side in connection with the investigation that was purportedly conducted by Commissioner Sadain and on the memoranda/report of the public respondent’s officers. The public respondent simply approved the recommendation of Commissioner Sadain. The petitioners were kept in the dark, learned about the controversy only when they were notified of the assailed resolution of the public respondent.
The public respondent, through the Office of the Solicitor General, as well as the private respondents, asserts that the petitioners failed to file a motion for reconsideration of the assailed decision before instituting this action with this Court; hence, the petition is premature. It is pointed out that the public respondent has broad powers to enforce all election laws, it has the power to control and supervise the proceedings of the board of canvassers, and the power to suspend or annul proclamation. When it learned about the two (2) sets of winning candidates as members of Sangguniang Bayan of Palimbang, Sultan Kudarat, the public respondent required an investigation to be conducted by one of the commissioners, who required the election officers in the place concerned to submit their reports on the matter. After a study of the various reports, it was ascertained that COCVP (C.E Form No. 25) No. 8031108 was null and void, fictitious and falsified. The public respondent made a finding that the genuine COCVP was that one bearing Serial No. 8031109, intended for the Municipality of Palimbang, Sultan Kudarat. It was thus incumbent upon the public respondent to order the immediate installation of the winning candidates on the basis of the genuine COCVP to give effect to the will of the electorate, conformably to its mandate under Section 242 of the Omnibus Election Code and the ruling of this Court in Aguam vs. Commission on Elections.7
The public respondent further asserts that the twin requirement of notice and hearing in annulment of proclamation is not applicable when the proclamation is null and void, citing Utto vs. Commission on Elections.8
The petition is meritorious.
While it is true that the COMELEC is vested with a broad power to enforce all election laws, the same is subject to the right of the parties to due process. In this case, the petitioners had been proclaimed as the winning candidates and had assumed their office. Since then, they had been exercising their rights and performing their duties as members of the Sangguniang Bayan of Palimbang, Sultan Kudarat. Their proclamation on May 20, 2001 enjoys the presumption of regularity and validity since no contest or protest was even filed assailing the same. The petitioners cannot be removed from office without due process of law. Due process in the proceedings before the public respondent exercising its quasi-judicial functions, requires due notice and hearing, among others. Thus, although the COMELEC possesses, in appropriate cases, the power to annul or suspend the proclamation of any candidate, we also ruled in Fariñas vs. Commission on Elections, Reyes vs. Commission on Elections and Gallardo vs. Commission on Elections that the COMELEC is without power to partially or totally annul a proclamation or suspend the effects of a proclamation without notice and hearing.9
In this case, the public respondent nullified the proclamation of the petitioners and ousted them from their office as members of the Sangguniang Bayan of Palimbang, based solely on the recommendations of its law department and of Commissioner Sadain, and on the memoranda of its officers. The petitioners were not accorded a chance to be heard on the said recommendations and the memorandum of Regional Election Director Clarita Callar, certification of Celia Romero, and certification of Election Officer Malic Sansarona dated September 12, 2001 before it issued the assailed resolution.
The conclusion of the public respondent that the basis of the petitioners’ proclamation was a fictitious and falsified document was grounded, inter alia, on a “confidential certification” of Election Officer Malic Sansarona dated September 12, 2001.10 However, it appears that a certification11 was earlier issued by the same election officer on June 25, 2001, stating that the petitioners whose names were listed as winning candidates as Sangguniang Bayan members in the COCVP (C.E. Form No. 25) No. 8031108, the very certificate declared by the public respondent in its Resolution No. 4615 as fictitious and falsified document, won in the elections.
In the case of Caruncho III vs. Commission on Elections,12 this Court has held that due process in quasi-judicial proceedings before the COMELEC requires due notice and hearing. The proclamation of a winning candidate cannot be annulled if he has not been notified of any motion to set aside his proclamation. This Court also ruled in Sandoval vs. Commission on Elections13 that:
... Although the COMELEC is clothed with jurisdiction over the subject matter and issue of SPC No. 98-143 and SPC No. 98-206, we find the exercise of its jurisdiction tainted with illegality. We hold that its order to set aside the proclamation of petitioner is invalid for having been rendered without due process of law. Procedural due process demands prior notice and hearing. Then after the hearing, it is also necessary that the tribunal show substantial evidence to support its ruling. In other words, due process requires that a party be given an opportunity to adduce his evidence to support his side of the case and that the evidence should be considered in the adjudication of the case. The facts show that COMELEC set aside the proclamation of petitioner without the benefit of prior notice and hearing and it rendered the questioned order based solely on private respondent’s allegations. We held in Bince, Jr. vs. COMELEC:
Petitioner cannot be deprived of his office without due process of law. Although public office is not property under Section 1 of the Bill of Rights of the Constitution, and one cannot acquire a vested right to public office, it is, nevertheless, a protected right. Due process in proceedings before the COMELEC, exercising its quasi-judicial functions, requires due notice and hearing, among others. Thus, although the COMELEC possesses, in appropriate cases, the power to annul or suspend the proclamation of any candidate, We had ruled in Farinas vs. Commission on Elections, Reyes vs. Commission on Elections and Gallardo vs. Commission on Elections that the COMELEC is without power to partially or totally annul a proclamation or suspend the effects of a proclamation without notice and hearing.
The public respondent’s reliance on the ruling of this Court in Utto vs. Commission on Elections14 is misplaced. The Court, in that case, held that the twin-requirement of notice and hearing in an annulment of proclamation is not applicable because of the illegality of petitioner’s proclamation.15 The factual circumstances in the instant petition are far different from those obtaining in Utto. In the Utto case, a notice of appeal was filed questioning the ruling of the board of canvassers but, the latter proceeded in proclaiming Utto as the winning candidate. This made the proclamation illegal. In the present case, nobody questioned the petitioners’ proclamation.
We rule that the petition in this case was not prematurely filed. Generally, a motion for reconsideration is a pre-requisite to the viability of a special civil action for certiorari. However, there are exceptions to the rule. The aggrieved party is not obliged to first file a motion for reconsideration of the assailed resolution before filing a petition under Rule 65 of the Rules of Court, as amended where, as in this case, (1) the question is purely legal, (2) judicial intervention is urgent; (3) its application may cause great and irreparable damage; and (4) the controverted acts violate due process.16
The private respondents cannot invoke Section 242 of the Omnibus Election Code to fortify their cause, because the said law specifically refers to pre-proclamation controversies, thus:
Sec. 242. Commission’s exclusive jurisdiction of all pre-proclamation controversies. – The Commission shall have exclusive jurisdiction of all pre-proclamation controversies. It may motu proprio or upon written petition, and after due notice and hearing, order the partial or total suspension of the proclamation of any candidate-elect or annul partially or totally any proclamation, if one has been made, as the evidence shall warrant in accordance with the succeeding section.17
Even the fact that the public respondent initiated the proceedings for the partial or total annulment of an illegal proclamation would not dispense with the requirements of notice and hearing. This was made clear in Sandoval vs. Commission on Elections:18
Citing Section 242 of the Omnibus Election Code, private respondent argues that the COMELEC is authorized to annul an illegal proclamation even without notice and hearing because the law states that it may motu proprio order a partial or total suspension of the proclamation of any candidate-elect or annul partially or totally any proclamation, if one has been made. ...
...
The phrase “motu proprio” does not refer to the annulment of proclamation but to the manner of initiating the proceedings to annul a proclamation made by the board of canvassers. The law provides two ways by which annulment proceedings may be initiated. It may be at the own initiative of the COMELEC (motu proprio) or by written petition. In either case, notice and hearing is required. This is clear from the language of the law.19
IN THE LIGHT OF THE FOREGOING, the petition is GRANTED. The assailed Resolution No. 4615 of the public respondent COMELEC en banc dated November 6, 2001, is hereby REVERSED and SET ASIDE. SO ORDERED.
Davide, Jr., C.J., Bellosillo, Puno, Panganiban, Quisumbing, Sandoval-Gutierrez, Carpio, Austria- Martinez, Corona, Carpio-Morales, Azcuna, and Tinga, JJ., concur.
Vitug, J., in the result.
Ynares-Santiago, J. on leave.
ICHONG vs. Hernandez
G.R. No. L-7995 May 31, 1957
LAO H. ICHONG, in his own behalf and in behalf of other alien residents, corporations and partnerships adversely affected. by Republic Act No. 1180, petitioner, vs. JAIME HERNANDEZ, Secretary of Finance, and MARCELINO SARMIENTO, City Treasurer of Manila,respondents.
Ozaeta, Lichauco and Picazo and Sycip, Quisumbing, Salazar and Associates for petitioner. Office of the Solicitor General Ambrosio Padilla and Solicitor Pacifico P. de Castro for respondent Secretary of Finance. City Fiscal Eugenio Angeles and Assistant City Fiscal Eulogio S. Serrano for respondent City Treasurer. Dionisio Reyes as Amicus Curiae. Marcial G. Mendiola as Amicus Curiae. Emiliano R. Navarro as Amicus Curiae.
LABRADOR, J.:
I. The case and issue, in general
This Court has before it the delicate task of passing upon the validity and constitutionality of a legislative enactment, fundamental and far-reaching in significance. The enactment poses questions of due process, police power and equal protection of the laws. It also poses an important issue of fact, that is whether the conditions which the disputed law purports to remedy really or actually exist. Admittedly springing from a deep, militant, and positive nationalistic impulse, the law purports to protect citizen and country from the alien retailer. Through it, and within the field of economy it regulates, Congress attempts to translate national aspirations for economic independence and national security, rooted in the drive and urge for national survival and welfare, into a concrete and tangible measures designed to free the national retailer from the competing dominance of the alien, so that the country and the nation may be free from a supposed economic dependence and bondage. Do the facts and circumstances justify the enactment?
II. Pertinent provisions of Republic Act No. 1180
Republic Act No. 1180 is entitled "An Act to Regulate the Retail Business." In effect it nationalizes the retail trade business. The main provisions of the Act are: (1) a prohibition against persons, not citizens of the Philippines, and against associations, partnerships, or corporations the capital of which are not wholly owned by citizens of the Philippines, from engaging directly or indirectly in the retail trade; (2) an exception from the above prohibition in favor of aliens actually engaged in said business on May 15, 1954, who are allowed to continue to engaged therein, unless their licenses are forfeited in accordance with the law, until their death or voluntary retirement in case of natural persons, and for ten years after the approval of the Act or until the expiration of term in case of juridical persons; (3) an exception therefrom in favor of citizens and juridical entities of the United States; (4) a provision for the forfeiture of licenses (to engage in the retail business) for violation of the laws on nationalization, control weights and measures and labor and other laws relating to trade, commerce and industry; (5) a prohibition against the establishment or opening by aliens actually engaged in the retail business of additional stores or branches of retail business, (6) a provision requiring aliens actually engaged in the retail business to present for registration with the proper authorities a verified statement concerning their businesses, giving, among other matters, the nature of the business, their assets and liabilities and their offices and principal offices of judicial entities; and (7) a provision allowing the heirs of aliens now engaged in the retail business who die, to continue such business for a period of six months for purposes of liquidation.
III. Grounds upon which petition is based-Answer thereto
Petitioner, for and in his own behalf and on behalf of other alien residents corporations and partnerships adversely affected by the provisions of Republic Act. No. 1180, brought this action to obtain a judicial declaration that said Act is unconstitutional, and to enjoin the Secretary of Finance and all other persons acting under him, particularly city and municipal treasurers, from enforcing its provisions. Petitioner attacks the constitutionality of the Act, contending that: (1) it denies to alien residents the equal protection of the laws and deprives of their liberty and property without due process of law ; (2) the subject of the Act is not expressed or comprehended in the title thereof; (3) the Act violates international and treaty obligations of the Republic of the Philippines; (4) the provisions of the Act against the transmission by aliens of their retail business thru hereditary succession, and those requiring 100% Filipino capitalization for a corporation or entity to entitle it to engage in the retail business, violate the spirit of Sections 1 and 5, Article XIII and Section 8 of Article XIV of the Constitution.
In answer, the Solicitor-General and the Fiscal of the City of Manila contend that: (1) the Act was passed in the valid exercise of the police power of the State, which exercise is authorized in the Constitution in the interest of national economic survival; (2) the Act has only one subject embraced in the title; (3) no treaty or international obligations are infringed; (4) as regards hereditary succession, only the form is affected but the value of the property is not impaired, and the institution of inheritance is only of statutory origin.
IV. Preliminary consideration of legal principles involved a. The police power. —
There is no question that the Act was approved in the exercise of the police power, but petitioner claims that its exercise in this instance is attended by a violation of the constitutional requirements of due process and equal protection of the laws. But before proceeding to the consideration and resolution of the ultimate issue involved, it would be well to bear in mind certain basic and fundamental, albeit preliminary, considerations in the determination of the ever recurrent conflict between police power and the guarantees of due process and equal protection of the laws. What is the scope of police power, and how are the due process and equal protection clauses related to it? What is the province and power of the legislature, and what is the function and duty of the courts? These consideration must be clearly and correctly understood that their application to the facts of the case may be brought forth with clarity and the issue accordingly resolved.
It has been said the police power is so far - reaching in scope, that it has become almost impossible to limit its sweep. As it derives its existence from the very existence of the State itself, it does not need to be expressed or defined in its scope; it is said to be co-extensive with self-protection and survival, and as such it is the most positive and active of all governmental processes, the most essential, insistent and illimitable. Especially is it so under a modern democratic framework where the demands of society and of nations have multiplied to almost unimaginable proportions; the field and scope of police power has become almost boundless, just as the fields of public interest and public welfare have become almost all-embracing and have transcended human foresight. Otherwise stated, as we cannot foresee the needs and demands of public interest and welfare in this constantly changing and progressive world, so we cannot delimit beforehand the extent or scope of police power by which and through which the State seeks to attain or achieve interest or welfare. So it is that Constitutions do not define the scope or extent of the police power of the State; what they do is to set forth the limitations thereof. The most important of these are the due process clause and the equal protection clause. b. Limitations on police power. —
The basic limitations of due process and equal protection are found in the following provisions of our Constitution:
SECTION 1.(1) No person shall be deprived of life, liberty or property without due process of law, nor any person be denied the equal protection of the laws. (Article III, Phil. Constitution)
These constitutional guarantees which embody the essence of individual liberty and freedom in democracies, are not limited to citizens alone but are admittedly universal in their application, without regard to any differences of race, of color, or of nationality. (Yick Wo vs. Hopkins, 30, L. ed. 220, 226.) c. The, equal protection clause. —
The equal protection of the law clause is against undue favor and individual or class privilege, as well as hostile discrimination or the oppression of inequality. It is not intended to prohibit legislation, which is limited either in the object to which it is directed or by territory within which is to operate. It does not demand absolute equality among residents; it merely requires that all persons shall be treated alike, under like circumstances and conditions both as to privileges conferred and liabilities enforced. The equal protection clause is not infringed by legislation which applies only to those persons falling within a specified class, if it applies alike to all persons within such class, and reasonable grounds exists for making a distinction between those who fall within such class and those who do not. (2 Cooley, Constitutional Limitations, 824-825.) d. The due process clause. —
The due process clause has to do with the reasonableness of legislation enacted in pursuance of the police power. Is there public interest, a public purpose; is public welfare involved? Is the Act reasonably necessary for the accomplishment of the legislature's purpose; is it not unreasonable, arbitrary or oppressive? Is there sufficient foundation or reason in connection with the matter involved; or has there not been a capricious use of the legislative power? Can the aims conceived be achieved by the means used, or is it not merely an unjustified interference with private interest? These are the questions that we ask when the due process test is applied.
The conflict, therefore, between police power and the guarantees of due process and equal protection of the laws is more apparent than real. Properly related, the power and the guarantees are supposed to coexist. The balancing is the essence or, shall it be said, the indispensable means for the attainment of legitimate aspirations of any democratic society. There can be no absolute power, whoever exercise it, for that would be tyranny. Yet there can neither be absolute liberty, for that would mean license and anarchy. So the State can deprive persons of life, liberty and property, provided there is due process of law; and persons may be classified into classes and groups, provided everyone is given the equal protection of the law. The test or standard, as always, is reason. The police power legislation must be firmly grounded on public interest and welfare, and a reasonable relation must exist between purposes and means. And if distinction and classification has been made, there must be a reasonable basis for said distinction. e. Legislative discretion not subject to judicial review. — Now, in this matter of equitable balancing, what is the proper place and role of the courts? It must not be overlooked, in the first place, that the legislature, which is the constitutional repository of police power and exercises the prerogative of determining the policy of the State, is by force of circumstances primarily the judge of necessity, adequacy or reasonableness and wisdom, of any law promulgated in the exercise of the police power, or of the measures adopted to implement the public policy or to achieve public interest. On the other hand, courts, although zealous guardians of individual liberty and right, have nevertheless evinced a reluctance to interfere with the exercise of the legislative prerogative. They have done so early where there has been a clear, patent or palpable arbitrary and unreasonable abuse of the legislative prerogative. Moreover, courts are not supposed to override legitimate policy, and courts never inquire into the wisdom of the law.
V. Economic problems sought to be remedied
With the above considerations in mind, we will now proceed to delve directly into the issue involved. If the disputed legislation were merely a regulation, as its title indicates, there would be no question that it falls within the legitimate scope of legislative power. But it goes further and prohibits a group of residents, the aliens, from engaging therein. The problem becomes more complex because its subject is a common, trade or occupation, as old as society itself, which from the immemorial has always been open to residents, irrespective of race, color or citizenship. a. Importance of retail trade in the economy of the nation. —
In a primitive economy where families produce all that they consume and consume all that they produce, the dealer, of course, is unknown. But as group life develops and families begin to live in communities producing more than what they consume and needing an infinite number of things they do not produce, the dealer comes into existence. As villages develop into big communities and specialization in production begins, the dealer's importance is enhanced. Under modern conditions and standards of living, in which man's needs have multiplied and diversified to unlimited extents and proportions, the retailer comes as essential as the producer, because thru him the infinite variety of articles, goods and needed for daily life are placed within the easy reach of consumers. Retail dealers perform the functions of capillaries in the human body, thru which all the needed food and supplies are ministered to members of the communities comprising the nation.
There cannot be any question about the importance of the retailer in the life of the community. He ministers to the resident's daily needs, food in all its increasing forms, and the various little gadgets and things needed for home and daily life. He provides his customers around his store with the rice or corn, the fish, the salt, the vinegar, the spices needed for the daily cooking. He has cloths to sell, even the needle and the thread to sew them or darn the clothes that wear out. The retailer, therefore, from the lowly peddler, the owner of a small sari-sari store, to the operator of a department store or, a supermarket is so much a part of day-to-day existence. b. The alien retailer's trait. —
The alien retailer must have started plying his trades in this country in the bigger centers of population (Time there was when he was unknown in provincial towns and villages). Slowly but gradually be invaded towns and villages; now he predominates in the cities and big centers of population. He even pioneers, in far away nooks where the beginnings of community life appear, ministering to the daily needs of the residents and purchasing their agricultural produce for sale in the towns. It is an undeniable fact that in many communities the alien has replaced the native retailer. He has shown in this trade, industry without limit, and the patience and forbearance of a slave.
Derogatory epithets are hurled at him, but he laughs these off without murmur; insults of ill- bred and insolent neighbors and customers are made in his face, but he heeds them not, and he forgets and forgives. The community takes note of him, as he appears to be harmless and extremely useful. c. Alleged alien control and dominance. —
There is a general feeling on the part of the public, which appears to be true to fact, about the controlling and dominant position that the alien retailer holds in the nation's economy. Food and other essentials, clothing, almost all articles of daily life reach the residents mostly through him. In big cities and centers of population he has acquired not only predominance, but apparent control over distribution of almost all kinds of goods, such as lumber, hardware, textiles, groceries, drugs, sugar, flour, garlic, and scores of other goods and articles. And were it not for some national corporations like the Naric, the Namarco, the Facomas and the Acefa, his control over principal foods and products would easily become full and complete.
Petitioner denies that there is alien predominance and control in the retail trade. In one breath it is said that the fear is unfounded and the threat is imagined; in another, it is charged that the law is merely the result of radicalism and pure and unabashed nationalism. Alienage, it is said, is not an element of control; also so many unmanageable factors in the retail business make control virtually impossible. The first argument which brings up an issue of fact merits serious consideration. The others are matters of opinion within the exclusive competence of the legislature and beyond our prerogative to pass upon and decide.
The best evidence are the statistics on the retail trade, which put down the figures in black and white. Between the constitutional convention year (1935), when the fear of alien domination and control of the retail trade already filled the minds of our leaders with fears and misgivings, and the year of the enactment of the nationalization of the retail trade act (1954), official statistics unmistakably point out to the ever-increasing dominance and control by the alien of the retail trade, as witness the following tables:
Assets Gross Sales
Year and No.- Per cent Per cent Retailers Pesos Pesos Establishments Distribution Distribution Nationality
1941:
Filipino 106,671 200,323,138 55.82 174,181,924 51.74 ......
Chinese 15,356 118,348,692 32.98 148,813,239 44.21 ......
Others 1,646 40,187,090 11.20 13,630,239 4.05 ......
1947:
Filipino 111,107 208,658,946 65.05 279,583,333 57.03 ......
Chinese 13,774 106,156,218 33.56 205,701,134 41.96 ......
Others 354 8,761,260 .49 4,927,168 1.01 ......
1948: (Census)
Filipino 113,631 213,342,264 67.30 467,161,667 60.51 ......
Chinese 12,087 93,155,459 29.38 294,894,227 38.20 ......
Others 422 10,514,675 3.32 9,995,402 1.29 ......
1949:
Filipino 113,659 213,451,602 60.89 462,532,901 53.47 ......
Chinese 16,248 125,223,336 35.72 392,414,875 45.36 ......
Others 486 12,056,365 3.39 10,078,364 1.17 ......
1951:
Filipino 119,352 224,053,620 61.09 466,058,052 53.07 ......
Chinese 17,429 134,325,303 36.60 404,481,384 46.06 ......
Others 347 8,614,025 2.31 7,645,327 87 ......
AVERAGE ASSETS AND GROSS SALES PER ESTABLISHMENT
Item Gross Year and Retailer's Assets Sales Nationality (Pesos) (Pesos)
1941: Filipino 1,878 1,633 ......
Chinese 7,707 9,691 ......
Others 24,415 8,281 ......
1947:
Filipino 1,878 2,516 ......
Chinese 7,707 14,934 ......
Others 24,749 13,919 ......
1948: (Census)
Filipino 1,878 4,111 ......
Chinese 7,707 24,398 ......
Others 24,916 23,686 ......
1949:
Filipino 1,878 4,069 ......
Chinese 7,707 24,152 ......
Others 24,807 20,737 ......
1951:
Filipino 1,877 3,905 ......
Chinese 7,707 33,207 ......
Others 24,824 22,033 ......
(Estimated Assets and Gross Sales of Retail Establishments, By Year and Nationality of Owners, Benchmark: 1948 Census, issued by the Bureau of Census and Statistics, Department of Commerce and Industry; pp. 18-19 of Answer.)
The above statistics do not include corporations and partnerships, while the figures on Filipino establishments already include mere market vendors, whose capital is necessarily small..
The above figures reveal that in percentage distribution of assests and gross sales, alien participation has steadily increased during the years. It is true, of course, that Filipinos have the edge in the number of retailers, but aliens more than make up for the numerical gap through their assests and gross sales which average between six and seven times those of the very many Filipino retailers. Numbers in retailers, here, do not imply superiority; the alien invests more capital, buys and sells six to seven times more, and gains much more. The same official report, pointing out to the known predominance of foreign elements in the retail trade, remarks that the Filipino retailers were largely engaged in minor retailer enterprises. As observed by respondents, the native investment is thinly spread, and the Filipino retailer is practically helpless in matters of capital, credit, price and supply. d. Alien control and threat, subject of apprehension in Constitutional convention. — It is this domination and control, which we believe has been sufficiently shown to exist, that is the legislature's target in the enactment of the disputed nationalization would never have been adopted. The framers of our Constitution also believed in the existence of this alien dominance and control when they approved a resolution categorically declaring among other things, that "it is the sense of the Convention that the public interest requires the nationalization of the retail trade; . . . ." (II Aruego, The Framing of the Philippine Constitution, 662-663, quoted on page 67 of Petitioner.) That was twenty-two years ago; and the events since then have not been either pleasant or comforting. Dean Sinco of the University of the Philippines College of Law, commenting on the patrimony clause of the Preamble opines that the fathers of our Constitution were merely translating the general preoccupation of Filipinos "of the dangers from alien interests that had already brought under their control the commercial and other economic activities of the country" (Sinco, Phil. Political Law, 10th ed., p. 114); and analyzing the concern of the members of the constitutional convention for the economic life of the citizens, in connection with the nationalistic provisions of the Constitution, he says:
But there has been a general feeling that alien dominance over the economic life of the country is not desirable and that if such a situation should remain, political independence alone is no guarantee to national stability and strength. Filipino private capital is not big enough to wrest from alien hands the control of the national economy. Moreover, it is but of recent formation and hence, largely inexperienced, timid and hesitant. Under such conditions, the government as the instrumentality of the national will, has to step in and assume the initiative, if not the leadership, in the struggle for the economic freedom of the nation in somewhat the same way that it did in the crusade for political freedom. Thus . . . it (the Constitution) envisages an organized movement for the protection of the nation not only against the possibilities of armed invasion but also against its economic subjugation by alien interests in the economic field. (Phil. Political Law by Sinco, 10th ed., p. 476.)
Belief in the existence of alien control and predominance is felt in other quarters. Filipino businessmen, manufacturers and producers believe so; they fear the dangers coming from alien control, and they express sentiments of economic independence. Witness thereto is Resolution No. 1, approved on July 18, 1953, of the Fifth National convention of Filipino Businessmen, and a similar resolution, approved on March 20, 1954, of the Second National Convention of Manufacturers and Producers. The man in the street also believes, and fears, alien predominance and control; so our newspapers, which have editorially pointed out not only to control but to alien stranglehold. We, therefore, find alien domination and control to be a fact, a reality proved by official statistics, and felt by all the sections and groups that compose the Filipino community. e. Dangers of alien control and dominance in retail. — But the dangers arising from alien participation in the retail trade does not seem to lie in the predominance alone; there is a prevailing feeling that such predominance may truly endanger the national interest. With ample capital, unity of purpose and action and thorough organization, alien retailers and merchants can act in such complete unison and concert on such vital matters as the fixing of prices, the determination of the amount of goods or articles to be made available in the market, and even the choice of the goods or articles they would or would not patronize or distribute, that fears of dislocation of the national economy and of the complete subservience of national economy and of the consuming public are not entirely unfounded. Nationals, producers and consumers alike can be placed completely at their mercy. This is easily illustrated. Suppose an article of daily use is desired to be prescribed by the aliens, because the producer or importer does not offer them sufficient profits, or because a new competing article offers bigger profits for its introduction. All that aliens would do is to agree to refuse to sell the first article, eliminating it from their stocks, offering the new one as a substitute. Hence, the producers or importers of the prescribed article, or its consumers, find the article suddenly out of the prescribed article, or its consumers, find the article suddenly out of circulation. Freedom of trade is thus curtailed and free enterprise correspondingly suppressed.
We can even go farther than theoretical illustrations to show the pernicious influences of alien domination. Grave abuses have characterized the exercise of the retail trade by aliens. It is a fact within judicial notice, which courts of justice may not properly overlook or ignore in the interests of truth and justice, that there exists a general feeling on the part of the public that alien participation in the retail trade has been attended by a pernicious and intolerable practices, the mention of a few of which would suffice for our purposes; that at some time or other they have cornered the market of essential commodities, like corn and rice, creating artificial scarcities to justify and enhance profits to unreasonable proportions; that they have hoarded essential foods to the inconvenience and prejudice of the consuming public, so much so that the Government has had to establish the National Rice and Corn Corporation to save the public from their continuous hoarding practices and tendencies; that they have violated price control laws, especially on foods and essential commodities, such that the legislature had to enact a law (Sec. 9, Republic Act No. 1168), authorizing their immediate and automatic deportation for price control convictions; that they have secret combinations among themselves to control prices, cheating the operation of the law of supply and demand; that they have connived to boycott honest merchants and traders who would not cater or yield to their demands, in unlawful restraint of freedom of trade and enterprise. They are believed by the public to have evaded tax laws, smuggled goods and money into and out of the land, violated import and export prohibitions, control laws and the like, in derision and contempt of lawful authority. It is also believed that they have engaged in corrupting public officials with fabulous bribes, indirectly causing the prevalence of graft and corruption in the Government. As a matter of fact appeals to unscrupulous aliens have been made both by the Government and by their own lawful diplomatic representatives, action which impliedly admits a prevailing feeling about the existence of many of the above practices.
The circumstances above set forth create well founded fears that worse things may come in the future. The present dominance of the alien retailer, especially in the big centers of population, therefore, becomes a potential source of danger on occasions of war or other calamity. We do not have here in this country isolated groups of harmless aliens retailing goods among nationals; what we have are well organized and powerful groups that dominate the distribution of goods and commodities in the communities and big centers of population. They owe no allegiance or loyalty to the State, and the State cannot rely upon them in times of crisis or emergency. While the national holds his life, his person and his property subject to the needs of his country, the alien may even become the potential enemy of the State. f. Law enacted in interest of national economic survival and security. —
We are fully satisfied upon a consideration of all the facts and circumstances that the disputed law is not the product of racial hostility, prejudice or discrimination, but the expression of the legitimate desire and determination of the people, thru their authorized representatives, to free the nation from the economic situation that has unfortunately been saddled upon it rightly or wrongly, to its disadvantage. The law is clearly in the interest of the public, nay of the national security itself, and indisputably falls within the scope of police power, thru which and by which the State insures its existence and security and the supreme welfare of its citizens.
VI. The Equal Protection Limitation a. Objections to alien participation in retail trade. — The next question that now poses solution is, Does the law deny the equal protection of the laws? As pointed out above, the mere fact of alienage is the root and cause of the distinction between the alien and the national as a trader. The alien resident owes allegiance to the country of his birth or his adopted country; his stay here is for personal convenience; he is attracted by the lure of gain and profit. His aim or purpose of stay, we admit, is neither illegitimate nor immoral, but he is naturally lacking in that spirit of loyalty and enthusiasm for this country where he temporarily stays and makes his living, or of that spirit of regard, sympathy and consideration for his Filipino customers as would prevent him from taking advantage of their weakness and exploiting them. The faster he makes his pile, the earlier can the alien go back to his beloved country and his beloved kin and countrymen. The experience of the country is that the alien retailer has shown such utter disregard for his customers and the people on whom he makes his profit, that it has been found necessary to adopt the legislation, radical as it may seem. Another objection to the alien retailer in this country is that he never really makes a genuine contribution to national income and wealth. He undoubtedly contributes to general distribution, but the gains and profits he makes are not invested in industries that would help the country's economy and increase national wealth. The alien's interest in this country being merely transient and temporary, it would indeed be ill-advised to continue entrusting the very important function of retail distribution to his hands.
The practices resorted to by aliens in the control of distribution, as already pointed out above, their secret manipulations of stocks of commodities and prices, their utter disregard of the welfare of their customers and of the ultimate happiness of the people of the nation of which they are mere guests, which practices, manipulations and disregard do not attend the exercise of the trade by the nationals, show the existence of real and actual, positive and fundamental differences between an alien and a national which fully justify the legislative classification adopted in the retail trade measure. These differences are certainly a valid reason for the State to prefer the national over the alien in the retail trade. We would be doing violence to fact and reality were we to hold that no reason or ground for a legitimate distinction can be found between one and the other. b. Difference in alien aims and purposes sufficient basis for distinction. —
The above objectionable characteristics of the exercise of the retail trade by the aliens, which are actual and real, furnish sufficient grounds for legislative classification of retail traders into nationals and aliens. Some may disagree with the wisdom of the legislature's classification. To this we answer, that this is the prerogative of the law-making power. Since the Court finds that the classification is actual, real and reasonable, and all persons of one class are treated alike, and as it cannot be said that the classification is patently unreasonable and unfounded, it is in duty bound to declare that the legislature acted within its legitimate prerogative and it can not declare that the act transcends the limit of equal protection established by the Constitution.
Broadly speaking, the power of the legislature to make distinctions and classifications among persons is not curtailed or denied by the equal protection of the laws clause. The legislative power admits of a wide scope of discretion, and a law can be violative of the constitutional limitation only when the classification is without reasonable basis. In addition to the authorities we have earlier cited, we can also refer to the case of Linsey vs. Natural Carbonic Fas Co. (1911), 55 L. ed., 369, which clearly and succinctly defined the application of equal protection clause to a law sought to be voided as contrary thereto:
. . . . "1. The equal protection clause of the Fourteenth Amendment does not take from the state the power to classify in the adoption of police laws, but admits of the exercise of the wide scope of discretion in that regard, and avoids what is done only when it is without any reasonable basis, and therefore is purely arbitrary. 2. A classification having some reasonable basis does not offend against that clause merely because it is not made with mathematical nicety, or because in practice it results in some inequality. 3. When the classification in such a law is called in question, if any state of facts reasonably can be conceived that would sustain it, the existence of that state of facts at the time the law was enacted must be assumed. 4. One who assails the classification in such a law must carry the burden of showing that it does not rest upon any reasonable basis but is essentially arbitrary." c. Authorities recognizing citizenship as basis for classification. —
The question as to whether or not citizenship is a legal and valid ground for classification has already been affirmatively decided in this jurisdiction as well as in various courts in the United States. In the case of Smith Bell & Co. vs. Natividad, 40 Phil. 136, where the validity of Act No. 2761 of the Philippine Legislature was in issue, because of a condition therein limiting the ownership of vessels engaged in coastwise trade to corporations formed by citizens of the Philippine Islands or the United States, thus denying the right to aliens, it was held that the Philippine Legislature did not violate the equal protection clause of the Philippine Bill of Rights. The legislature in enacting the law had as ultimate purpose the encouragement of Philippine shipbuilding and the safety for these Islands from foreign interlopers. We held that this was a valid exercise of the police power, and all presumptions are in favor of its constitutionality. In substance, we held that the limitation of domestic ownership of vessels engaged in coastwise trade to citizens of the Philippines does not violate the equal protection of the law and due process or law clauses of the Philippine Bill of Rights. In rendering said decision we quoted with approval the concurring opinion of Justice Johnson in the case of Gibbons vs. Ogden, 9 Wheat., I, as follows:
"Licensing acts, in fact, in legislation, are universally restraining acts; as, for example, acts licensing gaming houses, retailers of spirituous liquors, etc. The act, in this instance, is distinctly of that character, and forms part of an extensive system, the object of which is to encourage American shipping, and place them on an equal footing with the shipping of other nations. Almost every commercial nation reserves to its own subjects a monopoly of its coasting trade; and a countervailing privilege in favor of American shipping is contemplated, in the whole legislation of the United States on this subject. It is not to give the vessel an American character, that the license is granted; that effect has been correctly attributed to the act of her enrollment. But it is to confer on her American privileges, as contra distinguished from foreign; and to preserve the Government from fraud by foreigners; in surreptitiously intruding themselves into the American commercial marine, as well as frauds upon the revenue in the trade coastwise, that this whole system is projected."
The rule in general is as follows: Aliens are under no special constitutional protection which forbids a classification otherwise justified simply because the limitation of the class falls along the lines of nationality. That would be requiring a higher degree of protection for aliens as a class than for similar classes than for similar classes of American citizens. Broadly speaking, the difference in status between citizens and aliens constitutes a basis for reasonable classification in the exercise of police power. (2 Am., Jur. 468-469.)
In Commonwealth vs. Hana, 81 N. E. 149 (Massachusetts, 1907), a statute on the licensing of hawkers and peddlers, which provided that no one can obtain a license unless he is, or has declared his intention, to become a citizen of the United States, was held valid, for the following reason: It may seem wise to the legislature to limit the business of those who are supposed to have regard for the welfare, good order and happiness of the community, and the court cannot question this judgment and conclusion. In Bloomfield vs. State, 99 N. E. 309 (Ohio, 1912), a statute which prevented certain persons, among them aliens, from engaging in the traffic of liquors, was found not to be the result of race hatred, or in hospitality, or a deliberate purpose to discriminate, but was based on the belief that an alien cannot be sufficiently acquainted with "our institutions and our life as to enable him to appreciate the relation of this particular business to our entire social fabric", and was not, therefore, invalid. In Ohio ex rel. Clarke vs. Deckebach, 274 U. S. 392, 71 L. ed. 115 (1926), the U.S. Supreme Court had under consideration an ordinance of the city of Cincinnati prohibiting the issuance of licenses (pools and billiard rooms) to aliens. It held that plainly irrational discrimination against aliens is prohibited, but it does not follow that alien race and allegiance may not bear in some instances such a relation to a legitimate object of legislation as to be made the basis of permitted classification, and that it could not state that the legislation is clearly wrong; and that latitude must be allowed for the legislative appraisement of local conditions and for the legislative choice of methods for controlling an apprehended evil. The case of State vs. Carrol, 124 N. E. 129 (Ohio, 1919) is a parallel case to the one at bar. In Asakura vs. City of Seattle, 210 P. 30 (Washington, 1922), the business of pawn brooking was considered as having tendencies injuring public interest, and limiting it to citizens is within the scope of police power. A similar statute denying aliens the right to engage in auctioneering was also sustained in Wright vs. May, L.R.A., 1915 P. 151 (Minnesota, 1914). So also in Anton vs. Van Winkle, 297 F. 340 (Oregon, 1924), the court said that aliens are judicially known to have different interests, knowledge, attitude, psychology and loyalty, hence the prohibitions of issuance of licenses to them for the business of pawnbroker, pool, billiard, card room, dance hall, is not an infringement of constitutional rights. In Templar vs. Michigan State Board of Examiners, 90 N.W. 1058 (Michigan, 1902), a law prohibiting the licensing of aliens as barbers was held void, but the reason for the decision was the court's findings that the exercise of the business by the aliens does not in any way affect the morals, the health, or even the convenience of the community. In Takahashi vs. Fish and Game Commission, 92 L. ed. 1479 (1947), a California statute banning the issuance of commercial fishing licenses to person ineligible to citizenship was held void, because the law conflicts with Federal power over immigration, and because there is no public interest in the mere claim of ownership of the waters and the fish in them, so there was no adequate justification for the discrimination. It further added that the law was the outgrowth of antagonism toward the persons of Japanese ancestry. However, two Justices dissented on the theory that fishing rights have been treated traditionally as natural resources. In Fraser vs. McConway & Tarley Co., 82 Fed. 257 (Pennsylvania, 1897), a state law which imposed a tax on every employer of foreign-born unnaturalized male persons over 21 years of age, was declared void because the court found that there was no reason for the classification and the tax was an arbitrary deduction from the daily wage of an employee. d. Authorities contra explained. —
It is true that some decisions of the Federal court and of the State courts in the United States hold that the distinction between aliens and citizens is not a valid ground for classification. But in this decision the laws declared invalid were found to be either arbitrary, unreasonable or capricious, or were the result or product of racial antagonism and hostility, and there was no question of public interest involved or pursued. In Yu Cong Eng vs. Trinidad, 70 L. ed. 1059 (1925), the United States Supreme Court declared invalid a Philippine law making unlawful the keeping of books of account in any language other than English, Spanish or any other local dialect, but the main reasons for the decisions are: (1) that if Chinese were driven out of business there would be no other system of distribution, and (2) that the Chinese would fall prey to all kinds of fraud, because they would be deprived of their right to be advised of their business and to direct its conduct. The real reason for the decision, therefore, is the court's belief that no public benefit would be derived from the operations of the law and on the other hand it would deprive Chinese of something indispensable for carrying on their business. In Yick Wo vs. Hopkins, 30 L. ed 220 (1885) an ordinance conferring powers on officials to withhold consent in the operation of laundries both as to persons and place, was declared invalid, but the court said that the power granted was arbitrary, that there was no reason for the discrimination which attended the administration and implementation of the law, and that the motive thereof was mere racial hostility. In State vs. Montgomery, 47 A. 165 (Maine, 1900), a law prohibiting aliens to engage as hawkers and peddlers was declared void, because the discrimination bore no reasonable and just relation to the act in respect to which the classification was proposed.
The case at bar is radically different, and the facts make them so. As we already have said, aliens do not naturally possess the sympathetic consideration and regard for the customers with whom they come in daily contact, nor the patriotic desire to help bolster the nation's economy, except in so far as it enhances their profit, nor the loyalty and allegiance which the national owes to the land. These limitations on the qualifications of the aliens have been shown on many occasions and instances, especially in times of crisis and emergency. We can do no better than borrow the language of Anton vs. Van Winkle, 297 F. 340, 342, to drive home the reality and significance of the distinction between the alien and the national, thus:
. . . . It may be judicially known, however, that alien coming into this country are without the intimate knowledge of our laws, customs, and usages that our own people have. So it is likewise known that certain classes of aliens are of different psychology from our fellow countrymen. Furthermore, it is natural and reasonable to suppose that the foreign born, whose allegiance is first to their own country, and whose ideals of governmental environment and control have been engendered and formed under entirely different regimes and political systems, have not the same inspiration for the public weal, nor are they as well disposed toward the United States, as those who by citizenship, are a part of the government itself. Further enlargement, is unnecessary. I have said enough so that obviously it cannot be affirmed with absolute confidence that the Legislature was without plausible reason for making the classification, and therefore appropriate discriminations against aliens as it relates to the subject of legislation. . . . .
VII. The Due Process of Law Limitation. a. Reasonability, the test of the limitation; determination by legislature decisive. —
We now come to due process as a limitation on the exercise of the police power. It has been stated by the highest authority in the United States that:
. . . . And the guaranty of due process, as has often been held, demands only that the law shall not be unreasonable, arbitrary or capricious, and that the means selected shall have a real and substantial relation to the subject sought to be attained. . . . . x x x x x x x x x
So far as the requirement of due process is concerned and in the absence of other constitutional restriction a state is free to adopt whatever economic policy may reasonably be deemed to promote public welfare, and to enforce that policy by legislation adapted to its purpose. The courts are without authority either to declare such policy, or, when it is declared by the legislature, to override it. If the laws passed are seen to have a reasonable relation to a proper legislative purpose, and are neither arbitrary nor discriminatory, the requirements of due process are satisfied, and judicial determination to that effect renders a court functus officio. . . . (Nebbia vs. New York, 78 L. ed. 940, 950, 957.)
Another authority states the principle thus: . . . . Too much significance cannot be given to the word "reasonable" in considering the scope of the police power in a constitutional sense, for the test used to determine the constitutionality of the means employed by the legislature is to inquire whether the restriction it imposes on rights secured to individuals by the Bill of Rights are unreasonable, and not whether it imposes any restrictions on such rights. . . . x x x x x x x x x
. . . . A statute to be within this power must also be reasonable in its operation upon the persons whom it affects, must not be for the annoyance of a particular class, and must not be unduly oppressive. (11 Am. Jur. Sec. 302., 1:1)- 1074-1075.)
In the case of Lawton vs. Steele, 38 L. ed. 385, 388. it was also held:
. . . . To justify the state in thus interposing its authority in behalf of the public, it must appear, first, that the interests of the public generally, as distinguished from those of a particular class, require such interference; and second, that the means are reasonably necessary for the accomplishment of the purpose, and not unduly oppressive upon individuals. . . .
Prata Undertaking Co. vs. State Board of Embalming, 104 ALR, 389, 395, fixes this test of constitutionality:
In determining whether a given act of the Legislature, passed in the exercise of the police power to regulate the operation of a business, is or is not constitutional, one of the first questions to be considered by the court is whether the power as exercised has a sufficient foundation in reason in connection with the matter involved, or is an arbitrary, oppressive, and capricious use of that power, without substantial relation to the health, safety, morals, comfort, and general welfare of the public. b. Petitioner's argument considered. —
Petitioner's main argument is that retail is a common, ordinary occupation, one of those privileges long ago recognized as essential to the orderly pursuant of happiness by free men; that it is a gainful and honest occupation and therefore beyond the power of the legislature to prohibit and penalized. This arguments overlooks fact and reality and rests on an incorrect assumption and premise, i.e., that in this country where the occupation is engaged in by petitioner, it has been so engaged by him, by the alien in an honest creditable and unimpeachable manner, without harm or injury to the citizens and without ultimate danger to their economic peace, tranquility and welfare. But the Legislature has found, as we have also found and indicated, that the privilege has been so grossly abused by the alien, thru the illegitimate use of pernicious designs and practices, that he now enjoys a monopolistic control of the occupation and threatens a deadly stranglehold on the nation's economy endangering the national security in times of crisis and emergency.
The real question at issue, therefore, is not that posed by petitioner, which overlooks and ignores the facts and circumstances, but this, Is the exclusion in the future of aliens from the retail trade unreasonable. Arbitrary capricious, taking into account the illegitimate and pernicious form and manner in which the aliens have heretofore engaged therein? As thus correctly stated the answer is clear. The law in question is deemed absolutely necessary to bring about the desired legislative objective, i.e., to free national economy from alien control and dominance. It is not necessarily unreasonable because it affects private rights and privileges (11 Am. Jur. pp. 1080-1081.) The test of reasonableness of a law is the appropriateness or adequacy under all circumstances of the means adopted to carry out its purpose into effect (Id.) Judged by this test, disputed legislation, which is not merely reasonable but actually necessary, must be considered not to have infringed the constitutional limitation of reasonableness.
The necessity of the law in question is explained in the explanatory note that accompanied the bill, which later was enacted into law:
This bill proposes to regulate the retail business. Its purpose is to prevent persons who are not citizens of the Philippines from having a strangle hold upon our economic life. If the persons who control this vital artery of our economic life are the ones who owe no allegiance to this Republic, who have no profound devotion to our free institutions, and who have no permanent stake in our people's welfare, we are not really the masters of our destiny. All aspects of our life, even our national security, will be at the mercy of other people.
In seeking to accomplish the foregoing purpose, we do not propose to deprive persons who are not citizens of the Philippines of their means of livelihood. While this bill seeks to take away from the hands of persons who are not citizens of the Philippines a power that can be wielded to paralyze all aspects of our national life and endanger our national security it respects existing rights.
The approval of this bill is necessary for our national survival.
If political independence is a legitimate aspiration of a people, then economic independence is none the less legitimate. Freedom and liberty are not real and positive if the people are subject to the economic control and domination of others, especially if not of their own race or country. The removal and eradication of the shackles of foreign economic control and domination, is one of the noblest motives that a national legislature may pursue. It is impossible to conceive that legislation that seeks to bring it about can infringe the constitutional limitation of due process. The attainment of a legitimate aspiration of a people can never be beyond the limits of legislative authority. c. Law expressly held by Constitutional Convention to be within the sphere of legislative action. —
The framers of the Constitution could not have intended to impose the constitutional restrictions of due process on the attainment of such a noble motive as freedom from economic control and domination, thru the exercise of the police power. The fathers of the Constitution must have given to the legislature full authority and power to enact legislation that would promote the supreme happiness of the people, their freedom and liberty. On the precise issue now before us, they expressly made their voice clear; they adopted a resolution expressing their belief that the legislation in question is within the scope of the legislative power. Thus they declared the their Resolution:
That it is the sense of the Convention that the public interest requires the nationalization of retail trade; but it abstain from approving the amendment introduced by the Delegate for Manila, Mr. Araneta, and others on this matter because it is convinced that the National Assembly is authorized to promulgate a law which limits to Filipino and American citizens the privilege to engage in the retail trade. (11 Aruego, The Framing of the Philippine Constitution, quoted on pages 66 and 67 of the Memorandum for the Petitioner.)
It would do well to refer to the nationalistic tendency manifested in various provisions of the Constitution. Thus in the preamble, a principle objective is the conservation of the patrimony of the nation and as corollary the provision limiting to citizens of the Philippines the exploitation, development and utilization of its natural resources. And in Section 8 of Article XIV, it is provided that "no franchise, certificate, or any other form of authorization for the operation of the public utility shall be granted except to citizens of the Philippines." The nationalization of the retail trade is only a continuance of the nationalistic protective policy laid down as a primary objective of the Constitution. Can it be said that a law imbued with the same purpose and spirit underlying many of the provisions of the Constitution is unreasonable, invalid and unconstitutional?
The seriousness of the Legislature's concern for the plight of the nationals as manifested in the approval of the radical measures is, therefore, fully justified. It would have been recreant to its duties towards the country and its people would it view the sorry plight of the nationals with the complacency and refuse or neglect to adopt a remedy commensurate with the demands of public interest and national survival. As the repository of the sovereign power of legislation, the Legislature was in duty bound to face the problem and meet, through adequate measures, the danger and threat that alien domination of retail trade poses to national economy. d. Provisions of law not unreasonable. —
A cursory study of the provisions of the law immediately reveals how tolerant, how reasonable the Legislature has been. The law is made prospective and recognizes the right and privilege of those already engaged in the occupation to continue therein during the rest of their lives; and similar recognition of the right to continue is accorded associations of aliens. The right or privilege is denied to those only upon conviction of certain offenses. In the deliberations of the Court on this case, attention was called to the fact that the privilege should not have been denied to children and heirs of aliens now engaged in the retail trade. Such provision would defeat the law itself, its aims and purposes. Beside, the exercise of legislative discretion is not subject to judicial review. It is well settled that the Court will not inquire into the motives of the Legislature, nor pass upon general matters of legislative judgment. The Legislature is primarily the judge of the necessity of an enactment or of any of its provisions, and every presumption is in favor of its validity, and though the Court may hold views inconsistent with the wisdom of the law, it may not annul the legislation if not palpably in excess of the legislative power. Furthermore, the test of the validity of a law attacked as a violation of due process, is not its reasonableness, but its unreasonableness, and we find the provisions are not unreasonable. These principles also answer various other arguments raised against the law, some of which are: that the law does not promote general welfare; that thousands of aliens would be thrown out of employment; that prices will increase because of the elimination of competition; that there is no need for the legislation; that adequate replacement is problematical; that there may be general breakdown; that there would be repercussions from foreigners; etc. Many of these arguments are directed against the supposed wisdom of the law which lies solely within the legislative prerogative; they do not import invalidity.
VIII. Alleged defect in the title of the law
A subordinate ground or reason for the alleged invalidity of the law is the claim that the title thereof is misleading or deceptive, as it conceals the real purpose of the bill which is to nationalize the retail business and prohibit aliens from engaging therein. The constitutional provision which is claimed to be violated in Section 21 (1) of Article VI, which reads:
No bill which may be enacted in the law shall embrace more than one subject which shall be expressed in the title of the bill.
What the above provision prohibits is duplicity, that is, if its title completely fails to appraise the legislators or the public of the nature, scope and consequences of the law or its operation (I Sutherland, Statutory Construction, Sec. 1707, p. 297.) A cursory consideration of the title and the provisions of the bill fails to show the presence of duplicity. It is true that the term "regulate" does not and may not readily and at first glance convey the idea of "nationalization" and "prohibition", which terms express the two main purposes and objectives of the law. But "regulate" is a broader term than either prohibition or nationalization. Both of these have always been included within the term regulation.
Under the title of an act to "regulate", the sale of intoxicating liquors, the Legislature may prohibit the sale of intoxicating liquors. (Sweet vs. City of Wabash, 41 Ind., 7; quoted in page 41 of Answer.)
Within the meaning of the Constitution requiring that the subject of every act of the Legislature shall be stated in the tale, the title to regulate the sale of intoxicating liquors, etc." sufficiently expresses the subject of an act prohibiting the sale of such liquors to minors and to persons in the habit of getting intoxicated; such matters being properly included within the subject of regulating the sale. (Williams vs. State, 48 Ind. 306, 308, quoted in p. 42 of Answer.)
The word "regulate" is of broad import, and necessarily implies some degree of restraint and prohibition of acts usually done in connection with the thing to be regulated. While word regulate does not ordinarily convey meaning of prohibit, there is no absolute reason why it should not have such meaning when used in delegating police power in connection with a thing the best or only efficacious regulation of which involves suppression. (State vs. Morton, 162 So. 718, 182 La. 887, quoted in p. 42 of Answer.)
The general rule is for the use of general terms in the title of a bill; it has also been said that the title need not be an index to the entire contents of the law (I Sutherland, Statutory Construction, See. 4803, p. 345.) The above rule was followed the title of the Act in question adopted the more general term "regulate" instead of "nationalize" or "prohibit". Furthermore, the law also contains other rules for the regulation of the retail trade which may not be included in the terms "nationalization" or "prohibition"; so were the title changed from "regulate" to "nationalize" or "prohibit", there would have been many provisions not falling within the scope of the title which would have made the Act invalid. The use of the term "regulate", therefore, is in accord with the principle governing the drafting of statutes, under which a simple or general term should be adopted in the title, which would include all other provisions found in the body of the Act.
One purpose of the constitutional directive that the subject of a bill should be embraced in its title is to apprise the legislators of the purposes, the nature and scope of its provisions, and prevent the enactment into law of matters which have received the notice, action and study of the legislators or of the public. In the case at bar it cannot be claimed that the legislators have been appraised of the nature of the law, especially the nationalization and the prohibition provisions. The legislators took active interest in the discussion of the law, and a great many of the persons affected by the prohibitions in the law conducted a campaign against its approval. It cannot be claimed, therefore, that the reasons for declaring the law invalid ever existed. The objection must therefore, be overruled.
IX. Alleged violation of international treaties and obligations
Another subordinate argument against the validity of the law is the supposed violation thereby of the Charter of the United Nations and of the Declaration of the Human Rights adopted by the United Nations General Assembly. We find no merit in the Nations Charter imposes no strict or legal obligations regarding the rights and freedom of their subjects (Hans Kelsen, The Law of the United Nations, 1951 ed. pp. 29-32), and the Declaration of Human Rights contains nothing more than a mere recommendation or a common standard of achievement for all peoples and all nations (Id. p. 39.) That such is the import of the United Nations Charter aid of the Declaration of Human Rights can be inferred the fact that members of the United Nations Organizations, such as Norway and Denmark, prohibit foreigners from engaging in retail trade, and in most nations of the world laws against foreigners engaged in domestic trade are adopted.
The Treaty of Amity between the Republic of the Philippines and the Republic of China of April 18, 1947 is also claimed to be violated by the law in question. All that the treaty guarantees is equality of treatment to the Chinese nationals "upon the same terms as the nationals of any other country." But the nationals of China are not discriminating against because nationals of all other countries, except those of the United States, who are granted special rights by the Constitution, are all prohibited from engaging in the retail trade. But even supposing that the law infringes upon the said treaty, the treaty is always subject to qualification or amendment by a subsequent law (U. S. vs. Thompson, 258, Fed. 257, 260), and the same may never curtail or restrict the scope of the police power of the State (plaston vs. Pennsylvania, 58 L. ed. 539.)
X. Conclusion
Resuming what we have set forth above we hold that the disputed law was enacted to remedy a real actual threat and danger to national economy posed by alien dominance and control of the retail business and free citizens and country from dominance and control; that the enactment clearly falls within the scope of the police power of the State, thru which and by which it protects its own personality and insures its security and future; that the law does not violate the equal protection clause of the Constitution because sufficient grounds exist for the distinction between alien and citizen in the exercise of the occupation regulated, nor the due process of law clause, because the law is prospective in operation and recognizes the privilege of aliens already engaged in the occupation and reasonably protects their privilege; that the wisdom and efficacy of the law to carry out its objectives appear to us to be plainly evident — as a matter of fact it seems not only appropriate but actually necessary — and that in any case such matter falls within the prerogative of the Legislature, with whose power and discretion the Judicial department of the Government may not interfere; that the provisions of the law are clearly embraced in the title, and this suffers from no duplicity and has not misled the legislators or the segment of the population affected; and that it cannot be said to be void for supposed conflict with treaty obligations because no treaty has actually been entered into on the subject and the police power may not be curtailed or surrendered by any treaty or any other conventional agreement.
Some members of the Court are of the opinion that the radical effects of the law could have been made less harsh in its impact on the aliens. Thus it is stated that the more time should have been given in the law for the liquidation of existing businesses when the time comes for them to close. Our legal duty, however, is merely to determine if the law falls within the scope of legislative authority and does not transcend the limitations of due process and equal protection guaranteed in the Constitution. Remedies against the harshness of the law should be addressed to the Legislature; they are beyond our power and jurisdiction.
The petition is hereby denied, with costs against petitioner.
Paras, C.J., Bengzon, Reyes, A., Bautista Angelo, Concepcion, Reyes, J.B.L., Endencia and Felix, JJ., concur.
Separate Opinions
PADILLA, J., concurring and dissenting:
I agree to the proposition, principle or rule that courts may not inquire into the wisdom of an the Act passed by the Congress and duly approved by the President of the Republic. But the rule does not preclude courts from inquiring and determining whether the Act offends against a provision or provisions of the Constitution. I am satisfied that the Act assailed as violative of the due process of law and the equal protection of the laws clauses of the Constitution does not infringe upon them, insofar as it affects associations, partnership or corporations, the capital of which is not wholly owned by the citizens of the Philippines, and aliens, who are not and have not been engaged in the retail business. I am, however, unable to persuade myself that it does not violate said clauses insofar as the Act applies to associations and partnerships referred to in the Act and to aliens, who are and have heretofore been engaged in said business. When they did engage in the retail business there was no prohibition on or against them to engage in it. They assumed and believed in good faith they were entitled to engaged in the business. The Act allows aliens to continue in business until their death or voluntary retirement from the business or forfeiture of their license; and corporations, associations or partnership, the capital of which is not wholly owned by the citizens of the Philippines to continue in the business for a period of ten years from the date of the approval of the Act (19 June 1954) or until the expiry of term of the existence of the association or partnership or corporation, whichever event comes first. The prohibition on corporations, the capital of which is not wholly owned by citizens of the Philippines, to engage in the retail business for a period of more than ten years from the date of the approval of the Act or beyond the term of their corporate existence, whichever event comes first, is valid and lawful, because the continuance of the existence of such corporations is subject to whatever the Congress may impose reasonably upon them by subsequent legislation.1 But the prohibition to engage in the retail business by associations and partnerships, the capital of which is not wholly owned by citizen of the Philippines, after ten years from the date of the approval of the Act, even before the end of the term of their existence as agreed upon by the associates and partners, and by alien heirs to whom the retail business is transmitted by the death of an alien engaged in the business, or by his executor or administrator, amounts to a deprivation of their property without due process of law. To my mind, the ten-year period from the date of the approval of the Act or until the expiration of the term of the existence of the association and partnership, whichever event comes first, and the six-month period granted to alien heirs of a deceased alien, his executor or administrator, to liquidate the business, do not cure the defect of the law, because the effect of the prohibition is to compel them to sell or dispose of their business. The price obtainable at such forced sale of the business would be inadequate to reimburse and compensate the associates or partners of the associations or partnership, and the alien heirs of a deceased alien, engaged in the retail business for the capital invested in it. The stock of merchandise bought and sold at retail does not alone constitute the business. The goodwill that the association, partnership and the alien had built up during a long period of effort, patience and perseverance forms part of such business. The constitutional provisions that no person shall be deprived of his property without due process of law2 and that no person shall be denied the equal protection of the laws3 would have no meaning as applied to associations or partnership and alien heirs of an alien engaged in the retail business if they were to be compelled to sell or dispose of their business within ten years from the date of the approval of the Act and before the end of the term of the existence of the associations and partnership as agreed upon by the associations and partners and within six months after the death of their predecessor-in-interest.
The authors of the Constitution were vigilant, careful and zealous in the safeguard of the ownership of private agricultural lands which together with the lands of the public domain constitute the priceless patrimony and mainstay of the nation; yet, they did not deem it wise and prudent to deprive aliens and their heirs of such lands.4 For these reasons, I am of the opinion that section 1 of the Act, insofar as it compels associations and partnership referred to therein to wind up their retail business within ten years from the date of the approval of the Act even before the expiry of the term of their existence as agreed upon by the associates and partners and section 3 of the Act, insofar as it compels the aliens engaged in the retail business in his lifetime his executor or administrator, to liquidate the business, are invalid, for they violate the due process of law and the equal protection of the laws clauses of the Constitution.
Footnotes
1 Section 76, Act No. 1459..
2 Section 1 (1), Article III, of the Constitution..
3 Ibid.
4 Section 5, Article XIII, of the Constitution.
Facts:
This Court has before it the delicate task of passing upon the validity and constitutionality of a legislative enactment, fundamental and far‐reaching in significance. The enactment poses questions of due process, police power and equal protection of the laws. It also poses an important issue of fact, that is whether the conditions which the disputed law purports to remedy really or actually exist. Admittedly springing from a deep, militant, and positive nationalistic impulse, the law purports to protect citizen and country from the alien retailer. Through it, and within the field of economy it regulates, Congress attempts to translate national aspirations for economic independence and national security, rooted in the drive and urge for national survival and welfare, into a concrete and tangible measures designed to free the national retailer from the competing dominance of the alien, so that the country and the nation may be free from a supposed economic dependence and bondage. Do the facts and circumstances justify the enactment?
Held:
It has been said the police power is so far ‐ reaching in scope, that it has become almost impossible to limit its sweep. As it derives its existence from the very existence of the State itself, it does not need to be expressed or defined in its scope; it is said to be co‐extensive with self‐protection and survival, and as such it is the most positive and active of all governmental processes, the most essential, insistent and illimitable. Especially is it so under a modern democratic framework where the demands of society and of nations have multiplied to almost unimaginable proportions; the field and scope of police power has become almost boundless, just as the fields of public interest and public welfare have become almost all‐embracing and have transcended human foresight. Otherwise stated, as we cannot foresee the needs and demands of public interest and welfare in this constantly changing and progressive world, so we cannot delimit beforehand the extent or scope of police power by which and through which the State seeks to attain or achieve interest or welfare. So it is that Constitutions do not define the scope or extent of the police power of the State; what they do is to set forth the limitations thereof. The most important of these are the due process clause and the equal protection clause.
Resuming what we have set forth above we hold that the disputed law was enacted to remedy a real actual threat and danger to national economy posed by alien dominance and control of the retail business and free citizens and country from dominance and control; that the enactment clearly falls within the scope of the police power of the State, thru which and by which it protects its own personality and insures its security and future; that the law does not violate the equal protection clause of the Constitution because sufficient grounds exist for the distinction between alien and citizen in the exercise of the occupation regulated, nor the due process of law clause, because the law is prospective in operation and recognizes the privilege of aliens already engaged in the occupation and reasonably protects their privilege; that the wisdom and efficacy of the law to carry out its objectives appear to us to be plainly evident — as a matter of fact it seems not only appropriate but actually necessary — and that in any case such matter falls within the prerogative of the Legislature, with whose power and discretion the Judicial department of the Government may not interfere; that the provisions of the law are clearly embraced in the title, and this suffers from no duplicity and has not misled the legislators or the segment of the population affected; and that it cannot be said to be void for supposed conflict with treaty obligations because no treaty has actually been entered into on the subject and the police power may not be curtailed or surrendered by any treaty or any other conventional agreement.
Philippine Phosphate Fertilizer Corp. vs. Torres
March 17, 1994.
[GRN 98050 March 17, 1994.]
PHILIPPINE PHOSPHATE FERTILIZER CORPORATION, petitioner, vs. HON. RUBEN D. TORRES, Secretary of Labor and Employment, HON. RODOLFO S. MILADO, Department of Labor and Employment Mediator-Arbiter for Region VIII, Tacloban City, and PHILPHOS MOVEMENT FOR PROGRESS, INC. (PMPI), respondents.
PETITION for certiorari to set aside a decision of the Secretary of Labor.
The facts are stated in the opinion of the Court.
Quiroz, Dumas & Henares Law Offices for petitioner.
Seno, Mendoza & Associates for private respondent Philphos Movement for Progress, Inc.
BELLOSILLO, J.:
PHILIPPINE PHOSPHATE FERTILIZER CORPORATION (PHILPHOS) assails the decision of the Secretary of Labor of 7 August 1990 affirming the order of the Mediator-Arbiter of 28 March 1990 which directed the immediate conduct of a certification election among the supervisory, professional or technical, and confidential employees of petitioner corporation.
On 7 July 1989, Philphos Movement for progress, Inc. (PMPI for brevity), filed with the Department of Labor and Employment a petition for certification election among the superviso ry employees of petitioner, alleging that a supervisory union duly registered with the Department of Labor and Eployment it was seeking to represent the supervisory employees of Philippine Phosphate Fertilizer Corporation.
The petition for certification election filed by PMPI was not opposed by PHILPHOS. In fact, omn 11 August 1989, PHILPHOS submitted a position paper with the Mediator-Arbiter stating that its management welcomed he creation of a supervisory employees' union provided the necessary requisites of law were properly observed, but exempting from the union its superintendents who were managerial and not supervisory employees as they managed a division, subdivision or section, and were vested with powers or prerogatives to lay down and execute management policies. PHILPHOS also asserted that its professional or technical employees were not within the definition of supervisory employees under the Labor Code as they were immediately under the direction and supervision of its superintendents and supervisors. Moreover, the professional and technical employees did not have a staff of workers under them. Consequently, petitioner prayed for the exclusion of its superintendents and professional/ technical employees from the PMPI supervisory union.
On 13 October 1989, Mediator-Arbiter Rodolfo S. Milado issued an order directing the holding of a certification election among the supervisory employees of petitioner, excluding therefrom the superintendents and the professional and technical employees. He also directed the parties to attend the pre-election conference on 19 April 1990 for the determination of the mechanics of the election process and the qualifications and eligibility of those allowed to vote.
On 15 November 1989, PMPI filed an amended petition with the MediatorArbiter wherein it sought to represent not only the supervisory employees of petitioner but also its professional/technical and confidential employees. The amended petition was filed in view of the amendment of the PMPI Constitution which included in its meembership the professional /technical and confidentail employees.
On 14 December 1989, the parties therein agreed to submit their . respective petition paper and to consider the amemded petition submitted decision on the basis thereof and recieved documents.
On 28 March 1990, Mediator-Arbiter Milado issued an order granting the petition and directing the holding of a certification election among the "supervisory, professional (engineers, analysts, mechanics, accountants, nurses, midwives, etc.), technical, and confidential employees"1 to comprise the proposed bargaining unit.
On 16 April 1990, PHILPHOS appealed the order of 28 March 1990 to the Secretary of Labor and Employment who on 7 August 1990 rendered a decision through Undersecretary Bienvenido Laguesma dismissing the appeal. PHILPHOS moved for reconsideration but the same was denied; hence, the instant petition alleging grave abuse of discretion on the part of public respondents in rendering the assailed rulings.
On 8 July 1991, this Court issued a temporary restraining order enjoining respondents from holding the certification election among petitioner's supervisory, professional/technical, and confidential employees scheduled on 12 July 1991.
There are two (2) issues raised by petitioner: (1) whether it was denied due process in the proceedings before respondent Mediator-Arbiter; and, (2) whether its professional/technical and confidential employees may validly join respondent PMPI union which is composed of supervisors. PHILPHOS claims that it was denied due process when respondent Mediator-Arbiter granted the amended petition of respondent PMPI without according, PHILPHOS a new opportunity to be heard.
We do not see it the way PHILPHOS does here. The essence of due process is simply an opportunity to be heard or, as applied to administrative proceedings, an opportunity to explain one's side or an opportunity to seek a reconsideration of the action or ruling complained of.2 Where, as in the instant case, petitioner PHILPHOS agreed to file its position paper with the MediatorArbiter and to consider the case submitted for decision on the basis of the position papers filed by the parties, there was sufficient compliance with the requirement of due process, as petitioner was afforded reasonable opportunity to present its side.3
Moreover, petitioner could have, it also desired insisted on a hearing to confront and examine the witnesses of the other party. But it did not;4 instead, it opted to submit its position paper with the Mediator-Arbiter. Besides, petitioner had all the opportunity to ventilate its arguments in its appeal to the Secretary of Labor.
As regards the second issue, we are with petitioner that being a supervisory union, respondent PMPI cannot represent the professional/technical and confidential employees of petitioner whose positions we find to be more the rank and file than supervisory.
With the enactment in March 1989 of R.A. 6715, employees were thereunder reclassified into three (3) groups, namely: (a) managerial employees, (b) supervisory employees, and (c) rank and file employees. The category of supervisory employees is once again recognized in the present law.
Article 212, par. (in), of the Labor Code, as amended, provides that "(s)upervisory employees are those who in the interest of the employer, effectively recommend such managerial actions if the exercise of such authority is not merely routinary or clerical in nature but requires the use of independent judgment." The definition of managerial employees is limited to those having authority to hire and fire, while those who only recommend effectively the hiring or firing or transfer of personnel are considered closer to rank and file employees. The exclusion therefore of midlevel executives from the category of managers has brought about a third classification, the supervisory employees. The peculiar role of supervisors is such that while they are not managers, when they recommend action implementing management policy or ask for the discipline or dismissal of subordinates, they identify with the interests of the employer and may act contrary to the interests of the rank and file.5
In its position paper submitted to the Mediator-Arbiter, petitioner described the positions and functions of its professional/technical employees, (engineers, analysts, mechanics, accountants, nurses and midwives). The guidelines, which were not refuted by respondent PMPI, state: x x x x Professional and Technical positions are those whose primary duty consists of the performance of work directly related to management programs; who customarily, regularly and routinarily exercise judgment in the application of concepts, methods, systems and procedures in their respective fields of specialization; who regularly and directly assist a managerial and/or supevisory employee, execute under general supervision, work along specialized or technical lines requiring special training, experience or knowledge, or execute under general supervision special assignments and tasks x x x x They are immediately under the direction and supervision of supervisors or superintendents, They have no men under them but are regularly called upon by their supervisors or superintendents on some technical matters.6
Moreover, Herculano A. Duhaylungsod, Personnel Officer of petitioner, attested that there was no community of interests between the supervisors of petitioner and the professional/ technical employees; that as of 25 July 1990, personnel records showed that there were 125 supervisors and 271 professional/technical employees; that of the 271 professional/ technical employees, 150 were directly under and being supervised by supervisors, while the rest were staff members of superintendents.7
The certification of Personnel Officer Duhaylungsod that its professional /technical employees occupy positions that are nonsupervisory is evidence that said employees belong to the rank and file.8 Quite obviously, these professional/ technical employees cannot effectively recommend managerial actions with the use of independent judgment because they are under the supervision of superintendents and supervisors. Because it is unrefuted that those professional/technical employees are performing non supervisory functions, hence considered admitted, they should be clasified, at least for purposes of this case, its rank and file employees. Consequently, these professional/technical employees cannot be allowed to join a union composed of supervisors. Conversely, supervisory employees cannot join a labor organization of employees under their supervision but may validly form a separate organization of their own.9 This is provided in Art. 245 of the Labor Code, as amended by R.A. No. 6715, to wit: x x x x Managerial employees are not eligible to join, assist or form any labor organization. Supervisory employees shall not be eligible for membership in a labor organization of the rank and file employees but may join, assist or form separate labor organizations of their own.
Respondent PMPI is supposed to be a union of 125 supervisors. If the professional/technical employees are included as members, and records show that they are 271 in all or much more than the supervisors, then PMPI will turn out to be a rank and file union with the supervisors as members. . This is precisely the situation which the law prohibits. It would create an obvious conflict of views among the members, or at least between two (2) groups of members espousing opposing interests. The intent of the law is to avoid a situation where supervisors would merge with the rank and file, or where the supervisors' labor organization would represent conflicting interests, especially where, as in the case at bar, the supervisors will be commingling with those employees whom they directly supervise in their own bargaining unit. Members of the supervisory union might refuse to carry out disciplinary measures against their co-member rank and file employees.10
Supervisors have the right to form their own union or labor organization. What the law prohibits is a union whose membership comprises of supervisors merging with the rank and file employees because this is where conflict of interests may arise in the areas of discipline, collective bargaining and strikes.11 The professional/technical employees of petitioner therefore may join the existing rank and file union, or form a union a separate and distinct from the existing union organized by the rank and file employees of the same company.
As to the confidential employ, of the petitioner, the latter has not shown any proof or compelling reason to exclude them from joining respondent PMPI and from participating in the certification election, unless these confidential employees are the same professional/technical employees whom we find to be occupying rank and file positions.
WHEREFORE, the petition is GRANTED. The decision of respondent Secretary of Labor of 7 August 1990, as well as the order of the respondent Mediator-Arbiter of 28 March 1990, is SET ASIDE. The professional/technical employees of petitioner Philippine Phosphate Fertilizer Corporation (PHILPHOS) are declared disqualified from affiliating with respondent Philphos Movement for Progress, Inc. (PMPI).
The Department of Labor is directed to order immediately the conduct of certification election among the supervisory employees of petitioner, particularly excluding therefrom its professional and technical employees.
SO ORDERED.
Cruz (Chairman), Davide, Jr., Quiason and Kapunan, JJ., concur.
Petition granted; Assailed decision set aside.
1. Rollo, p. 56.
2. People v. NLRC, G.R. No. 71499 29 July 1989, 175 SCRA 431. 3. Maglutac v. NLRC, G.R. 78345, 21 September 1990, 189 SCRA 767.
4. Chua-Qua v. Clave, G.R. 49549,30 August 1990,189 SCRA 117.
5. Atlas Lithographic Services, Inc. v. Laguesma, G.R. No. 96566, 6 Ja 1992. , 205 SCRA 12.
6. Rollo, pp. 35-36.
7. Rollo, pp, 88-89.
8. Hipolito v. Ferrer-Calleja, G.R. No. 81830, 1 October 1990, 190 SCRA 182.
9. Adamson & Adamson, Inc. v. The Court of Industrial Relationa, No. L-35120, 31 January 1984, 127 SCRA 268.
10. See Note 5.
11. Ibid.
Rubi vs. Provincial Board of Mindoro
February 28, 1919.
[GRN 14078 February 28, 1919.]
RUBI ET AL. (manguianes), plaintiffs, vs. THE PROVINCIAL BOARD OF MINDORO, defendant.
1. STATUTES; SECTION 2145 OF THE ADMINISTRATIVE CODE OF 1917; VALIDITY; CONSTRUCTION; HISTORY.-Section 2145 of the Administrative Code of 1917 reads as follows: "With the prior approval of the Department Head, the provincial governor of any province in which non-Christian inhabitants are found is authorized, when such a course is deemed necessary in the interest of law and order to direct such inhabitants to take up their habitation on sites on unoccupied public lands to be selected by him and approved by the provincial board." Beginning with Act No. 387, sections 68-71, having reference to the Province of Nueva Vizcaya, Acts Nos. 411, 422, 445, 500, 547, 548, 549, 550, 579, 753, 855, 1113, 1145, 1268, 1306 were enacted for the province of Abra, Antique, Bataan, Ilocos Norte, Ilocos Sur, Isabela, Lepanto-Bontoc, Mindoro, Misamis, Nueva Vizcaya, Pangasinan, Paragua (Palawan), Tarlac, Tayabas, and Zambales. Act No. 547 referred especially to the Manguianes.
All of these special laws with the exception of Act No. 1306 were repealed by Acts Nos. 1396 and 1397. The last named Act incorporated and embodied the provisions in general language. In turn, Act No. 1397 was repealed by the Administrative Code of 1916. The last Administrative Code retains the provision which originated in Act No. 387, enacted in 1902, in section 2145 herein quoted.
2. ID.; ID.; ID.; ID.; GOVERNMENT POLICY.-These different laws denote an anxious regard for the welfare of the non-Christian inhabitants of the Philippines and a settled and consistent practice with reference to the method to be followed for their advancement.
3. ID.; ID.; ID.; ID.; ID.-Every really new question that comes before the courts is in the last analysis determined by the application of public ]policy as a ratio decidendi. In balancing conflicting solutions that one is perceived to tip the scales which the court believes will best promote the public welfare in its probable operation as a general rule or principle.
4. ID.; ID.; ID.; "NON-CHRISTIAN;" HISTORY.-A skeleton history of the attitude assumed towards the backward inhabitants of the Islands both before and after the acquisition of the Philippines by the United States is set forth in the opinion. The most important of the laws of the Indies having reference to the subject are compiled in Book 6, Title 3. A clear exposition of the purposes of the Spanish government in its efforts to improve the conditions of such inhabitants by concentrating them in "reducciones" is found in the decree of the Governor-General of the Philippine Islands of January 14, 1881. Ever since the acquisition of the Philippine Islands by the United States, the question as to the best method for dealing with the primitive inhabitants has been a perplexing one. Organic and statutory law has given the subject consideration.
5. ID.; ID.; ID.; ID.; DEFINED.-"Non-Christian" is an awkward and unsatisfactory expression. Legislative, judicial, and executive authority has held that the term "non-Christian" should not be given a literal meaning or a religious signification, but that it was intended to relate to degree of civilization. This has been the uniform construction of executive officials who have been called upon to interpret and enforce the law. The term "non-Christian" refers not to religious belief, but in a way to geographical area, and more directly to natives of the Philippine Islands of a low grade of civilization.
6. ID.; ID.; ID.; ID.; THE "MANGUIANES."--The name "Manguian" signifies savage, mountaineer, pagan, negro. The Manguianes are very low in culture.
7. ID.; ID.; ID. ; AMERICAN INDIAN POLICY.-From the beginning of the United States, and even before the Indians have been treated as "in a state of pupilage." The recognized relation between the Government of the United States and the Indians may be described as that of guardian and ward. It is for the congress to determine when and how the guardianship shall be terminated. The Indians are always subject to the plenary authority of the United States.
8. ID.; ID.; ID.; ID.-With reference to the laws affecting the Indians, it has been held that it is not within the power of the courts to overrule the judgment of Congress. For very good reason, the subject has always been deemed political in nature not subject to the jurisdiction of the judicial department of the Government.
9. ID.; ID.; CONSTITUTIONAL LAW; DELEGATION OF LEGISLATIVE POWER.-The maxim of constitutional law forbidding the delegation of legislative power should be zealously protected.
10. ID.; ID.; ID.; ID.-"The true distinction, therefore, is between the delegation of power to make the law which necessarily involves a discretion as to what it shall be and conferring authority or discretion as to its execution to be exercised under and in pursuance of the law. The first cannot be done; to the latter no valid objection can be made." (Cincinnati, W. & Z. R. Co. vs. Comrs. Clinton County [1852], 1 Ohio St., 88.)
11. ID.; ID.; ID.; ID.-The legislature may make decisions of executive departments or subordinate officials thereof, to whom it has committed the execution of certain acts, final on questions of fact. The growing tendency in the decisions is to give prominence to the "necessity," of the case. 12. ID.; ID.; ID.; ID.-An exception to the general rule, sanctioned by immemorial practice permits the central legislative body to delegate legislative powers to local authorities.
13. ID.; ID.; ID.; ID.-Section 2145 of the Administrative Code of 1917 is not an unlawful delegation of legislative power by the Philippine Legislature to provincial officials and a department head.
14. ID.; ID.; ID.; RELIGIOUS DISCRIMINATION.-Since the term "non-Christian" is here construed to refer to natives of the Philippine Islands of a low grade of civilization, section 2145 of the Administrative Code of 1917 does not discriminate between individuals on account of religious differences and is therefore not invalid.
15. ID.; ID.; ID.; CIVIL LIBERTY.-Various conceptions of civil liberty are quoted in the opinion. Civil liberty may be said to mean that measure of freedom which may be enjoyed in a civilized a widespread belief in the amplest possible demonstration of governmental activity.
25. ID.; ID.; ID.; ID.-Considered purely as an exercise of the police power, the courts cannot fairly say that the Legislature has exceeded its rightful authority in enacting section 2145 of the Administrative Code of 1917.
26. ID.; ID.; ID.; STATUTORY CONSTRUCTION; LEGISLATIVE INTENTION.-The fundamental objective of governmental policy is to establish friendly relations with the so-called non- Christians, and to promote their educational, agricultural, industrial, and economic development and advancement in civilization.
27. ID.; ID.; ID.; ID.; ID.-In so far as the Manguianes themselves are concerned the purposes of the Government are to gather together the children for educational purposes, and to improve the health and morals-is in fine to begin the process of civilization.
28. ID.; ID.; ID.; ID.; ID.-In so far as the relation of the Manguianes to the State is concerned, the purposes of the Legislature in enacting the law, and of the executive branch in enforcing it, are to protect the settlers in Mindoro and to develop the resources of that great Island.
29. ID.; ID.; ID.; ID.; PRESUMPTION.-Most cautiously should the power of this court to overrule the judgment of the Philippine Legislature, a coordinate branch, be exercised. The whole tendency of the best considered cases is toward non-interference on the part of the courts whenever political ideas are the moving consideration.
30. ID.; ID.; ID.--Section 2145 of the Administrative Code of 1917 is constitutional.
31. STATUTES; "NON-CHRISTIAN;" DEFINED.-The words "non-Christian" have a clear, definite and well settled signification when used in the Philippine statute-book as a descriptive adjective, applied to "tribes ... .. peoples" or "inhabitants," dwelling in more or less remote districts and provinces throughout the Islands.
32. ID.; ID.; ID.; TESTS.-The tests for the determination of the fact that an individual or tribe is, or is not of the "low grade of civilization" denoted by the words "non-Christian" are, and throughout the period of American occupation always have been, "the mode of life, the degree of advancement in civilization, and connection or lack of connection with some civilized community."
30. ID.; ID.; ID.--Section 2145 of the Administrative Code of 1917 is constitutional.
31. STATUTES; "NON-CHRISTIAN;" DEFINED.-The words "non-Christian" have a clear, definite and well settled signification when used in the Philippine statute-book as a descriptive adjective, applied to "tribes ... .. peoples" or "inhabitants," dwelling in more or less remote districts and provinces throughout the Islands.
33. ID.; ID.; STANDARD OF CIVILIZATION OF INHABITANTS NOT NON-CHRISTIAN.-The legislative and administrative history of the Philippine Islands clearly discloses that the standard of civilization to which a specific tribe must be found to have advanced, to justify its removal from the class embraced within the descriptive term "non-Christian," as that term is used in the Philippine statute-book, is that degree of civilization which results in a mode of life within the tribe such that it is feasible and practicable to extend to, and enforce upon its membership the general laws and regulations, administrative, legislative, and judicial, which control the conduct of the admittedly civilized inhabitants of the Islands; a mode of life, furthermore, which does not find expression in tribal customs or practices which tend to brutalize or debauch the members of the tribe indulging in such customs or practices, or to expose to loss or peril the lives or property of those who may be brought in contact with the members of the tribe.
34. ID.; ID.; ID.-So the standard of civilization to which any given number or group of inhabitants of a particular province in these Islands, or any individual member of such a group, must be found to have advanced, in order to remove such group or individual from the class embraced within the statutory description of "non-Christian," is that degree of civilization which would naturally and normally result in the withdrawal by such persons of permanent allegiance or adherence to a "non-Christian" tribe, had they at any time adhered to or maintained allegiance to such a tribe; and which would qualify them whether they reside within or beyond the habitat of a "non-Christian" tribe, not only to maintain a mode of life independent of and apart from that maintained by such tribe, but such a mode of life as would not be inimical to the lives or property or general welfare of the civilized inhabitants of the Islands with whom they are brought in contact. 35. ID.; SECTION 2145 OF THE ADMINISTRATIVE CODE OF 1917; BASIS; WHEN PROPERLY APPLICABLE.-The power to provide for the issuance of the reconcentration. orders contemplated in section 2145 of the Administrative Code rests upon analogous principles to those upon which the liberty and freedom of action of children and persons of unsound minds is restrained without consulting their wishes, but for their own good and the general welfare. The power rests upon necessity, that "great master of all things," and is properly exercised only where certain individuals or groups of individuals are found to be of such a low grade of civilization, that their own wishes cannot be permitted to determine their mode of life or place of residence.
ORIGINAL ACTION in the Supreme Court. Habeas corpus.
The facts are stated in the opinion of the court.
D. R. Williams and Filemon Sotto for plaintiff.
Solicitor-General Paredes for defendant.
MALCOLM, J.:
In one of the cases which denote a landmark in American Constitutional History (Worcester vs. Georgia [1832], 6 Pet., 515), Chief Justice Marshall, the first luminary of American jurisprudence began his opinion (relating to the status of an Indian) with words which, with a slight change in phraseology, can be made to introduce the present opinion-This cause, in every point of view in which it can be placed, is of the deepest interest. The legislative power of a state, the controlling power of the constitution and laws, the rights, if they have any, the political existence of a people, the personal liberty of a citizen, are all involved in the subject now to be considered.
To imitate still further the opinion of the Chief Justice, we adopt his outline and proceed first, to introduce the facts and the issues, next to give a history of the socalled "non-Christians," next to compare the status of the "non-Christians" with that of the American Indians, and, lastly to resolve the constitutional questions presented.
I. INTRODUCTION.
This is an application for habeas corpus in favor of Rubi and other Manguianes of the Province of Mindoro. It is alleged that the Manguianes are being illegally deprived of their liberty by the provincial officials of that province. Rubi and his companions are said to be held on the reservation established at Tigbao, Mindoro, against their will, and one Dabalos is said to be held under the custody of the provincial sheriff in the prison at Calapan for having run away from the reservation. The return of the Solicitor-General alleges:,
"1. That on February 1, 1917, the provincial board of Mindoro adopted resolution No. 25 which is as follows:
"'The provincial governor, Hon. Juan Morente, jr., presented the following resolution:
"Whereas several attempts and schemes have been made for the advancement of the non- Christian people of Mindoro, which were all a failure.
"'Whereas it has been found out and proved that unless some other measure is taken for the Mangyan work of this province, no successful result will be obtained toward educating these people.
"'Whereas it is deemed necessary to oblige them to live in one place in order to make a permanent settlement.
"'Whereas the provincial governor of any province in which non-Christian inhabitants are found is authorized, when such a course is deemed necessary in the interest of law and order, to direct such inhabitants to take up their habitation on sites on unoccupied public lands to be selected by him and approved by the provincial board.
"'Whereas the provincial governor is of the opinion that the sitio of Tigbao on Lake Naujan is a place most convenient for the Mangyanes to live on, Now, therefore be it Resolved, That under section 2077 of the Administrative Code, 800 hectares of public land in the sitio of Tigbao on Naujan Lake be selected as a site for the permanent settlement of Mangyanes in Mindoro subject to the approval of the Honorable Secretary of the Interior, and
"'Resolved further, That Mangyans may only solicit homesteads on this reservation providing that said homestead applications are previously recommended by the provincial governor.
"2. That said resolution No. 25 (series 1917) of the provincial board of Mindoro was approved by the Secretary of the Interior of February 21, 1917.
"3. That on December 4, 1917, the provincial governor of Mindoro issued executive order No. 2 which says:
"'Whereas the provincial board, by Resolution No. 25, current series, has selected a site in the sitio of Tigbao on Naujan Lake for the permanent settlement of Mangyanes in Mindoro.
"'Whereas said resolution has been duly approved by the Honorable, the Secretary of the Interior, on February 21, 1917. "'Now, therefore, I, Juan Morente, jr., provincial governor of Mindoro, pursuant to the provisions of section 2145 of the revised Administrative Code, do hereby direct that all the Mangyans in the vicinities of the townships of Naujan and Pola and the Mangyans east of the Baco River including those in the districts of Dulangan and Rubi's place in Calapan, to take up their habitation on the site of Tigbao, Naujan Lake, not later than December 31, 1917.
"'Any Mangyan who shall refuse to comply with this order shall upon conviction be imprisoned not exceeding sixty days in accordance with section 2759 of the revised Administrative Code.'
"4. That the resolution of the provincial board of Mindoro copied in paragraph 1 and the executive order of the governor of the same province copied in paragraph 3, were necessary measures for the protection of the Mangyanes of Mindoro as well as the protection of public forests in which they roam, and to introduce civilized customs among them.
"5. That Rubi and those living in his rancheria have not fixed their dwellings within the reservation of Tigbao and are liable to be punished in accordance with section 2759 of Act No. 2711.
6. That the undersigned has no information that Doroteo Dabalos is being detained by the sheriff of Mindoro but if he is so detained it must be by virtue of the provisions of articles Nos. 2145 and 2759 of Act No. 2711."
It thus appears that the provincial governor of Mindoro and the provincial board thereof directed the Manguianes in question to take up their habitation in Tigbao, a site on the shore of Lake Naujan, selected by the provincial Section 2145 of the Administrative Code of 1917 reads as follows:
"SEC. 2145. Establishment of non-Christians upon sites selected by provincial governor.-With the prior approval of the Department Head, the provincial governor of any province in which non-Christian inhabitants are found is authorized, when such a course is deemed necessary in the interest of law and order, to direct such inhabitants to take up their habitation on sites on unoccupied public lands to be selected by him and approved by the provincial board."
In connection with the above-quoted provision, there should be noted section 2759 of the same Code, which reads as follows:
"SEC. 2759. Refusal of a non-Christian to take up appointed habitation.-Any non-Christian who shall refuse to comply with the directions lawfully given by a provincial governor, pursuant to section two thousand one hundred and forty-five of this Code to take up habitation upon a site designated by said governor shall upon conviction be imprisoned for a period not exceeding sixty days." The substance of what is now found in said section 2145 is not new to Philippine law. The genealogical tree of this section, if we may be permitted to use such terminology, would read: Section 2077, Administrative Code of 1916; section 62, Act No. 1397; section 2 of various special provincial laws, notably of Act No. 547, specifically relating to the Manguianes; section 69, Act No. 387.
Section 2145 and its antecedent laws make use of the term "non-Christians." This word, as will later be disclosed, is also found in varying forms in other laws of the Philippine Islands. In order to put the phrase in its proper category, and in order to understand the policy of the Government of the Philippine Islands with reference to the uncivilized elements of the Islands, it is well first of all to set down a skeleton history of the attitude assumed by the authorities towards these "non-Christians," with particular regard for the legislation on the subject.
II. HISTORY.
A. BEFORE ACQUISITION OF THE PHILIPPINES BY THE UNITED STATES.
The most important of the laws of the Indies having reference to the subject at hand are compiled in Book VI, Title III, in the following language:
LAW I.
"The Emperor Charles and the Prince, the governor at Cigales, on March 21, 1551. Philip II at Toledo, on February 19, 1560. In the forest of Segovia on September 13, 1565. In the Escorial on November 10, 1568. Ordinance 149 of the poblaciones of 1573. In San Lorenzo, on May 20, 1578.
"THAT THE 'INDIOS' BE REDUCED INTO 'POBLACIONES' (COMMUNITIES).
"In order that the indios may be instructed in the Sacred Catholic Faith and the evangelical law, and in order that they may forget the blunders of their ancient rites and ceremonies to the end that they may live in harmony and in a civilized manner, it has always been endeavored with great care and special attention to use all the means most convenient to the attainment of these purposes. To carry out this work with success our Council of the Indies and other religious persons met at various times; the prelates of New Spain assembled by order of Emperor Charles V of glorious memory in the year one thousand five hundred and forty-six- all of which meetings were actuated with a desire to serve God and our Kingdom. At these meetings it was resolved that indios be made to live in communities, and not to live in places divided and separated from one another by sierras and mountains, wherein they are deprived of all spiritual and temporal benefits and wherein they can not profit from the aid of our ministers and from that which gives rise to those human necessities which men are obliged to give one another. Having realized the convenience of this resolution, our kings, our predecessors by different orders have entrusted and ordered the viceroys, presidents, and governors to execute with great care and moderation the concentration of the indios into reducciones; and to deal with their doctrine with such forbearance and gentleness without causing inconveniences, so that those who would not presently settle and who would see the good treatment and the protection of those already in settlements would, of their own accord, present themselves, and it is ordained that they be not required to pay taxes more than what is ordered. Because the above has been executed in the greater part of our Indies, we hereby order and decree that the same be complied with in all the remaining parts of the Indies, and the encomenderos shall entreat compliance thereof in the manner and form prescribed by the laws of this title."
"LAW VIII.
"Philip II at the Pardo, on December 1, 1573. Philip III at Madrid, October 10, 1618.
"THAT THE 'REDUCCIONES' BE MADE IN ACCORDANCE WITH THE CONDITIONS OF THIS LAW.
"The places wherein the pueblos and reducciones shall be formed should have the facilities of waters, lands, and mountains, ingress and egress, husbandry and a passageway of one league long, wherein the indios can have their live stock that they may not be mixed with those of the Spaniards.
"LAW IX.
"Philip II at Toledo, on February 19, 1560.
"THAT THE 'INDIOS' IN 'REDUCCIONES' BE NOT DEPRIVED OF THE LANDS PREVIOUSLY HELD BY THEM.
"With more good-will and promptness, the indios shall be concentrated in reducciones. Provided they shall not be deprived of the lands and granaries which they may have in the places left by them. We hereby order that no change shall be made in this respect, and that they be allowed to retain the lands held by them previously so that they may cultivate them and profit therefrom."
"LAW XIII.
"THE SAME AS ABOVE.
"THAT THE 'REDUCCIONES' BE NOT REMOVED WITHOUT ORDER OF THE KING, VICEROY, OR COURT. "No governor, or magistrate, or alcalde mayor, or any other court, has the right to alter or to remove the pueblos or the reducciones once constituted and founded, without our express order or that of the viceroy, president, or the royal district court, provided, however, that the encomenderos, priests, or indios request such a change or consent to it by offering or giving information to that end. And, because these claims are often made for private interests and not for those of the indios, we hereby order that this law be always complied with, otherwise the change will be considered fraudulently obtained. The penalty of one thousand pesos shall be imposed upon the judge or encomendero who should violate this law."
"LAW XV.
"Philip III at Madrid, on October 10, 1618.
"THAT THERE BE MAYORS AND ALDERMEN IN THE 'REDUCCIONES,' WHO SHALL BE 'INDIOS.'
"We order that in each town and reduccion there be a mayor, who should be an India of the same reduccion if there be more than eighty houses, there should be two mayors and two aldermen, also indios; and, even if the town be a big one, there should, nevertheless, be more than two mayors and four aldermen. If there be less than eighty indios but not less than forty, there should be not more than one mayor and one alderman, who should annually elect nine others, in the presence of the priests, as is the practice in town inhabited by Spaniards and indios."
"LAW XXI.
"Philip II, in Madrid, on May 2, 1563, and on November 25, 1578. At Tomar, on May 8, 1581. At Madrid, on January 10, 1589. Philip III, at Tordesillas, on July 12, 1600. Philip IV, at Madrid, on October I and December 17, 1646. For this law and the one following, see Law I, Tit. 4, Book 7.
"THAT IN THE TOWNS OF THE 'INDIOS,' THERE SHALL LIVE NO SPANIARDS, NEGROES, 'MESTIZOS,' AND MULATTOES.
"We hereby prohibit and forbid Spaniards, negroes, mulattoes, or mestizos to live in the reducciones and towns of the indios, because it has been found that some Spaniards who deal, trade, live, and associate with the indios are men of troublesome nature of dirty ways of living; robbers, gamblers, and vicious and useless men; and, to avoid the wrongs done them, the indios would leave their towns and provinces; and the negroes, mestizos, and mulattoes, besides maltreating them and utilizing their services, contaminate them with their bad customs, idleness, and also some of their blunders and vices which may corrupt and pervert the goal which we desire to reach with regard to their salvation, increase, and tranquility. We hereby order the imposition of grave penalties upon the commission of the acts above-mentioned which should not be tolerated in the towns, and that the viceroys, presidents, governors, and courts take great care in executing the law within their powers and avail themsel cooperation of the ministers who are truly honest. As regards the mestizos and Indian and Chinese half- breeds (zambaigos), who are children of indias and born among them, and who are to inherit their houses and haciendas, they shall not be affected by this law, it appearing to be a harsh thing to separate them from their parents." (Law of the Indies, vol. 2, pp. 228, 229, 230, 231.)
A clear exposition of the purposes of the Spanish government, in its efforts to improve the condition of the less advanced inhabitants of the Islands by concentrating them in "reducciones," is found in the Decree of the Governor-General of the Philippine Islands of January 14, 1881, reading as follows:
"It is a legal principle as well as a national right that every inhabitant of a territory recognized as an integral part of a nation should respect and obey the laws in force therein; while, on the other hand, it is the duty to conscience and to humanity for all governments to civilize those backward races that might exist in the nation, and which, living in the obscurity of ignorance, lack all the notions which enable them to grasp the moral and material advantages that may be acquired in those towns under the protection and vigilance afforded them by the same laws.
"It is equally highly depressive to our national honor to tolerate any longer the separation and isolation of the non-Christian races from the social life of the civilized and Christian towns; to allow any longer the commission of depredations, precisely in the Island of Luzon wherein is located the seat of the representative of the Government of the metropolis.
"It is but just to admit the fact that all the governments have occupied themselves with this most important question, and that much has been heretofore accomplished with the help and self-denial of the missionary fathers who have even sacrificed their lives to the end that those degenerate races might be brought to the principles of Christianity, but the means and the preaching employed to allure them have been insufficient to complete the work under taken. Neither have the punishments imposed been sufficient in certain cases and in those which have not been guarded against, thus giving way for the majority of these races to persist in their mode of living and customs of isolation.
"As it is impossible to consent to the continuation of such a lamentable state of things, taking into account the prestige which the country demands and the inevitable duty which every government has in enforcing respect and obedience to the national laws on the part of all who reside within the territory under its control, I have proceeded in the premises by giving the most careful study of this serious question which involves important interests for civilization, from the moral and material as well as the political standpoints. After hearing the illustrious opinions of all the local authorities, ecclesiastics, and missionaries of the provinces of Northern Luzon, and also after finding the unanimous conformity of the meeting held with the Archbishop of Manila, the Bishops of Jaro and Cebu, and the provincial prelates of the Orders of the Dominicans, Agustinians, Recoletos, Franciscans, and Jesuits as also of the meeting of the Council of Authorities, held for the object so indicated, I have arrived at an intimate conviction of the inevitable necessity of proceeding in a practical manner for the submission of the said pagan and isolated races, as well as of the manner and the only form of accomplishing such a task.
"For the reasons above stated and for the purpose of carrying out these objects, I hereby promulgate the following:
"DECREE.
"I. All the indian inhabitants (indios) of the Island of Luzon are, from this date, to be governed by the common law, save those exceptions prescribed in this decree which are based upon the differences of instruction, of the customs, and of the necessities of the different pagan races which occupy a part of its territory. effort must be made to establish their homes within the reach of the sound of the bell.
"5. For the protection and defense of these new towns, there shall be established an armed force composed precisely of native Christians, the organization and service of which shall be determined in a regulation based upon that of the abolished Tercios de Policia (division of the Guardia Civil).
"6. The authorities shall see to it that the inhabitants of the new towns understand all the rights and duties affecting them and the liberty which they have as to where and how they shall till their lands and sell the products thereof with the only exception of the tobacco which shall be bought by the Hacienda at the same price and conditions allowed other producers, and with the prohibition against these new towns as well as the others from engaging in commerce or any other transaction with the rebellious indios the violation of which shall be punished with deportation.
"7. In order to properly carry out this express prohibition the limits of the territory of the rebellious indios shall be fixed; and whoever should go beyond the said limits shall be detained and assigned governmentally wherever convenient.
"8. For the purpose of assisting in the conversion of the pagans into the fraternity of the Catholic Church, all who have settled and who profess our sacred religion shall by this fact alone be exempt for eight years from rendering personal labor. "9. The authorities shall offer in the name of the State to the races not subdued (aetas and mountain igorrots) the following advantages in return for their voluntary submission: to live in towns; unity among their families; concession of good lands and the right to cultivate them in the manner they wish and in the way they deem most productive; support during a year, and clothes upon affecting submission; respect for their habits and customs in effort must be made to establish their homes within the reach of the sound of the bell.
"5. For the protection and defense of these new towns, there shall be established an armed force composed precisely of native Christians, the organization and service of which shall be determined in a regulation based upon that of the abolished Tercios de Policia (division of the Guardia Civil).
"6. The authorities shall see to it that the inhabitants of the new towns understand all the rights and duties affecting them and the liberty which they have as to where and how they shall till their lands and sell the products thereof, with the only exception of the tobacco which shall be bought by the Hacienda at the same price and conditions allowed other producers, and with the prohibition against these new towns as well as the others from engaging in commerce or any other transaction with the rebellious indios, the violation of which shall be punished with deportation.
"7. In order to properly carry out this express prohibition the limits of the territory of the rebellious indios shall be fixed; and whoever should go beyond the said limits shall be detained and assigned governmentally wherever convenient.
"8. For the purpose of assisting in the conversion of the pagans into the fraternity of the Catholic Church, all who have settled and who profess our sacred religion shall by this fact alone be exempt for eight years from rendering personal labor.
"9. The authorities shall offer in the name of the State to the races not subdued (aetas and mountain igorrots) the following advantages in return for their voluntary submission: to live in towns; unity among their families; concession of good lands and the right to cultivate them in the manner they wish and in the way they deem most productive; support during a year, and clothes upon affecting submission; respect for their habits and customs in so far as the same are not opposed to natural law; freedom to decide of their own accord as to whether they want to be Christians or not; the establishment of missions and families of recognized honesty who shall teach, direct, protect, and give them security and trust them; the purchase or facility of the sale of their harvests; the exemption from contributions and tributes for ten years and from the quintas (a kind of tax) for twenty years; and lastly, that those who are governed by the local authorities as the ones who elect such officials under the direct charge of the authority of the province or district. "10. The races indicated in the preceding article, who voluntarily admit the advantages offered, shall, in return, have the obligation of constituting their new towns, of constructing their town hall, schools, and country roads which place them in communication with one another and with the Christians; provided, that the location of these towns be distant from their actual residences when the latter do not have the good conditions of location and cultivation, and provided further that the putting of families in a place so selected by them be authorized in the towns already constituted.
"11. The armed force shall proceed to the prosecution and punishment of the tribes, that, disregarding the peace, protection, and advantages offered them, continue in their rebellious attitude on the first of next April, committing from now on the crimes and vexations against the Christian towns; and for this purpose, the Captain General's Office shall proceed with the organization of the divisions of the Army which in conjunction with the rural guards (cuadrilleros), shall have to enter the territory of such tribes. On the expiration of the term, they shall destroy their dwelling-houses, labors, and implements, and confiscate their products and cattle. Such a punishment shall necessarily be repeated twice a year, and for this purpose the military headquarters shall immediately order a detachment of the military staff to study the zones where such operations shall take place and everything conducive to the successful accomplishment of the same.
"12. The chiefs of provinces, priests, and missionaries, local authorities, and other subordinates to my authority, civil as well as military authorities, shall give the most effective aid and cooperation to the said forces in all that is within the attributes and the scope of the authority of each.
"13. With respect to the reduccion of the pagan races found in some of the provinces in the southern part of the Archipelago, which intend to visit the preceding provisions shall conveniently be applied to them.
"14. There shall be created under my presidency as Governor-General, Vice-Royal Patron, a council or permanent commission which shall attend to and decide all the questions relative to the application of the foregoing regulations that may be brought to it for consultation by the chiefs of provinces and priests and missionaries.
"15. The secondary provisions which may be necessary as a complement to the foregoing in bringing about due compliance with this decree shall be promulgated by the respective official centers within their respective jurisdictions." (Gaceta de Manila, No. 15) (Diccionario de la Administracion, vol. 7, pp. 128-134.)
B. AFTER ACQUISITION OF THE PHILIPPINES BY THE UNITED STATES. Ever since the acquisition of the Philippine Islands by the United States, the question as to the best method for dealing with the primitive inhabitants has been a perplexing one.
J. Organic law.
The first order of an organic character after the inauguration of the American Government in the Philippines was President McKinley's Instructions to the Commission of April 7, 1900, later expressly approved and ratified by section 1 of the Philippine Bill, the Act of Congress of to appoint senators and representatives for the territory which at the time of the passage of the Jones Law was not represented in the Philippine Assembly, that is for the twelfth district (sec. 16). The law established a bureau to be known as the "Bureau of non-Christian Tribes" which shall have general supervision over the public affairs of the inhabitants which are represented in the Legislature by appointed senators and representatives (sec. 22).
Philippine organic law may, therefore, be said to recognize a dividing line between the territory not inhabited by Moros or other non-Christian tribes, and the territory which is inhabited by Moros, or other non-Christian tribes.
2. Statute law.
Local governments in the Philippines have been provided for by various acts of the Philippine Commission and Legislature. The most notable are Acts Nos. 48 and 49 concerning the Province of Benguet and the Igorots; Act No. 82, the Municipal Code; Act No. 83, the Provincial Government Act; Act No. 183, the Charter of the city of Manila; Act No. 787, providing for the organization and government of the Moro Province; Act No. 1396, the Special Provincial Government Act; Act No. 1397, the Township Government Act; Act No. 1667, relating to the organization of settlements; Act No. 1963, the Baguio Charter; and Act No. 2408, the Organic Act of the Department of Mindanao and Sulu. The major portion of these laws have been carried forward into the Administrative Codes of 1916 and 1917.
Of more particular interest are certain special laws concerning the government of the primitive peoples. Beginning with Act No. 387, sections 68-71, enacted on April 9, 1902, by the United States Philippine Commission, having reference to the Province of Nueva Vizcaya, Acts Nos. 411, 422, 445, 500, 547, 548, 549, 550, 579, 753, 855, 1113, 1145, 1268, 1306 were enacted for the provinces of Abra, Antique, Bataan, Ilocos Norte, Ilocos Sur, Isabela to appoint senators and representatives for the territory which at the time of the passage of the Jones Law was not represented in the Philippine Assembly, that is for the twelfth district (sec. 16). The law established a bureau to be known as the "Bureau of non-Christian Tribes" which shall have general supervision over the public affairs of the inhabitants which are represented in the Legislature by appointed senators and representatives (sec. 22). Philippine organic law may, therefore, be said to recognize a dividing line between the territory not inhabited by Moros or other non-Christian tribes, and the territory which is inhabited by Moros, or other non-Christian tribes.
2. Statute law.
Local governments in the Philippines have been provided for by various acts of the Philippine Commission and Legislature. The most notable are Acts Nos. 48 and 49 concerning the Province of Benguet and the Igorots; Act No. 82, the Municipal Code; Act No. 83, the Provincial Government Act; Act No. 183, the Charter of the city of Manila; Act No. 787, providing for the organization and government of the Moro Province; Act No. 1396, the Special Provincial Government Act; Act No. 1397, the Township Government Act; Act No. 1667, relating to the organization of settlements; Act No. 1963, the Baguio Charter; and Act No. 2408, the Organic Act of the Department of Mindanao and Sulu. The major portion of these laws have been carried forward into the Administrative Codes of 1916 and 1917.
Of more particular interest are certain special laws concerning the government of the primitive peoples. Beginning with Act No. 387, sections 68-71, enacted on April 9, 1902, by the United States Philippine Commission, having reference to the Province of Nueva Vizcaya, Acts Nos. 411, 422, 445, 500, 547, 548, 549, 550, 579, 753, 855, 1113, 1145, 1268, 1306 were enacted for the provinces of Abra, Antique, Bataan, Ilocos Norte, Ilocos Sur, Isabela, Lepanto-Bontoc, Mindoro, Misamis, Nueva Vizcaya, Pangasinan, Paragua (Palawan), Tarlac, Tayabas, and Zambales. As an example of these laws, because referring to the Manguianes, we insert Act No. 547:
"No. 547.-AN ACT PROVIDING FOR THE ESTABLISHMENT OF LOCAL CIVIL GOVERNMENTS FOR THE MANGUIANES IN THE PROVINCE OF MINDORO.
"By authority of the United States, be it enacted by the Philippine Commission, that:
"SECTION 1. Whereas the Manguianes of the Province of Mindoro have not progressed sufficiently in civilization to make it practicable to bring them under any form of municipal government, the provincial governor is authorized, subject to the approval of the Secretary of the Interior, in dealing with these Manguianes to appoint officers from among them to fix their designations and badges of office, and to prescribe their powers and duties: Provided, That the powers and duties thus prescribed shall not be in excess of those conferred upon township officers by Act Numbered Three hundred and eighty-seven entitled 'An Act providing for the establishment of local civil governments in the townships and settlements of Nueva Vizcaya.'
"SEC. 2. Subject to the approval of the Secretary of the Interior, the provincial governor is further authorized when he deems such a course necessary in the interest of law and order to direct such Manguianes to take up their habitation on sites on unoccupied public lands to be selected by him and approved by the provincial board. Manguianes who refuse to comply with such directions shall upon conviction be imprisoned for a period not exceeding sixty days.
"SEC. 3. The constant aim of the, governor shall be to aid the Manguianes of his province to acquire the knowledge and experience necessary for successful local popular government, and his supervision and control over them shall be exercised to this end, and to the end that law and order and individual freedom shall be maintained. administrative Code of 1917, reestablishing this Bureau. Among other laws which contain the phrase, there can be mentioned Acts Nos. 127, 129, 397, 547, 549, 549, 550, 1397, 1639, and 2551.
"Non-Christian people," "non-Christian inhabitants," and "non-Christian Filipinos" have been the favorite nomenclature in lieu of the unpopular word "tribes," since the coming into being of a Filipinized legislature. These terms can be found in sections 2076, 2077, 2390, 2394, Administrative Code of 1916; sections 701-705, 2145, 2422, 2426, Administrative Code of 1917; and in Acts Nos. 2404, 2435, 2444, 2674 of the Philippine Legislature, as well as in Act No. 1667 of the Philippine Commission.
The Administrative Code specifically provides that the term "non-Christian" shall include Mohammedans and pagans. (Sec. 2576, Administrative Code of 1917; sec. 2561, Administrative Code of 1916, taken from Act No. 2408, sec. 3.)
D. MEANING OF TERM "NON-CHRISTIAN."
If we were to follow the literal meaning of the word "non-Christian," it would of course result in giving to it a religious signification. Obviously, Christians would be those who profess the Christian religion, and non-Christians, would be those who do not profess the Christian religion. In partial corroboration of this view, there could also be cited section 2576 of the last Administrative Code and certain well-known authorities, as Zuñiga, "Estadismo de las Islas Filipinas," Professor Ferdinand Blumentritt, "Philippine Tribes and Languages," and Dr. N. M. Saleeby, "The Origin of Malayan Filipinos." (See Blair & Robertson, "The Philippine Islands," 1493-1898, Vol. III, p. 300, notes, Craig-Benitez, "Philippine Progress prior to 1898", Vol. 1, p. 107.)
Not content with the apparent definition of the word, we shall investigate further to ascertain what is its true meaning. administrative Code of 1917, reestablishing this Bureau. Among other laws which contain the phrase, there can be mentioned Acts Nos. 127, 129, 397, 547, 549, 549, 550, 1397, 1639, and 2551.
"Non-Christian people," "non-Christian inhabitants," and "non-Christian Filipinos" have been the favorite nomenclature in lieu of the unpopular word "tribes," since the coming into being of a Filipinized legislature. These terms can be found in sections 2076, 2077, 2390, 2394, Administrative Code of 1916; sections 701-705, 2145, 2422, 2426, Administrative Code of 1917; and in Acts Nos. 2404, 2435, 2444, 2674 of the Philippine Legislature, as well as in Act No. 1667 of the Philippine Commission.
The Administrative Code specifically provides that the term "non-Christian" shall include Mohammedans and pagans. (Sec. 2576, Administrative Code of 1917; sec. 2561, Administrative Code of 1916, taken from Act No. 2408, sec. 3.)
D. MEANING OF TERM "NON-CHRISTIAN."
If we were to follow the literal meaning of the word "non-Christian," it would of course result in giving to it a religious signification. Obviously, Christians would be those who profess the Christian religion, and non-Christians, would be those who do not profess the Christian religion. In partial corroboration of this view, there could also be cited section 2576 of the last Administrative Code and certain well-known authorities, as Zuñiga, "Estadismo de las Islas Filipinas," Professor Ferdinand Blumentritt, "Philippine Tribes and Languages," and Dr. N. M. Saleeby, "The Origin of Malayan Filipinos." (See Blair & Robertson, "The Philippine Islands," 1493-1898, Vol. III, p. 300, notes, Craig-Benitez, "Philippine Progress prior to 1898", Vol. 1, p. 107.)
Not content with the apparent definition of the word, we shall investigate further to ascertain what is its true meaning.
In one sense, the word can have a geographical signification. This is plainly to be seen by the provisions of many laws. Thus, according to the Philippine Bill, the authority of the Philippine Assembly was recognized in the "territory" of the Islands not inhabited by Moros or other non- Christian tribes. Again, the Jones Law confers similar recognition in the authorization of the twelfth senatorial district for the "territory not now represented in the Philippine Assembly." The Philippine Legislature has, time and again, adopted acts making certain other acts applicable to that "part" of the Philippine Islands inhabited by Moros or other non-Christian tribes'.
Section 2145, is found in article XII of the Provincial Law of the Administrative Code. The first section of this article, preceding section 2145, makes the provisions of the article applicable only in specially organized provinces. The specially organized provinces are the Mountain Province, Nueva Vizcaya, Mindoro, Batanes, and Palawan. These are the provinces to which the Philippine Legislature has never seen fit to give all the powers of local self-government. They do not, however, exactly coincide with the portion of the Philippines which is not granted popular representation. Nevertheless, it is still a geographical description.
It is well-known that within the specially organized provinces, there live persons some of whom are Christians and some of whom are not Christians. In fact, the law specifically recognizes this. (Sec. 2422, Administrative Code of 1917, etc.)
If the religious conception is not satisfactory, so again the geographical conception is likewise inadequate. The reason is that the motive of the law relates not to a particular people, because of their religion, or to a particular province because of its location, but the whole intent of the law is predicated on the civilization or lack of civilization of the inhabitants.
At most, "non-Christian" is an awkward and unsatisfied factoryword. Apologetic words usually introduce the term. "The so-called non-Christian" is a favorite expression. The Secretary of the Interior who for so many years had these people under his jurisdiction, recognizing the difficulty of selecting an exact designation, speaks of the "backward Philippine peoples, commonly known as the 'non-Christian tribes.' " (See Hearings before the Committee on the Philippines, United States Senate, Sixty-third Congress, third session on H. R. 18459, An Act to declare the purpose of the people of the United States as to the future political status of the Philippine Islands and to provide a more autonomous government for the Islands, pp. 346, 351; letter of the Secretary of the Interior of June 30, 1906, circulated by the Executive Secretary.)
The idea that the term "non-Christian" is intended to relate to degree of civilization, is substantiated by reference to legislative, judicial, and executive authority.
The legislative intent is borne out by Acts Nos. 48, 253, 387, 1667, and 2674, and sections 701 et seq., and sections 2422 et seq., of the Administrative Code of 1917. For instance, Act No. 253 charged the Bureau of non-Christian tribes to conduct "systematic investigations with reference to non-Christian tribes * * * with special view to determining the most practicable means for bringing about their advancement in civilization and material prosperity."
As authority of a judicial nature is the decision of the Supreme Court in the case of United States vs. Tubban [Kalinga] ([1915], 29 Phil., 434). The question here arose as to the effect of a tribal marriage in connection with article 429 of the Penal Code concerning the husband who surprises his wife in the act of adultery. In discussing the point, the court makes use of the following language: " * * * we are not advised of any provision of law which recognizes as legal a tribal marriage of so-called non-Christians or members of uncivilized tribes, celebrated within that province without compliance with the requisites also that the fact that the accused is shown to be a member of an uncivilized tribe of a low order of intelligence, uncultured and uneducated, should be taken into consideration as a second marked extenuating circumstance."
Of much more moment is the uniform construction of executive officials who have been called upon to interpret and enforce the law. The official who, as a member of the Philippine Commission, drafted much of the legislation relating to the so-called non-Christians and who had these people under his authority was the former Secretary of the Interior. Under date of June 30, 1906, this official addressed a letter to all governors of provinces, organized under the Special Provincial Government Act, a letter which later received recognition by the Governor- General and was circulated by the Executive Secretary, reading as follows "SIR: Within the past few months, the question has arisen as to whether people who were originally non-Christians but have recently been baptized or who are children of persons who have been recently baptized are, for the purposes of Acts 1396 and 1397, to be considered Christian or non- Christians.
"It has been extremely difficult, in framing legislation for the tribes in these islands which are. not advanced far in civilization to hit upon any suitable designation which will fit all cases. The number of individual tribes is so great that it is almost out of the question to enumerate all of them in an Act. It was finally decided to adopt the designation 'non-Christians' as the one most satisfactory, but the real purpose of the Commission was not so much to legislate for people having any particular religious belief as for those lacking sufficient advancement so that they could, to their own advantage, be brought under the Provincial Government Act and the Municipal Code.
"The mere act of baptism does not, of course, in itself change the degree of civilization to which the person baptized has attained at the time the act of baptism is performed. For practical purposes, therefore, you will give the member of so-called 'wild tribes' of your province the benefit of the doubt even though they may recently have embraced Christianity.
"The determining factor in deciding whether they are to be allowed to remain under the jurisdiction of regularly organized municipalities or what form of government shall be afforded to them should be the degree of civilization to which they have attained and, you are requested to govern yourself accordingly.
"I have discussed this matter with the Honorable, the Governor-General, who concurs in the opinion above expressed and who will have the necessary instructions given to the governors of the provinces organized under the Provincial Government Act." (Internal Revenue Manual, p. 214.)
The present Secretary of the Interior, in a memorandum furnished a member of this court has the following to say on the subject:
"As far as names are concerned the classification is indeed unfortunate, but while no other better classification has as yet been made the present classification should be allowed to stand. * * * I believe the term carries the same meaning as that expressed in the letter of the Secretary of the Interior (of June 30, 1906, herein quoted). It is indicative of the degree of civilization rather than of religious denomination for to hold that it is indicative of religious denomination will make the law invalid as against that Constitutional guaranty of religious freedom."
Another official who was concerned with the status of the non-Christians, was the Collector of Internal Revenue. The question arose for ruling relative to the cedula taxation of the Manobos and the Aetas. Thereupon, the view of the Secretary of the Interior was requested on the point, who, by return indorsement, agreed with the interpretation of the Collector of Internal Revenue. This construction of the Collector of Internal Revenue can be found in circular letter No. 199 of the Bureau of Internal Revenue, dated June 11, 1907, reading as follows (Internal Revenue Manual, p. 214) :
"The internal revenue law exempts 'members of non-Christian tribes' from the payment of cedula taxes. The Collector of Internal Revenue has interpreted this provision of law to mean not that persons who profess some form of Christian worship are alone subject to the cedula tax, and that all other persons are exempt; he has interpreted it to mean that all persons preserving tribal relations with the so-called non-Christian tribes are exempt from the cedula tax, and that all others, including Jews, Mohammedans, Confucians, Buddists, etc., are subject to said tax so long as they live in cities or towns, or in the country in a civilized condition. In other words, it is not so much a matter of a man's form of religious worship or profession that decides whether or not he is subject to the cedula tax; it is more dependent on whether he is living in a civilized manner or is associated with the mountain tribes, either as a member thereof or as a recruit. So far, this question has not come up as to whether a Christian, maintaining his religious belief, but throwing his lot and living with a non-Christian tribe, would or would not be subject to the cedula tax. On one occasion a prominent Hebrew of Manila claimed to this office that he was exempt from the cedula tax, inasmuch as he was not a Christian. This Office, however, continued to collect cedula taxes from all of the Jews, East Indians, Arabs, Chinamen, etc., residing in Manila. Quite a large proportion of the cedula taxes paid in this city are paid by men belonging to the nationalities mentioned. Chinamen, Arabs and others are quite widely scattered throughout the Islands, and a condition similar to that which exist in Manila also exists in most of the large provincial towns. Cedula taxes are therefore being collected by this Office in all parts of these Islands on the broad ground that civilized people are subject to such taxes, and non-civilized people preserving their tribal relations are not subject thereto.
(Sgd.) "JNO. S. HORD,
"Collector of Internal On September 17, 1910, the Collector of Internal Revenue addressed circular letter No. 327, approved by the Secretary of Finance and Justice, to all provincial treasurers. This letter in part reads:
"In view of the many questions that have been raised by provincial treasurers regarding cedula taxes due from members of non-Christian tribes when they come in from the hills for the purpose of settling down and becoming members of the body politic of the Philippine Islands, the following clarification of the laws governing such questions and digest of rulings thereunder is hereby published for the information of all concerned:
"Non-Christian inhabitants of the Philippine Islands are so classed, not by reason of the fact that they do not profess Christianity, but because of their uncivilized mode of life and low state of development. All inhabitants of the Philippine Islands classed as members of non-Christian tribes may be divided into three classes in so far as the cedula tax law is concerned. * * *
"Whenever any member of a non-Christian tribe leaves his wild and uncivilized mode of life severs whatever tribal relations he may have had and attaches himself to some civilized community, becoming a member of the body politic, he thereby makes himself subject to precisely the same law that governs the other members of that community and from and after the date when he so attaches himself to the community the same cedula and other taxes are due from him as from other members thereof. If he comes in after the expiration of the delinquency period the same rule should apply to him as to persons arriving from foreign countries or reaching the age of eighteen subsequent to the expiration of such period, and a regular class A, D, F, or H cedula, as the case may be, should be furnished him without penalty and without requiring him to pay the tax for former years.
"In conclusion, it should be borne in mind that the prime factor in determining whether or not a man is subject to the regular cedula tax is not the circumstance that he does or does not profess Christianity, nor even his maintenance of or failure to maintain tribal relations with some of the well known wild tribes, but his mode of life, degree of advancement in civilization and connection or lack of connection with some civilized community. For this reason so called 'Remontados' and 'Montescos' will be classed by this office as members of non-Christian tribes in so far as the application of the Internal Revenue Law is concerned, since, even though they belong to no well recognized tribe, their mode of life degree of advancement and so forth are practically the same as those of the Igorrots and members of other recognized non-Christian tribes.
"Very respectfully,
(Sgd.) "ELLIS CROMWELL,
"Collector of Internal Revenue,
"Approved:
(Sgd.) "GREGORIO ARANETA,
"Secretary of Finance and Justice."
The two circulars above quoted have since been repealed by Bureau of Internal Revenue Regulations No. 1, promulgated by Venancio Concepcion, Acting Collector of Internal Revenue, and approved on April 16, 1915, by Honorable Victorino Mapa, Secretary of Finance and Justice. Section 30 of the regulations is practically a transcript of Circular Letter No. 327.
The subject has come before the Attorney-General for consideration. The Chief of Constabulary requested the opinion of the Attorney-General as to the status of a nonChristian who has been baptized by a minister of the Gospel. The precise questions were these: "Does he remain non- Christian or is he entitled to the privileges of a Christian? By purchasing intoxicating liquors, does he commit an infraction of the law and does the person selling same lay himself liable under the provision of Act No. 1639?" The opinion of Attorney-General Avanceña, after quoting the same authorities hereinbefore set out concludes:
"In conformity with the above quoted constructions, it is probable that the person in question remains a non-Christian, so that in purchasing intoxicating liquors both he and the person selling the same make themselves liable to prosecution under the provisions of Act No. 1639. At least, I advise you that these should be the constructions placed upon the law until a court shall hold otherwise."
Solicitor-General Paredes in his brief in this case says:
"With respect to the meaning which the phrase non-Christian inhabitants has in the provisions of the Administrative Code which we are studying, we submit that said phrase does not have its natural meaning which would include all non-Christian inhabitants of the Islands, whether Filipinos or strangers, civilized or uncivilized, but simply refers to those uncivilized members of the non-Christian tribes of the Philippines who living without home or fixed residence, roam in the mountains, beyond the reach of law and order. * * * "The Philippine Commission in denominating in its laws that portion of the inhabitants of the Philippines which live in tribes as non-Christian tribes, as distinguished from the common Filipinos which carry on a social and civilized life did not intend to establish a distinction based on the religious beliefs of the individual, but, without dwelling on the difficulties which later would be occasioned by the phrase adopted the expression which the Spanish legislation employed to designate the uncivilized portion of the inhabitants of the Philippines.
"The phrase 'non-Christian inhabitants' used in the provisions of articles 2077 and 2741 of Act No. 2657 (articles 2145 and 2759) should be understood as equivalent to members of uncivilized tribes of the Philippines, not only because this is the evident intention of the law, but because to give it its literal meaning would make the law null and unconstitutional as making distinctions based on the religion of the individual."
The official Census of 1903, in the portion written by no less an authority than Dr. David P. Barrows, then "Chief of the Bureau of non-Christian Tribes," divides the population into Christian or Civilized Tribes, and non-Christian or Wild Tribes. (Census of the Philippine Islands [1903], vol. 1, pp. 411 et seq.) The present Director of the Census, Hon. Ignacio Villamor, writes that the classification likely to be used in the Census now being taken is: "Filipinos and Primitive Filipinos." In a Pronouncing Gazetteer and Geographical Dictionary of the Philippine Islands, prepared in the Bureau of Insular Affairs, War Department, a subdivision under the title non- Christian tribes is, "Physical and Political Characteristics of the non-Christian Tribes," which sufficiently shows that the term refers to culture and not to religion.
In resume, therefore, the Legislature and the Judiciary, inferentially, and different executive officials, specifically, join in the proposition that the term "non-Christian" refers, not to religious belief, but, in a way, to geographical area, and, more directly, to natives of the Philippine Islands of a low grade of civilization, usually living in tribal relationship apart from settled communities.
E. THE MANGUIANES.
The so-called non-Christians are in various stages approaching civilization. The Philippine Census of 1903 divided them into four classes. Of the third class, are the Manguianes (or Mangyans) of Mindoro.
Of the derivation of the name "Manguian" Dr. T. H. Pardo de Tavera in his Etimologia de los nombres de Razas de Filipinas, says:
"In Tagalog, Bicol, and Visaya, Manguian signifies 'savage,' 'mountainer,' 'pagan,' 'negro.' It may be that the use of this word is applicable to a great number of Filipinos, but nevertheless it has been applied only to certain inhabitants of Mindoro. Even in primitive times without doubt this name was given to those of that island who bear it to-day, but its employment in three Filipino languages shows that the radical ngian had in all these languages a sense to-day forgotten. In Pampango this ending still exists and signifies 'ancient,' from which we can deduce plates the preservation of the Indian nations as an object sought by the United States, and proposes to effect this object by civilizing and converting them from hunters into agriculturists."
A leading case which discusses the status of the Indians is that of the United States vs. Kagama ([1886], 118 U. S., 375). Reference is herein made to the clause of the United States Constitution which gives Congress "power to regulate commerce with foreign nations, and among the several States, and with the Indian tribes." The court then proceeds to indite a brief history of the position of the Indians in the United States (a more extended account of which can be found in Marshall's opinion in Worcester vs. Georgia, supra), as follows:
"The relation of the Indian tribes living within the borders of the United States, both before and since the Revolution to the people of the United States, has always been an anomalous one and of a complex character.
"Following the policy of the European Governments in the discovery of America towards the Indians who were found here, the colonies before the Revolution and the States and the United States since have recognized in the Indians a possessory right to the soil over which they roamed and hunted and established occasional villages. But they asserted an ultimate title in the land itself, by which the Indian tribes were forbidden to sell or transfer it to other nations or peoples without the consent of this paramount authority. When a tribe wished to dispose of its land, or any part of it, or the State or the United States wished to purchase it, a treaty with the tribe was the only mode in which this could be done. The United States recognized no right in private persons, or in other nations to make such a purchase by treaty or otherwise. With the Indians themselves these relations are equally difficult to define. They were, and always have been, regarded as having a semi-independent position when they preserved their tribal relations; not as States, not as nations, not as possessed-of the full attributes of sovereignty, but as a separate people, with the power of regulating their internal and social relations, and thus far not brought under the laws of the Union or of the State within whose limits they resided."
The opinion then continues:
"It seems to us that this (effect of the law) is within the competency of Congress. These Indian tribes are the wards of the nation. They are communities dependent on the United States. Dependent largely for their daily food. Dependent for their political rights. They owe no allegiance to the States, and receive from them no protection. Because of the local ill feeling, the people of the States where they are found are often their deadliest enemies. From their very weakness and helplessness, so largely due to the course of dealing of the Federal Government with them and the treaties in which it has been promised, there arise the duty of protection, and with it the power. This has always been recognized by the Executive and by Congress, and by this court, whenever the question has arisen. * * * The power of the General Government over these remnants of a race once powerful, now weak and diminished in numbers, is necessary to their protection, as well as to the safety of those among whom they dwell. It must exist in that government, because it never has existed anywhere else, because the theater of its exercise is within the geographical limits of the United States, because it has never been denied, and because it alone can enforce its laws on all the tribes."
In the later case of United States vs. Sandoval ([1913], 231 U. S., 28) the question to be considered was whether the status of the Pueblo Indians and their lands was such that Congress could prohibit the introduction of intoxicating liquor into those lands notwithstanding the admission of New Mexico to statehood. The court looked to the reports of the different superintendents charged with guarding their interests and found that these Indians are dependent upon the fostering care and protection of the government "like reservation Indians in general." Continuing, the court said "that during the Spanish dominion, the Indians of the pueblos were treated as wards requiring special protection were with the power of regulating their internal and social relations, and thus far not brought under the laws of the Union or of the State within whose limits they resided."
The opinion then continues:
"It seems to us that this (effect of the law) is within the competency of Congress. These Indian tribes are the wards of the nation. They are communities dependent on the United States. Dependent largely for their daily food. Dependent for their political rights. They owe no allegiance to the States, and receive from them no protection. Because of the local ill feeling, the people of the States where they are found are often their deadliest enemies. From their very weakness and helplessness, so largely due to the course of dealing of the Federal Government with them and the treaties in which it has been promised, there arise the duty of protection, and with it the power. This has always been recognized by the Executive and by Congress, and by this court, whenever the question has arisen. * * * The power of the General Government over these remnants of a race once powerful, now weak and diminished in numbers, is necessary to their protection, as well as to the safety of those among whom they dwell. It must exist in that government, because it never has existed anywhere else, because the theater of its exercise is within the geographical limits of the United States, because it has never been denied, and because it alone can enforce its laws on all the tribes."
In the later case of United States vs. Sandoval ([1913], 231 U. S., 28) the question to be considered was whether the status of the Pueblo Indians and their lands was such that Congress could prohibit the introduction of intoxicating liquor into those lands notwithstanding the admission of New Mexico to statehood. The court looked to the reports of the different superintendents charged with guarding their interests and found that these Indians are dependent upon the fostering care and protection of the government "like reservation Indians in general." Continuing, the court said "that during the Spanish dominion, the Indians of the pueblos were treated as wards requiring special protection, were subjected to restraints and official supervision in the alienation of their property." And finally, we note the following: "Not only does the Constitution expressly authorize Congress to regulate commerce with the Indian tribes, but long continued legislative and executive usage and an unbroken current of judicial decisions have attributed to the United States as a superior and civilized nation the power and the duty of exercising a fostering care and protection over all dependent Indian communities within its borders, whether within its original territory or territory subsequently acquired, and whether within or without the limits of a state."
With reference to laws affecting the Indians, it has been held that it is not within the power of the courts to overrule the judgment of Congress. For very good reason, the subject has always been deemed political in nature, not subject to the jurisdiction of the judicial department of the government. (Matter of Heff [1905], 197 U. S., 488; U. S. vs. Celestine [1909], 215 U. S., 278; U. S. vs. Sandoval, supra; Worcester vs. Georgia, supra; U. S. vs. Rogers [1846], 4 How., 567; The Cherokee Tobacco [1871], 11 Wall., 616; Roff vs. Burney [1897], 168 U. S., 218; Thomas vs. Gay [1898], 169 U. S., 264; Lone Wolf vs. Hitchcock [19031, 187 U. S., 553; Wallace vs. Adams [19071, 204 U. S., 415; Conley vs. Bollinger [1910], 216 U. S., 84; Tiger vs. Western Invest. Co. [19111, 221 U. S., 286; U. S. vs. Lane [1913], 232 U. S., 598; Cyr vs. Walker [1911], 29 Okla., 281; 35 L. R. A. [N. S.], 795.) Whenever, therefore, the United States sets apart any public land as an Indian reservation, it has full authority to pass such laws and authorize such measures as may be necessary to give to the Indians thereon full protection in their persons and property. (U. S. vs. Thomas [1894], 151 U. S., 577.)
All this is borne out by long-continued legislative and executive usage, and an unbroken line of judicial decisions.
The only case which is even remotely in point and which, if followed literally, might result in the issuance of habeas corpus, is that of United States vs. Crook ([1879], Fed. Cas. No. 14891). This was a hearing upon return to a writ of habeas corpus issued against Brigadier General George Crook at the relation of Standing Bear and other Indians, formerly belonging to the Ponca Tribe of Indians. The petition alleged in substance that the relators are Indians who have formerly belonged to the Ponca tribe of Indians, now located in the Indian Territory; that they had some time previously withdrawn from the tribe, and completely severed their tribal relations therewith, and had adopted the general habits of the whites, and were then endeavoring to maintain themselves by their own exertions, and without aid or assistance from the general government; that whilst they were thus engaged, and without being guilty of violating any of the laws of the United States, they were arrested and restrained of their liberty by order of the respondent George Crook. The substance of the return to the writ was that the relators are individual members of and connected with the Ponca tribe of Indians; that they had fled or escaped from a reservation situated some place within the limits of the Indian Territory-had departed therefrom without permission from the Government; and, at the request of the Secretary of the Interior, the General of the Army had issued an order which required the respondent to arrest and return the relators to their tribe in the Indian Territory, and that, pursuant to the said order, he had caused the relators to be arrested on the Omaha Indian Territory.
The first question was whether an Indian can test the validity of an illegal imprisonment by habeas corpus. The second question of much greater importance related to the right of the Government to arrest and hold the relators for a time, for the purpose of being returned to the Indian Territory from which it was alleged the Indian escaped. In discussing this question, the court reviewed the policy the Government had adopted in its dealings with the friendly tribe of Poncas. Then, continuing the court said: "Laws passed for the government of the Indian country, and for the purpose of regulating trade and intercourse with the Indian tribes, confer upon certain officers of the Government almost unlimited power over the persons who go upon the reservations without lawful authority. * * * Whether such an extensive discretionary power is wisely vested in the commissioner of Indian affairs or not, need not be questioned. It is enough to know that the power rightfully exists, and, where existing the exercise of the power must be upheld." The decision concluded as follows:
"The reasoning advanced in support of my views, leads me to conclude:
"1. That an Indian is a 'person' within the meaning of the laws of the United States, and has, therefore, the right to sue out a writ of habeas corpus in a federal court, or before a federal judge in all cases where he may be confined or in custody under color of authority of the United States or where he is restrained of liberty in violation of the constitution or laws of the United States.
"2. That General George Crook, the respondent, being commander of the military department of the Platte, has the custody of the relators under color of authority of the United States, and in violation of the laws thereof.
"3. That no rightful authority exists for removing by force any of the relators to the Indian Territory, as the respondent has been directed to do. "4. That the Indians possess the inherent right of expatriation, as well as the more fortunate white race, and have the inalienable right to 'life, liberty, and the pursuit of happiness,' so long as they obey the laws and do not trespass on forbidden ground. And,
"5. Being restrained of liberty under color of authority of the United States, and in violation of the laws thereof, the relators must be discharged from custody, and it is so ordered."
As far as the first point is concerned, the decision just quoted could be used as authority to determine that Rubi, the Manguian petitioner, a Filipino, and a citizen of the Philippine Islands, is a "person" within the meaning of the Habeas Corpus Act, and as such, entitled to sue out a writ in the Philippine courts. (See also In re Race Horse [18951, 70 Fed., 598.) We so decide.
As to the second point, the facts in the Standing Bear case and the Rubi case are not exactly identical. But even admitting similarity of facts, yet it is known to all that Indian reservations do exist in the United States, that Indians have been taken from different parts of the country and placed on these reservations without any previous consultation as to their own wishes, and that, when once so located, they have been made to remain on the reservation for their own good and for the general good of the country. If any lesson can be drawn from the Indian policy of the United States, it is that the determination of this policy is for the legislative and executive branches of the government and that when once so decided upon the courts should not interfere to upset a carefully planned governmental system. Perhaps, just as many forceful reasons exist for the segregation of the Manguianes in Mindoro as existed for the segregation of the different Indian tribes in the United States.
IV. CONSTITUTIONAL QUESTIONS.
A. DELEGATION OF LEGISLATIVE POWER.
The first constitutional objection which confronts us is that the Legislature could not delegate this power to provincial authorities. In so attempting, it is contended, the Philippine Legislature has abdicated its authority and avoided its full responsibility.
That the maxim of Constitutional Law forbidding the delegation of legislative power should be zealously protected, we agree. An understanding of the rule will, however, disclose that it has not been violated in this instance.
The rule has nowhere been better stated than in the early Ohio case decided by Judge Ranney, and since followed in a multitude of cases, namely: "The true distinction therefore is between the delegation of power to make the law. which necessarily involves a discretion as to what it shall be, and conferring an authority or discretion as to its execution to be exercised under and in pursuance of the law. The first cannot be done; to the latter no valid objection can be made." (Cincinnati, W. & Z. R. Co. vs. Comm'rs. Clinton County [18521, 1 Ohio St., 88.) Discretion, as held by Chief Justice Marshall in Wayman vs. Southard Q18251, 10 Wheat., 1) may be committed by the Legislature to an executive department or official. The Legislature may make decisions of executive departments or subordinate officials thereof, to whom it has committed the execution of certain acts, final on questions of fact. (U. S. vs. Kinkead [1918], 248 Fed., 141.) The growing tendency in the decisions is to give prominence to the "necessity" of the case.
Is not all this exactly what the Legislature has attempted to accomplish by the enactment of section 2145 of the Administrative Code? Has not the Legislature merely conferred upon the provincial governor with the approval of the provincial board and the Department Head, discretionary authority as to the execution of the law? Is not this "necessary"?
The case of West vs. Hitchock, ([1906], 205 U. S., 80) was a petition for mandamus to require the Secretary of the Interior to approve the selection and taking of one hundred and sixty acres by the relator out of the lands ceded to the United States by the Wichita and affiliated bands of Indians. Section 463 of the United States Revised Statutes provided: "The Commissioner of Indian Affairs shall under the direction of the Secretary of the Interior, and agreeably to such regulations as the President may prescribe, have the management of all Indian affairs, and of all matters arising out of the Indian relations." Justice Holmes said: "We should hesitate a good deal especially in view of the long established practice of the Department, before saying that this language was not broad enough to warrant a regulation obviously made for the welfare of the rather helpless people concerned. The power of Congress is not doubted. The Indians have been treated as wards of the nation. Some such supervision was necessary, and has been exercised. In the absence of special provisions naturally it would be exercised by the Indian Department." (See also as corroborative authority, if any is needed, Union Bridge Co. vs. U. S. [19071, 204 U. S., 364, reviewing the previous decisions of the United States Supreme Court; U. S. vs. Lane [19143, 232 U. S., 599.)
There is another aspect of the question, which once accepted, is decisive. An exception to the general rule, sanctioned by immemorial practice, permits the central legislative body to delegate legislative powers to local authorities. The Philippine Legislature has here conferred authority upon the Province of Mindoro, to be exercised by the provincial governor and the provincial board.
Who but the provincial governor and the provincial board, as the official representatives of the province are better qualified to judge "when such a course is deemed necessary in the interest of law and order?" As officials charged with the administration of the province and the protection of its inhabitants, who but they are better fitted to select sites which have the conditions most favorable for improving the people who have the misfortune of being in a backward state ?
Section 2145 of the Administrative Code of 1917 is not an unlawful delegation of legislative power by the Philippine Legislature to provincial officials and a department head.
B. RELIGIOUS DISCRIMINATION.
The attorney de officio, for petitioners, in a truly remarkable brief, submitted on behalf of his unknown clients says that-"The statute is perfectly clear and unambiguous. In limpid English, and in words as plain and unequivocal as language can express, it provides for the segregation of 'non-Christians' and none other." The inevitable result, then, is that the law "constitutes an attempt by the "Every man may claim the fullest liberty to exercise his faculties, compatible with the possession of like liberty by every other." (Spencer, Social Statistics, p. 94.)
"Liberty is the creature of law, essentially different from that authorized licentiousness that trespasses on right. It is a legal and a refined idea, the offspring of high civilization which the savage never understood, and never can understand. Liberty exists in proportion to wholesome restraint; the more restraint on others to keep off from us, the more liberty we have. * * * That man is free who is protected from injury." (II Webster's Works, p. 393.)
"Liberty consists in the ability to do what one ought to desire and in not being forced to do what one ought not to desire." (Montesquieu, Spirit of the Laws.)
"Even liberty itself, the greatest of all rights is not unrestricted license to act according to one's own will. It is only freedom from restraint under conditions essential to the equal enjoyment of the same right by others." (Field, J., in Crowley vs. Christensen [18901, 137 U. S., 86.)
"Liberty does not import an absolute right in each person to be at all times and in all circumstances, wholly freed from restraint. There are manifold restraints to which every person is necessarily subject for the common good. On any other basis, organized society could not exist with safety to its members. Society based on the rule that each one is a law unto himself would soon be confronted with disorder and anarchy. Real liberty for all could not exist under the operation of a principle which recognizes the right of each individual person to use his own, whether in respect of his person or his property, regardless of the injury that may be done to others. * * * There is, of course, a sphere within which the individual may assert the supremacy of his own will, and rightfully dispute the authority of any human government-especially of any free government existing under a written Constitution-to interfere with the exercise of that will. But it is equally "Every man may claim the fullest liberty to exercise his faculties, compatible with the possession of like liberty by every other." (Spencer, Social Statistics, p. 94.) "Liberty is the creature of law, essentially different from that authorized licentiousness that trespasses on right. It is a legal and a refined idea, the offspring of high civilization which the savage never understood, and never can understand. Liberty exists in proportion to wholesome restraint; the more restraint on others to keep off from us, the more liberty we have. * * * That man is free who is protected from injury." (II Webster's Works, p. 393.)
"Liberty consists in the ability to do what one ought to desire and in not being forced to do what one ought not to desire." (Montesquieu, Spirit of the Laws.)
"Even liberty itself, the greatest of all rights is not unrestricted license to act according to one's own will. It is only freedom from restraint under conditions essential to the equal enjoyment of the same right by others." (Field, J., in Crowley vs. Christensen [18901, 137 U. S., 86.)
"Liberty does not import an absolute right in each person to be at all times and in all circumstances, wholly freed from restraint. There are manifold restraints to which every person is necessarily subject for the common good. On any other basis, organized society could not exist with safety to its members. Society based on the rule that each one is a law unto himself would soon be confronted with disorder and anarchy. Real liberty for all could not exist under the operation of a principle which recognizes the right of each individual person to use his own, whether in respect of his person or his property, regardless of the injury that may be done to others. * * * There is, of course, a sphere within which the individual may assert the supremacy of his own will, and rightfully dispute the authority of any human government-especially of any free government existing under a written Constitution-to interfere with the exercise of that will. But it is equally true that in every well-ordered society charged with the duty of conserving the safety of its members, the rights of the individual in respect of his liberty may at times under the pressure of great dangers be subjected to such restraint to be enforced by reasonable regulations as the safety of the general public may demand."' (Harlan, J., in Jacobson vs. Massachusetts [1905] 197 U. S., 11.)
"Liberty is freedom to do right and never wrong; it is ever guided by reason and the upright and honorable conscience of the individual." (Apolinario Mabini.)
Civil liberty may be said to mean that measure of freedom which may be enjoyed in a civilized community, consistently with the peaceful enjoyment of like freedom in others. The right to liberty guaranteed by the Constitution includes the right to exist and the right to be free from arbitrary personal restraint or servitude. The term cannot be dwarfed into mere freedom from physical restraint of the person of the citizen, but is deemed to embrace the right of man to enjoy the faculties with which he has been endowed by his Creator, subject only to such restraints as are necessary for the common welfare. As enunciated in a long array of authorities including epoch-making decisions of the United States Supreme Court, liberty includes the right of the citizen to be free to use his faculties in all lawful ways; to live and work where he will; to earn his livelihood by any lawful calling; to pursue any avocation, and for that purpose to enter into all contracts which may be proper, necessary, and essential to his carrying out these purposes to a successful conclusion. The chief elements of the guaranty are the right to contract, the right to choose one's employment, the right to labor, and the right of locomotion.
In general, it may be said that liberty means the opportunity to do those things which are ordinarily done by free men. (There can be noted Cummings Vs. Missouri [1866], 4 Wall., 277; Wilkinson vs. Leland [1829], 2 Pet., 627; Williams vs. Fears [1900], 179 U. S., 274; Allgeyer 168593-45 vs. Louisiana (1896], 165 U. S., 578; State vs. Kreutzberg [1902], 114 Wis., 530. See 6 R. C. L., 258, 261.)
One thought which runs through all these different conceptions of liberty is plainly apparent. It is this: "Liberty" as understood in democracies, is not license; it is "liberty regulated by law." Implied in the term is restraint by law for the good of the individual and for the greater good of the peace and order of society and the general well-being. No man can do exactly as he pleases. Every man must renounce unbridled license. The right of the individual is necessarily subject to reasonable restraint by general law for the common good. Whenever and wherever the natural rights of citizens would, if exercised without restraint, deprive other citizens of rights which are also and equally natural such assumed rights must yield to the regulation of law. The liberty of the citizen may be restrained in the interest of the public health, or of the public order and safety, or otherwise within the proper scope of the police power. (See Hall vs. Geiger-Jones [1916], 242 U. S., 539; Hardie-Tynes Manufacturing Co. vs. Cruz [1914], 189 Ala., 66.)
None of the rights of the citizen can be taken away except by due process of law. Daniel Webster, in the course of the argument in the Dartmouth College Case before the United States Supreme Court, since a classic in forensic literature, said that the meaning of "due process of law" is, that "every citizen shall hold his life, liberty, property, and immunities under the protection of the general rules which govern society." To constitute "due process of law," as has been often held, a judicial proceeding is not always necessary. In some instances, even a hearing and notice are not requisite, a rule which is especially true where much must be left to the discretion of the administrative officers in applying a law to particular cases. (See McGehee, Due Process of Law, p. 371.) Neither is due process a stationary and blind sentinel of liberty. "Any legal proceeding enforced by public authority, whether sanctioned by age and custom, or newly devised in the discretion of the legislative power in furtherance of the public good which regards and preserves these principles of liberty and justice must be held to be due process of law." (Hurtado vs. California [1883], 110 U. S., 516.) "Due process of law" means simply * * * "first, that there shall be a law prescribed in harmony with the general powers of the legislative department of the Government; second, that this law shall be reasonable in its operation; third, that it shall be enforced according to the regular methods of procedure prescribed; and fourth, that it shall be applicable alike to all the citizens of the state or to all of a class." (U. S. vs. Ling Su Fan [1908], 10 Phil., 104, affirmed on appeal to the United States Supreme Court.1) "What is due process of law depends on circumstances it varies with the subject-matter and necessities of the situation." (Moyer vs. Peabody [1909], 212 U. S., 82.)
The pledge that no person shall be denied the equal protection of the laws is not infringed by a statute which is applicable to all of a class. The classification must have a reasonable basis and cannot be purely arbitrary in nature.
We break off with the foregoing statements leaving the logical deductions to be made later on.
D. SLAVERY AND INVOLUNTARY SERVITUDE.
The fourth constitutional contention of petitioner relates to the Thirteenth Amendment to the United States Constitution particularly as found in those portions of Philippine Organic Law providing "That slavery shall not exist in said Islands; nor shall involuntary servitude exist except as a punishment for crime whereof the party shall have been duly convicted." It is quite possible that the Thirteenth Amendment, since reaching to "any place subject to" the "jurisdiction" of the United States, has force in the Philippines. However this may be the Philippine Legislature has by adoption, with necessary modifications of sections 268 to 271 inclusive of the United States Criminal Code, prescribed the punishment for these crimes. Slavery and involuntary servitude together with their corollary, peonage, all denote "a condition of enforced, compulsory service of one to another." (Hodges vs. U. S. [19061, 203 U. S., 1.) The term of broadest scope is possibly involuntary servitude. It has been applied to any servitude in fact involuntary, no matter under what form such servitude may have been disguised. (Bailey vs. Alabama [1910], 219 U. S., 219.)
So much for an analysis of those constitutional provisions on which petitioners rely for their freedom. Next must come a description of the police power under which the State must act if section 2145 is to be held valid.
E. THE POLICE POWER.
Not attempting to phrase a definition of police power, all that it is necessary to note at this moment is the farreaching scope of the power, that it has become almost impossible to limit its sweep, and that among its purposes is the power to prescribe regulations to promote the health, peace, morals, education, and good order of the people, and to legislate so as to increase the industries of the State, develop its resources and add to its wealth and prosperity. (See Barbier vs. Connolly [1884], 113 U. S., 27.) What we are most interested in is the right of the government to restrain liberty by the exercise of the police power. "The police power of the State," one court has said,
* * "is a power coextensive with self-protection, and is not inaptly termed the 'law of overruling necessity.' It may be said to be that inherent and plenary power in the State which enables it to prohibit all things hurtful to the comfort, safety and welfare of society." (Lake View vs. Rose Hill Cemetery Co. [1873], 70 III., 191.) Carried onward by the current of legislation, the judiciary rarely attempts to dam the onrushing power of legislative discretion, provided the purposes of the law do not go beyond the great principles that mean security for the public welfare or do not arbitrarily interfere with the right of the individual.
The Government of the Philippine Islands has both on reason and authority the right to exercise the sovereign police power in the promotion of the general welfare and the public interest. "There can be no doubt that the exercise of the police power of the Philippine Government belongs to the Legislature and that this power is limited only by the Acts of Congress and those fundamental principles which lie at the foundation of all republican forms of government." (Churchill and Tait vs. Rafferty [1915], 32 Phil., 580; U. S. vs. Pompeya [19151, 31 Phil., 245.)
With the foregoing approximation of the applicable basic principles before us, before finally deciding whether any constitutional provision has indeed been violated by section 2145 of the Administrative Code, we should endeavor to ascertain the intention of the Legislature in enacting this section. If legally possible, such legislative intention should be effectuated.
F. LEGISLATIVE INTENT.
The preamble of the resolution of the provincial board of Mindoro which set apart the Tigbao reservation, it will be remembered, assigned as reasons for the action, the following: (1) The failure of former attempts for the advancement of the non-Christian people of the province; and (2) the only successful method for educating the Manguianes was to oblige them to live in a permanent settlement. The Solicitor-General adds the following: (3) The protection of the Manguianes; (4) the protection of the public forests in which they roam; (5) the necessity of introducing civilized customs among the Manguianes.
The present Secretary of the Interior says of the Tigbao reservation and of the motives for its selection, the following:
"To inform himself of the conditions of those Manguianes who were taken together to Tigbao, the Secretary of the Interior on June 10 to 13, 1919, made a trip to that place. There he found that the site selected is a good one; that creditable progress has been made in the clearing of forests, construction of buildings, etc., that there appears to be encouraging reaction by the boys to the work of the school the requirements of which they appear to meet with enthusiastic interest after the first weeks which are necessarily a somewhat trying period for children wholly unaccustomed to orderly behaviour and habit of life. He also gathered the impression that the results obtained during the period of less than one year since the beginning of the institution definitely justify its continuance and development.
"Of course, there were many who were protesting against that segregation. Such was naturally to be expected, but the Secretary of the Interior, upon his return to Manila, made the following statement to the press:
" 'It is not deemed wise to abandon the present policy over those who prefer to live a nomadic life and evade the influence of civilization. The Government will follow its policy to organize them into political communities and to educate their children with the object of making them useful citizens of this country. To permit them to live a wayfaring life will ultimately result in a burden to the state and on account of their ignorance, they will commit crimes and make depredations, or if not they will be subject to involuntary servitude 'by those who may want to abuse them.' "
The Secretary of the Interior, who is the official charged with the supervision of all the non- Christian people has adopted as the solaria of his administration-"The advancement of the non- Christian elements of our population to equality and unification with the highly civilized Christian inhabitants." This is carried on by the adoption of the following measures:
"(a) Pursuance of the closer settlement policy whereby people of seminomadic race are induced to leave their wild habitat and settle in organized communities.
"(b) The extension of the public school system and the system of public health throughout the regions inhabited by the non-Christian people.
"(c) The extension of public works throughout the Mohammedan regions to facilitate their development and the extension of government control.
"(d) Construction of roads and trails between one place and another among non-Christians, to promote social and commercial intercourse and maintain amicable relations among them and with the Christian people.
" (e) Pursuance of the development of natural economic resources, especially agriculture.
"(f) The encouragement of immigration into, and of the investment of private capital in the fertile regions of Mindanao and Sulu."
The Secretary adds:
"To attain the end desired work of a civilizing influence have been continued among the non- Christian people. These people are being taught and guided to improve their living conditions in order that they may fully appreciate the benefits of civilization. Those of them who are still given to nomadic habits are being persuaded to abandon their wild habitat and settle in organized settlements. They are being made to understand that it is the purpose of the Government to organize them politically into fixed and permanent communities, thus bringing them under the control of the Government, to aid them to live and work, protect them from involuntary servitude and abuse, educate their children, and show them the advantages of leading a civilized life with their civilized brothers. In short, they are being impressed with the purposes and objectives of the Government of leading them to economic, social, and political equality, and unification with the more highly civilized inhabitants of the country." (See Report of the Department for 1917.)
The fundamental objective of governmental policy is to establish friendly relations with the so- called non-Christians, and to promote their educational, agricultural, industrial, and economic development and advancement in civilization. (Note Acts Nos. 2208, 2404, 2444.) Act No. 2674 in reestablishing the Bureau of non-Christian Tribes, defines the aim of the Government towards the nonChristian people in the following unequivocal terms:
"It shall be the duty of the Bureau of non-Christian Tribes to continue the work for advancement and liberty in favor of the regions inhabited by non-Christian Filipinos and foster by all adequate means and in a systematical, rapid, and complete manner the moral, material, economic, social, and political development of those regions, always having in view the aim of rendering permanent the mutual intelligence between, and complete fusion of, all the Christian and non-Christian elements populating the provinces of the Archipelago." (Sec. 3.)
May the Manguianes not be considered, as are the Indians in the United States, proper wards of the Filipino people? By the fostering care of a wise Government, may not these unfortunates advance in the "habits and arts of civilization?" Would it be advisable for the courts to intrude upon a plan, carefully formulated, and apparently working out for the ultimate good of these people?
In so far as the Manguianes themselves are concerned, the purpose of the Government is evident. Here, we have on the Island of Mindoro, the Manguianes, leading a nomadic life, making depredations on their more fortunate neighbors, uneducated in the ways of civilization, and doing nothing for the advancement of the Philippine Islands. What the Government wished to do by bringing them into a reservation was to gather together the children for educational purposes, and to improve the-health and morals was in fine to begin the process of civilization. This method was termed in Spanish times, "bringing under the bells." The same idea adapted to the existing situation has been followed with reference to the Manguianes and other peoples of the same class, because it required, if they are to be improved that they be gathered together. On these few reservations there live under restraint in some cases, and in other instances voluntarily, a few people with the sort of liberty they wish to preserve and for which they are now fighting in court? They will ultimately become a heavy burden to the State and on account of their ignorance they will commit crimes and make depredations, or if not they will be subjected to involuntary servitude by those who may want to abuse them.
"There is no doubt in my mind that this people has not a right conception of liberty and does not practise liberty in a rightful way. They understand liberty as the right to do anything they will-going from one place to another in the mountains, burning and destroying forests and making illegal caiñgins thereon.
"Not knowing what true liberty is and not practising the same rightfully, how can they allege that they are being deprived thereof without due process of law?
"But does the Constitutional guaranty that no person shall be deprived of his liberty without due process of law apply to a class of persons who do not have a correct idea of what liberty is and do not practise liberty in a rightful way?
"To say that it does will mean to sanction and defend an erroneous idea of such class of persons as to what liberty is. It will mean, in the case at bar, that the Government should not adopt any measures looking to the welfare and advancement of the class of persons in question. It will mean that this people should be let alone in the mountains and in a permanent state of savagery without even the remotest hope of coming to understand liberty in its true and noble sense.
"In dealing with the backward population, like the Manguianes, the Government has been placed in the alternative of either letting them alone or guiding them in the path of civilization. The latter measure was adopted as the one more in accord with humanity and with national conscience." people with the sort of liberty they wish to preserve and for which they are now fighting in court? They will ultimately become a heavy burden to the State and on account of their ignorance they will commit crimes and make depredations, or if not they will be subjected to involuntary servitude by those who may want to abuse them.
"There is no doubt in my mind that this people has not a right conception of liberty and does not practise liberty in a rightful way. They understand liberty as the right to do anything they will-going from one place to another in the mountains, burning and destroying forests and making illegal caiñgins thereon.
"Not knowing what true liberty is and not practising the same rightfully, how can they allege that they are being deprived thereof without due process of law? "But does the Constitutional guaranty that no person shall be deprived of his liberty without due process of law apply to a class of persons who do not have a correct idea of what liberty is and do not practise liberty in a rightful way?
"To say that it does will mean to sanction and defend an erroneous idea of such class of persons as to what liberty is. It will mean, in the case at bar, that the Government should not adopt any measures looking to the welfare and advancement of the class of persons in question. It will mean that this people should be let alone in the mountains and in a permanent state of savagery without even the remotest hope of coming to understand liberty in its true and noble sense.
"In dealing with the backward population, like the Manguianes, the Government has been placed in the alternative of either letting them alone or guiding them in the path of civilization. The latter measure was adopted as the one more in accord with humanity and with national conscience."
"The national legislation on the subject of non-Christian people has tended more and more towards the education and civilization of such people and fitting them to be citizens. The progress of those people under the tutelage of the Government is indeed encouraging and the signs of the times point to a day which is not far distant when they will become useful citizens. In the light of what has already been accomplished which has been winning the gratitude of most of the backward people, shall we give up the noble work simply because a certain element, believing that their personal interests would be injured by such a measure has come forward and challenged the authority of the Government to lead this people in the path of civilization? Shall we, after expending sweat, treasure and even blood only to redeem this people from the claws of ignorance and superstition, now willingly retire because there has been erroneously invoked in their favor that Constitutional guaranty that no person shall be deprived of his liberty without due process of law? To allow them to successfully invoke that Constitutional guaranty at this time will leave the Government without recourse to pursue the works of civilizing them and making them useful citizens. They will thus be left in a permanent state of savagery and become a vulnerable point of attack by those who doubt, may challenge the ability of the nation to deal with our backward brothers.
"The Manguianes in question have been directed to live together at Tigbao. There they are being taught and guided to improve their living conditions. They are being made to understand that the object of the government is to organize them politically into fixed and permanent communities. They are being aided to live and work. Their children are being educated in a school especially established for them. In short, everything is being done for them in order that their advancement in civilization and material prosperity may be assured. Certainly their living together in Tigbao does not make them slaves or put them in a condition compelled to do services for another. They do not work for anybody but for themselves. There is, therefore, no involuntary servitude.
"But they are compelled to live there and prohibited from emigrating to some other place under penalty of imprisonment. Attention in this connection is invited to the fact that this people, living a nomadic and wayfaring life, do not have permanent individual property. They move from one place to another as the conditions of living warrant, and the entire space, where they are roving about is the property of the nation, the greater part being lands of public domain. Wandering from one place to another on the public lands, why can not the government adopt a measure to concentrate them in a certain fixed place on the public lands, instead of permitting them to roam all over the entire territory? This measure is necessary both in the interest of the public as owner of the lands about which they are roving and for the proper accomplishment of the purposes and objectives of the Government. For as people accustomed to nomadic habit, they will always long to return to the mountains and follow a wayfaring life, and unless a penalty is provided for, you can not make them live together and the noble intention of the Government of organizing them politically will come to naught."
G. APPLICATION AND CONCLUSION.
Our exhaustive study should have left us in a position to answer specific objections and to reach a general conclusion.
In the first place, it is argued that the citizen has the right, generally speaking, to go where he pleases. Could he not, however, be kept away from certain localities? To furnish an example from the Indian legislation. The early Act of Congress of 1802 (2 U. S. Stat. at L., p. 141) punished those intruders who should cross the line into an Indian reservation. Those citizens certainly did not possess absolute freedom of locomotion. Again the same law provided for the apprehension of marauding Indians. Without any doubt, this law and other similar laws were accepted and followed time and again without question.
It is said that, if we hold this section to be constitutional, we leave this weak and defenseless people confined as in a prison at the mercy of unscrupulous officials. What, it is asked, would be the remedy of any oppressed Manguian? The answer would naturally be that the official into whose hands are given the enforcement of the law would have little or no motive to oppress these people; on the contrary, the presumption would all be that they would endeavor to carry out the purposes of the law intelligently and patriotically. If, indeed, they did ill-treat any person thus confined, there always exists the power of removal in the hands of superior officers, and the courts are always open for a redress of grievances. When, however, only the validity of the law is generally challenged and no particular case of oppression is called to the attention of the courts, it would seem that the judiciary should not unnecessarily hamper the Government in the accomplishment of its laudable purpose.
The question is above all one of sociology. How far, consistently with freedom, may the rights and liberties of the individual members of society be subordinated to the will of the Government? It is a question which has assailed the very existence of government from the beginning of time. Not now purely an ethical or philosophical subject, nor now to be decided by force, it has been transferred to the peaceful forum of the Judiciary. In resolving such an issue, the Judiciary must realize that the very existence of government renders imperative a power to restrain the individual to some extent, dependent, of course, on the necessities of the class attempted to be benefited. As to the particular degree to which the Legislature and the Executive can go in interfering with the rights of the citizen, this is, and for a long time to come will be, impossible for the courts to determine.
The doctrines of laissez faire and of unrestricted freedom of the individual, as axioms of economics and political theory, are of the past. The modern period has shown a widespread belief in the amplest possible demonstration of governmental activity. The courts unfortunately have sometimes seemed to trail after the other two branches of the Government in this progressive march.
Considered, therefore, purely as an exercise of the police power, the courts cannot fairly say that the Legislature has exceeded its rightful authority. It is, indeed, an unusual exercise of that power. But a great malady requires an equally drastic remedy.
Further, one cannot hold that the liberty of the citizen is unduly interfered with when the degree of civilization of the Manguianes is considered. They are restrained for their own good and the general good of the Philippines. Nor can one say that due process of law, has not been followed. To go back to our definition of due process of law and equal protection of the laws, there exists a law; the law seems to be reasonable; it is enforced according to the regular methods of procedure prescribed; and it applies alike to all of a class.
As a point which has been left for the end of this decision and which in case of doubt, would lead to the determination that section 2145 is valid, is the attitude which the courts should assume towards the settled policy of the Government. In a late decision with which we are in full accord, Gamble vs. Vanderbilt University (200 Southwestern Reporter, 510) the Chief Justice of the Supreme Court of Tennessee writes:
I "We can see no objection to the application of public policy as a ratio decidendi. Every really new question that comes before the courts is, in the last analysis, determined on that theory, when not determined by differentiation of the principle of a prior case or line of cases, or by the aid of analogies furnished by such prior cases. In balancing conflicting solutions, that one is perceived to tip the scales which the court believes will best promote the public welfare in its probable operation as a general rule 2145 of the Administrative Code does not deprive a person of his liberty without due process of law and does not deny to him the equal protection of the laws, and that confinement in reservations in accordance with said section does not constitute slavery and involuntary servitude. We are further of the opinion that section 2145 of the Administrative Code is a legitimate exertion of the police power, somewhat analogous to the Indian policy of the United States. Section 2145 of the Administrative Code of 1917 is constitutional.
Petitioners are not unlawfully imprisoned or restrained of their liberty. Habeas corpus can, therefore, not issue. This is the ruling of the court. Costs shall be taxed against petitioners. So ordered.
Arellano, C. J., Torres, and Avanceña, JJ., concur.
CARSON, J., concurring:
I fully concur in the reasoning and the conclusions of Justice Malcolm as set forth in the prevailing opinion.
The words "non-Christian" have a clear, definite and well settled signification when used in the Philippine statutebook as a descriptive adjective, applied to "tribes," "people," or "inhabitants," dwelling in more or less remote districts and provinces throughout the Islands.
Justice Malcolm, as I think, correctly finds that these words, as used in this connection in our statute-book, denote the "low grade of civilization" of the individuals included in the class to which they are applied. To this I would add that the tests for the determination of the fact that an individual or tribe is, or is not of the "low grade of civilization" denoted by the words "non- Christian" are, and throughout the period of American occupation always have been, "the mode of life, the degree of advancement in civilization, and connection or lack of connection with some civilized community." (Cf. letter of Collector of Internal Revenue dated September 17, 1910, and set out in the principal opinion.)
The legislative and administrative history of the Philippine 2145 of the Administrative Code does not deprive a person of his liberty without due process of law and does not deny to him the equal protection of the laws, and that confinement in reservations in accordance with said section does not constitute slavery and involuntary servitude. We are further of the opinion that section 2145 of the Administrative Code is a legitimate exertion of the police power, somewhat analogous to the Indian policy of the United States. Section 2145 of the Administrative Code of 1917 is constitutional. Petitioners are not unlawfully imprisoned or restrained of their liberty. Habeas corpus can, therefore, not issue. This is the ruling of the court. Costs shall be taxed against petitioners. So ordered.
Arellano, C. J., Torres, and Avanceña, JJ., concur.
CARSON, J., concurring:
I fully concur in the reasoning and the conclusions of Justice Malcolm as set forth in the prevailing opinion.
The words "non-Christian" have a clear, definite and well settled signification when used in the Philippine statutebook as a descriptive adjective, applied to "tribes," "people," or "inhabitants," dwelling in more or, less remote districts and provinces throughout the Islands.
Justice Malcolm, as I think, correctly finds that these words, as used in this connection in our statute-book, denote the "low grade of civilization" of the individuals included in the class to which they are applied. To this I would add that the tests for the determination of the fact that an individual or tribe is, or is not of the "low grade of civilization" denoted by the words "non- Christian" are, and throughout the period of American occupation always have been, "the mode of life, the degree of advancement in civilization, and connection or lack of connection with some civilized community." (Cf. letter of Collector of Internal Revenue dated September 17, 1910, and set out in the principal opinion.)
The legislative and administrative history of the Philippine Islands clearly discloses that the standard of civilization to which a specific tribe must be found to have advanced, to justify its removal from the class embraced within the descriptive term "non-Christian," as that term is used in the Philippine statute-book, is that degree of civilization which results in a mode of life within the tribe, such that it is feasible and practicable to extend to, and enforce upon its membership the general laws and regulations, administrative, legislative, and judicial, which control the conduct of the admittedly civilized inhabitants of the Islands; a mode of life, furthermore, which does not find expression in tribal customs or practices which tend to brutalize or debauch the members of the tribe indulging in such customs or practices, or to expose to loss or peril the lives or property of those who may be brought in contact with the members of the tribe.
So the standard of civilization to which any given number or group of inhabitants of a particular province in these Islands, or any individual member of such a group must be found to have advanced, in order to remove such group or individual from the class embraced within the statutory description of "non-Christian," is that degree of civilization which would naturally and normally result in the withdrawal by such persons of permanent allegiance or adherence to a "non-Christian" tribe had they at any time adhered to or maintained allegiance to such a tribe; and which would qualify them whether they reside within or beyond the habitat of a "non- Christian" tribe, not only to maintain a mode of life independent of and apart from that maintained by such tribe, but a mode of life as would not be inimical to the lives or property or general welfare of the civilized inhabitants of the Islands with whom they are brought in contact.
The contention that in this particular case, and without challenging the validity of the statute, the writ should issue because of the failure to give these petitioners as well as the rest of the fifteen thousand Manguiane by the reconcentration order an opportunity to be heard before any attempt was made to enforce it, begs the question and is, of course, tantamount to a contention that there is no authority in law for the issuance of such an order.
If the fifteen thousand Manguianes, affected by the order complained of had attained that degree of civilization which would have made it practicable to serve notice upon, and give an opportunity for a real hearing, to all the members of the tribe affected by the order, it may well be doubted whether the provincial board and the Secretary of the Interior would have been justified in its enforcement. By what proceeding known to the law, or to be specially adopted in a particular case, could the officers of any province provide for a genuine hearing upon a proposal to issue a reconcentration order upon a head-hunting tribe in the north of the Island of Luzon; or upon one of the nomadic tribes whose habitat is in the mountain fastnesses of Mindanao, and whose individual members have no fixed or known place of residence, or upon the fifteen thousand Manguianes roaming in the wilds of Mindoro?
Of course, friendly headmen or chief might and, as a rule, should be consulted, after the practice in the United States when tribes or groups of American Indians have been placed upon reservations; but since non-Christian headmen and chiefs in the Philippines have no lawful authority to bind their peoples by their acts or their consent the objection based on lack of a hearing, would have the same force whether the issuance of a reconcentration order was or was not preceded by a pow-wow of this kind.
The truth of the matter is that the power to provide for the issuance of such orders rests upon analogous principles to those upon which the liberty and freedom of action of children and persons of unsound minds is restrained, without consulting their wishes, but for their own good and the general welfare. The power rests upon necessity, that "great master of all things," and is properly exercised only where certain individuals or groups of individuals are found to be of such a low grade of civilization, that their own wishes cannot be permitted to determine their mode of life or place of residence. The status of the non-Christian inhabitants of these Islands, and the special and necessarily paternal attitude assumed toward them by the Insular Government is well illustrated by the following provisions found in the Administrative Code of 1917:
" SEC. 705. Special duties and purposes of Bureau (of non-Christian tribes).-It shall be the duty of the Bureau of non-Christian tribes to continue the work for advancement and liberty in favor of the regions inhabited by nonChristian Filipinos and to foster by all adequate means and in a systematic, rapid, and complete manner the moral, material, economic, social and political development of those regions, always having in view the aim of rendering permanent the mutual intelligence between and complete fusion of all the Christian and non-Christian elements populating the provinces of the Archipelago."
"SEC. 2116. Township and settlement fund.-There shall be maintained in the provincial treasuries of the respective specially organized provinces a special fund to be known as the township and settlement fund, which shall be available, exclusively for expenditures for the benefit of the townships and settlements of the province, and, non-Christian inhabitants of the province, upon approval of the Secretary of the Interior."
As I understand it, the case at bar does not raise any real question as to the jurisdiction of the courts of these Islands in habeas corpus proceedings to review the action of the administrative authorities in the enforcement of reconcentration orders issued under authority of section 2145 of the Administrative Code, against a petitioner challenging the alleged fact that he is a "non-Christian" as that term is used in the statute. I, therefore, express no opinion on that question at this time.
JOHNSON, J., dissenting:
I dissent. The petitioners were deprived of their liberty without a hearing. That fact is not denied. I cannot give my consent to any act which deprives the humblest citizen of his just liberty without a hearing, whether he be a Christian or non-Christian. All persons in the Philippine Islands are entitled to a hearing, at least, before they are deprived of their liberty.
MOIR, J., with whom ARAULLO, and STREET, JJ., concur, dissenting:
I dissent.
I realize that a dissenting opinion carries little weight, but my sense of justice will not permit me to let this decision go on record without expressing my strong dissent from the opinion of Justice Malcolm, concurred in by a majority of the court. I shall not attempt to analyze the opinion or to go into the questions in detail. I shall simply state, as briefly as may be the legal and human side of the case as it presents itself to my mind. The facts are that one Rubi and various other Manguianes in the Province of Mindoro were ordered by the provincial governor of Mindoro to remove their residence from their native habitat and to establish themselves on a reservation at Tigbao in the Province of Mindoro and to remain there, or be punished by imprisonment if they escaped. This reservation, as appears from the resolution of the provincial board, extends over an area of 800 hectares of land, which is approximately 2,000 acres, on which about three hundred Manguianes are confined. One of the Manguianes, Dabalos, escaped from the reservation and was taken in hand by the provincial sheriff and placed in prison at Calapan, solely because he escaped from the reservation. The Manguianes sued out a writ of habeas corpus in this court, alleging that they are deprived of their liberty in violation of law.
The Solicitor-General of the Philippine Islands makes return to the writ copied in the majority opinion which states that the provincial governor of Mindoro with the prior approval of his act by the Department Secretary ordered the placing of the petitioners and others on a reservation.
The Manguianes, it is stated on page 694 of the majority opinion, "are very low in culture. They have considerable Negrito blood and have not advanced beyond the Negritos in civilization. They are peaceful, timid, primitive, seminomadic people. They number approximately 15,000 (?). The Manguianes have shown no desire for community life, and, as indicated in the preamble to Act No.547, have not progressed sufficiently in civilization to make it practicable to bring them under any form of municipal government."
It may be well to add that the last P. I. Census (1903) shows that the Island of Mindoro (not including the smaller islands which together make the Province of Mindoro) has an area of 3,851 square miles and a population of 28,361 of which 7,369 are wild or uncivilized tribes (Manguianes). This appears to be the total Mangyan population of the province. The total population was less than seven to the mile (Vol. 2, P. I. Census, pp. 30 and 407).
The Island is fertile, heavily wooded and well watered.
It has no savage population, but it is sparsely settled by Christian Filipinos along the coast and by Manguianes.
The Manguianes roamed its mountains and valleys, fishing and hunting at will long before Magallanes [Magellan] anchored his boats in the waters of Cebu. They have made little or no progress in the ways of civilization. "They are a peaceful, timid, primitive, seminomadic people," whom the Government of the Philippine Islands would bring under the beneficient influence of civilization and progress. The law provides for it in section 2145 of the Administrative Code, and for those who like Dabalos do not take kindly to the ways provided for civilizing them section 2759 provides the punishment.
The attorney for the petitioners has raised various constitutional questions, but only the fundamental one will be considered by me. It is that the sections of the Administrative Code, 2145 and 2759, quoted in the majority opinion, are in violation of the first paragraph of section 3 of the Act of Congress of August 29, 1916, which reads as follows:
"That no law shall be enacted in said Islands which shall deprive any person of life, liberty or property without due process of law, or deny to any person therein the equal protection of the laws."
It is not necessary to argue that a Mangyan is one of the persons protected by that provision.
The Attorney-General argues that the treatment provided for the Manguianes is similar to that accorded the Indians in the United States, and reference is made all through the court's decision to the decisions of the United States Supreme Court with reference to the Indians. It is not considered necessary to go into these cases for the simple reason that all the Indian nations in the United States were considered as separate nations and all acts taken in regard to them were the result of separate treaties made by the United States Government with the Indian nations, and, in compliance with these treaties, reservations were set apart for them on which they lived and were protected from intrusion and molestation by white men. Some of these reservations were larger than the Island of Luzon, and they were not measured in hectares but in thousands of square miles.
The Manguianes are not a separate state. They have no treaty with the Government of the Philippine Islands by which they have agreed to live within a certain district where they are accorded exclusive rights. They are citizens of the Philippine Islands. Legally they are Filipinos. They are entitled to all the rights and privileges of any other citizen of this country. And when the provincial governor of the Province of Mindoro attempted to take them from their native habitat and to hold them on the little reservation of about 800 hectares, he deprived them of their rights and their liberty without due process of law, and they were denied the equal protection of the law.
The majority opinion says "they are restrained for their own good and the general good of the Philippines."
They are to be made to accept the civilization of the more advanced Filipinos whether they want it or not. They are backward and deficient in culture and must be moved from their homes, however humble they may be and "brought under the bells" and made to stay on a reservation.
Are these petitioners charged with any crime? There is no mention in the return of the Solicitor- General of the Philippine Islands of any crime having been committed by these "peaceful, timid, primitive, semi-nomadic people."
A memorandum of the Secretary of the Interior of the Philippine Islands is copied in extenso in the majority opinion, and from it I gather the nature of their offense which is that "Living a nomadic and wayfaring life and evading the influence of civilization, they (the Manguianes) are engaged in the works of destruction-burning and destroying the forests and making illegal caiñgins thereon. Not bringing any benefit to the State but, instead, injuring and damaging its interests, what will ultimately become of those people with the sort of liberty they wish to preserve and for which they are now fighting in court? They will ultimately become a heavy burden to the State and, on account of their ignorance, they will commit crimes and make depredations, or if not they will be subjected to involuntary servitude by those who may want to abuse them.
"There is no doubt in my mind that this people has not a right conception of liberty and does not practice liberty in a rightful way. They understand liberty as the right to do anything they will-going from one place to another in the mountains, burning and destroying forests and making illegal caiñgins thereon.
"Not knowing what true liberty is and not practising the same rightfully, how can they allege that they are being deprived thereof without due process of law?
"But does the Constitutional guaranty that 'no person shall be deprived of his liberty without due process of law' apply to a class of persons who do not have a correct idea of what liberty is and do not practise liberty in a rightful way?
"To say that it does will mean to sanction and defend an erroneous idea of such class of persons as to what liberty is. It will mean, in the case at bar, that the Government should not adopt any measures looking to the welfare and advancement of the class of persons in question. It will mean that this people should be let alone in the mountains and in a permanent state of savagery without even the remotest hope of coming to understand liberty in its true and noble sense.
"In dealing with the backward population, like the Manguianes, the Government has been placed in the alternative of either letting them alone or guiding them in the path of civilization. The latter measure was adopted as the one more in accord with humanity and with national conscience. "The national legislation on the subject of non-Christian people has tended more and more towards the education and civilization of such people and fitting them to be citizens."
There appear to be two intimations or charges in this memorandum; one is that the Manguianes destroy the forests by making a caiñgin. What is a caiñgin. Simply this. These people move their camp or place of abode frequently and when they do move to a new place, it is necessary to clear the land in order to plant corn and camotes (sweet potatoes) and they cut down the smaller trees and burn these around the larger ones, killing them, so and harvested. This land may be abandoned later on-due to superstition, to a lack of game in the neighborhood, to poor crops from exhausted fertility, or to a natural desire to move on.
Granting that the Manguianes do make caiñgins or clear lands in spots and then abandon them for the more fertile lands, which every man knows to be just over the hills, we cannot see that they are committing such a great abuse as to justify incarcerating them on a small tract of land for incarceration it is and nothing less.
The second intimation or charge is that "they will become a heavy burden to the state and on account of their ignorance they will commit crimes and make depredations, or if not they will be subjected to involuntary servitude by those who want to abuse them." They have never been a burden to the state and never will be. They have not committed crimes and, when they do, let the law punish them. The authorities are anticipating too much from these "peaceful, timid, primitive, semi-nomadic people." Their history does not demonstrate that we must expect them to commit crimes and jail them to prevent the possibility. But the secretary says "they will be subjected to involuntary servitude by those who want to abuse them." Are they more liable to be subjected to involuntary servitude when left free to roam their native hills and gain a livelihood as they have been accustomed to for hundreds of years than they will be if closely confined on a narrow reservation from which they may not escape without facing a term in jail? Is it not more likely that they will be glad to exchange their "freedom" on a small reservation for the great boon of binding themselves and their children to the more fortunate Christian Filipinos who will feed them and clothe them in return for their services?
I think it not only probable but almost a certainty that they will all be subjected to involuntary personal servitude if their freedom is limited as it has been. How will they live? There may be persons who are willing to lend them money with which to buy food on the promise that they is no probability of the department head ever giving his approval to such a crime, but the fact that he can do it and has done it in the present case is what makes the law unconstitutional. The arbitrary and unrestricted power to do harm should be the measure by which a law's legality is tested and not the probability of doing harm. "It has been said that this is a government of laws and not of men; that there is no arbitrary body of individuals; that the constitutional principles upon which our government and its institutions rest do not leave room for the play and action of purely personal and arbitrary power, but that all in authority are guided and limited by these provisions which the people have, through the organic law, declared shall be the measure and scope of all control exercised over them. In particular the fourteenth amendment, and especially the equal protection clause, thereof, forbids that the individual shall be subjected to any arbitrary exercise of the powers of government; it was intended to prohibit, and does prohibit, any arbitrary deprivation of life or liberty, or arbitrary spoliation of property.
"As we have seen, a statute which makes a purely arbitrary or unreasonable classification, or which singles out any particular individual or class as the subject of hostile and discriminating legislation, is clearly unconstitutional as being opposed to the fourteenth amendment and especially to the equal protection clause thereof. This is a plain case, and requires no further discussion." (Vol. 4, Encyclopedia of U. S. Supreme Court Reports, p. 366.)
"When we consider the nature and the theory of our institutions of government, the principles upon which they are supposed to rest, and review the history of their development, we are constrained to conclude that they do not mean to leave room for the play and action of purely personal and arbitrary power. Sovereignty itself is, of course, not subject to law, for it is the author and source of law; but in our system, while sovereign powers are delegated to the agencies of government, sovereignty itself remain with the people by whom and for whom all government exists and acts. And the law is the definition and limitation of power. It is, indeed, quite true, that there must always be lodged somewhere, and in some person or body, the authority of final decision; and, in many cases of mere administration the responsibility is purely political, no appeal lying except to the ultimate tribunal of the public judgment, exercised either in the pressure of opinion or by means of the suffrage. But the fundamental rights to life, liberty, and the pursuit of happiness, considered as individual possessions, are secured by those maxims of constitutional law which are the monuments showing the victorious progress of the race in securing to men the blessings of civilization under the reign of just and equal laws, so that, in the famous language of Massachusetts Bill of Rights, the Government of Commonwealth 'may be a government of law and not of men.' For the very idea that one man may be compelled to hold his life, or the means of living, or any material right essential to the enjoyment of life, at the mere will of another, seems to be intolerable in any country where freedom prevails, as being the essence of slavery itself." (Yiek Wo vs. Hopkins, 118 U. S., 374.)
It is said that the present law is an old Act being in substance Act No. 547 of the Philippine Commission. But it has never been brought before this court for determination of its constitutionality. No matter how beneficient the motives of the lawmakers if the law tends to deprive any man of life, liberty, or property without due process of law, it is void.
In my opinion the acts complained of which were taken in conformity with section 2145 of the Administrative Code not only deprive these Manguianes of their liberty, without due process of law, but will in all probability deprive them of their life, without due process of law. History teaches that to take a semi-nomadic tribe from their native fastnesses and to transfer them to the narrow confines of a reservation is to invite disease and suffering and death.
From my long experience in the Islands, I should say that it would be a crime of little less magnitude to take the Ifugaos from their mountain homes where they have reclaimed a wilderness and made it a land of beauty and fruitfulness and to transfer them to the more fertile, unoccupied, malaria infested valleys which they look down upon from their fields-than it would be to order their decapitation en masse.
There can be no denial that the Ifugaos are "non-Christians," or "wild tribes" and are in exactly the same category as the Manguianes. If the Manguianes may be so taken from their native habitat and reconcentrated on a reservation-in effect an open air jail-then so may the Ifugaos, so may the Tinguianes, who have made more progress than the Ifugaos, and so may the Moros.
There are "non-Christian" in nearly every province in the Philippine Islands. All of the thirty-nine governors upon the prior approval of the head of the department have the power under this law to take the non-Christian inhabitants of their different provinces from their homes and put them on a reservation for "their own good and the general good of the Philippines," and the courts will grant them no relief. These unfortunate citizens of the Philippine Islands would hold their liberty, and their lives, may be subject to the unregulated discretion of the provincial governor.
And who would be safe?
After the reservation is once established might not a provincial governor decide that some political enemy was a non-Christian, and that he would be safer on the reservation. No matter what his education and culture, he could have no trial, he could make no defense, the judge of the court might be in a distant province and not within reach, and the provincial governor's fiat is final.
The case of the United States vs. Crook (Federal Cases 14891), cited in the majority opinion, should be quoted at length. District Judge Dundy said:
"During the fifteen years in which I have been engaged From my long experience in the Islands, I should say that it would be a crime of little less magnitude to take the Ifugaos from their mountain homes where they have reclaimed a wilderness and made it a land of beauty and fruitfulness and to transfer them to the more fertile, unoccupied, malaria infested valleys which they look down upon from their fields-than it would be to order their decapitation en masse.
There can be no denial that the Ifugaos are "non-Christians," or "wild tribes" and are in exactly the same category as the Manguianes. If the Manguianes may be so taken from their native habitat and reconcentrated on a reservation-in effect an open air jail-then so may the Ifugaos, so may the Tinguianes, who have made more progress than the Ifugaos, and so may the Moros.
There are "non-Christian" in nearly every province in the Philippine Islands. All of the thirty-nine governors upon the prior approval of the head of the department, have the power under this law to take the non-Christian inhabitants of their different provinces from their homes and put them on a reservation for "their own good and the general good of the Philippines," and the courts will grant them no relief. These unfortunate citizens of the Philippine Islands would hold their liberty, and their lives, may be, subject to the unregulated discretion of the provincial governor.
And who would be safe?
After the reservation is once established might not a provincial governor decide that some political enemy was a non-Christian, and that he would be safer on the reservation. No matter what his education and culture, he could have no trial, he could make no defense, the judge of the court might be in a distant province and not within reach, and the provincial governor's fiat is final.
The case of the United States vs. Crook (Federal Cases 14891), cited in the majority opinion should be quoted at length. District Judge Dundy said:
"During the fifteen years in which I have been engaged in administering the laws of my country, I have never been called upon to hear or decide a case that appealed so strongly to my sympathy as the one now under consideration. On the one side, we have a few of the remnants of a once numerous and powerful, but now weak, insignificant, unlettered, and generally despised race; and the other, we have the representative of one of the most powerful, most enlightened, and most christianized nations of modern times. On the one side, we have the representatives of this wasted race coming into this national tribunal of ours, asking for justice and liberty to enable them to adopt our boasted civilization, and to pursue the arts of peace, which have made us great and happy as a nation; on the other side, we have this magnificent, if not magnanimous, government, resisting this application with the determination of sending these people back to the country which is to them less desirable than perpetual imprisonment in their own native land. But I think it is creditable to the heart and mind of the brave and distinguished officer who is made respondent herein to say that he has no sort of sympathy in the business in which he is forced by his position to bear a part so conspicuous; and, so far as I am individually concerned, I think it not improper to say that, if the strongest possible sympathy could give the relators title to freedom, they would have been restored to liberty the moment the arguments in their behalf were closed. No examination or further thought would then have been necessary or expedient. But in a country where liberty is regulated by law, something more satisfactory and enduring than mere sympathy must furnish and constitute the rule and basis of judicial action. It follows that this case must be examined and decided on principles of law, and that unless the relators are entitled to their discharge under the constitution or laws of the United States, or some treaty made pursuant thereto, they must be remanded to the custody of the officer who caused their arrest, to be returned to the Indian Territory which they left without the consent of the government.
"On the 8th of April, 1879, the relators Standing Bear and twenty-five others during the session of the court held at that time at Lincoln, presented their petition duly verified, praying for the allowance of a writ of habeas corpus and their final discharge from custody thereunder.
"The petition alleges, in substance, that the relators are Indians who have formerly belonged to the Ponca tribe of Indians now located in the Indian Territory; that they had some time previously withdrawn from the tribe, and completely severed their tribal relations therewith, and had adopted the general habits of the whites, and were then endeavoring to maintain themselves by their own exertions, and without aid or assistance from the general government; that whilst they were thus engaged, and without being guilty of violating any of the laws of the United States, they were arrested and restrained of their liberty by order of the respondent, George Crook.
"The writ was issued and served on the respondent on the 8th day of April, and, the distance between the place where the writ was made returnable and the place where the relators were confined being more than twenty miles, ten days were allotted in which to make return.
"On the 18th of April the writ was returned, and the authority for the arrest and detention is therein shown. The substance of the return to the writ, and the additional statement since filed is that the relators are individual members of and connected with the Ponca tribe of Indians; that they had fled or escaped from a reservation situated in some place within the limits of the Indian Territory-had departed therefrom without permission from the government; and, at the request of the secretary of the interior, the general of the army had issued an order which required the respondent to arrest and return the relators to their tribe in the Indian Territory, and that, pursuant to the said order, he had caused the relators to be arrested on the Omaha Indian reservation, and that they were in his custody for the purpose of being returned to the Indian Territory. "It is claimed upon the one side, and denied upon the other that the relators had withdrawn and severed for all time, their connection with the tribe to which they belonged; and upon this point alone was there any testimony produced by either party hereto. The other matter stated in the petition and the return to the writ are conceded to be true; so that the questions to be determined are purely questions of law.
"On the 8th of March, 1859, a treaty was made by the United States with the Ponca tribe of Indians, by which a certain tract of country north of the Niobrara river and west of the Missouri, was set apart for the permanent home of the said Indians, in which the government agreed to protect them during their good behaviour. But just when or how, or why, or under what circumstances, the Indians left their reservation in Dakota and went to the Indian Territory does not appear.
"A question of much greater importance remains for consideration, which when determined will be decisive of this whole controversy. This relates to the right of the government to arrest and hold the relators for a time for the purpose of being returned to a point in the Indian Territory from which it is alleged the Indians escaped. I am not vain enough to think that I can do full justice to a question like the one under consideration. But, as the matter furnishes so much valuable material for discussion, and so much food for reflection, I shall try to present it as viewed from my own standpoint, without reference to consequences or criticisms, which though not specially invited will be sure to follow.
"On the 15th day of August, 1976, Congress passed the general Indian appropriation bill, and in it we find a provision authorizing the secretary of the interior to use $25,000 for the removal of the Poncas to the Indian claim to be unable to see the justice, or reason, or wisdom, or necessity, of removing them by force from their own native plains and blood relations to a far- off country, in which they can see little but new-made graves opening for their reception. The land from which they fled in fear has no attractions for them. The love of home and native land was strong enough in the minds of these people to induce them to brave every peril to return and live and die where they had been reared. The bones of the dead son of Standing Bear -were not to repose in the land they hoped to be leaving forever, but were carefully preserved and protected and formed a part of what was to them a melancholy procession homeward. Such instances of parental affections, and such love of home and native land, may be heathen in origin, but it seems to me that they are not unlike Christian in principle."
And the court declared that the Indians were illegally held by authority of the United States and in violation of their right to life, liberty, and the pursuit of happiness, and ordered their release from custody.
This case is very similar to the case of Standing Bear and others. I think this Court should declare that sections 2145 and 2759 of the Administrative Code of 1917 are unconstitutional, null and void, and that the petitioners are illegally restrained of their liberty, and that they have been denied the equal protection of the laws, and order the respondents immediately to liberate all of the petitioners.
Writ denied.
1. 218 U. S., 302; 54 L. ed., 1049.
RUBI VS. PROVINCIAL BOARD OF MINDORO
[39 PHIL 660; G.R. NO. 14078; 7 MAR 1919]
Facts:
This is an application for habeas corpus in favor of Rubi and other Manguianes of the Province of Mindoro.
The provincial board of Mindoro adopted resolution No. 25 which states that “provincial governor of any province in which non-Christian inhabitants (uncivilized tribes) are found is authorized, when such a course is deemed necessary in the interest of law and order, to direct such inhabitants to take up their habitation on sites on unoccupied public lands to be selected by him and approved by the provincial board”. It is resolved that under section 2077 of the Administrative Code, 800 hectares of public land in the sitio of Tigbao on Naujan Lake be selected as a site for the permanent settlement of Mangyanes in Mindoro. Further, Mangyans may only solicit homesteads on this reservation providing that said homestead applications are previously recommended by the provincial governor.
Thereafter, the provincial governor of Mindoro issued executive order No. 2, which says that the provincial governor has selected a site in the sitio of Tigbao on Naujan Lake for the permanent settlement of Mangyanes in Mindoro. In that case, pursuant to Section 2145 of the Revised Administrative Code, all the Mangyans in the townships of Naujan and Pola and the Mangyans east of the Baco River including those in the districts of Dulangan and Rubi's place in Calapan, were ordered to take up their habitation on the site of Tigbao, Naujan Lake. Also, that any Mangyan who shall refuse to comply with this order shall upon conviction be imprisoned not exceed in sixty days, in accordance with section 2759 of the revised Administrative Code.
Said resolution of the provincial board of Mindoro were claimed as necessary measures for the protection of the Mangyanes of Mindoro as well as the protection of public forests in which they roam, and to introduce civilized customs among them. It appeared that Rubi and those living in his rancheria have not fixed their dwelling within the reservation of Tigbao and are liable to be punished.
It is alleged that the Manguianes are being illegally deprived of their liberty by the provincial officials of that province. Rubi and his companions are said to be held on the reservation established at Tigbao, Mindoro, against their will, and one Dabalos is said to be held under the custody of the provincial sheriff in the prison at Calapan for having run away form the reservation.
Issue:
Whether or Not Section 2145 of the Administrative Code deprive a person of his liberty without due process of law.
Whether or Not Section 2145 of the Administrative Code of 1917 is constitutional.
Held:
The Court held that section 2145 of the Administrative Code does not deprive a person of his liberty without due process of law and does not deny to him the equal protection of the laws, and that confinement in reservations in accordance with said section does not constitute slavery and involuntary servitude. The Court is further of the opinion that section 2145 of the Administrative Code is a legitimate exertion of the police power, somewhat analogous to the Indian policy of the United States. Section 2145 of the Administrative Code of 1917 is constitutional.
The preamble of the resolution of the provincial board of Mindoro which set apart the Tigbao reservation, it will be read, assigned as reasons fort the action, the following: (1) The failure of former attempts for the advancement of the non-Christian people of the province; and (2) the only successfully method for educating the Manguianes was to oblige them to live in a permanent settlement. The Solicitor-General adds the following; (3) The protection of the Manguianes; (4) the protection of the public forests in which they roam; (5) the necessity of introducing civilized customs among the Manguianes.
Considered purely as an exercise of the police power, the courts cannot fairly say that the Legislature has exceeded its rightful authority. It is, indeed, an unusual exercise of that power. But a great malady requires an equally drastic remedy. One cannot hold that the liberty of the citizen is unduly interfered without when the degree of civilization of the Manguianes is considered. They are restrained for their own good and the general good of the Philippines. Nor can one say that due process of law has not been followed. None of the rights of the citizen can be taken away except by due process of law. To constitute "due process of law," as has been often held, a judicial proceeding is not always necessary. In some instances, even a hearing and notice are not requisite a rule which is especially true where much must be left to the discretion of the administrative officers in applying a law to particular cases.
The idea of the provision in question is to unify the people of the Philippines so that they may approach the highest conception of nationality. The public policy of the Government of the Philippine Islands is shaped with a view to benefit the Filipino people as a whole. The Manguianes, in order to fulfill this governmental policy, must be confined for a time, as we have said, for their own good and the good of the country.
Therefore, petitioners are not unlawfully imprisoned or restrained of their liberty. Habeas corpus can, therefore, not issue.
Kwong Sing vs. City of Manila
October 11, 1920.
[GRN 15972 October 11, 1920.]
KWONG SING, in his own behalf and in behalf of all others having a common or general interest in the subject-matter of this action, plaintiff and appellant, vs. THE CITY OF MANILA, defendant and appellant.
1. PUBLIC CORPORATIONS; MUNICIPAL POLICE POWER; ORDINANCE NO. 532, CITY OF MANILA; LAUNDRIES; LAUNDRY RECEIPTS IN ENGLISH AND SPANISH.-The government of the city of Manila possesses the power to enact Ordinance No.532, requiring receipts in duplicate in English and.Spanish duly signed showing the kind and number of articles delivered by laundries and dyeing and cleaning establishments. As said ordinance is neither oppressive, nor unequal, nor unjust, it is valid.
2. ID.; ID.; ID.; ID.; ID.; "REGULATE," CONSTRUED.-The word "regulate," as used in subsection (l), section 2444, of the Administrative Code, means and includes the power to control, to govern, and to restrain; but "regulate" should not be construed as synonymous with "suppress" or "prohibit."
3. ID.; ID.; ID.; ID.; ID.; ID.-Under the power to regulate laundries, the municipal authorities can make proper police regulations as to the mode in which the employment or business shall be exercised.
4. ID.; ID.; ID.; ID.; ID.; PURPOSE.-The object of the ordinance was the promotion of peace and good order and the prevention of fraud, deceit, cheating, and imposition. The convenience of the public would also be served in a community where there is a Babel of tongues by having receipts made out in the two official languages.
5. ID.; ID.; ID.; ID.; ID.; ID-Reasonable restraints of a lawful business for such purposes are permissible under the police power.
6. ID.; ID.; ID.; ID.; ID.; RULES DETERMINING VALIDITY.-It is a familiar legal principle that an ordinance must be reasonable. Not only must it appear that the interest of the public generally require an interference with private rights, but the means adopted must be reasonably necessary for the accomplishment of the purpose and not unduly oppressive upon individuals.
7. ID.; ID.; ID.; ID.; ID.; ID.-If the ordinance appears to the judicial mind to be partial or oppressive, it must be declared invalid. 8. ID.; ID.; ID.; ID.; ID.; ID.-The presumption is that the municipal authorities, in enacting the ordinance, did so with a rational and conscientious regard for the rights of the individual and of the community.
9. ID.; ID.; ID.; TD.; ID.; ID.-Even if private rights of person or property are subjected to restraint, and even if loss will result to individuals from the enforcement of the ordinance, this is not sufficient ground for failing to uphold the hands of the legislative body.
10. ID.; ID.; ID.; ID.; ID.; YOUNG vs. RAFFERTY, DISTINGUISHED.-There is no analogy between the instant case and the former one of Young.vs. Rafferty ([1916], 33 Phil., 556).
11. ID.; INJUNCTION; VALIDITY OF AN ORDINANCE.-The validity of a municipal ordinance can be determined on a complaint for an injunction where it is apparent that irreparable injury is impending, that a multiplicity of suits is threatened, and that complainants have no other plain, speedy, and adequate remedy.
12. ID.; ID.; RESTRAINING CRIMINAL PROSECUTIONs.-As a general rule, an injunction will not be granted to restrain a criminal prosecution.
13. CONSTITUTIONAL LAW; DUE PROCESS OF LAW AND EQUAL PROTECTION OF THE LAWS; RIGHTS OF CHINESE ALIENS.-The rights of Chinese laundrymen are not less because they may be aliens. The life, liberty, or property of these persons cannot be taken without due process of law; they are entitled to the equal protection of the laws without regard to their race; and treaty rights, as effectuated between the United States and China, must be accorded them.
APPEAL from a judgment of the Court of First Instance of Manila. Ostrand, J.
The facts are stated in the opinion of the court.
G. E. Campbell for appellant.
City Fiscal Diaz for appellee.
MALCOLM, J.:
The validity of Ordinance No. 532 of the city of Manila requiring receipts in duplicate in English and Spanish duly signed showing the kind and number of articles delivered by laundries and dyeing and cleaning establishments, must be decided on this appeal. The ordinance in question reads as follows:
"[ORDINANCE No. 532.] "AN ORDINANCE REGULATING THE DELIVERY AND RETURN OF CLOTHES OR CLOTHS DELIVERED TO BE WASHED IN LAUNDRIES, DYEING AND CLEANING ESTABLISHMENTS.
"Be it ordained by the Municipal Board of the city of Manila, that:
"SECTION 1. Every person, firm or corporation in the city of Manila engaged in laundering, dyeing, or cleaning by any process, cloths, or clothes for compensation, shall issue to the person from whom cloths or clothes to be washed, dyed, or cleaned are received a receipt in duplicate, in English and Spanish, duly signed, showing the kind and number of articles delivered, and the duplicate copy of the receipt shall be kept by the owner of the establishment or person issuing same. This receipt shall be substantially of the following form:
"No ------
"NAME OF THE ESTABLISHMENT.
"PLACE OF SAME.
"MANILA ------, 19 ------" Received of Mr ------
(Name.)
------the following articles delivered (Residence.) to me to be ------
(Washed, cleaned. or dyed.)
------
------
------it ------
"These articles will have been ------and (Cleaned, washed or dyed.) may be taken at ------m. on the ------day of ------, 19 ------upon payment of P ------the amount of compensation for the work done.
------
"(Owner or person in charge.) "Provided, however, That in case the articles to be delivered are so many that it will take much time to classify them, the owner of the establishment, through the consent of the person delivering them, may be excused from specifying in the receipt the kinds of such articles, but he shall state therein only the total number of the articles so received.
"SEC. 2. No person shall take away any cloths or clothes delivered to a person, firm, or corporation, mentioned in the preceding section, to be washed, dyed or cleaned, unless he returns the receipt issued by such person, firm, or corporation.
"SEC. 3. Violation of any of the provisions of this ordinance shall be punished by a fine of not exceeding twenty pesos.
"SEC. 4. This Ordinance shall take effect on its approval.
"Approved, February 25, 1919."
In the lower court, the prayer of the complaint was for a preliminary injunction, afterwards to be made pemanent, prohibiting the city of Manila from enforcing Ordinance No. 532, and for a declaration by the court that the said ordinance was null and void. The preliminary injunction was granted. But the permanent injunction was not granted for, after trial, the judgment was, that the petitioner take nothing by his action, without special finding as to costs. From this judgment plaintiff has appealed, assigning two errors as having been committed by the trial court, both intended to demonstrate that Ordinance No. 532 is invalid.
The government of the city of Manila possesses the power to enact Ordinance No. 532. Section 2444, paragraphs (l) and (ee) of the Administrative Code, as amended by Act No. 2774, section 8, authorizes the municipal board of the city of Manila, with the approval of the mayor of the city:
" (1) To regulate and fix the amount of the license fees for the following: * * * laundries * * *."
" (ee) To enact all ordinances it may deem necessary and proper for the sanitation and safety, the furtherance of the prosperity, and the promotion of the morality, peace, good order, comfort, convenience, and general welfare of the city and its inhabitants, and such others as may be necessary to carry into. effect and discharge the powers and duties conferred by this chapter. * * *"
The word "regulate," as used in subsection (1), section 2444 of the Administrative Code, means and includes the power to control, to govern, and to restrain; but "regulate" should not be construed as synonymous with "suppress" or "prohibit." Consequently, under the power to regulate laundries, the municipal authorities could make proper police regulations as to the mode in which the employment or business shall be exercised. And, under the general welfare clause (subsection [ee], section 2444 of the Manila Charter), the business of laundries and dyeing and cleaning establishments could be regulated, as this term is above construed, by an ordinance in the interest of the public health, safety, morals, peace, good order, comfort, convenience, prosperity, and the general welfare.
The purpose of the municipal authorities in adopting the ordinance is fairly evident. Ordinance No. 532 was enacted, it is said, to avoid disputes between laundrymen and their patrons and to protect customers of laundries who are not able to decipher Chinese characters from being defrauded. The object of the ordinance was, accordingly, the promotion of peace and good order and the prevention of fraud, deceit, cheating, and imposition. The convenience of the public would also presumably be served in a community where there is a Babel of tongues by having receipts made out in the two official languages. Reasonable restraints of a lawful business for such purposes are permissible under the police power. The legislative body is the best judge of whether or not the means adopted are adequate to accomplish the ends in view.
Chinese laundrymen are here the protestants. Their rights, however, are not less because they may be Chinese aliens. The life, liberty, or property of these persons cannot be taken without due process of law; they are entitled to the equal protection of the laws without regard to their race; and treaty rights, as effectuated between the United States and China, must be accorded them.
With these premises conceded, appellant's claim is, that Ordinance No. 532 savors of class legislation; that it unjustly discriminates between persons in similar circumstances; and that it constitutes an arbitrary infringement of property rights. To an extent, the evidence for the plaintiffs substantiated their claims. There are, in the city of Manila, more than forty Chinese laundries (fiftytwo, according to the Collector of Internal Revenue), The laundrymen and employees in Chinese laundries do not, as a rule, speak, read, and write English or Spanish. Some of them are however, able to write and read numbers.
Plaintiff's contention is also that the ordinance is invalid, because it is arbitrary, unreasonable, and not justified under the police power of the city. It is, of course, a familiar legal principle that an ordinance must be reasonable. Not only must it appear that the interest of the public generally require an interference with private rights, but the means adopted must be reasonably necessary for the accomplishment of the purpose and not unduly oppressive upon individuals. If the ordinance appears to the judicial mind to be partial or oppressive, it must be declared invalid. The presumption is, however, that the municipal authorities, in enacting the ordinance, did so with a rational and conscientious regard for the rights of the individual and of the community. Up to this point, propositions and facts have been stated which are hardly debatable. The trouble comes in the application of well-known legal rules to individual cases.
Our view, after most thoughtful consideration, is, that the ordinance invades no fundamental right, and impairs no personal privilege. Under the guise of police regulation, an attempt is not made to violate personal or property rights. The ordinance is neither discriminatory nor unreasonable in its operation. It applies to all public laundries without distinction, whether they belong to Americans, Filipinos, Chinese, or any other nationality. All, without exception, and each and everyone of them without distinction, must comply with the ordinance. There is no privilege, no discrimination, no distinction. Equally and uniformly the ordinance applies to all engaged in the laundry business, and, as nearly as may be, the same burdens are cast upon them.
The oppressiveness of the ordinance may have been somewhat exaggerated. The printing of the laundry receipts need not be expensive. The names of the several kinds of clothing may be printed in English and Spanish with the equivalent in Chinese below. With such knowledge of English and Spanish as laundrymen and their employees now possess, and, certainly, at least one person in every Chinese laundry must have a vocabulary of a few words, and with ability to read and write arabic numbers, no great difficulty should be experienced, especially after some practice, in preparing the receipts required by Ordinance No. 532. It may be conceded that an additional burden will be imposed on the business and occupation affected by the ordinance. Yet, even if private rights of person or property are subjected to restraint, and even if loss will result to individuals from the enforcement of the ordinance, this is not sufficient ground for failing to uphold the hands of the legislative body. The very foundation of the police power is the control of private interests for the public welfare.
Numerous authorities are brought to our attention. Many of these cases concern laundries and find their origin in the State of California. We have examined them all and find none which impel us to hold Ordinance No. 532 invalid. Not here, as in the leading decision of the United States Supreme Court, which had the effect of nullifying an ordinance of the City and County of San Francisco, California, can there be any expectation that the ordinance will be administered by public authority "with an evil eye and an unequal hand." (Yick Wo vs. Hopkins [1886], 118 U. S., 356, which compare with Barbier vs. Connolly [1884], 113 U. S., 27.)
There is no analogy between the instant case and the former one of Young vs. Rafferty ([1916], 33 Phil., 556). The holding there was that the Internal Revenue Law did not empower the Collector of Internal Revenue to designate the language in which the entries in books shall be made by merchants subject to the percentage tax. In the course of the decision, the following remark was interpolated: "In reaching this conclusion, we have carefully avoided using any language which would indicate our views upon the plaintiffs' second proposition to the effect that if the regulation were an Act of the Legislature itself, it would be invalid as being in conflict with the paramount law of the land and treaties regulating certain relations with foreigners." There, the action was taken by means of administrative regulation; here, by legislative enactment. There, authority was rested on specific delegated powers; here, on both specific power and the all-pervading police power. There, governmental convenience was the aim; here, the public welfare. We are convinced that the same justices who participated in the decision in Young,vs. Rafferty [supral would now agree with the conclusion toward which we are tending.
Our holding is, that the government of the city of Manila had the power to enact Ordinance No. 532 and that as said ordinance is found not to be oppressive, nor unequal, nor unjust, it is valid. This statement disposes of both assignments of error, for the impropriety of the question answered by a witness for the defense over the objection of plaintiff's attorney can be conceded without affecting the result.
After the case was submitted to this court, counsel for appellants asked that a preliminary injunction issue, restraining the defendant or any of its officers from enforcing Ordinance No. 532, pending decision. It was perfectly proper for the trial and appellate courts to determine the validty of the municipal ordinance on a complaint for an injunction, since it was very apparent that irreparable injury was impending, that a multiplicity of suits was threatened, and that complainants had no other plain, speedy, and adequate remedy. But finding that the ordinance is valid, the general rule to the effect that an injunction will not be granted to restrain a criminal prosecution should be followed.
Judgment is affirmed, and the petition for a preliminary injunction is denied, with costs against the appellants. So ordered.
Mapa, C. J., Johnson, Araullo, Avanceña, and Villamor,
JJ., concur.
Judgment affirmed, injunction denied.
Yu Cong Eng vs. Trinidad
February 6, 1925
[GRN 20479 February 6, 1925]
YU CONG ENG ET AL., petitioners, vs. W. TRINIDAD, Collector of Internal Revenue, ET AL., respondents.
1. CONSTITUTIONAL LAW; CONSTITUTIONALITY OF ACT No. 2972, THE CHINESE BOOKKEEPING LAW.-Act No. 2972, the Chinese Bookkeeping Law, providing that "It shall be unlawful for any person, company, partnership or corporation engaged in commerce, industry or any other activity for the purpose of profit in the Philippine Islands, in accordance with existing law, to keep its account books in any language other than English, Spanish or any local dialect," is valid and constitutional.
2. ID.; ID.; DETERMINATION OF THE CONSTITUTIONALITY OF A LAW IN ORIGINAL PROCEEDINGS IN THE APPELLATE COURT-Equity has power, to be exercised in proper cases, to restrain criminal prosecutions under unconstitutional statutes, and to grant preliminary injunctions where the constitutionality of a penal law is doubtful and fairly debatable, and permanent injunctions where the laws are held invalid. The remedy by injunction to restrain the enforcement of unconstitutional statutes or abuse of authority under a valid statute, is limited to cases where property rights are threatened with irreparable injury or where persons would be subjected to a multiplicity of suits.
3. ID.; ID.; ID.-As a general rule, the question of constitutionality must be raised in the lower court and that court must be given an opportunity to pass upon the question before it may be presented to the appellate court for resolution. (Cadwallader-Gibson Lumber Company vs. Del Rosario, [1913], 26 Phil., 192.) Occasionally under a recently enacted statute affecting numerous persons and extensive property rights liable to give rise to amultiplicity of suits and numerous prosecutions, it is proper, right at the threshold of a prosecution, to have the validity of a given law determined in the interest of the accused and of the public, so as to permit of the orderly administration of justice (Young vs. Rafferty [1916], 03 Phil., 550,Kwong Sing vs.City of Manila [1920], 41 Phil., 103; Dimayuga and Fajardo vs. Fernandez [1922], 43 Phil., 304.)
4. ID.; ID.; ID.-In as much as the property and personal rights of nearly twelve thousand merchants are affected by these proceedings, and inasmuch as Act No. 2972 is a new law not yet interpreted by the courts, in the interest of the public welfare and for the advancement of public policy, the question of the validity of Act No. 2972 is determined in these proceedings in prohibition and injunction. 5. ID.; ID.; RULES OF CONSTITUTIONAL CONSTRUCTION.-The presumption is always in favor of constitutionality. To doubt is to sustain. (Weems vs. United States [1910], 217 U. S., 349; Adkins vs. Children's Hospital of the District of Columbia [1923], 261 U. S., 525; 67 Law. ed., 785.)
6. ID.; ID.; ID.-A law should be so construed if possible as to avoid conflict with the Constitution, although such construction may not be the most obvious or natural one. When an Act is susceptible of two or more constructions, one of which Will maintain and the others destroy it, the courts will always adopt the former. (U. S. vs. Coombs [1838], 12 Peters, 72; Board of Supervisors of Grenada County vs. Brown [1884], 112 U. S., 261; In re Guariña [1913], 24 Phil., 37; Fuentes vs. Director of Prisons, No. 224491).
7. ID.; ID.; ID.; JUDICIAL CONSTRUCTION OF ACT No. 2972.-Act No. 2972 admits of three constructions. The first construction a literal application of the law, and the second construction permitting of the keeping of duplicate sets of account books by merchants, would probably result in holding the law unconstitutional. But the third construction to the effect that the law only intended to require the keeping of such books as were necessary in order to facilitate governmental inspection for taxation purposes, permits the courts to sustain the law. This is a practical judicial construction of a law where the validity of this law is in issue, which gives to the law a meaning accomplishing everything needed by the Government for taxation purposes, without being unduly oppressive on the individual and which permits the courts to uphold the law.
8. ID.; ID.; ID.; ID-Act No. 2972 is a fiscal measure intended to facilitate the work of the Government agents and to prevent fraud in the return of the merchants, in conformity with the sales tax and the income tax. Conceded that the Chinese handle sixty per cent of the aggregate business of the Philippines, approximate equality in taxation demands that they pay something like the same proportion in taxes for the support of the State.
9. ID.; ID.; ID.; ID.-Act No. 2972 is construed as meaning that any person, company, partnership, or corporation engaged in commerce, industry, or any other activity for the purpose of profit in the Philippine Islands, shall keep its account books, consisting of sales books and other records and returns required for taxation purposes by the regulations of the Bureau of ality, to the solution of which we propose to give careful consideration.
The petitioners are Chinese merchants claiming to represent themselves and all other persons similarly situated and affected, particularly twelve thousand Chinese merchants. The respondents, against whom the petition for prohibition and injunction is directed, are the Collector of Internal Revenue, the Fiscal of the City of Manila, and Honorable Pedro Concepcion, Judge of First Instance of Manila. The allegations of the petition center on the unconstitutionality of Act No. 2972 above-mentioned. To the petition (later amended), a demurrer, was interposed by the respondents which met squarely the main issue of constitutionality, while raising, in addition, the preliminary question of jurisdiction. Following oral argument, the court overruled respondents' demurrer and required them to answer: To respondents' answer to the amended petition, petitioners presented a demurrer.
In order that the court might be assisted by having before it all possible facts and circumstances which might aid it in arriving at a correct conclusion, the parties were permitted to offer evidence to substantiate their claims. Nearly one thousand pages of testimony, more or less relevant to the issue, have resulted. While all of this testimony has been gone over with painstaking care, it is not feasible for the court to encumber the decision with rulings on the multitudinous objections which have perfunctorily been raised before the commissioner.
Before passing to our principal task, it is necessary to say something about the preliminary point of jurisdiction argued by counsel, relating to the propriety of the constitutional question being decided in original proceedings in prohibition.
The Supreme Court is granted both concurrent jurisdiction in prohibition with Courts of First Instance over inferior tribunals or persons, and original jurisdiction over Courts of First Instance when such courts are exercising functions without or in excess of their jurisdiction. (Code of Civil Procedure, sec. 516.) It is a jurisdiction, however, which must be exercised circumspectly, for otherwise, the court would usurp the powers of judges of First Instance. The law having given to judges of First Instance jurisdiction to try criminal cases, the appellate court should not meddle with the initiation or trial of such cases, except for good reasons, and should not permit the substitution of extraordinary proceedings for appeal.
As before held by this court, and by the Federal courts, equity has power, to be exercised in proper cases, to restrain criminal prosecutions under unconstitutional statutes, and to grant preliminary injunctions where the constitutionality of a given penal law is doubtful and fairly debatable, and permanent injunctions where the laws are held. invalid. The remedy by injunction to restrain the enforcement of unconstitutional statutes or abuse of authority under a valid statute, seems to be limited to cases where property rights are threatened with irreparable injury or where persons would be subjected to a multiplicity of suits.
A more complicated question arises, with reference to what stage of a threatened criminal prosecution, an accused person shall have the right to test the validity of a criminal statute by means of original proceedings presented in the appellate court. We believe the correct principle was announced in Cadwallader-Gibson Lumber Co. vs. Del Rosario ([1913], 26 Phil., 192). In other words, as a general rule, the question of constitutionality must be raised in the lower court and that court must be given an opportunity to pass upon the question before it may be presented to the appellate court for resolution. Yet occasionally, under a recently enacted statute affecting numerous persons and extensive property rights, liable to give rise to a multiplicity of actions and numerous prosecutions, it is proper, right at the threshold of a prosecution, to have the validity of a given law determined in the interest of the accused and of the public, so as to permit of the orderly to keep its account books in any language other than English, Spanish or any local dialect.
"SEC. 2. Any person violating the provisions of this Act shall, upon conviction, be punished by a fine of not more than ten thousand pesos, or by imprisonment for not more than two years or both.
"SEC. 3. This Act shall take effect on November first, nineteen hundred and twenty-one.
"Approved, February 21, 1921."
Subsequently, pursuant to the provisions of Act No. 2998, Act No. 2972 was made to take effect on January 1, 1923. But due to the unavailing efforts of the Secretary of War, the present Governor-General, and the Chinese Community to have Act No. 2972 repealed, so counsel for the petitioners intimates, its enforcement was suspended until the adjournment of the Legislature in February, 1923.
On March 2, 1923, the agents of the Bureau of Internal Revenue, in the exercise of their legitimate functions, inspected the books of account of the Chinese merchant Yu Cong Eng. Upon finding that said books were not kept in accordance with their understanding of the provisions of Act No. 2972, they took possession of the merchant's books and referred the matter to the city fiscal of Manila for appropriate action.
The city fiscal, considering that Yu Cong Eng had committed a violation of the law, on March 7, 1923, caused an information to be filed, subscribed, and sworn to before Judge of First Instance Concepcion, thereby giving rise to criminal case No. 25551 of the Court of First Instance of Manila. This information alleged in substance that the accused merchant had kept his books of account "only in Chinese, instead of keeping or causing them to be kept in English, Spanish, or any local dialect, thus rendering it difficult for the agents and authorized representatives of the Government of the Philippine Islands and of the City of Manila, to examine and inspect the aforementioned books of account, thereby preventing and hindering the investigation and determination of all the amount that said accused was, is, or will be under obligation to pay for licenses, permits, and taxes." A warrant of arrest was issued by the Judge of First Instance before whom the information was filed, and in compliance therewith, the accused merchant, now become the instant petitioner, was arrested. The antecedents of these proceedings, therefore, do not affect directly any other person except the petitioner Yu Cong Eng who says that he neither reads, writes, nor understands the English or Spanish language or any local dialect, although inferentially affecting all other merchants in a like situation.
To properly appreciate the situation, we must go back a little further into the history of the case and must have before us the applicable provisions of Philippine law.
The sales tax has been in force in the Philippines for a number of years. Our law provides for privilege taxes to be levied on certain businesses and occupations. These percentage taxes on business are payable at the end of each calendar quarter in the amount lawfully due on the business transacted during the past quarter. It is made the duty of every person conducting a business subject to such tax, within the same period as is allowed for the payment of the quarterly installments of the fixed taxes without penalty, to make a true and complete return of the amount of the receipts or earnings of his business during the preceding quarter and pay the tax due thereon. All merchants not specifically exempted must pay a tax of one and one-half per cent on the gross value in money of the commodities, goods, wares, and merchandise sold, bartered, exchanged, or consigned abroad by them, such tax to be based on the actual selling price or value of the things in question at the time they are disposed of or consigned. (Administrative Code, secs. 1453 et seq.; Act No. 3065.) the amount of the tax would be without such data." (Young vs. Rafferty, supra.) The Collector of Internal Revenue was also granted the power to make regulations prescribing the manner in which the proper books, invoices, and other papers shall be kept, and entries therein made by the persons subject to the merchant's tax. (Act No. 2339, secs. 5, 6 [j] ; Administrative Code, sec. 1424 [j]).
Taking advantage of his supposed authority, pursuant to the above cited provisions of law, the Collector of Internal Revenue issued a circular letter on October 8, 1914, approved by the Secretary of Finance and Justice, requiring every merchant and manufacturer with certain specified exceptions, who was subject to the merchant's tax, to keep a record of their daily sales either in the English or the Spanish language. The validity of this regulation was challenged in the case of Young vs. Rafferty, supra. The defense of the Collector of Internal Revenue was that the regulation issued by him had for its object the protection of the Government and to prevent the non-payment of the merchant's and percentage taxes. Following trial in the lower court and appeal, the Supreme Court held that sections 5 and 6 of Act No. 2339 did not empower the Collector of Internal Revenue to designate the language in which the entries in such books are made by merchants subject to the percentage tax. Omitting portions of the opinion handed down by Mr. Justice Trent, some of which will be noticed in other connections, it is only necessary for us to quote the portion which deals with the subject at hand, namely: "It is also urged that the regulation is designed to protect the Government against evasion of the percentage tax. If it be necessary to impose such a burden upon so large a number of the business community in order that the Government may protect itself from such losses, we apprehend that it was never intended that the initiative should be taken by the Collector of Internal Revenue. The condition complained of by the Collector has confronted the the amount of the tax would be without such data." (Young vs. Rafferty, supra.) The Collector of Internal Revenue was also granted the power to make regulations prescribing the manner in which the proper books, invoices, and other papers shall be kept, and entries therein made by the persons subject to the merchant's tax. (Act No. 2339, secs. 5, 6 [j] ; Administrative Code, sec. 1424 [j])
Taking advantage of his supposed authority, pursuant to the above cited provisions of law, the Collector of Internal Revenue issued a circular letter on October 8, 1914, approved by the Secretary of Finance and Justice, requiring every merchant and manufacturer with certain specified exceptions, who was subject to the merchant's tax, to keep a record of their daily sales either in the English or the Spanish language. The validity of this regulation was challenged in the case of Young vs. Rafferty, supra. The defense of the Collector of Internal Revenue was that the regulation issued by him had for its object the protection of the Government and to prevent the non-payment of the merchant's and percentage taxes. Following trial in the lower court and appeal, the Supreme Court held that sections 5 and 6 of Act No. 2339 did not empower the Collector of Internal Revenue to designate the language in which the entries in such books are made by merchants subject to the percentage tax. Omitting portions of the opinion handed down by Mr. Justice Trent, some of which will be noticed in other connections, it is only necessary for us to quote the portion which deals with the subject at hand, namely:
"It is also urged that the regulation is designed to protect the Government against evasion of the percentage tax. If it be necessary to impose such a burden upon so large a number of the business community in order that the Government may protect itself from such losses, we apprehend that it was never intended that the initiative should be taken by the Collector of Internal Revenue. The condition complained of by the Collector has confronted the authority to require the keeping of the original record of the vast number of these transactions in a tongue unknown to the parties; and I think furthermore that his authority to prescribe regulations intended to expedite the collection of taxes of this nature, is necessarily limited to the promulgation of regulations reasonably necessary to that end."
As will at once be noticed, the Supreme Court limited its decision to the annulment of the circular of the Collector of Internal Revenue. It left for the Legislature to determine if a law on the subject should be enacted, without expressing any opinion as to the validity of such a law.
Following some agitation on the subject, the then Governor-General, in a message to the Legislature on October 16, 1920, recommended for consideration "Legislation as already approved by the Senate should require that all business houses keep their books in English or Spanish, or in any one of the local Philippine dialects, in order to avoid wholesale frauds upon the public revenues." The bill was presented in the House of Representatives by Representative Urgello with the following explanatory note:
"As all of the merchants doing business in the Philippines are not of the same nationality, some of them keep their books of account in their native language. The examination of these books by the agents of the Government for their proper verification, is made with some difficulty, inasmuch as in many cases it requires the help of a translator which constitutes an expense to the public treasury.
"Uniformity and facility in the examination and investigation of these books require that the same be kept by the merchants, whether individuals or corporations, in English or Spanish.
"This is the object of the attached bill."
After the Philippine Legislature had passed Act No. 2972, the present Governor-General in a message asked for either the repeal or a modification of the law. Hearings before committees of the Legislature were permitted. According to the report prepared and submitted by the Chairman of the Committee on Revision of Laws of the House of Representatives, which we feel at liberty to take into consideration, at the hearing before this committee the representatives of the Chinese community advocated the repeal of Act No. 2972, but this was strongly opposed by the representatives of the Bureau of Audits, and the Bureau of Internal Revenue. The representative of the Bureau of Internal Revenue, Mr. Posadas, "gave repeated assurances before the Committee that due to the unintelligibility of the books of Chinese merchants, because of the language in which the same was written, the public treasury was being defrauded annually in several millions of pesos, and that in order to protect the Government it is necessary to uphold Act No. 2972." (Exhibit 3.) Eventually, the Philippine Legislature, with the exception that it postponed the taking effect of the law, refused otherwise to modify it.
There has next followed the instant proceedings, by means of which an expression of opinion is sought to settle the conflict of views as to the constitutionality of Act No. 2972. The law is attacked by the petitioners as in violation of treaty and constitutional rights of Chinese merchants, domiciled in the Philippine Islands. It is contended with marked earnestness, that the law is unreasonable and oppressive in nature, and repugnant to the provisions of the Fourteenth Amendment to the Constitution of the United States and of the corresponding provisions of the Jones Law, the Act of Congress of August 29, 1916, guaranteeing to all persons the equal protection of the laws. The law is defended by the city fiscal of Manila as a proper and reasonable exercise of the police power of the Philippine Government, and of its power of taxation. Four questions suggest themselves for discussion. What would be the probable effect, if Act No. 2972 was put in operation? What was the purpose of the Legislature in ,enacting Act No. 2972? What are the respective legal rights of the Chinese and of the Government? What is a logical construction of Act No. 29721. In connection with the first question, it is, of course, undeniable that we cannot declare a legislative Act void because it conflicts with our opinion of what is just or expedient. Nevertheless, the effects and consequences enter with more or less force into consideration, whenever the validity of any law is in issue. (See 2 Lewis' Sutherland Statutory Construction, pp. 908 et seq.)
The pleadings, the evidence, and the decision in Young vs. Rafferty, supra, disclose with regard to the mercantile life of the Philippines, the following facts:
There are approximately 85,000 merchants of all nationalities in the Philippines, to whom Act No. 2972 applies. Of this number, 71,000 are Filipinos who may use their own dialects, unless they prefer English or Spanish. Approximately 1,500 are American, British, or Spanish subjects, who are permitted to use their native languages. Possibly 500 are of foreign nationalities most of whom know the English or Spanish language. Of the remainder, between 10,000 and 12,000 are Chinese. The aggregate commercial' business transacted by the Chinese merchants represents about sixty per cent of the total business done by all the merchants in the Philippine Islands. According to Mr. H. B. Pond, vice-president and general manager of the Pacific Commercial Company, the Chinese "are the principal distributing factors in the Philippine Islands of imported goods, and the principal gatherers of goods for exportation in the more remote places," and if the Chinese were driven out of business, "there would be no other system of distribution available throughout the Islands." It is further claimed, on the one hand, that not to exceed one per cent of the Chinese merchants in the Philippine Islands understand English, Spanish, or a local dialect sufficiently well to be able to keep or revise their own books of account in any one of these languages, and that not to exceed ten per cent have even a working knowledge of the annual net income of the 8,445 Chinese retail merchants would not exceed P500 each, and of 2,000 of the 3,335 wholesale merchants, not to exceed P1,000. (Exhibit G.) The same investigation disclosed that not to exceed 12 Chinese firms are actually keeping their books in a language other than Chinese. The Chinese Consul General further testified that from his inquiries, he had found that the great majority of the Chinese merchants are utterly unable to comply with Act No. 2972.
Mr. William T. Nolting, President of the Bank of the Philippine Islands and formerly Collector of Internal Revenue, testified to the following salient facts: 1. Not over one per cent of the Chinese merchants are qualified to transact their business in English, Spanish, or a native dialect; 2. It would be impossible to obtain accountants to assist them in keeping their books in English, Spanish, or a local dialect, although this deficiency might be overcome in the future; 3. If the merchant is unable to understand his accounts and cannot impose extreme confidence in his bookkeeper, he is in a precarious position at all times; 4. An attempt to enforce Act No. 2972 would not facilitate the collection of taxes from the Chinese merchants but on the other hand might prove prejudicial both to the interests of the Government and of the Chinese; 5. When he was in charge of the Bureau of Internal Revenue, he never experienced any difficulty in finding and employing a sufficient number of competent and honest Chinese accountants to make the necessary inspections of the books of Chinese merchants; 6. The honesty of Chinese merchants in making the declarations of their sales compares favorably with other nationalities in that respect; and 7. To permit the Chinese merchants to keep two sets of books, one in Chinese and the other in English, Spanish, or some local dialect, would be a most dangerous practice because entries might be made in one set that would not be made in the other.
The reply of the fiscal is to the effect that the oppressiveness of the law has been considerably exaggerated, that it applies as well to Japanese and other foreign merchants who do not complain, that only a relatively small per cent of the Chinese merchants seek to obstruct the enforcement of the law, that bookkeepers are available if the Chinese wish to employ them, and that the new law will facilitate governmental inspection of merchants' books. Numerous witnesses have been called and numerous documents have been offered to substantiate the stand taken by the Government. We will here notice only an indorsement by Wenceslao Trinidad, former Collector of Internal Revenue, and the testimony of Juan Posadas, the present Collector of Internal Revenue.
Former Collector Trinidad, in a communication addressed to the Secretary to the Governor- General on September 22, 1921, said:
"During the year 1920, internal revenue tax receipts were issued to 95,363 merchants and manufacturers, 183 printers and publishers, 10,424 common carriers, 10,967 contractors and warehousemen, 58,942 peddlers of merchandise and 1,001 brokers. All of the above- mentioned persons are required to pay percentage taxes on their gross sales or receipts. On account of the nature of this tax, these persons are required to keep books of accounts wherein they can enter the amounts of business done by them.
"This Bureau has no statistics to show the number of Chinese engaged in different businesses subject to percentage taxes but it is safe to say that they represent fully sixty per cent of the numbers stated above. All of these Chinese merchants keep their accounts in Chinese, with the exception of a very few large business houses which keep two sets of books of accounts, one in Chinese and the other in Spanish. There are also other businessmen who do not keep their books of accounts either in English or Spanish. These are Germans, Japanese, Syrians and Hindus. The reply of the fiscal is to the effect that the oppressiveness of the law has been considerably exaggerated, that it applies as well to Japanese and other foreign merchants who do not complain, that only a relatively small per cent of the Chinese merchants seek to obstruct the enforcement of the law, that bookkeepers are available if the Chinese wish to employ them, and that the new law will facilitate governmental inspection of merchants' books. Numerous witnesses have been called and numerous documents have been offered to substantiate the stand taken by the Government. We will here notice only an indorsement by Wenceslao Trinidad, former Collector of Internal Revenue, and the testimony of Juan Posadas, the present Collector of Internal Revenue.
Former Collector Trinidad, in a communication addressed to the Secretary to the Governor- General on September 22, 1921, said:
"During the year 1920, internal revenue tax receipts were issued to 95,363 merchants and manufacturers, 183 printers and publishers, 10,424 common carriers, 10,967 contractors and warehousemen, 58,942 peddlers of merchandise and 1,001 brokers. All of the above- mentioned persons are required to pay percentage taxes on their gross sales or receipts. On account of the nature of this tax, these persons are required to keep books of accounts wherein they can enter the amounts of business done by them.
"This Bureau has no statistics to show the number of Chinese engaged in different businesses subject to percentage taxes but it is safe to say that they represent fully sixty per cent of the numbers stated above. All of these Chinese merchants keep their accounts in Chinese, with the exception of a very few large business houses which keep two sets of books of accounts, one in Chinese and the other in Spanish. There are also other businessmen who do not keep their books of accounts either in English or Spanish. These are Germans, Japanese, Syrians and Hindus.
"Mr. FELIX. Has the Bureau of Internal Revenue that sufficient and competent personnel to audit the books of account of merchants who do not keep their books in Spanish, English, or some local dialect?-Mr. POSADAS. No, sir, we have only an insignificant number of Chinese accountants to make examinations of the books of the Chinese merchants.
"Mr. FELIX. If the Bureau of Internal Revenue were not able-as according to you it is not able-to examine properly the books of accounts of merchants who do not keep their books in English, Spanish, or some local dialect, may the case arise wherein those merchants who do not keep their books in the languages permitted by Act No. 2972 would fail to pay the full amount of taxes due to the internal revenue, even though they were acting in good faith? * * *-Mr. POSADAS. Yes, sir, because judging from the audits even of those books of account which are intelligible to the office personnel, the office has found many differences, or items not declared for the purpose of taxation.
"Mr. FELIX. Do you know how many returns of merchants were examined in 1922 by the Chinese accountants of the income tax division of your Bureau? * * *-Mr. POSADAS. During that year, the Chinese acountants in the income tax division inspected 477 returns of Chinese.
"Mr. FELIX. Do you know whether there were any underdeclarations in those cases, that were inspected that you have referred to?* * *-Mr. POSADAS. In the comparison of these returns with the books of account of the interested parties, differences were found which amount to more than P600,000 which was-not declared.
"Mr. FELIX. Has the Bureau of Internal Revenue that sufficient and competent personnel to audit the books of account of merchants who do not keep their books in Spanish, English, or some local dialect?-Mr. POSADAS. No, sir, we have only an insignificant number of Chinese accountants to make examinations of the books of the Chinese merchants.
"Mr. FELIX. If the Bureau of Internal Revenue were not able-as according to you it is not able-to examine properly the books of accounts of merchants who do not keep their books in English, Spanish, or some local dialect, may the case arise wherein those merchants who do not keep their books in the languages permitted by Act No. 2972 would fail to pay the full amount of taxes due to the internal revenue, even though they were acting in good faith? * * *-Mr. POSADAS. Yes, sir, because judging from the audits even of those books of account which are intelligible to the office personnel, the office has found many differences, or items not declared for the purpose of taxation.
"Mr. FELIX. Do you know how many returns of merchants were examined in 1922 by the Chinese accountants of the income tax division of your Bureau? * * *-Mr. POSADAS. During that year, the Chinese acountants in the income tax division inspected 477 returns of Chinese.
"Mr. FELIX. Do you know whether there were any underdeclarations in those cases, that were inspected that you have referred to?* * *-Mr. POSADAS. In the comparison of these returns with the books of account of the interested parties, differences were found which amount to more than P600,000 which was-not declared.
"Mr. GIBBS. And, therefore, assuming that it would be possible to employ a sufficient number of competent Chinese inspectors of books of account, there would be no advantage in the enforcement of Act No. 2972 except in so far as it might aid the directors of the Bureau and the chiefs of division in making the inspections incident to deciding disputes between the inspectors and the merchants that you have mentioned? Mr. POSADAS. The advantage of the Accounting Law, which compels merchants to keep their books in English, Spanish, or some local dialect, lies precisely in the fact that it would facilitate the inspection of these books of account by the employees of the Bureau of Internal Revenue, and enable them to check up the taxes which have been paid by the merchants and ascertain whether or not they agree with the transactions actually had. This work is at present being done so far as concerns the merchants who keep their books in languages comprehensible to the Bureau, and to a certain extent it means that these merchants are penalized. On the other hand, it has been almost impossible to do this with regard to those merchants who keep their books entirely in languages not comprehensible to the office, and the net result therefore is that while we can collect differences in taxes due from part of the merchants, it is almost impossible to do so with regard to the other part.
"Mr. GIBBS. But supposing that you had also Chinese accountants competent to act as supervising agents in the provinces, then what advantage would there be in enforcing Act No. 2972?-Mr. POSADAS. The advantage would consist precisely in the fact that we would avoid the duplication of personnel, because otherwise we would have to duplicate the personnel in each district by employing Filipinos and Chinese.
"Mr. GIBBS. Could you not easily put in a Chinese district inspector and a Filipino district inspector, leaving it to the Chinese district inspector to inspect the books of the Chinese and to the Filipino district inspector the books of the Filipinos and others?-Mr. POSADAS. It is physically impossible to employ Chinese supervisors, in view of the fact that up to this time I have never known of a Chinese who has qualified himself in the civil service to occupy the position.
"Mr.GIBBS. Is it not true, Mr. Posadas, that the practice of inspecting the books of account of the Chinese by means of Chinese accountants has been followed by the Bureau of Internal Revenue in the Philippines for the past twenty years or more?-Mr. POSADAS. To judge from the results of the inspections made by my Bureau during my incumbency therein, I am led to believe that the inspections which were formerly made were superficial, in view of the fact that the Bureau during these latter years, has discovered large differences which were never declared for the purposes of taxation.
"Mr. GIBBS. Let's put the question in another form, Mr. Posadas: Is it not a fact that the only possible benefit which the Bureau of Internal Revenue would derive from the enforcement of Act No. 2972 would be in so far as it might assist the Bureau in checking up the information required by its regulations ?-Mr. POSADAS. Yes, sir, and to determine whether any items subject to taxation had been omitted.
"Mr. GIBBS. Another question, Mr. Posadas: Don't you think that by means of Chinese accountants, much more satisfactory information could be obtained from books properly kept in Chinese than from books kept abominably in English or Spanish?-Mr. POSADAS. Even though the books which are kept in a language other than Chinese were abominably kept, as long as they contain the entries of all the transactions carried out by a merchant or by a person subject to taxation, it would always be better than amended by Act No. 2830.) The official language of the legislative branch of the Government is either English or Spanish, although in practice Spanish is more extensively used, while exactly the reverse is true of the executive branch of the Government. In compliance with the President's Instructions to the Commission of April 7, 1900, full opportunity has been given to all the people of the Islands to acquire the use of the English language, with the result that English is made the basis of public and private school instruction. (Administrative Code, sec. 922.) In the customs service, the law provides that the cargo manifest and each copy thereof shall be accompanied by a translation into English, if originally written in a language other than English. (Administrative Code, sec. 1226.)
The above brief description of the language situation at least discloses some of the difficulties which have beset the attempt to hasten the adoption of a common language in the Philippines. Yet it is evident, that the Filipino people have cheerfully imposed upon themselves the burden of acquiring one or more languages other than their native languages and have now, through their elective representatives, sought to require conformity with governmental policy by a large class of foreign residents.
In the United States during the months immediately following the conclusion of the World War, a number of States passed statutes in substantially the same form forbidding the teaching of any modern language except English, to children below the eighth grade in any school. The United States Supreme Court held the statutes unconstitutional on account of having no reasonable relation to some purpose within the competency of the State to effect, and on account of violating the constitutional guarantee of liberty in the Federal Constitution. "The protection of the Constitution extends to all," it was said,"to those who speak other languages as well as to those born with English on the tongue." (Meyer vs. Nebraska, Bartels amended by Act No. 2830.) The official language of the legislative branch of the Government is either English or Spanish, although in practice Spanish is more extensively used, while exactly the reverse is true of the executive branch of the Government. In compliance with the President's Instructions to the Commission of April 7, 1900, full opportunity has been given to all the people of the Islands to acquire the use of the English language, with the result that English is made the basis of public and private school instruction. (Administrative Code, sec. 922.) In the customs service, the law provides that the cargo manifest and each copy thereof shall be accompanied by a translation into English, if originally written in a language other than English. (Administrative Code, sec. 1226.) The above brief description of the language situation at least discloses some of the difficulties which have beset the attempt to hasten the adoption of a common language in the Philippines. Yet it is evident, that the Filipino people have cheerfully imposed upon themselves the burden of acquiring one or more languages other than their native languages and have now, through their elective representatives, sought to require conformity with governmental policy by a large class of foreign residents.
In the United States during the months immediately following the conclusion of the World War, a number of States passed statutes in substantially the same form forbidding the teaching of any modern language except English, to children below the eighth grade in any school. The United States Supreme Court held the statutes unconstitutional on account of having no reasonable relation to some purpose within the competency of the State to effect, and on account of violating the constitutional guarantee of liberty in the Federal Constitution. "The protection of the Constitution extends to all," it was said,"to those who speak other languages as well as to those born with English on the tongue." (Meyer vs. Nebraska, Bartels vs. Iowa, Pohl vs. Ohio, Nebraska District of Evangelical Lutheran Synod vs. McKelvie [1923], 262 U. S., 390, 404; XII Michigan Law Review, Jan., 1924, p. 248.)
In other countries, however, notably in the Republics in the Americas, which have had their institutional law greatly influenced by the United States Constitution, laws are on the statute books which permit only Spanish to be used in commercial transactions. This is the system found in Bolivia, Chile, Colombia, Ecuador, Guatemala, Honduras, Mexico, Salvador, Uruguay, and Venezuela. (Commercial Laws of the World, vols. 1, 2, 3, 5, 6, 10, and 20; Manzano, Bonilla y Miñana, Codigos de Comercio, Tomos II y III; Wheless, Compendium of the Laws of Mexico, vol. 1; Exhibit 12.)
The purpose of the Legislature in enacting Act No. 2972 is disclosed by the decision of this court in Young vs. Rafferty, supra, by the messages of the Governor-General, by the hearings before the committees of the Philippine Legislature, and by other sources. All these indicate that the Act is a fiscal measure intended to facilitate the work of the government agents and to prevent fraud in the returns of merchants, in conformity with the sales tax and the income tax. For instance, in the decision in Young vs. Rafferty, supra, it was stated: " * * * It need hardly be said that the record which merchants are required to keep of their daily sales under the provisions of the circular letter of the Collector set out in the complaint is simplicity itself, and that it will, if honestly and faithfully kept, enable the Government to collect the percentage tax exactly due it.* * * "
Conceded that the Chinese handle sixty per cent of the aggregate business of the Philippines, approximate equality in taxation demands that they pay something like the same proportion in taxes for the support of the State. In enacting Act No. 2972, the Philippine Legislature did so pursuant to the wide authority which is delegated to it by Organic law. The Organic Act, the Act of Congress of August 29, 1916, provides "That general legislative power, except as otherwise herein provided, is hereby granted the Philippine Legislature, authorized by this Act." (Secs. 8, 12.)
The police power exists in the Philippine Islands in about the same form and to the same extent as in a State of the American Union. Under the general police power, persons and property in the Philippines have been subjected to various kinds of restrictions and burdens, in order to secure the general health, comfort, and prosperity of all. As indicated by a quotation of petitioners, the police power is not limited to regulations necessary for the preservation of good order or the public health and safety, but the prevention of fraud, cheating, and imposition is equally within its scope.
The rule to follow in the application of the police power is that announced in the leading case of Lawton vs. Steele ([1894], 152 U. S., 133), oft quoted with approval by our Supreme Court, namely:
" * * * Large discretion is necessarily vested in the legislature to determine, not only what the interests of the public require, but what measures are necessary for the protection of such interests. To justify the state in thus interposing its authority in behalf of the public, it must appear, first, that the interests of the public generally, as distinguished from those of a particular class, require such interference; and, second, that the means are reasonably necessary for the accomplishment of the purpose, and not unduly oppressive upon individuals. The legislature may not, under the guise of protecting the public interests, arbitrarily interfere with private business, or impose unusual and unnecessary restrictions upon lawful occupations.* * * " (See further, U. S. vs. Toribio [1910], 15 Phil., 85; Case vs. Board of Health and Heiser [1913], 24 Phil., 250; U. S. vs. Gomez Jesus [1915], 31 Phil., 218; Churchill and Tait vs. Rafferty [1915], 32 Phil., 580; and Rubi vs. Provincial Board of Mindoro [1919], 39 Phil., 660.) tax.The inhibition of the amendment was designed to prevent any person or class of persons from being singled out as a special subject for discriminating and hostile legislation * * *.In the construction of therevenue laws, special consideration is of course to be had of the purpose for which they are enacted. That purpose is to supply the government with a revenue. But in theproceedings to obtain this it is also intended that no unnecessary injury shall be inflicted upon the individual taxed. While this is secondary to the main object-the impelling occasion of the law-it is none the less a sacred duty. Care is taken in constitutions to insert provisions to secure the citizen against injustice in taxation, and all legislative action is entitled to the presumption that this has been intended. (1 Cooley on Taxation, pp. 55, 56, 75, 452.) The petitioners are Chinese subjects. The treaty rights accorded the Chinese are those of the most favored nation. Their constitutional rights are those accorded all aliens, which means that the life, liberty, or property of these persons cannot be taken without due process of law, and that they are entitled to the equal protection of the laws, without regard to their race. (Yick Wo vs. Hopkins [1885], 118 U. S., 356; Kwong Sing vs. City of Manila, supra.) Our Code of Commerce and our Corporation Law permit foreigners, and companies created in a foreign country, to engage in commerce in the Philippine Islands. (Code of Commerce, art. 15; Act No. 1459, sec. 73.) The rights of these Chinese aliens are not less than the rights of American and Philippine citizens. Nor more.
Six decisions bearing particularly on the rights of the Chinese, three coming from the United States Supreme 'Court, two from the Supreme Court of the Philippine Islands, and one from the Supreme Court of Hawaii have at least persuasive application to the instant proceedings. Two of the decisions of the United States Supreme Court that we have in mind, Barbier vs. Connolly ([1884], 113 U. S., 27) and Yick Wo vs. Hopkins ([1885], 118 U. S., 356), are so well known as merely to require citation, while a recent series of cases on the language question have already been mentioned. We only stop to quote one significant sentence taken from Mr. Justice Field's opinion, pertaining to the Fourteenth Amendment to the United States Constitution, in the first cited case, namely:
" * * * Class legislation, discriminating against some and favoring others, is prohibited; but legislation which, in carrying out a public purpose, is limited in its application, if within the sphere of its operation it affects alike all persons similarly situated, is not within the Amendment."
The case of Young vs. Rafferty, supra, of Philippine origin we have heretofore noticed. But later in point of time, a question was raised in the Philippine courts relative to the power of the Municipal Board of the City of Manila to enact Ordinance No. 532, requiring receipts in duplicate in English and Spanish duly signed, showing the kind and number of articles delivered by laundries and dyeing and cleaning establishments. (Kwong Sing vs. City of Manila, supra.) It was held that as said ordinance was neither oppressive, nor unequal, nor unjust, it was valid. It was said:
"The purpose of the municipal authorities in adopting the ordinance is fairly evident. Ordinance No. 532 was enacted, it is said, to avoid disputes between laundry men and their patrons and to protect. customers of laundries who are not able to decipher Chinese characters from being defrauded. The object of the ordinance was, accordingly, the promotion of peace and good order and the prevention of fraud, deceit, cheating, and imposition. The convenience of the public would also presumably be served in a community where there is a Babel of tongues by having receipts made out in the two official languages. Reasonable restraints of a lawful business for such purposes are permissible under the police power. The legislative body is the best judge of whether or not the means adopted are adequate to accomplish the ends in view.
"Our view, after most thoughtful consideration, is, that the ordinance invades no fundamental right, and impairs no personal privilege. Under the guise of police regulation, an attempt is not made to violate personal or property rights. The ordinance is neither discriminatory nor unreasonable in its operation. It applies to all public laundries without distinction, whether they belong to Americans, Filipinos, Chinese, or any other nationality. All, without exception, and each and everyone of them without distinction, must comply with the ordinance. There is no privilege, no discrimination, no distinction. Equally and uniformly the ordinance applies to all engaged in the laundry business, and, as nearly as may be, the same burdens are cast upon them.
"There is no analogy between the instant case and the former one of Young vs. Rafferty ([1916], 33 Phil., 556). The holding there was that the Internal Revenue Law did not empower the Collector of Internal Revenue to designate the language in which the entries in books shall be made by merchants subject to the percentage tax. * * * There, the action was taken by means of administrative regulation; here, by legislative enactment. There, authority was rested on specific delegated powers; here, on both specific, power and the all-pervading police power. There, governmental convenience was the aim; here, the public welfare. We are convinced that the same justices who participated in the decision in Young vs. Rafferty (supra) would now agree with the conclusion toward which we are tending."
The case most directly in line with the facts before us, is that of the King vs. Lau Kiu ([1888], 7 Hawaii, 489), decided by the Supreme Court of the Hawaiian Islands during the period of the monarchial regime in those Islands. An Act of the Hawaiian Legislature prescribed, that no wholesale or retail license should be granted to any person except upon the express condition that the licensee shall at all times keep full, true, and correct books of account of all business transacted by him in connection with such license, in the English, Hawaiian, or some European language. It was contended among other things that this was legislation against one certain class of subjects in the Kingdom, to wit, against such subjects (and particularly the Chinese) as do not speak or write the Hawaiian, English, or any European language, and was not applicable to all citizens alike. It was held by the Supreme Court that this Act was contrary to articles 1 and 14 of the Constitution, which secure to all persons the enjoyment of life and liberty and the right of acquiring, possessing, and protecting property according to law. It was held, further, that the Act could not be sustained as an exercise of the police power of the state, as it had no relation to the health, comfort, safety, or welfare of the public.
The presumption is always in favor of constitutionality. As the United States Supreme Court in a case of Philippine origin said: " * * The function of the legislature is primary, its exercise fortified by presumption of right and legality, and is not to be interfered with lightly, nor by any judicial conception of its wisdom or propriety. * * * " (Weems vs. United States [1910], 217 U. S., 349.) This presumption is especially strong in the case of statutes enacted to promote a public purpose, such as stattutes relating to taxation. To doubt is to sustain.
Only the other day, the United States Supreme Court, speaking through Mr. Justice Sutherland, said:
"The judicial duty of passing upon the constitutionality of an act of Congress is one of great gravity and delicacy.
The case most directly in line with the facts before us, is that of the King vs. Lau Kiu ([1888], 7 Hawaii, 489), decided by the Supreme Court of the Hawaiian Islands during the period of the monarchial regime in those Islands. An Act of the Hawaiian Legislature prescribed, that no wholesale or retail license should be granted to any person except upon the express condition that the licensee shall at all times keep full, true, and correct books of account of all business transacted by him in connection with such license, in the English, Hawaiian, or some European language. It was contended among other things that this was legislation against one certain class of subjects in the Kingdom, to wit, against such subjects (and particularly the Chinese) as do not speak or write the Hawaiian, English, or any European language, and was not applicable to all citizens alike. It was held by the Supreme Court that this Act was contrary to articles 1 and 14 of the Constitution, which secure to all persons the enjoyment of life and liberty and the right of acquiring, possessing, and protecting property according to law. It was held, further, that the Act could not be sustained as an exercise of the police power of the state, as it had no relation to the health, comfort, safety, or welfare of the public.
The presumption is always in favor of constitutionality. As the United States Supreme Court in a case of Philippine origin said: " * * The function of the legislature is primary, its exercise fortified by presumption of right and legality, and is not to be interfered with lightly, nor by any judicial conception of its wisdom or propriety. * * * " (Weems vs. United States [1910], 217 U. S., 349.) This presumption is especially strong in the case of statutes enacted to promote a public purpose, such as stattutes relating to taxation. To doubt is to sustain.
Only the other day, the United States Supreme Court, speaking through Mr. Justice Sutherland, said:
"The judicial duty of passing upon the constitutionality of an act of Congress is one of great gravity and delicacy.
The statute here in question has successfully borne the scrutiny of the legislative branch of the government, which, by enacting it, has affirmed its validity; and that determination must be given great weight. This court, by an unbroken line of decisions from Chief Justice Marshall to the present day, has steadily adhered to the rule that every possible presumption is in favor of the validity of an act of Congress until overcome beyond rational doubt. But if, by clear and indubitable demonstration, a statute be opposed to the Constitution, we have no choice but to say so.* * * " (Adkins vs. Children's Hospital of the District of Columbia [1923], 261 U. S., 525; 67 Law ed., 785.)
That the Supreme Court of the Philippine Islands has consistently followed these rules is disclosed by the few laws held invalid. During the twenty-three years of the Supreme Court's existence, it has never held invalid one complete law, while portions of laws have been nullified on but few occasions. (Casanovas vs. Hord [1907], 8 Phil.p 125; Omo vs. Insular Government [1908], 11 Phil., 67; Weigall vs. Morgan Shuster [1908], 11 Phil., 340; Barrameda vs. Moir [1913], 25 Phil., 44; McGirr vs. Hamilton and Abreu [1915], 30 Phil., 563; Central Capiz vs. Ramirez [19201, 40 Phil., 883; Concepcion vs. Paredes [1921], 42 Phil., 599; McDaniel vs. Apacible and Cuisia [1922], 44 Phil., 248.)
It may be said to be an elementary, a fundamental ' and a universal rule of construction, applied when considering constitutional questions, that when a law is susceptible of two constructions one of which will maintain and the other destroy it, the courts will always adopt the former. Whenever a law can be so construed as to uphold it, it will be so construed although the construction which is adopted does not appear to be as natural as another construction. But where the meaning of the Act is plain, words cannot be read into it or out of it in order to save the law. (1 Lewis' Sutherland Statutory Construction, pp. 135, 136; Cooley's Constitutional Limitations, 184; 6 R. C. L., 78.) brings the statute into harmony with the provisions of the Constitution. Cooley Constitutional Law, 184-5; Newland vs. Marsh, 19 III., 384; People vs. Supervisors, 17 N. Y., 241; Colwell vs. Water Power Co., 4 C. E. Green (19 N. J. Eq.), 249. And such is the rule recognized by the Supreme Court of Mississippi in Marshall vs. Grimes, 41 Miss., 31, in which it was said: 'General words in the Act should not be so construed as to give an effect to it beyond the legislative power, and thereby render the Act unconstitutional. But, if possible, a construction should be given to it that will render it free from constitutional objection; and the presumption must be that the Legislature intended to grant such rights as are legitimately within its power.' Again, in Sykes vs. Mayor, 55 Mississippi, 143: 'It ought never to be assumed that the lawmaking department of the government intended to usurp or assume power prohibited to it. And such construction, if the words will admit of it, ought to be put on its legislation as will make it consistent with the supreme law."'
Identical canons of statutory construction have often been invoked in the Philippines to enable the courts to avoid declaring a law unconstitutional. For instance, the decision in the well known case of In re Guariña ([1913], 24 Phil., 37, 46), citing Black on Interpretation of Laws, pp. 87, 93, and 94, is authority for this statement of the rule: "It is the duty of the courts in construing a statute enacted by the Philippine Commission (Legislature), not to give it a construction which would be repugnant to an Act of Congress, if the language of the statute is fairly susceptible of another construction not in conflict with the higher law; and in doing so, contentions touching the apparent intention of the legislator will be disregarded which would lead to the conclusion that the Commission intended to enact a law in violation of an Act of Congress." Not long since, this court, in the case of Fuentes vs.
Director of Prisons, No. 22449,1 saved Act No. 3104 relating to the brings the statute into harmony with the provisions of the Constitution. Cooley Constitutional Law, 184-5; Newland vs. Marsh, 19 III., 384; People vs. Supervisors, 17 N. Y., 241; Colwell vs. Water Power Co., 4 C. E. Green (19 N. J. Eq.), 249. And such is the rule recognized by the Supreme Court of Mississippi in Marshall vs. Grimes, 41 Miss., 31, in which it was said: 'General words in the Act should not be so construed as to give an effect to it beyond the legislative power, and thereby render the Act unconstitutional. But, if possible, a construction should be given to it that will render it free from constitutional objection; and the presumption must be that the Legislature intended to grant such rights as are legitimately within its power.' Again, in Sykes vs. Mayor, 55 Mississippi, 143: 'It ought never to be assumed that the lawmaking department of the government intended to usurp or assume power prohibited to it. And such construction, if the words will admit of it, ought to be put on its legislation as will make it consistent with the supreme law."'
Identical canons of statutory construction have often been invoked in the Philippines to enable the courts to avoid declaring a law unconstitutional. For instance, the decision in the well known case of In re Guariña ([1913], 24 Phil., 37, 46), citing Black on Interpretation of Laws, pp. 87, 93, and 94, is authority for this statement of the rule: "It is the duty of the courts in construing a statute enacted by the Philippine Commission (Legislature), not to give it a construction which would be repugnant to an Act of Congress, if the language of the statute is fairly susceptible of another construction not in conflict with the higher law; and in doing so, contentions touching the apparent intention of the legislator will be disregarded which would lead to the conclusion that the Commission intended to enact a law in violation of an Act of Congress." Not long since, this court, in the case of Fuentes vs.
Director of Prisons, No. 22449,1 saved Act No. 3104 relating to the journal, and a ledger are indispensable books of account for an efficient system of accounting, and that, in the smaller shops, even simpler entries showing merely the daily record of sales and record of purchases of merchandise would be sufficient. The keeping of records of sales, and possibly further records of purchases, in English, Spanish, or a native dialect, and the filling out of the necessary forms would serve the purpose of the Government while not being oppressive. Actually, notations in English, Spanish, or a dialect of all sales in sales books, and of data in other specified forms are insisted upon by the Bureau of Internal Revenue, although as appears from Exhibit 2, it is doubtful if all Chinese merchants have complied with these regulations. The faithful observance of such rules by the Chinese is not far removed from the offer of cooperation oft made for them by the petitioners or the "translation of the account books" oft mentioned and explained by the respondents.
The law, in speaking of any person, company, partnership, or corporation, makes use of the expression "its account books." Does the phrase "its account books" mean that all the account books of the person, company, partnership, or corporation must be kept exclusively in English, Spanish, or any local dialect? The petitioners argue that the law has this meaning. Or does the phrase "its account books" mean that the persons, company, partnership, or corporation shall keep duplicate sets of account books, one set in Chinese and the other a translation into English, Spanish, or any local dialect? Counsel for the respondents urge this construction of the law upon the court. Or does the phrase "its account books" mean that the person, company, partnership, or corporation must keep such account books as are necessary for taxation purposes? This latter interpretation occurs to us as a reasonable one and as best safeguarding the rights of the accused. And lastly, what effect has Act No. 2972 had upon the provisions of the Code of Commerce on the subject of merchants?
Has the Act repealed or modified any article of the Code of Commerce?
The interrogatories above made at least lead to the deduction that the law is more or less ambiguous and that it will bear two or more constructions.
Let us repeat: Act No. 2972 is a fiscal measure. It should be so construed if possible as to effectuate legislative intent, as collected from the occasion for the law, the circumstance under which it was enacted, the mischief to be remedied, and the policy which dictated its passage. It should be so construed if possible as to avoid conflict with the constitution, although such construction may not be the most obvious or natural one. Giving, therefore, to the law a meaning which will carry out the main governmental purpose and which will permit us to sanction its constitutionality, it seeks to prohibit not only the Chinese but all merchants of whatever nationality from making entries in the books of account or forms subject to inspection for taxation purposes in any other language than either the English or Spanish language or a local dialect, although permitting all merchants to execute their commercial transactions or operations in any language or dialect they may prefer, and although permitting them to keep such other books of account as their personal convenience may dictate and in a language which will come most easily to them. We would go so far as to hold that circular No. 467 of the Bureau of Internal Revenue which this court once held beyond the power of the Collector of Internal Revenue to promulgate, and any other reasonable regulation of a similar nature, as within the power of the Philippine Legislature to sanction and entirely enforceable.
To any possible plaint by the Government, that this is tantamount to "judicial legislation," we would say: It is not "judicial legislation" as this phrase is commonly used in the spirit of antagonistic fault finding. No words are written into the law. No words are taken out of the law. It is merely a practical judicial 'construction of a law where the validity of this law is in issue, which gives to the law a meaning accomplishing everything needed by the Government for tax purposes, without being unduly oppressive on the individual, and which permits the courts to uphold the law.
To the petitioners, who by our decision do not obtain all they may wish, we append this word of advice: Under such a construction as is above indicated, the Chinese will not be singled out as a special subject for discriminating and hostile legislation. There will be no arbitrary deprivation of liberty or arbitrary spoliation of property. There will be no unjust and illegal discrimination between persons in similar circumstances. The law will prove oppressive to the extent that all tax laws are oppressive, but not oppressive to the extent of confiscation. The means to accomplish a necessary interference with private business are no more oppressive upon individuals than is necessary to maintain the State. The law is not intended for the convenience of the trader or the protection of the creditors, but has relation to the public welfare, to the power of taxation, to the right of the government to exist. The Chinese must bear their just proportion of the tax burden, however unwelcome it may be, without flinching.
A faint effort has been made by the petitioners to have the court declare Act No. 2972 void because the subject thereof is not expressed in its title. But legislation should not be embarrassed by such strict construction as is urged by counsel. No distinguishable variance between the title of the law and the body of the law can be discovered after microscopic examination. The law is brief in its terms, and neither the Legislature nor the public need be misled by the title. (Government of the Philippine Islands vs. Municipality of Binalonan and Roman Catholic Bishop of Nueva Segovia [1915], 32 Phil., 634.)
We construe Act No. 2972 as meaning that any person, company, partnership, or corporation, engaged in commerce, industry, or any other activity for the purpose of profit in the Philippine Islands, shall keep its account books, consisting of sales books and other records and returns required for taxation purposes by regulations of the Bureau of Internal Revenue, in effect when this action was begun, in English, Spanish, or a local dialect. Agreeable to such construction, we hold Act No. 2972 valid and constitutional.
The temporary injunction heretofore issued is dissolved although under the construction given to the law it may well be doubted if the Government will care to proceed with the criminal prosecution. If the Government should not dismiss the information, this question may be raised by demurrer in the lower court.
Petition denied without costs.
Avanceña, Villamor, Ostrand, and Romualdez, JJ., concur.
Johnson, Acting Chief Justice, did not take part.
STREET, J., dissenting:
The Act which has been assailed in this case looks innocent enough on its face but when examined in connection with conditions among those for whom it was prescribed, compliance is found to be impossible, or supposing that the Act could be complied with, the loss resulting to thousands of Chinese merchants would be so disproportionate to any possible good to be attained, that the enforcement of the law would amount to a denial of liberty and equal protection of the law to the persons adversely affected.
It is unnecessary for me to enlarge upon the destructive effects of the law as a ground for declaring it invalid, for it is admitted in the majority opinion that if Act No. 2972 is taken to mean what it says, it must be considered a dead letter. But after admitting this much, the court, in its extreme reluctance to declare the entire statute void, addresses itself to the problem of limiting its effect by what I consider to be an illegitimate process of judicial amendment under the guise of interpretation. The first section of the Act, as thus amended by the Supreme Court, reads as follows:
"It shall be unlawful for any person, company, partnership or corporation engaged in commerce, industry or any other activity for the purpose of profit in the Philippine Islands, in accordance with existing law, to keep its account books, (consisting of sales books and other records and returns required for taxation purposes by regulations of the Bureau of Internal Revenue, in effect when this action was begun) in any language other than English, Spanish or any local dialect."
The new matter which I have here inserted in parenthesis is taken verbatim from the dispositive part of the decision and defines precisely the extent to which the court has decided to allow the Act to operate. Where are the rules of interpretation by which this matter can be deduced from the language of the Act? The opinion of the court supplies no answer. Of course if the Legislature had confined the Act to giving the Collector of Internal Revenue a power to prescribe forms and require data convenient for the assessment of taxes, the law would not have been subject to criticism; but how can an intention to legislate in this form be deduced from the proposition, so entirely distinct, contained in the Act, that it shall be unlawful for a merchant to keep his account books in other languages than those mentioned? That the court is here exercising the mere role of a legislator is very obvious, for who can say that the Philippine Legislature, conscious of the ineffectiveness of the law as written, would have willed that the power granted to the Collector should take the precise form and extent now allowed by the court? In assuming the functions of a legislature we are entering upon a sea that has not been charted for the guidance of courts, and if this decision should prove fruitful as a precedent we shall find ourselves free in the future to wander pretty much at will through legislative Acts.
The precise rule applicable to this case is stated in Meyer vs. Nebraska (262 U. S., 390; 67 Law. ed., 1042), where the Supreme Court of the United States, speaking through Mr. Justice McReynolds, declared that the liberty secured by the constitutional provision under discussion may not be interfered with, under the guise of protecting the public interest, by legislative action which is arbitrary or without reasonable relation to some purpose within the competency of the state to effect.
The decision of the Supreme Court of Hawaii in King vs. Lau Kiu (7 Hawaiian Rep., 489), declaring invalid a statute almost exactly like that involved in this action is also suggestive, as reflecting judicial sense in a community containing a large element of Chinese population.
It is my opinion that Act No. 2972 of the Philippine Legislature is wholly void, and the injunction should have been made perpetual. In addition to smashing the law the court should have removed the debris.
JOHNS, J., dissenting:
With all due respect to the well written, exhaustive majority opinion, the only question involved is the meaning and construction which should be placed upon Act No. 2972, which is entitled "An Act to provide in what language account books shall be kept, and to establish penalties for its violation."
"SECTION 1. It shall be unlawful for any person, company, partnership or corporation engaged in commerce, industry or any other activity for the purpose of profit in the Philippine Islands, in accordance with existing law, to keep its account books in any language other than English, Spanish or any local dialect.
"SEC. 2. Any person violating the provisions of this Act shall, upon conviction, be punished by a fine of not more than ten thousand pesos, or by imprisonment for not more than two years or both."
It will be noted that section 1 makes it unlawful for any of the persons specified "to keep its account books in any language other than English, Spanish or any local dialect." Section 2 provides that any person violating the provisions of section 1 shall be punished by a fine of not more than P10,000 or by imprisonment for not more than two years or both. In other words, you have a law prohibiting the doing of certain things and providing a punishment for its violation. Hence, the statute in question is a criminal law, and must be construed as such.
Sutherland on Statutory Construction is recognized as standard authority all over the world, and portions of it are quoted with approval in the majority opinion.
In his second edition, section 531, the author says:
"What statutes are penal.-Among penal laws which must be strictly construed, those most obviously included are all such acts as in terms impose a fine or corporal punishment under sentence in state prosecutions, or forfeitures to the state as a punitory consequence of violating laws made for preservation of the peace and good order of society."
The majority opinion frankly says:
"A literal application of the law would make it unlawful for any Chinese merchant to keep his account books in any language other than English, Spanish, or a local dialect. The petitioners say the law is susceptible of that interpretation. But such interpretation might, and probably would, cause us to hold the law unconstitutional."
In section 363, Sutherland on Statutory Construction, it is said.
"* * * If a statute is plain, certain and unambiguous, so that no doubt arises from its own terms as to its scope and meaning, a bare reading suffices; then interpretation is needless."
"SEC. 366.* * * We are not at liberty to imagine an intent and bind the letter of the act to that intent; much less can we indulge in the license of striking out and inserting, and remodeling, with the view of making the letter express an intent which the statute in its native form does not evidence. Every construction, therefore, is vicious which requires great changes in the letter of the statute, and, of the several constructions, that is to be preferred which introduces the most general and uniform remedy.
" * * * No mere omission, no mere failure to provide for contingencies, which it may seem wise to have specifically provided for, justify any judicial addition to the language of the statute.
"The legislature must be understood to mean what it has plainly expressed, and this excludes construction. The legislative intent being plainly expressed, so that the act read by itself, or in connection with other statutes pertaining to the same subject, is clear, certain and unambiguous, the courts have only the simple and obvious duty to enforce the law according to its terms. * * * If a legislative enactment violates no constitutional provision or principle, it must be deemed its own sufficient and conclusive evidence of the justice, propriety and policy of its. passage. Courts have, then, no power to set it aside, or evade its operation by forced and unreasonable construction. If it has been passed improvidently, the responsibility is with the legislature and not with the courts."
"SEC. 520. Strict construction of penal statutes-The penal law is intended to regulate the conduct of people of all grades of intelligence within the scope of responsibility. It is therefore essential to its justice and humanity that it be expressed in language which they can easily comprehend; that it be held obligatory only in the sense in which all can and will understand it. And this consideration presses with increasing weight according to the severity of the penalty. Hence every provision affecting any element of a criminal offense involving life or liberty lature intended it should mean. If the language in the act was indefinite, uncertain or ambiguous that position would be tenable.
Numerous decisions are cited in the majority opinion, all of which are good law, but only two of them are in point upon the main question here involved, and both of them are squarely against the law as laid down in the majority opinion. In legal effect, that opinion holds that Act No. 2972, in its existing form, and as it was enacted by the Legislature, is unconstitutional and void. It then proceeds to reconstruct, change and modify the law, and then holds that the law, as reconstructed and modified is constitutional. No law is cited which authorizes this or any other court to reconstruct or modify the plain, simple language of a legislative act, for the simple reason that no such a law will ever be found. But, as Sutherland says, where, as in the instant case, the language is clear and explicit, it must be construed to mean what it says.
On legal principle, the case of Meyer vs. Nebraska, decided by the Supreme Court of the United States at the October term, 1922 (67 Law. ed., 1042), cited in the majority opinion, is square in point. The Legislature of Nebraska passed a law entitled "An Act Relating to the Teaching of Foreign Languages in the State of Nebraska," section 1 of which is as follows:
"No person, individually or as a teacher, shall, in any private, denominational, parochial or public school, teach any subject to any person in any language other than the English language.
"SEC. 2. Languages, other than the English language, may be taught as languages only after a pupil shall have attained and successfully passed the eighth grade as evidenced by a certificate of graduation issued by the country superintendent of the county in which the child resides.
"SEC. 3. Any person who violates any of the provisions of this Act shall be deemed guilty of a misdemeanor - and upon conviction, shall be subject to a fine of not less than lature intended it should mean. If the language in the act was indefinite, uncertain or ambiguous that position would be tenable. Numerous decisions are cited in the majority opinion, all of which are good law, but only two of them are in point upon the main question here involved, and both of them are squarely against the law as laid down in the majority opinion. In legal effect, that opinion holds that Act No. 2972, in its existing form, and as it was enacted by the Legislature, is unconstitutional and void. It then proceeds to reconstruct, change and modify the law, and then holds that the law, as reconstructed and modified is constitutional. No law is cited which authorizes this or any other court to reconstruct or modify the plain, simple language of a legislative act, for the simple reason that no such a law will ever be found. But, as Sutherland says, where, as in the instant case, the language is clear and explicit, it must be construed to mean what it says.
On legal principle, the case of Meyer vs. Nebraska, decided by the Supreme Court of the United States at the October term, 1922 (67 Law. ed., 1042), cited in the majority opinion, is square in point. The Legislature of Nebraska passed a law entitled "An Act Relating to the Teaching of Foreign Languages in the State of Nebraska," section 1 of which is as follows:
"No person, individually or as a teacher, shall, in any private, denominational, parochial or public school, teach any subject to any person in any language other than the English language.
"SEC. 2. Languages, other than the English language, may be taught as languages only after a pupil shall have attained and successfully passed the eighth grade as evidenced by a certificate of graduation issued by the country superintendent of the county in which the child resides.
"SEC. 3. Any person who violates any of the provisions of this Act shall be deemed guilty of a misdemeanor - and upon conviction, shall be subject to a fine of not less than reconstructed or modified the plain, clear, simple language of a legislative act, for the purpose of holding it constitutional. We frankly concede that, for taxation purposes, the legislature has the power to enact a law requiring that a record of all sales and purchases should be kept in a given language, and to specify and define how and in what manner such record should be kept, and that such a law would be valid. But we are not dealing with the question of what the legislature can do. The question involved here is what the legislature has done. Both in the title and the body of the act, the legislature has said that it shall be unlawful for any person, firm or corporation engaged in certain lines of business to keep its account books in any language other than English, Spanish or any local dialect, and has expressly imposed a penalty for a violation of the act. There are no exceptions or limitations in the language, and it is not confined or limited to any specific purpose. It is broad and general and applies to any and all account books which may be kept or used in connection with the business.
The majority opinion holds that the law should be construed to read that account books, for taxation purposes only, shall be kept in either English, Spanish or any local dialect. With all due respect to the majority opinion, that is the very highest type of judicial legislation. If the act is to be so construed, then the law itself should specify and define what books are required to be kept, for taxation purposes, and how they should be kept, or it should delegate that power to the tax officials.
Assuming, as the majority opinion does, that Act No. 2972 should read that account books, for taxation purposes, should be kept in either English, Spanish or any local dialect, the act does not specify or define what books shall be kept or how and in what manner they shall be kept. Neither does it delegate that power to anyone else. In its effort in trying to get out of one hole and make a void reconstructed or modified the plain, clear, simple language of a legislative act, for the purpose of holding it constitutional. We frankly concede that, for taxation purposes, the legislature has the power to enact a law requiring that a record of all sales and purchases should be kept in a given language, and to specify and define how and in what manner such record should be kept, and that such a law would be valid. But we are not dealing with the question of what the legislature can do. The question involved here is what the legislature has done. Both in the title and the body of the act, the legislature has said that it shall be unlawful for any person, firm or corporation engaged in certain lines of business to keep its account books in any language other than English, Spanish or any local dialect, and has expressly imposed a penalty for a violation of the act. There are no exceptions or limitations in the language, and it is not confined or limited to any specific purpose. It is broad and general and applies to any and all account books which may be kept or used in connection with the business.
The majority opinion holds that the law should be construed to read that account books, for taxation purposes only, shall be kept in either English, Spanish or any local dialect. With all due respect to the majority opinion, that is the very highest type of judicial legislation. If the act is to be so construed, then the law itself should specify and define what books are required to be kept, for taxation purposes, and how they should be kept, or it should delegate that power to the tax officials.
Assuming, as the majority opinion does, that Act No. 2972 should read that account books, for taxation purposes, should be kept in either English, Spanish or any local dialect, the act does not specify or define what books shall be kept or how and in what manner they shall be kept. Neither does it delegate that power to anyone else. In its effort in trying to get out of one hole and make a void law a valid law, the majority opinion runs into another hole, which is equally fatal to the law. If, as it holds, Act No. 2972 should be construed to mean that account books, for taxation purposes only, should be kept in either English, Spanish or some local dialect, and the law does not specify what books shall be kept or how and in what manner they shall be kept and that power is not delegated to anyone else, how can the law be enforced? Under such a construction, if a defendant should be charged with a violation of the law, what law has he violated, and upon what legal principle could a conviction be sustained? Upon that point, the law as drafted by the legislature is definite and certain. In legal effect, it provides that all account books for any and all purposes shall be kept in either English, Spanish or some local dialect. The law as reconstructed by the majority opinion would be that such account books are to be confined and limited to account books for taxation purposes. Yet, the law does not specify what books shall be kept for that purpose, or how or in what manner they shall be kept, or what the entries shall contain. Neither is that power delegated. In the absence of such provisions, how could anyone be convicted of a violation of the law? For what crime could he be charged and what would be his offense?
Apparently, the majority opinion realizes the legal effect of its reconstruction of the law, for on page 36 (p. 420, supra), the opinion says:
" * * * it seeks to prohibit not only the Chinese but all merchants of whatever nationality from making entries in the books of account or forms subject to inspection for taxation purposes in any other language than either the English or Spanish language or a local dialect,
And on page 37 (p. 420, supra), it says:
" * * * We would go so far as to hold that circular No. 467 of the Bureau of Internal Revenue which this court once held beyond the power of the Collector of Internal States; an example which it would be well for this court to follow. However grave the responsibility may be, if a given law is unconstitutional, under our oath of office, it is our duty to so declare it.
We repeat that no law is cited in the majority opinion and that none will ever be found 'which holds the law in question to be constitutional. The majority opinion violates every rule above quoted of Sutherland on Statutory Construction.
For such reasons, I vigorously dissent.
Plaintiffs should have the writ prayed for in their petition.
Petition denied.
1 46. Phil., 22.
YU CONG ENG VS. TRINIDAD
[47 PHIL 385; G.R. NO. 20479; 6 FEB 1925]
Facts:
The petitioner, Yu Cong Eng, was charged by information in the court of first instance of Manila, with a violation of Act 2972, which provides that (Section 1) it shall be unlawful for any person, company, or partnership or corporation engaged in commerce, industry or any other activity for the purpose of profit in the Philippine Islands, in accordance with existing law, to keep its account books in any language other than English, Spanish or any local dialect. He was arrested, his books were seized, and the trial was about to proceed, when he and the other petitioner, Co Liam, on their own behalf, and on behalf of all the other Chinese merchants in the Philippines, filed the petition against the fiscal, or prosecuting attorney of Manila, and the collector of internal revenue engaged in the prosecution, and against the judge presiding.
Issue:
Whether or Not Act 2972 is unconstitutional.
Held:
Yes. The Philippine government may make every reasonable requirement of its taxpayers to keep proper records of their business transactions in English or Spanish or Filipino dialect by which an adequate measure of what is due from them in meeting the cost of government can be had. But we are clearly of opinion that it is not within the police power of the Philippine Legislature, because it would be oppressive and arbitrary, to prohibit all Chinese merchants from maintaining a set of books in the Chinese language, and in the Chinese characters, and thus prevent them from keeping advised of the status of their business and directing its conduct.
Aniag, Jr. vs. Commission on Elections
October 7, 1994.
[GRN 104961 October 7, 1994.]
CONGRESSMAN FRANCISCO B. ANIAG, JR., petitioner, vs. COMMISSION ON ELECTIONS and DEPARTMENT OF JUSTICE SPECIAL TASK FORCE, respondents. CONCURRING OPINION CONCURRING AND DISSENTING OPINION
PETITION for review of the resolutions of the Commission on Elections.
The facts are stated in the opinion of the Court
Ronolfo S. Sasamba for petitioner.
BELLOSILLO, J.:
PETITIONER assails in this petition (for declaratory relief, certiorari and prohibition the following resolutions of the Commission on Elections: Resolution No. 2327 dated 26 December 1991 for being unconstitutional, and Resolution No. 92-0829 dated 6 April 1992 and Resolution No. 92- 0999 dated 23 April 1992, for want of legal and factual bases.
The factual backdrop: In preparation for the synchronized national and local elections scheduled on 11 May 1992, the Commission on Elections (COMELEC) issued on 11 December 1991 Resolution No. 2323 otherwise referred to as the "Gun Ban," promulgating rules and regulations on bearing, carrying and transporting of firearms or other deadly weapons, on security personnel or bodyguards, on bearing arms by members of security agencies or police organizations, and organization or maintenance of reaction forces during the election period.1 Subsequently, on 26 December 1991 COMELEC issued Resolution No. 2327 providing for the summary disqualification of candidates engaged in gunrunning, using and transporting of firearms, organizing special strike forces, and establishing spot checkpoints.2
On 10 January 1992, pursuant to the "Gun Ban," Mr. Serapio P. Taccad, Sergeant-at-Arms, House of Representatives, wrote petitioner who was then Congressman of the let District of Bulacan requesting the return of the two (2) firearms3 issued to him by the House of Representatives. Upon being advised of the request on 13 January 1992 by his staff, petitioner immediately instructed his driver, Ernesto Arellano, to pick up the firearms from petitioner's house at Valle Verde and return them to Congress. Meanwhile, at about five o'clock in the afternoon of the same day, the Philippine National Police (PNP) headed by Senior Superintendent Danilo Cordaro set up a checkpoint outside the Batasan Complex some twenty (20) meters away from its entrance.
About thirty minutes later, the policemen manning the out flagged down the car driven by Arellano as it approached the checkpoint. They searched the car and found the firearms meatly packed in their gun cases and placed in a bag in the trunk of the car. Arellano was then apprehended and detained. He explained that he was ordered by petitioner to get the firearms from the house and return them to Sergeant-at-Arms Taccad of the House of Representatives.
Thereafter, the police referred Arellano's case to the Office of the City Prosecutor for inquest. The referral did not include petitioner as among those charged with an election offense. On 15 January 1992, the City Prosecutor ordered the release of Arellano, after finding the latter's sworn explanation meritorious.4
On 28 January 1992, the City Prosecutor invited petitioner to shed light on the circumstances mentioned in Arellano's sworn explanation. Petitioner not only appeared at the preliminary investigation to confirm Arellano's statement but also wrote the City Prosecutor urging him to exonerate Arellano. He explained that Arellano did not violate the firearms ban as he in fact was complying with it when apprehended by returning the firearms to Congress; and, that he was petitioner's driver, not a security officer nor a bodyguard.5
On 6 March 1992, the Office of the City Prosecutor issued a resolution which, among other matters, recommended that the case against Arellano be dismissed and that the "unofficial" charge against petitioner be also dismissed.6
Nevertheless, on 6 April 1992, upon recommendation of its Law Department, COMELEC issued Resolution No. 92-0829 directing the filing of information against petitioner and Arellano for violation of Sec. 261, par. (q), of B.P. B1g. 881 otherwise known as the Omnibus Election Code, in relation to Sec. 32 of R.A. No. 7166;7 and petitioner to show cause why he should not be disqualified from running for in elective position, pursuant to COMELEC Resolution No. 2327, in relation to Secs. 32, 33 and 35 of RA 7166, and Sec. 52, par. (c), of B.P. Blg. 881.8
On 13 April 1992, petitioner moved for reconsideration and to hold in abeyance the administrative proceedings as well as the filing of the information in court.9 On 23 April 1992, the COMELEC firearms, carries any firearms outside his residence or place of business during the election period, unless authorized in writing by the Commission: Provided, That a motor vehicle, water or aircraft shall not he considered a residence or place of business or extension hereof x x x x (B.P. Blg. 981). Sec. 32. Who May Bear Firearms- During the election period, no person shall bear, carry or transport firearms or other deadly weapons in public places, including any building, frost, park, private vehicle or public conveyance, even if licensed to possess or carry the same, unless authorized in writing by the Commission. The issuance of firearm licenses shall be suspended during the election period x x x x (R.A. No. 7166).
Sec. 33. Security Personnel and Bodyguards.-During the election period, no candidate for public office, including incumbent public officers seeking election to any public office, shall employ, avail himself of or engage the services of security personnel or bodyguards, whether or not such bodyguards are regular members or officers of the Philippine National Police, the Armed Forces of the Philippines or other law enforcement agency of the Government x x x x (ibid.).
Sec. 35. Rules and Regulations.-The Commission shall issue rules and regulations to implement this Act. Said rules shall be published in at least two (2) national newspapers of general circulation (ibid.).
Sec. 52. Powers and functions of the Commission on Elections.-In addition to the powers and functions conferred upon it by the Constitution, the Commission shall have exclusive charge of the enforcement and administration of all laws relative to the conduct of elections for the purpose of ensuring free, orderly and honest elections, and shall x x x x (c) Promulgate rules and regulations implementing the provision of this Code or other laws which the Commnission is required to enforce and administer, and require the payment of legal fees and collect the same in payment of any business done in the Commission, at rates that it may provide and fix in its rules and regulations x x x x(B.P. Blg. 881.) denied petitioner's motion for reconsideration.10 Hen recourse.
Petitioner questions the constitutionality of Resolution No. 2327. He argues that the rules and regulations of an administrative body must respect the limits defined by law; that the Omnibus Election Code provides for the disqualification of any person/candidate from running for or holding a public office, i.e., any person who has either been declared by competent authority as insane or incompetent or has been sentenced by final judgment for subversion, insurrection, rebellion or for any offense for which he has been sentenced to a penalty of more than eighteen months or for a crime involving moral turpitude; that gunrunning, losing or transporting firearms or similar weapons and other acts mentioned in the resolution are not within the letter or spirit of the provisions of the Code; that the resolution, did away with the requirement of final conviction before the commission of certain offenses; that instead, it created a presumption of guilt as a candidate maybe disqualified from office in situations (a) where the criminal charge, is still pending, (b) where there is no pending criminal case, and (c) where the accused has already been acquitted, all contrary to the requisite quantum of proof for one to be disqualified from running or holding public office under the Omnibus Election Code, i.e., proof beyond reasonable doubt. As a result, petitioner concludes, Resolution No. 2327 violate, the fundamental law thus rendering it fatally defective.
But, the issue on the disqualification of petitioner from running in the 11 May 1992 synchronized elections was rendered moot when he lost his bid for a seat in Congress in the elections that ensued. Consequently, it is now futile to discuss the implications of the charge against him on his qualification to run for public office.
However, there still remains an important question to be resolved, i.e., whether he can be validly prosecuted for instructing his driver to return to the Sergeant-at-Arms of the House of Representatives the two Firearms issued to him on the basis of the evidence gathered from the warrantless search of his car.
Petitioner strongly protests against the manner by which the PNP conducted the search. According to him, without a warrant and without informing the driver of his fundamental rights the policemen searched his car. The firearms were not tucked in the waist nor within the immediate reach of Arellano but were neatly packed in their gun cases and wrapped in a bag kept in the trunk of the car. Thus, the search of his car that yielded the evidence for the prosecution was clearly violative of Secs. 2 and 3, par. (2), Art. III, of the Constitution.11
Petitioner further maintains that he was neither impleaded as party respondent in the preliminary investigation before the Office of the City Prosecutor nor included in the charge sheet. Consequently, making him a respondent in the criminal information would violate his constitutional right to due process.
Petitioner disputes the charge that he violated Sec. 33 of R.A. 7166, which prohibits any candidate for public office during the election period from employing or availing himself or engaging the services of security personnel or bodyguards since, admittedly, Arellano was not a security officer or bodyguard but a civilian employee assigned to him as driver by the House of Representatives. Specifically, petitioner further argues, Arellano was instructed to return to Congress, as he did, the firearms in compliance with the directive of its pursuant to the "Gun Ban," thus, no law was in fact violated.12
On 25 June 1992, we required COMELEC to file its own comment on the petition13 upon manifestation of the Solicitor General that it could not take the position of COMELEC and prayed instead to be excused from filing the required comment.14
COMELEC claim that petitioner is charged with violation of Sec. 26, par. (q), in relation to Sec. 263, of B.P. Blg. 881 which provides that the principals, accomplices and accessories, as defined in the Revised Penal Code, shall be criminally liable for election offenses." It points out that it was upon petitioner's instruction that Arellano brought the firearms in question outside petitioner's residence, submitting that his right to be heard was not violated as he was invited by the City Prosecutor to explain he circumstances regarding Arellano's possession of the firearms. Petitioner also filed a sworn written explanation about the incident. Finally, COMELEC claims that violation of the "Gun Ban" is mala prohibita, hence, the intention of the offender is immaterial.15
Be that as it may, we find no need to delve into the alleged constitutional infirmity of Resolution No. 2327 since this petition may be resolved without passing upon this particular issue.16
As a rule, a valid search must be authorized by a search warrant duly issued by an appropriate authority. However, this is not absolute. Aside from a search incident to a lawful arrest, a warrantless search had been upheld in cases of moving vehicles and the seizure of evidence in plain view,17 as well as the search conducted at police or military checkpoints which we declared are not illegal per se, and stressed that the warrantless search is not violative of the Constitution for as long as the vehicle is neither searched nor its occupants subjected to a body search, and the inspection of the vehicle is merely limited to a visual search.18
Petitioner contends that the guns were not tucked in Arellano's waist nor placed within his reach, and that they were neatly packed in gun cases and placed inside a bag at the back of the car. Significantly, COMELEC did not rebut this claim. The records do not show that the manner by which the package was bundled led the PNP to suspect that it contained firearms. There was no mention either of any report regarding any nervous, suspicious or unnatural reaction from Arellano when the car was stopped and searched. Given these circumstances and relying on its visual observation, the PNP could not thoroughly search the car lawfully as well as the package without violating the constitutional injunction.
An extensive search without warrant could only be resorted to if the officers conducting the search had reasonable or probable cause to believe before the search that either the motorist was a law offender or that they would find the instrumentality or evidence pertaining to the commission of a crime in the vehicle to be searched.19 The existence of probable cause justifying the warrantless search is determined by the facts of each case.20 Thus, we upheld the validity of the warrantless search in situations where the smell of marijuana emanated from a plastic bag owned by the accused, or where the accused was acting suspiciously, and attempted to flee.21
We also recognize the stop-and-search without warrant conducted by police officers on the basis of prior confidential information which were reasonably corroborated by other attendant matters, e.g., where a confidential report that a sizeable volume of marijuana would be transported along the route where the search was conducted and appellants were caught in flagrante delicto transporting drugs at the time of their arrest;22 where apart from the intelligence information, there were reports by an undercover "deep penetration" against the appellants were bringing prohibited drugs into the country;" where the information that a Caucasian coming from Sagada bringing prohibited drugs was strengthened by the conspicuous bulge in accused's waistline and his suspicious failure to produce his passport and other identification papers;24 where the physical appearance of the accused fitted the description giver. in the confidential information about a woman transporting marijuana;25 where the accused carrying a bulging, black leather bag were suspiciously quiet and nervous when queried about its contents;26 or where the identity of the drug courier was already established by police authorities who received confidential information about the probable arrival of accused on boad one of the vessels arriving in Dumaguete City.27
In the case at bench, we find that the checkpoint was set up twenty (20) meters from the entrance to the Batasan Complex to enforce Resnlution No. 2327. There was no evidence to show that the policemen were impelled to do so because of a confidential report leading them to reasonably believe that certain motorists matching the description furnished by their informant were engaged in gunrunning, transporting Firearms or in organizing special strike forces. Nor, as adverted to earlier, was there any indication from the package or behavior of Arellano that could have triggered the suspicion of the policemen. Absent such justifying circumstances specifically pointing to the culpability of petitioner and Arellano, the search could not be valid. The action then of the policemen unreasonably intruded into petitioner's privacy and the security of his property, in violation of Sec. 2, Art. III, of the Constitution. Consequently, the firearms obtained in violation of petitioner's right against warrantless search cannot be admitted for any purpose in any proceeding.
It maybe argued that the seeming acquiescence of Arellano to the search constitutes an implied waiver of petitioner's right to question the reasonableness of the search of the vehicle and the seizure of the firearms.
While Resolution No. 2327 authorized the setting up of checkpoints, it however stressed that "guidelines shall be made to ensure that no infringement of civil and political rights results from the implementation of this authority," and that "the places and manner of setting up of checkpoints shall be determined in consultation with the Committee on Firearms Ban and Security Personnel creatd under Sec. 5, Resolution No. 2323."28 The facts show that PNP installed the checkpoint at about five o'clock in the afternoon of 13 January 1992. The search was made soon thereafter, or thirty minutes later. It was not shown that news of impending checkpoints without necessarily giving their locations, and the reason for the same have been announced in the media to forewarn the citizens. Nor did the informal checkpoint that afternoon carry signs informing the public of the purpose of its operation. As a result, motorists passing that place did not have any inkling whatsoever about the reason behind the. instant exercise. With the authorities in control to stop and search passing vehicles, the motorists did not have. any choice but to submit to the PNP's scrutiny. Otherwise, any attempt to turnabout albeit innocent would raise suspicion and provide probable cause for the police to arrest the motorist and to conduct an extensive search of his vehicle.
In the case of petitioner, only his driver was at the at that time it was stopped for inspection. As conceded by COMELEC, driver Arellano did not know the purpose of the checkpoint. In the face of fourteen (14) armed policemen conducting the operation,29 driver Arellano being alone and a mere employee of petitioner could not have marshalled the strength and the courage to protest against the extensive search conducted in the vehicle. In such scenario, the "implied acquiescence," if there was any, could not be more than a mere passive conformity on Arellano's part to the search, and "consent" given under intimidating or coercive circumstances is no consent within the purview of the constitutional guaranty.
Moreover, the manner by which COMELEC proceeded against petitioner runs counter to the due process clause of the Constiution. The facts show that petitioner was not among those charged by the PNP with violation of the Omnibus Election Code. Nor was he subjected by the City Prosecutor to a preliminary investigation for such offense. The non-disclosure by the City Prosecutor to the petitioner that he was a respondent in the preliminary investigation is violative of due process which requires that the procedure established by law should be obeyed.30
COMELEC argues that petitioner was given the chance to be heard because he was invited to enlighten the City Prosecutor regarding the circumstances leading to the arrest of his driver, and that petitioner in fact submitted a sworn letter of explanation regarding the incident. This does not satisfy the requirement of due process the essence of which is the reasonable opportunity to be heard and to submit any evidence one may have in support of his defense.31 Due process guarantees the observance of both substantive and procedural rights, whatever the source of such rights, be it the Constitution itself or only a ntatute or a rule of court.32 In Go v. Court of Appeals,33 we held that
While the right to preliminary investigationis statutory rather than constitutional in its fundament, since it has in fact been established by statute, it is a component part of due process in criminal justice, The right to have a preliminary investigation conducted before being bound over to trial for a criminal offense and hence formally at risk of incarceration or some other penalty is not a mere formal or technical right; it is a substantive right x x x x [T]he right to an opportunity to avoid a process painful to anyone save, perhaps, to hardened criminals is avaluable right. To deny petitioner's claim to a preliminary investigation would be to deprive him of the full measure of his right to due process. Apparently, petitioner was merely invited during the prelimiinary investigation of Arellano to corroborate the latter's explanation. Petitioner then was made to believe that he was not a party respondent in the case, so that his written explanation on the incident was only intended to exculpate Arellano, not petitioner himself. Hence, it cannot be seriously contended that petitioner was fully given the opportunity to meet the accusation against him as he was not apprised that he was himself a respondent when he appeared before the City Prosecutor.
Finally, it must be pointed out too that petitioner's filing of a motion for reconsideration with COMELEC cannot be considered as a waiver of his claim to a separate preliminary investigation for himself. The motion itself expresses petitioner's vigorous insistence on his right. Petitioner's protestation started as soon as he learned of his inclusion in the charge, and did not case up even after COMELEC's denial of his motion for reconsideration. This is understandably so since the prohibition against carrying firearms bears the penalty of imprisonment of not less than one (1) year nor more than six (6) years without probation and with disqualification from holding public office, and deprivation of the right to suffrage. Against such strong stance, petitioner clearly did not waive his right to a preliminary investigation.
WHEREFORE, the instant petition is GRANTED. The warrantless search conducted by the Philippine National Police on 13 January 1992 is declared illegal and the firearms seized during the warrantless search cannot be used as evidence in any proceeding against petitioner. Consequently, COMELEC Resolution No. 92-0829 dated 6 April 1992 being violative of the Constitution is SET ASIDE.
The temporary restraining order we issued on 5 May 1992 is made permanent.
SO ORDERED.
Narvasa (C.J.), Romero, Quiason, Puno, Kapunan and Mendoza, JJ., concur.
Cruz, J., See concurring opinion.
Feliciano, Padilla and Bidin, JJ., are on leave.
Separate Opinions
CRUZ, J., concurring:
I concur, and reiterate my objections to checkpoints in general as originally expressed in my dissent in the case of Valmonte v. De Villa, 178 SCRA 217, where I said:
The sweeping statements in the majority opinion are as dangerous as the checkpoints it would sustain and fraught with serious threats to individual liberty. The bland declaration that individual rights must yield to the demands of national security ignores the fact that the Bill of Rights was intended precisely to limit the authority of the State even if asserted on the ground of national security. What is worse is that the searches and seizures are peremptorily pronounced to be reasonable even without proof of probable cause and much less the required warrant. The improbable excuse is that they are aimed at "establishing an effective territorial defense, maintaining peace and order, and providing an atmosphere conducive to the social, economic and political development of the National Capital Region." For these purposes, every individual may be stopped and searched at random and at any time simply because he excites the suspicion, caprice, hostility or malice of the officers manning the checkpoints, on pain of arrest or worse, even being shot to death, if he resists. xxx xxx xxx
Unless we are vigilant of our rights, we may find ourselves back to the dark era of the truncheon and the barbed wire, with the Court itself a captive of its own complaisance and sitting at the death-bed of liberty.
I hope the colleagues I have behind on my retirement will reconsider the stand of the Court on checkpoints and finally dismantle them altogether as an affront to individual liberty.
REGALADO, J., concurring and dissenting:
I join Mr. Justice Davide, Jr. in his opinion wherein he concurs with the majority ruling that with respect to petitioner Aniag, Resolution No. 92-0829 of respondent commission should be set aside, not because of an unconstitutional warrantless search but by reason of the fact that he was not actually charged as a respondent in the preliminary investigation of the case.
With regard to petitioner's driver, Ernesto Arellano, although he was not impleaded as a co- petitioner in the present recourse, the nullification of said Resolution No. 92-0829 necessarily applies to him and redounds to his benefit. To the extent, therefore, that the majority opinion thereby reinstates the resolution of the Office of the City Prosecutor dismissing the charge against Arellano, I concur in that result.
However, even as a simple matter of consistency but more in point of law, I dissent from the rationale submitted therefor, that is, that Arellano was the victim of an unlawful search without a warrant. The pertinent facts stated by the majority readily yield the conclusion that there was consent on the part of Arellano to the search of the car then under his control, particularly of its baggage compartment where the firearms were discovered. As held in People vs. Excela, et al.,1 consent to a search may be given expressly or impliedly, and as early as People vs. Malasugui, 2 the settled rule is that a search may be validly conducted without a warrant if the person searched consented thereto. I would prefer to sustain the exonertion of Ernesto Arellano on the justifying circumstance that he was acting in obedience to what he innocently believed to be a lawful order of a superior, that is, the instructions of his employer, petitioner Aniag, who was himself acting upon and in compliance with Resolution No. 2323 of respondent commission which was implemented by the Sergeant-at-Arms of the House of Representatives.
The said justifying circumstance provided in paragraph 6, Article 11 of the Revised Penal Code can be given suppletory effect to special laws like B.P. Blg. 881 and R.A. No. 7166 by force of Article 10 of the same Code. There is no prohibition therefor in the cited provisions of B.P. Blg. 881 in relation to R.A. No. 7166, nor is there any legal impossibility for such suppletory application whether by express provision or by necessary implication. And even if the order of petitioner Aniag may be considered as illegal, Arellano acted thereon in good faith 3 and under a mistake of fact as to its legality, hence its exculpation is ineludibly dictated. Ignorantia facti excusat.
It being evident from the very seconds and the factual findings adopted in the majority opinion that no error was committed by the Office of the City Prosecutor in dismissing the charge against Ernesto Arellano for lack of sufficient grounds to engender a well founded belief that a crime had been committed and that he was probably guilty thereof, 4 respondent commission acted with grave abuse of discretion in arriving at a contrary conclusion and directing his prosecution in its Resolution No. 92-0829.
DAVIDE, J., concurring and dissenting:
I regret that I can concur only in the result, viz., the granting of the petition.
Considering the specific issues raised by the petitioner which, as stated in the exordium of the majority opinion, are whether (a) COMELEC Resolution No. 2327, dated 26 December 1991, is unconstitutional, and (b) COMELEC Resolutions No. 92-0829, dated 6 April 1992, and No. 92- 0999, dated 23 April 1992, have legal and factual bases, I am unable to agree with the specific disposition declaring (a) illegal the warrantless search conducted by the Philippine National Police (PNP) on 13 January 1992, (b) inadmissible in evidence in any proceeding against the petitioner the firearms seized during such warrantless search, and (c) unconstitutional COMELEC Resolution No. 92-0829.
1. Having declined to rule on the constitutionality of Resolution No. 2327 because "this petition may be resolved without passing upon this particular issue" (first paragraph, page 10, Ponencia), this Court may no longer inquire into the constitutionality of the spot checkpoints authorized to be established thereunder. And whether the warrantless search conducted by the PNP at the checkpoint was valid, it being assumed that it would have been, provided there existed a probable cause thereof, is a question of fact whose presentation in this case is either procedurally premature, or one which this Court cannot, with definiteness, resolve considering the obvious paucity of the facts before it. The most the majority opinion can state is that "[t]here was no evidence to show that the police were impelled to do so because of a confidential report leading them to reasonably believe that certain motorists matching the description furnished by their informant were engaged in gunrunning, transporting firearms or in organizing special strike forces. Nor, as adverted to earlier, was there any indication from the package or behavior of Arellano that could have triggered the suspicion of the policemen." Nothing more could be expected at this stage since the records of the proceedings conducted by the Office of the City Prosecutor and the COMELEC are not before this Court. A declaration of invalidity of the warrantless search and of the inadmissibility in evidence of the firearms seized would thus be premature.
It may additionally be relevant to state that the search was not in connection with the crime of illegal possession of firearms, which would have been factually and legally baseless since the firearms involved were licensed and were duly issued to the petitioner by the House of Representatives, but for the violation of the gun ban which was validly decreed by the COMELEC pursuant to its constitutional power to enforce and administer all laws and regulations relative to the conduct of elections, plebiscite, initiative, referendum, and recall (Section 2(1), Article IX-C, 1987 Constitution), its statutory authority to have exclusive charge of the enforcement and administration of all laws relative to the conduct of elections for the purpose of ensuring free, orderly, and honest elections (Section 52, Omnibus Election Code), and its statutory authority to promulgate rules and regulations implementing the provisions of the Omnibus Election Code or other laws which the COMELEC is required to enforce and administer (Section 52(c), Id.; Section 35, R.A. No. 7166), in relation to paragraph (q), Section 261 of the Omnibus Election Code which prohibits the carrying of firearms outside the residence or place of business during the election period unless authorized in writing by the COMELEC, and Section 32 of R.A. No. 7166 which prohibits any person from bearing, carrying, or transporting firearms or other deadly weapons in public places, including any building, street, park, private vehicle, or public conveyance, even if such person is licensed to possess or carry the same during the election period, unless authorized in writing by the COMELEC.
In this case, the petitioner himself admits that on 10 January 1992 he was requested by the Sergeant-at-Arms of the House of Representatives to return the two firearms issued to him, and that on 13 January 1992, he instructed his driver, Ernesto Arellano, to pick up the firearms from his (petitioner's) house at Valle Verde and to return them to the House of Representatives. That day was already within the election period, which commenced the day earlier pursuant to COMELEC Resolution No. 2314 (In The Matter of Fixing The Schedule of Activities in Connection With the Elections of National and Local Officials on May 11, 1992), promulgated on 20 November 1991. Considering then that the offense for which he was to be charged was for the violation of paragraph (q), Section 261 of the Omnibus Election Code, in relation to Section 32 of R.A. No. 7166, which, in view of his aforesaid admissions, renders unnecessary the offer in evidence of the seized firearms, I fail to grasp the rationale of a ruling on the admissibility in evidence of the firearms.
2. COMELEC Resolution No. 92-0829, dated 6 April 1992, should not be set aside on the ground of unconstitutionality. It simply directed the filing of an information against the petitioner and Arellano for the violation of paragraph (q), Section 261 of the Omnibus Election Code, in relation to Section 32 of R.A. No. 7166, and directed the petitioner to show cause why he should not be disqualified from running for an elective position, pursuant to COMELEC Resolution No. 2327, in relation to Sections 32, 33, and 35 of R.A. No. 7166 and paragraph (c), Section 52 of the Omnibus Election Code. Insofar as Arellano is concerned, he is not a petitioner in this case. Moreover, as to him, the resolution was nothing more than a disapproval of the recommendation of the Office of the City Prosecutor to dismiss the complaint against him. As against the petitioner, there was no denial of due process because the petitioner was later heard on his motion for reconsideration. Moreover, the right of an accused to a preliminary investigation is not a creation of the Constitution; its origin is statutory (Kilusang Bayan sa Paglilingkod ng mga Magtitinda ng Bagong Pamilihang Bayan ng Muntinglupa, Inc. vs. Dominguez 205 SCRA 92 [1992]).
The fatal flaw of Resolution No. 92-0829 lies in its directive to file the information against the petitioner despite the fact that he was never formally charged before the Office of the City Prosecutor. There was only an "'unofficial' charge imputed against" him. The COMELEC then acted with grave abuse of discretion amounting to want or excess of jurisdiction.
I vote then to grant the petition, but solely on the ground that the COMELEC acted with grave abuse of discretion in directing the filing of an information against the petitioner for the violation of paragraph (q), Section 261 of the Omnibus Election Code, in relation to Section 32 of R.A. No. 7166.
Melo, J., concur and dissent.
VITUG, J., concurring:
The ultimate hypothesis of sound governance is not might but the willingness of the governed to accept and subordinate themselves to authority.
When our people gave their consent to the fundamental law of the land, they did not renounce but, to the contrary, reserved for themselves certain rights that they held sacred and inviolable. One such right is the privilege to be so secured "in their persons, houses, papers, and effects against unreasonable searches and seizures of whatever nature and for any purpose." Their sole conceded proviso to this rule is when a search warrant or a warrant of arrest is lawfully issued. There are, to be sure, known exceptions, predicated on necessity and justified by good reasons, when warrantless searches and seizures are allowed. It is in this context that I appreciate the ratio decidendi of the Court in Valmonte vs. De Villa (178 SCRA 211). In giving its imprimatur to the installation of checkpoints, the Court clearly has based its decision on the existence at the time of what has been so described as an "abnormal" situation that then prevailed. Evidently, the Court did not have the intention to have its ruling continue to apply to less aberrant circumstances than previously obtaining.
The question has been asked: Between the security of the State and its due preservation, on the one hand, and the constitutionally-guaranteed right of an individual, on the other hand, which should be held to prevail? There is no choice to my mind not for any other reason than because there is, in the first place, utterly no need to make a choice. The two are not incompatible; neither are they necessarily opposed to each other. Both can be preserved; indeed, the vitality of one is the strength of the other.
There should be ways to curb the ills of society so severe as they might seem. A disregard of constitutional mandates or an abuse on the citizenry, I am most certain, is not the answer. It might pay to listen to the words of Mr. Justice Isagani A. Cruz when he said, "(u)nless we are vigilant of our rights, we may find ourselves back to the dark era of the truncheon and the barbed wire, with the Court itself a captive of its own complaisance and sitting at the death-bed of liberty."
It is a welcome note that in the subsequent case of Bagalihog vs. Fernandez (198 SCRA 614), the Court has expressed:
"This guaranty is one of the greatest of individual liberties and was already recognized even during the days of the absolute monarchies, when the king could do no wrong. On this right, Cooley wrote: "Awe surrounded and majesty clothed the King, but the humblest subject might shut the door of his cottage against him and defend from intrusion that privacy which was as sacred as the kingly prerogatives.
"The provision protects not only those who appear to be innocent but also whose who appear to be guilty but are nevertheless to be presumed innocent until the contrary is proved. The mere fact that in the private respondent's view the crime involved is 'heinous' and the victim was 'a man of consequence' did not authorize disregard of the constitutional guaranty. Neither did 'superior orders' condone the omission for they could not in any case be superior to the Constitution." While it gives me great comfort to concur with my esteemed colleague, Mr. Justice Josue N. Bellosillo, in his ponencia, I would express, nonetheless, the humble view that even on the above constitutional aspect, the petition could rightly be granted.
1. Rollo, p. 56.
2. Id., p. 35.
3. One (1) 9 mm SN U164076 P-256 and one (1) Berotta 9 mm Para SN-39721 SMC, Rollo, p. 79.
4. Rollo, pp. 74 -75.
5. Id., pp. 77-78.
6. Id., pp. 91-94.
7. Sec. 261, Prohibited Acts.- The following shall be guilty of an election offense: x x x (q) ) Carrying firearms outside residence or price of business. Any person, although possessing a permit to carry firearms, carries any firearms outside his residence or place of business during the election period, unless authorized in writing by the Commission: Provided, That a motor vehicle, water or aircraft shall not be considered a residence or place of business or extension hereof . . . (B.P. Blg. 88.1).
Sec. 32. Who May Bear Firearms. - During the election period, no person shall bear, carry or transport firearms or other deadly weapons in public places, including any building, street, park, private vehicle or public conveyance, even if licensed to possess or carry the same, unless authorized in writing by the Commission. The issuance of firearm licenses shall be suspended during the election period . . . (R.A. No. 7166).
Sec. 33. Security Personnel and Bodyguards. - During the election period, no candidate for public office, including incumbent public officers seeking election to any public office, shall employ, avail himself of or engage the services of security personnel or bodyguards, whether or not such bodyguards are regular members or officers of the Philippine National Police, the Armed Forces of the Philippines or other law enforcement agency of the Government . . . (ibid.)
Sec. 35. Rules and Regulations. - The Commission shall issue rules and regulations to implement this Act. Said rules shall be published in at least two (2) national newspapers of general circulation (ibid.)
Sec. 52. Powers and functions of the Commission on Elections. - In addition to the powers and functions conferred upon it by the Constitution, the Commission shall have exclusive charge of the enforcement and administration of all laws relative to the conduct of elections for the purpose of ensuring free, orderly and honest elections, and shall . . . (c) Promulgate rules and regulations implementing the provision of this Code or other laws which the Commission is required to enforce and administer, and require the payment of legal fees and collect the same in payment of any business done in the Commission, at rates that it may provide and fix in its rules and regulations . . . (B.P. Blg. 881).
8. Rollo, pp. 38-39.
9. Id.F 881. .
10. Id ., p. 40.
11. Art. 111, Sec. 2. The right of the people to be secure In their persons, houses, papers, and effects against unreasonable searches and seizures of whatever nature and for any purpose shall be inviolable, and no search warrant or warrant of arrest shall issue except upon probable cause to be determined personally by the judge after examination under oath or affirmation of the complainant and the witnesses he may produce, and particularly describing the place to be searched and the persons or things to be seized.
Sec. 3, par. (2). Any evidence obtained in violation of this or the preceding section shall be inadmissible for any purpose in any proceeding.
12. Id., pp. 18-30.
13. Id., p. 110.
14. Id., p. 128.
15. Id., pp. 121-125.
16. See Alger Electric, Inc. v. Court of Appeals, L-34298, 28 February 1985, 135 SCRA 37, 45; Arrastre Security Association-TUPAS v. Ople, L-45344, 20 February 1984,127 SCRA 580,595.
17. People v. Bagista, G.R. No. 86218, 18 September 1992, 214 SCRA 63, 68-69.
18. Valmonte v. de Villa, G.R. No. 83988, 24 May 1990, 185 SCRA 665, 669, see also concurring opinion of Justice Gutierrez, Jr., pp. 672-673, and dissenting opinions of Justice Cruz, pp. 173- 174, and Justice Sarmiento, pp. 174-175.
19. Id., p. 670; People v. Bagista, supra.
20. See Valmonte v. De Villa, G.R. No. 83988, 29 September 1989, 178 SCRA 211, 216. 21. People v. Malmstedt, G.R. No. 91107, 19 June 1991, 198 SCRA 401, 408, citing People v. Claudio, G.R. No. 72564, 15 April 1988, 160 SCRA 646, People v. Tangliben, G.R. No. 63630, 6 April 1990, 184 SCRA 220, and Posadas v. Court of Appeals, G.R. No. 83139, 2 August 1990, 188 SCRA 288, see also dissenting opinion of Justice Cruz, pp. 410-412, and concurring and dissenting opinion of Justice Narvasa, now Chief Justice, pp. 412-424.
22. People v. Maspel, Jr., G.R. No. 85177, 20 August 1990, 188 SCRA 751.
23. People v. Lo He Wing, G.R. No. 88017, 21 January 1991, 193 SCRA. 122.
24. People v. Malmstedt, ibid.
25. People v. Bagista, supra p. 10.
26. People v. Exala, G. R. No. 6005, 23 April 1993, 221 SCRA 494;502. -503.
27. People v. Saycon, G.R. No, 110995, 5 September 1994.
28. Rollo, P. 36.
29. Rollo, p. 69.
30. United States v. Ocampo, 18 Phil. 1,41 (1910).
31. See Mutuc v. Court of Appeals, No. L-48108, 26 September 1990, 190 SCRA 43, 49.
32. See Tupas v. Court of Appeals, G.R. No 89571, 6 February 1991, 193 SCRA 597.
33. GR No. 101837, 11 February 199, 206 SCRA 138,153, italics ours.
REGALADO, J., concurring and dissenting:
1. G.R. No. 76005 April 23, 1993, 221 SCRA 494.
2. 63 Phil. 221 (1936).
3. People vs. Beronilla, et al., 96 Phil. 566 (1955).
4. Sec. 1, Rule 112, 1985 Rules of Criminal Procedure, as amended.
Javier vs. COMELEC
September 22, 1986
EN BANC
[GRN L-68379-81 September 22, 1986.*]
EVELIO B. JAVIER, petitioner, vs. THE COMMISSION ON ELECTIONS, and ARTURO F. PACIFICADOR, respondents.
Raul S. Roco and Lorna Patajo-Kapunan for petitioner.
D E C I S I O N
CRUZ, J :
The new Solicitor General has moved to dismiss this petition on the ground that as a result of supervening events it has become moot and academic. It is not as simple as that, Several lives have been lost in connection with this case, including that of the petitioner himself. The private respondent is now in hiding. The purity of suffrage has been defiled and the popular will scorned through a confabulation of those in authority. This Court cannot keep silent in the face of these terrible facts. The motion is denied.
The petitioner and the private respondent were candidates in Antique for the Batasang Pambansa in the May 1984 elections. The former appeared to enjoy more popular support but the latter had the advantage of being the nominee of the KBL with all its perquisites of power. On May 13, 1984, the eve of the elections, the bitter contest between the two came to a head when several followers of the petitioner were ambushed and killed, allegedly by the latter's men. Seven suspects, including respondent Pacificador, are now facing trial for these murders. The incident naturally heightened tension in the province and sharpened the climate of fear among the electorate. Conceivably, it intimidated voters against supporting the Opposition candidate or into supporting the candidate of the ruling party.
It was in this atmosphere that the voting was held, and the post-election developments were to run true to form. Owing to what he claimed were attempts to railroad the private respondent's proclamation, the petitioner went to the Commission on Elections to question the canvass of the election returns. His complaints were dismissed and the private respondent was proclaimed winner by the Second Division of the said body. The petitioner thereupon came to this Court, arguing that the proclamation was void because made only by a division and not by the Commission on Elections en banc as required by the Constitution. Meanwhile, on the strength of his proclamation, the private respondent took his oath as a member of the Batasang Pambansa.
The case was still being considered by this Court when on February 11, 1986, the petitioner was gunned down in cold blood and in broad daylight. The nation, already indignant over the obvious manipulation of the presidential elections in favor of Marcos, was revolted by the killing, which flaunted a scornful disregard for the law by the assailants who apparently believed they were above the law. This ruthless murder was possibly one of the factors that strengthened the cause of the Opposition in the February revolution that toppled the Marcos regime and installed the present government under President Corazon C. Aquino.
The abolition of the Batasang Pambansa and the disappearance of the office in dispute between the petitioner and the private respondent - both of whom have gone their separate ways - could be a convenient justification for dismissing this case. But there are larger issues involved that must be resolved now, once and for all, not only to dispel the legal ambiguities here raised. The more important purpose is to manifest in the clearest possible terms that this Court will not disregard and in effect condone wrong on the simplistic and tolerant pretext that the case has become moot and academic.
The Supreme Court is not only the highest arbiter of legal questions but also the conscience of the government. The citizen comes to us in quest of law but we must also give him justice. The two are not always the same. There are times when we cannot grant the latter because the issue has been settled and decision is no longer possible according to the law. But there are also times when although the dispute has disappeared, as in this case, it nevertheless cries out to be resolved. Justice demands that we act then, not only for the vindication of the outraged right, though gone, but also for the guidance of and as a restraint upon the future.
It is a notorious fact decried by many people and even by the foreign press that elections during the period of the Marcos dictatorship were in the main a desecration of the right of suffrage. Vote-buying, intimidation and violence, illegal listing of voters, falsified returns, and other elections anomalies misrepresented and vitiated the popular will and led to the induction in office of persons who did not enjoy the confidence of the sovereign electorate. Genuine elections were a rarity. The price at times was human lives. The rule was chicanery and irregularity, and on all levels of the polls, from the barangay to the presidential. This included the rigged plebiscites and referenda that also elicited the decision and provoked the resentments of the people.
Antique in 1984 hewed to the line and equaled if it did not surpass the viciousness of elections in other provinces dominated by the KBL. Terrorism was a special feature, as demonstrated by the killings previously mentioned, which victimized no less than one of the main protagonists and implicated his rival as a principal perpetrator. Opposition leaders were in constant peril of their lives even as their supporters were gripped with fear of violence at the hands of the party in power.
What made the situation especially deplorable was the apparently indifferent attitude of the Commission on Elections toward the anomalies being committed. It is a matter of record that the petitioner complained against the terroristic acts of his opponents. All the electoral body did was refer the matter to the Armed Forces without taking a more active step as befitted its constitutional role as the guardian of free, orderly and honest elections. A more assertive stance could have averted the Sibalom election eve massacre and saved the lives of the nine victims of the tragedy.
Public confidence in the Commission on Elections was practically nil because of its transparent bias in favor of the administration. This prejudice left many opposition candidates without recourse except only to this Court.
Alleging serious anomalies in the conduct of the elections and the canvass of the election returns, the petitioner went to the Commission on Elections to prevent the impending proclamation of his rival, the private respondent herein. 1 Specifically, the petitioner charged that the elections were marred by "massive terrorism, intimidation, duress, vote-buying, fraud, tampering and falsification of election returns under duress, threat and intimidation, snatching of ballot boxes perpetrated by the armed men of respondent Pacificador." 2 Particular mention was made of the municipalities of Caluya, Cabate, Tibiao, Barbaza, Laua-an, and also of San Remigio, where the petitioner claimed the election returns were not placed in the ballot boxes but merely wrapped in cement bags or manila paper.
On May 18, 1984, the Second Division of the Commission on Elections directed the provincial board of canvassers of Antique to proceed with the canvass but to suspend the proclamation of the winning candidate until further orders. 3 On June 7, 1984, the same Second Division ordered the board to immediately convene and to proclaim the winner without prejudice to the outcome of the case before the Commission. 4 On certiorari before this Court, the proclamation made by the board of canvassers was set aside as premature, having been made before the lapse of the 5-day period of appeal, which the petitioner had seasonably made. 5 Finally, on July 23, 1984, the Second Division promulgated the decision now subject of this petition which inter alia proclaimed Arturo F. Pacificador the elected assemblyman of the province of Antique.
This decision was signed by Chairman Victoriano Savellano and Commissioners Jaime Opinion and Froilan M. Bacungan. Previously asked to inhibit himself on the ground that he was a former law partner of private respondent Pacificador, Opinion had refused.
The petitioner then came to this Court, asking us to annul the said decision. The core question in this case is one of jurisdiction, to wit: Was the Second Division of the Commission on Elections authorized to promulgate its decision of July 23, 1984, proclaiming the private respondent the winner in the election?
The applicable provisions are found in Article XII-C, Sections 2 and 3, of the 1973 Constitution.
Section 2 confers on the Commission on Elections the power to:
"(2) Be the sole judge of all contests relating to the election, returns and qualifications of all member of the Batasang Pambansa and elective provincial and city officials."
Section 3 provides:
"The Commission on Elections may sit en banc or in three divisions. All election cases may be heard and decided by divisions except contests involving members of the Batasang Pambansa, which shall be heard and decided en banc. Unless otherwise provided by law, all election cases shall be decided within ninety days from the date of their submission for decision."
While both invoking the above provisions, the petitioner and the respondents have arrived at opposite conclusions. The records are voluminous and some of the pleadings are exhaustive and in part even erudite. And well they might be, for the noble profession of the law - despite all the canards that have been flung against it - exerts all efforts and considers all possible viewpoints in its earnest search of the truth.
The petitioner complains that the proclamation made by the Second Division is invalid because all contests involving the members of the Batasang Pambansa come under the jurisdiction of the Commission on Elections en banc. This is as it should be, he says, to insure a more careful decision, considering the importance of the offices involved. The respondents, for their part, argue that only contests need to be heard and decided en banc and all other cases can be - in fact, should be - filed with and decided only by any of the three divisions.
The former Solicitor General makes much of this argument and lays a plausible distinction between the terms "contests" and "cases" to prove his point. 8 Simply put, his contention is that the pre-proclamation controversy between the petitioner and the private respondent was not yet a contest at that time and therefore could be validly heard by a mere division of the Commission on Elections, consonant with Section 3. The issue was at this stage still administrative and so was resoluble by the Commission under its power to administer all laws relative to the conduct of elections, 9 not its authority as sole judge of the election contest.
A contest, according to him, should involve a contention between the parties for the same office "in which the contestant seeks not only to oust the intruder but also to have himself inducted into the office." 10 No proclamation had as yet been made when the petition was filed and later decided. Hence, since neither the petitioner nor the private respondent had at that time assumed office, there was no Member of the Batasang Pambansa from Antique whose election, returns or qualifications could be examined by the Commission on Elections en banc.
In providing that the Commission on Elections could act in division when deciding election cases, according to this theory, the Constitution was laying down the general rule. The exception was the election contest involving the members of the Batasang Pambansa, which had to be heard and decided en banc. 11 The en banc requirement would apply only from the time a candidate for the Batasang Pambansa was proclaimed as winner, for it was only then that a contest could be permitted under the law. All matters arising before such time were, necessarily, subject to decision only by division of the Commission as these would come under the general heading of "election cases."
As the Court sees it, the effect of this interpretation would be to divide the jurisdiction of the Commission on Elections into two, viz.: (1) over matters arising before the proclamation, which should be heard and decided by division in the exercise of its administrative power; and (2) over matters arising after the proclamation, which could be heard and decided only en banc in the exercise of its judicial power. Stated otherwise, the Commission as a whole could not act as sole judge as long as one of its divisions was hearing a pre-proclamation matter affecting the candidates for the Batasang Pambansa because there was as yet no contest; or to put it still another way, the Commission en banc could not do what one of its divisions was competent to do, i.e., decide a pre-proclamation controversy. Moreover, a mere division of the Commission on Elections could hear and decide, save only those involving the election, returns and qualifications of the members of the Batasang Pambansa, all cases involving electiveprovincial and city officials from start to finish, including pre-proclamation controversies and up to the election protest, In doing so, it would exercise first administrative and then judicial powers. But in the case of the Commission en banc, its jurisdiction would begin only after the proclamation was made and a contest was filed and not at any time and on any matter before that, and always in the exercise only of judicial power.
This interpretation would give to the part more powers than were enjoyed by the whole, granting to the division while denying to the banc. We do not think this was the intention of the Constitution. The framers could not have intended such an irrational rule.
We believe that in making the Commission on Elections the sole judge of all contests involving the election, returns and qualifications of the members of the Batasang Pambansa and elective provincial and city officials, the Constitution intended to give it full authority to hear and decide these cases from beginning to end and on all matters related thereto, including those arising before the proclamation of the winners. It is worth observing that the special procedure for the settlement of what are now called "pre- proclamation controversies" is a relatively recent innovation in our laws, having been introduced only in 1978, through P.D. No. 1296, otherwise known as the 1978 Election Code. Section 175 thereof provided:
"Sec. 175. Suspension and annulment of proclamation. - The Commission shall be the sole judge of all pre-proclamation controversies and any of its decisions, orders or rulings shall he final and executory. It may, motu proprio or upon written petition, and after due notice and hearing order the suspension of the proclamation of a candidate-elect or annul any proclamation, if one has been made, on any of the grounds mentioned in Sections 172, 173 and 174 thereof."
Before that time all proceedings affecting the election, returns and qualifications of public officers came under the complete jurisdiction of the competent court or tribunal from beginning to end and in the exercise of judicial power only. It therefore could not have been the intention of the framers in 1935, when the Commonwealth Charter was adopted, and even in 1973, when the past Constitution was imposed, to divide the electoral process into the pre- proclamation stage and the post-proclamation stage and to provide for a separate jurisdiction for each stage, considering the first administrative and the second judicial.
Besides, the term "contest" as it was understood at the time Article XII-C, Section 2(2) was incorporated in the 1973 Constitution did not follow the strict definition of a contention between the parties for the same office. Under the Election Code of 1971, which presumably was taken into consideration when the 1973 Constitution was being drafted, election contests included the quo warranto petition that could be filed by any voter on the ground of disloyalty or ineligibility of the contestee although such voter was himself not claiming the office involved.
The word "contests" should not be given a restrictive meaning; on the contrary, it should receive the widest possible scope conformably to the rule that the words used in the Constitution should be interpreted liberally. As employed in the 1973 Constitution, the term should be understood as referring to any matter involving the title or claim of title to an elective office, made before or after proclamation of the winner, whether or not the contestant is claiming the office in dispute. Needless to stress, the term should be given a consistent meaning and understood in the same sense under both Section 2(2) and Section 3 of Article XII- C of the Constitution.
The phrase "election, returns and qualifications" should be interpreted in its totality as referring to all matters affecting the validity of the contestee's title. But if it is necessary to specify, we can say that "election" referred to the conduct of the polls, including the listing of voters, the holding of the electoral campaign, and the casting and counting of the votes; "returns" to the canvass of the returns and the proclamation of the winners, including questions concerning the composition of the board of canvassers and the authenticity of the election returns; and "qualifications" to matters that could be raised in a quo warranto proceeding against the proclaimed winner, such as his disloyalty or ineligibility or the inadequacy of his certificate of candidacy.
All these came under the exclusive jurisdiction of the Commission on Elections insofar as they applied to the members of the defunct Batasang Pambansa and, under Article XII-C, Section 3, of the 1973 Constitution, could be heard and decided by it only en banc.
We interpret "cases" as the generic term denoting the actions that might be heard and decided by the Commission on Elections, only by division as a general rule except where the case was a "contest" involving members of the Batasang Pambansa, which had to be heard and decided en banc.
As correctly observed by the petitioner, the purpose of Section 3 in requiring that cases involving members of the Batasang Pambansa be heard and decided by the Commission en banc was to insure the most careful consideration of such cases. Obviously, that objective could not be achieved if the Commission could act en banc only after the proclamation had been made, for it might then be too late already. We are all-too-familiar with the grab-the- proclamation-and-delay-the-protest strategy of many unscrupulous candidates which has resulted in the frustration of the popular will and the virtual defeat of the real winners in the election. The respondent's theory would make this gambit possible for the pre-proclamation proceedings, being summary in nature, could be hastily decided by only three members in division, without the care and deliberation that would have otherwise been observed by the Commission en banc.
After that, the delay. The Commission en banc might then no longer be able to rectify in time the proclamation summarily and not very judiciously made by the division. While in the end the protestant might be sustained, he might find himself with only a Phyrric victory because the term of his office would have already expired.
It may be argued that in conferring the initial power to decide the pre-proclamation question upon the division, the Constitution did not intend to prevent the Commission en banc from exercising the power directly, on the theory that the greater power embraces the lesser. It could if it wanted to but then it could also allow the division to act for it. That argument would militate against the purpose of the provision, which precisely limited all questions affecting the election contest, as distinguished from election cases in general, to the jurisdiction of the Commission en banc as sole judge thereof. "Sole judge" excluded not only all other tribunals but also and even the division of the Commission. A decision made on the contest by less than the Commission en banc would not meet the exacting standard of care and deliberation ordained by the Constitution.
Incidentally, in making the Commission the "sole judge" of pre-proclamation controversies in Section 175, supra, the law was obviously referring to the body sitting en banc. In fact, the pre- proclamation controversies involved in Aratuc vs. Commission on Elections, 13 where the said provision was applied, were heard and decided en banc.
Another matter deserving the highest consideration of this Court but accorded cavalier attention by the respondent Commission on Elections is due process of law, that ancient guaranty of justice and fair play which is the hallmark of the free society. Commissioner Opinion ignored it. Asked to inhibit himself on the ground that he was formerly a law partner of the private respondent, he obstinately insisted on participating in the case, denying he was biased.
Given the general attitude of the Commission on Elections toward the party in power at the time, and the particular relationship between Commissioner Opinion and MP Pacificador, one could not be at least apprehensive, if not certain, that the decision of the body would be adverse to the petitioner. As in fact it was. Commissioner Opinion's refusal to inhibit himself and his objection to the transfer of the case to another division cannot be justified by any criterion of propriety. His conduct on this matter belied his wounded protestations of innocence and proved the motives of the Second Division when it rendered its decision.
This Court has repeatedly and consistently demanded "the cold neutrality of an impartial judge" as the indispensable imperative of due process. 15 To bolster that requirement, we have held that the judge must not only be impartial but must also appear to be impartial as an added assurance to the parties that his decision will be just. 16 The litigants are entitled to no less than that. They should be sure that when their rights are violated they can go to a judge who shall give them justice. They must trust the judge, otherwise they will not go to him at all. They must believe in his sense of fairness, otherwise they will not seek his judgment. Without such confidence, there would be no point in invoking his action for the justice they expect.
Due process is intended to insure that confidence by requiring compliance with what Justice Frankfurter calls the rudiments of fair play. Fair play calls for equal justice. There cannot be equal justice where a suitor approaches a court already committed to the other party and with a judgment already made and waiting only to be formalized after the litigants shall have undergone the charade of a formal hearing. Judicial (and also extrajudicial) proceedings are not orchestrated plays in which the parties are supposed to make the motions and reach the denouement according to a prepared script. There is no writer to foreordain the ending. The judge will reach his conclusions only after all the evidence is in and all the arguments are filed, on the basis of the established facts and the pertinent law. The relationship of the judge with one of the parties may color the facts and distort the law to the prejudice of a just decision. Where this is probable or even only possible, due process demands that the judge inhibit himself, if only out of a sense of delicadeza. For like Caesar's wife, he must be above suspicion. Commissioner Opinion, being a lawyer, should have recognized his duty and abided by this well-known rule of judicial conduct. For refusing to do so, he divested the Second Division of the necessary vote for the questioned decision, assuming it could act, and rendered the proceeding null and void. 17
Since this case began in 1984, many significant developments have taken place, not the least significant of which was the February revolution of "people power" that dislodged the past regime and ended well nigh twenty years of travail for this captive nation. The petitioner is gone, felled by a hail of bullets sprayed with deadly purpose by assassins whose motive is yet to be disclosed. The private respondent has disappeared with the "pomp of power" he had before enjoyed. Even the Batasang Pambansa itself has been abolished, "an iniquitous vestige of the previous regime" discontinued by the Freedom Constitution. It is so easy now, as has been suggested not without reason, to send the records of this case to the archives and say the case is finished and the book is closed.
But not yet.
Let us first say these meager words in tribute to a fallen hero who was struck down in the vigor of his youth because he dared to speak against tyranny. Where many kept a meekly silence for fear of retaliation, and still others feigned and fawned in hopes of safety and even reward, he chose to fight. He was not afraid. Money did not tempt him. Threats did not daunt him. Power did not awe him. His was a singular and allexacting obsession: the return of freedom to his country. And though he fought not in the barricades of war amid the sound and smoke of shot and shell, he was a soldier nonetheless, fighting valiantly for the liberties of his people against the enemies of his race, unfortunately of his race too, who would impose upon the land a perpetual night of dark enslavement. He did not see the breaking of the dawn, sad to say, but in a very real sense Evelio B. Javier made that dawn draw nearer because he was, like Saul and Jonathan, "swifter than eagles and stronger than lions."
A year ago this Court received a letter which began: "I am the sister of the late Justice Calixto Zaldivar. I am the mother of Rhium Z. Sanchez, the grandmother of Plaridel Sanchez IV and Aldrich Sanchez, the aunt of Mamerta Zaldivar. I lost all four of them in the election eve ambush in Antique last year." She pleaded, as so did hundreds of others of her provincemates in separate signed petitions sent us, for the early resolution of that horrible crime, saying "I am 82 years old now. I am sick. May I convey to you my prayer in church and my plea to you, 'Before I die, I would like to see justice to my son and grandsons,' May I also add that the people of Antique have not stopped praying that the true winner of the last elections will be decided upon by the Supreme Court soon."
That was a year ago and since then a new government has taken over in the wake of the February revolution. The despot has escaped, and with him, let us pray, all the oppressions and repressions of the past have also been banished forever. A new spirit is now upon our land. A new vision limns the horizon. Now we can look forward with new hope that under the Constitution of the future every Filipino shall be truly sovereign in his own country, able to express his will through the pristine ballow with only his conscience as his counsel.
This is not an impossible dream. Indeed, it is an approachable goal. It can and will be won if we are able at last, after our long ordeal, to say never again to tyranny. If we can do this with courage and conviction, then and only then, and not until then, can we truly say that the case is finished and the book is closed.
WHEREFORE, let it be spread in the records of this case that were it not for the supervening events that have legally rendered it moot and academic, this petition would have been granted and the decision of the Commission on Elections dated July 23, 1984, set aside as violative of the Constitution.
SO ORDERED.
Feria, Yap, Narvasa, Alampay and Paras, JJ., concur.
Teehankee, C.J., I concur and reserve the filing of a separate concurrence.
Fernan and Gutierrez, Jr., JJ., concur in the result.
Separate Opinions
MELENCIO-HERRERA, J., concurring:
I concur in the result. The questioned Decision of the Second Division of the COMELEC, dated July 23, 1984, proclaiming private respondent, Arturo F. Pacificador, as the duly elected Assemblyman of the province of Antique, should be set aside for the legal reason that all election contests, without any distinction as to cases or contests, involving members of the defunct Batasang Pambansa fall under the jurisdiction of the COMELEC en banc pursuant to Sections 2 and 3 of Article XII-C of the 1973 Constitution.
FELICIANO, J., concurring:
I agree with the result reached, that is, although this petition has become moot and academic, the decision, dated 23 July 1984, of the Second Division of the Commission on Elections which had proclaimed Arturo F. Pacificador as the duly elected Assemblyman of the Province of Antique must be set aside or, more accurately, must be disregarded as bereft of any effect in law. I reach this result on the same single, precisely drawn, ground relied upon by Melencio- Herrera, J.: that all election contests involving members of the former Batasan Pambansa must be decided by the Commission on Elections en banc under Sections 2 and 3 of Article XII-C of the 1973 Constitution. These Sections do not distinguish between "pre-proclamation" and "post-proclamation" contests nor between "cases" and "contests."
1. Rollo, p. 26.
2. Rollo, p. 26.
3. Ibid., p. 9; p. 28.
4. Id., p. 30.
5. Id., p. 30.
6. Id., p. 62.
7. Id., p. 62; pp. 107-111.
8. Id., pp. 11-16; pp. 196-208.
9. Art. XII-C, Sec. 2(1), 1973 Constitution.
10. Vera vs. Avelino, 77 Phil. 191.
11. Art. XII-C, Sec. 3, 1973 Constitution.
12. Election Code of 1971, Sec. 219.
13. 88 SCRA 251.
14. Rollo, pp. 109-111.
15. Mateo vs. Villaluz, 50 SCRA 18; Gutierrez vs. Santos, 2 SCRA 249.
16. People vs. Opida, G.R. No. L-46272, July 13, 1986, citing Fernandez vs. Presbitero, 79 SCRA 61; Sardinia-Linco vs. Pineda, 104 SCRA 757.
17. Comelec Res. No. 1669, Sec. 5.
Ynot vs. Intermediate Appellate Court March 20, 1987.
[GRN L-74457 March 20, 1987.*]
RESTITUTO YNOT, petitioner, vs. INTERMEDIATE APPELLATE COURT, THE STATION COMMANDER, INTEGRATED NATIONAL POLICE, BAROTAC NUEVO, ILOILO and THE REGIONAL DIRECTOR, BUREAU OF ANIMAL INDUSTRY, REGION IV, ILOILO CITY, respondents.
PETITION for certiorari to review the decision of the Intermediate Appellate Court.
The facts are stated in the opinion of the Court.
Ramon A. Gonzales for petitioner.
CRUZ, J..
The essence of due process is distilled in the immortal cry of Themistocles to Alcibiades: "Strike- but hear me first!' "It is this cry that the petitioner in effect repeats here as he challenges the constitutionality of Executive Order No. 626-A.
The said executive order reads in full as follows:
"WHEREAS, the President has given orders prohibiting the interprovincial movement of carabaos and the slaughtering of carabaos not complying with the requirements of Executive Order No. 626 particularly with respect to age;
"WHEREAS, it has been observed that despite such orders the violators still manage to circumvent the prohibition against interprovincial movement of carabaos by transporting carabeef instead; and
"WHEREAS, in order to achieve the purposes and objectives of Executive Order No. 626 and the prohibition against interprovincial movement of carabaos, it is necessary to strengthen the said Executive Order and provide for the disposition of the carabaos and carabeef subject of the violation;
"NOW, THEREFORE, I, FERDINAND E. MARCOS, President of the Philippines, by virtue of the powers vested in me by the Constitution, do hereby promulgate the following:
"SECTION 1. Executive Order No. 626 is hereby amended such that henceforth, no carabao, regardless of age, sex, physical condition or purpose and no carabeef shall be transported from one province to another. The carabao or carabeef transported in violation of this Executive Order as amended shall be subject to confiscation and forfeiture by the government, to be distributed to charitable institutions and other similar institutions as the Chairman of the Na. tional Meat Inspection Commission may am fit, in the case of carsbed, and to deserving farmers through dispersal as the Director of Animal Industry may see fit, in the case of carabaos.
"SECTION 2. This Executive Order shall take effect immediately.
"Done in the City of Manila, this 25th day of October, in the year of Our Lord, nineteen hundred and eighty.
(SGD.) FERDINAND E. MARCOS
President
Republic of the Philippines"
The petitioner had transported six carabaos in a pump boat from Masbate to Iloilo on January 13, 1984, when they were confiscated by the police station commander of Barotac Nuevo, Iloilo, for violation of the above measure.1 The petitioner sued for recovery, and the Regional Trial Court of Iloilo City issued a writ of replevin upon his filing of a supersedeas bond of P12,000.00. After considering the merits of the case, the court sustained the confiscation of the carabaos and, since they could no longer be produced, ordered the confiscation of the bond. The court also declined to rule on the constitutionality of the executive order, as raised by the petitioner, for lack of authority and also for its presumed validity.2
The petitioner appealed the decision to the Intermediate Appellate Court,**3 which upheld the trial court,*** and he has now come before us in this petition for review on certiorari.
The thrust of his petition is that the executive order is unconstitutional insofar as it authorizes outright confiscation of the carabao or carabeef being transported across provincial boundaries. His claim is that the penalty is invalid because it is imposed without according the owner a right to be heard before a competent and impartial court as guaranteed by due process. He complains that the measure should not have been presumed, and so sustained, as constitutional. There is also a challenge to the improper exercise of the legislative power by the former President under Amendment No. 6 of the 1973 Constitution.4
While also involving the same executive order, the case of Pesigan v. Angeles5 is not applicable here. The question raised there was the necessity of the previous publication of the measure in the Official Gazette before it could be considered enforceable We imposed the requirement then on the basis of due process of law. In doing so, however, this Court did not, as contended by the Solicitor General, impliedly affirm the constitutionality of Executive Order No. 626-A. That is an entirely different matter. This Court has declared that while lower courts should observe a becoming modesty in examining constitutional questions, they are nonetheless not prevented from resolving the same whenever warranted, subject only to review by the highest tribunal.6 We have jurisdiction under the Constitution to "review, revise, reverse, modify or affirm on appeal or certiorari, as the law or rules of court may provide," final judgments and orders of lower courts in, among others, all cases involving the constitutionality of certain measures.7
This simply means that the resolution of such cams may be made in the first instance by these lower courts.
And while it is true that laws are presumed to be constitutional, that presumption is not by any means conclusive and in fact may be rebutted. Indeed, if there be a clear showing of their invalidity, and of the need to declare them so, then "will be the time to make the hammer fall, and heavily,"8 to recall Justice Laurel's trenchant warning. Stated otherwise, courts should not follow the path of least resistance by simply presuming the constitutionality of a law when it is questioned. On the contrary, they should probe the issue more deeply, to relieve the abscess, paraphrasing another distinguished jurist,9 and so heal the wound or excise the affliction.
Judicial power authorizes this; and when the exercise is demanded, there should be no shirking of the task for fear of retaliation, or loss of favor, or popular censure, or any other similar inhibition unworthy of the bench, especially this Court.
The challenged measure is denominated an executive order but it is really presidential decree, promulgating a new rule instead of merely implementing an existing law. It was issued by President Marcos not for the purpose of taking care that the laws were faithfully executed but in the exercise of his legislative authority under Amendment No. 6. It was provided thereunder that whenever in his judgment there existed a grave emergency or a threat or imminence thereof or whenever the legislature failed or was unable to act adequately on any matter that in his judgment required immediate action, he could, in order to meet the exigency, issue decrees, orders or letters of instruction that were to have the force and effect of law. As there is no showing of any exigency to justify the exercise of that extraordinary power then, the petitioner has reason, indeed, to question the validity of the executive order. Nevertheless, since the determination of the grounds was supposed to have been made by the President "in his judgment," a phrase that will lead to protracted discussion not, really 8 J. Laurel, concurring opinion, Zandueta v. dela Costa, 66 Phil. 615, 627. necessary at this time, we reserve resolution of this matter until a more appropriate occasion. For the nonce, we confine ourselves to the more fundamental question of due process.
It is part of the art of constitution-making that the provisions of the charter be cast in precise and unmistakable language to avoid controversies that might arise on their correct interpretation. That is the ideal. In the case of the due process clause, however, this rule was deliberately not followed and the wording was purposely kept ambiguous. In fact, a proposal to delineate it more clearly was submitted in the Constitutional Convention of 1934, but it was rejected by Delegate Jose P. Laurel, Chairman of the Committee on the Bill of Rights, who forcefully argued against it. He was sustained by the body.10
The due process clause was kept intentionally vague so it would remain also conveniently resilient. This was felt necessary because due process is not, like some provisions of the fundamental law, an "iron rule" laying down an implacable and immutable command for all seasons and all persons. Flexibility must be the best virtue of the guaranty. The very elasticity of the due process clause was meant to make it adapt easily to every situation, enlarging or constricting its protection as the changing times and circumstances may require.
Aware of this, the courts have also hesitated to adopt their own specific description of due process, lest they confine themselves ina legal straitjacket that will deprive them of the elbow room they may need to vary the meaning of the clause whenever indicated. Instead, they have preferred to leave the import of the protection openended, as it were, to be "gradually ascertained by the process Of inclusion and exclusion in the course of the decision of cases as they arise."11 Thus, Justice Felix Frankfurter of the U.S. Supreme Court, for example, would go no farther than to define due processand in so doing sums it all up-as nothing more and nothing less than "the embodiment of the sporting idea of fair play."12
When the barons of England extracted from their sovereign liege the reluctant promise that that Crown would thenceforth not proceed against the fife, liberty or property of any of its subjects except by the lawful judgment of his peers or the law of the land, they thereby won for themselves and their progeny that splendid guaranty of fairness that is now the hallmark of the free society. The solemn vow that King John made at Runnymede in 1215 has since then resounded through the ages, as a ringing reminder to all rulers, benevolent or base, that every person, when confronted by the stern visage of the law, is entitled to have his say in a fair and open hearing of his cause.
The closed mind has no place in the open society. It is part of the sporting idea of fair play to hear "the other side" before an opinion is formed or a decision is made by those who sit in judgment. Obviously, one side is only one-half of the question; the other half must also be considered if an impartial verdict is to be reached based on an informed appreciation of the issues in contention. It is indispensable that the two sides complement each other, as unto the bow the arrow, in leading to the correct ruling after examination of the problem not from one or the other perspective only but in its totality. A judgment based on less that this full appraisal, on the pretext that a hearing is unnecessary or useless, is tainted with the vice of bias or intolerance or ignorance, or worst of all, in repressive regimes, the insolence of power. The minimum requirements of due process are notice and hearing13 which, generally speaking, may not be dispensed with because they are intended as a safeguard against official arbitrariness. It is a gratifying commentary on our judicial system that the jurisprudence of this country is rich with applications of this guaranty as proof of our fealty to the rule of law and the ancient rudiments of fair play. We have consistently declared that every person, faced by the awesome Power of the State, is entitled to "the law of the land," which Daniel Webster described almost two hundred years ago in the famous Dartmouth College Case,14 as "the law which hears before it condemns, which proceeds upon inquiry and renders judgment only after trial." It has to be so if the rights of every person are to be secured beyond the reach of officials who, out of mistaken zeal or plain arrogance, would degrade the due process clause into a worn and empty catchword.
This is not to say that notice and hearing are imperative in every case for, to be sure, there are a number of admitted exceptions. The conclusive presumption, for example, bars the admission of contrary evidence as long as such presumption is based on human experience or there is a rational connection between the fact proved and the fact ultimately presumed therefrom.15 There are instances when the need for expeditious action will justify omission of these requisites, as in the summary abatement of a nuisance per se, like a mad dog on the loose. which may be killed on sight because of the immediate danger it poses to the safety and lives of the people. Pornographic materials, contaminated meat and narcotic drugs are inherently pernicious and may be summarily destroyed. The passport of a person sought for a criminal offense may be cancelled without hearing, to compel his return to the country he has fled.16 Filthy restaurants may be summarily padlocked in the interest of the public health and bawdy houses to protect the public morals.17 In such instances, previous judicial hearing may be omitted without violation of due process in view of the nature of the Property involved or the urgency of the need to protect the general welfare from a clear and present danger.
The protection of the general welfare is the particular function of the police power which both restraints and is restrained by due process. The police power is simply defined as the power inherent in the State to regulate liberty and property for the promotion of the general welfare.18 By reason of its function, it extends to all the great public needs and is described as the most pervasive, the least limitable and the most demanding of the three inherent powers of the State, far outpacing taxation and eminent domain. The individual, as a member of society, is hemmed in by the police power, which affects him even before he is born and follows him still after he is dead-from the womb to beyond the tomb-in practically everything he does or owns. Its reach is virtually limitless. It is a ubiquitous and often unwelcome intrusion. Even so, as long as the activity or the property has some relevance to the public welfare, its regulation under the police power is not only proper but necessary. And the justification is found in the venerable Latin maxims, Salus populi est suprema lex and Sic utere tuo ut alienum non laedas, which call for the subordination of individual interests to the benefit of the greater number.
It is this power that is now invoked by the government to justify Executive Order No. 626-A, amending the basic rule in Executive Order No. 626, prohibiting the slaughter of carabaos except under certain conditions. The original measure was issued for the reason, as expressed In one of its Whereases, that "present conditions demand that the carabaos and the buffaloes be conserved for the benefit of the small farmers who rely on them for energy needs." We affirm at the outset the need for such a measure. In the face of the worsening energy crisis and the increased dependence of our farms on these traditional beasts of burden, the government would have been remiss, indeed, if it had not taken steps to protect and preserve them.
A similar prohibition was challenged in United States v. Toribio,19 where a law regulating the registration, branding and slaughter of large cattle was claimed to be a deprivation of property without due process of law. The defendant had been convicted thereunder for having slaughtered his own carabao without the required permit, and he appealed to the Supreme Court. The conviction was affirmed. The law was sustained as a valid police measure to prevent the indiscriminate killing of carabaos, which were then badly needed by farmers. An epidemic had stricken many of these animals and the reduction of their number had resulted in an acute decline in agricultural output. which in turn had caused an incipient famine. Further. more, because of the scarcity of the animal and the con. sequent increase in their price, cattle-rustling had spread alarmingly, necessitating more effective measures for the registra. tion and branding of these animal . The Court held that the questioned statute was a valid exercise of the police power and declared in part as follows:
"To justify the State in thus interposing its authority in behalf of the public, it must appear, first, that the interests of the public generally, as distinguished from those of a particular class, require such interference; and second, that the means are reasonably necessary for the accomplishment of the purpose, and not unduly oppressive upon individuals. x x x x x x.
"From what has been said, we think it is clear that the enactment of the provisions of the statute under consideration was required by 'the interests of the public generally, as distinguished from those of a particular class' and that the prohibition of the slaughter of carabaos for human consumption, so long as these animals are fit for agricultural work or draft purposes was a 'reasonably necessary' limitation on private ownership, to protect the community from the lose of the services of such animals by their slaughter by improvident owners, tempted either by greed of momentary gain, or by a desire to enjoy the luxury of animal food, even when by so doing the productive Power of the community may be measurably and dangerously affected." In the light of the tests mentioned above, we hold with the Toribio Case that the carabao, as the poor man's tractor, so to speak, has a direct relevance to the public welfare and so is a lawful subject of Executive Order No. 626. The method chosen in the basic measure is also reasonably necessary for the purpose sought to be achieved and not unduly oppressive upon individuals, again following the above-cited doctrine. There is no doubt that by banning the slaughter of these animals except where they are at least seven years old if male and eleven years old if female upon issuance of the necessary permit, the executive order will be conserving those still fit for farm work or breeding and preventing their improvident depletion.
But while conceding that the amendatory measure has the same lawful subject as the original executive order, we cannot say with equal certainty that it complies with the second requirement, viz., that there be a lawful method. We note that to strengthen the original measure, Executive Order No. 626-A imposes an absolute ban not on the slaughter of the carabaos but on their movement, providing that "no carabao, regardless of age, sex, physical condition or purpose (sic) and no carabeef shall be transported from one province to another." The object of the prohibition escapes us. The reasonable connection between the means employed and the purpose sought to be achieved by the questioned measure is missing.
We do not see how the prohibition of the interprovincial transport of carabaos can prevent their indiscriminate slaughter, considering that they can be killed anywhere, with no less difficulty in one province than in another. Obviously, retaining the carabaos in one province will not prevent their slaughter there, any more than moving them to another province will make it easier to kill them them As for the carabeef, the prohibition is made to apply to it as otherwise, so says executive order, it could be easily circumvented by simply killing the animal. Perhaps so. However, if the movement of the live animal for the purpose of preventing their slaughter cannot be prohibited, it should follow that there is no reason either to prohibit their transfer as, not to be flippant, dead meat.
Even if a reasonable relation between the means and the end were to be assumed, we would still have to reckon with the sanction that the measure applies for violation of the prohibition. The penalty is outright confiscation of the carabao or carabeef being transported, to be meted out by the executive authorities, usually the police only. In the Toribio Case, the statute was sustained because the penalty prescribed was fine and imprisonment, to be imposed by the court after trial and conviction of the accused. Under the challenged measure, significantly, no such trial is prescribed, and the property being transported is immediately impounded by the police and declared, by the measure itself, as forfeited to the government.
In the instant case, the carabaos were arbitrarily confiscated by the police station commander, were returned to the petitioner only after he had filed a complaint for recovery and given a supersedeas bond of P12,000.00, which was ordered confiscated upon his failure to produce the carabaos when ordered by the trial court. The executive order defined the prohibition, convicted the petitioner and immediately imposed punishment, which was carried out forthright. The measure struck at once and pounced upon the petitioner without giving him a chance to be heard, thus denying him the centuries-old guaranty of elementary fair play.
It has already been remarked that there are occasions when notice and hearing may be validly dispensed with notwithstanding the usual requirement for these minimum guarantees of due process. It is also conceded that summary action may be validly taken in administrative proceedings as procedural due process is not necessarily judicial only.20 In the exceptional cases accepted, however, there is a justification for the omission of the right to a previous hearing, to wit, the immediacy of the problem sought to be corrected and the urgency of the need to correct it.
In the case before us, there was no such pressure of time or action calling for the petitioner's peremptory treatment. The properties involved were not even inimical per se as to require their instant destruction. There certainly was no reason why the offense prohibited by the executive order should not have been proved first in a court of justice, with the accused being accorded all the rights safeguarded to him under the Constitution. Considering that, as we held in Pesigan v. Angeles,21 Executive Order No. 626-A is penal in nature, the violation thereof should have been pronounced not by the police only but by a coat of justice, which alone would have had the authority to impose the prescribed penalty, and only after trial and conviction of the accused.
We also mark, on top of all this, the questionable manner of the disposition of the confiscated property as prescribed in the questioned executive order. It is there authorized that the seized property shall "be distributed to charitable institutions and other similar institutions as the Chairman of the National Meat Inspection Commission may see fit, in the case of carsbeef, and to deserving farmers through dispersal as the Director of Animal Industry may see fit, in the case of carabaos." (Emphasis supplied.) The phrase "may see fit" is an extremely generous and dangerous condition, if condition it is. It is laden with perilous opportunities for partiality and abuse, and even corruption. One searches in vain for the usual standard and the reasonable guidelines, or better still, the limitations that the said officers must observe when they make their distribution. There is none. Their options are apparently boundless. Who shall be the fortunate beneficiaries of their generosity and by what criteria shall they be chosen? Only the officers named can supply the answer, they and they alone may choose the grantee as they see fit, and in their own exclusive discretion. Definitely, there is here a "roving commission," a wide and sweeping authority that is not "canalized within banks that keep it from overflowing," in short, a clearly profligate and therefore invalid delegation of legislative powers. To sum up then, we find that the challenged measure is an invalid exercise of the police power because the method employed to conserve the carabaos is not reasonably necessary to the purpose of the law and, worse, is unduly oppressive. Due process is violated because the owner of the property confiscated is denied the right to be heard in his defense and is immediately condemned and punished. The conferment on the administrative authorities of the power to adjudge the guilt of the supposed offender is a clear encroachment on judicial functions and militates against the doctrine of separation of powers. There is, finally, also an invalid delegation of legislative powers to the officers mentioned therein who are granted unlimited discretion in the distribution of the properties arbitrarily taken. For these reasons, we hereby declare Executive Order No. 626-A unconstitutional.
We agree with the respondent court, however, that the police station commander who confiscated the petitioner's carabaos is not liable in damages for enforcing the executive order in accordance with its mandate. The law was at that time presumptively valid, and it was his obligation, as a member of the police, to enforce it. It would have been impertinent of him, being a mere subordinate of the President, to declare the executive order unconstitutional and, on his own responsibility alone, refuse to execute it. Even the trial court, in fact, and the Court of Appeals itself did not feel they had the competence, for all their superior authority, to question the order we now annul.
The Court notes that if the petitioner had not seen fit to assert and protect his rights as he saw them, this case would never have reached us and the taking of his property under the challenged measure would have become a fait accomplish despite its invalidity. We commend him for his spirit. Without the present challenge, the matter would have ended in that pump boat in Masbate and another violation of the Constitution, for all its obviousness, would have been perpetrated, allowed without protest, and soon forgotten in the limbo of relinquished rights.
The strength of democracy lies not in the rights it guarantees but in the courage of the people to invoke them whenever they are ignored or violated. Rights are but weapons on the wall if, like expensive tapestry, all they do is embellish and impress. Rights, as weapons, must be a promise of protection. They become truly meaningful, and fulfill the role assigned to them in the free society, if they are kept bright and sharp with use by those who are not afraid to assert them.
WHEREFORE, Executive Order No. 626-A is hereby declared unconstitutional. Except as affirmed above, the decision of the Court of Appeals is reversed. The supersedeas bond is cancelled and the amount thereof is ordered restored to the petitioner. No costs.
SO ORDERED. Teehankee, C.J., Yap, Fernan, Narvasa, Gutierrez, Jr., Paras, Gancayco, Padilla, Bidin, Sarmiento and Cortes, JJ., concur.
Melencio-Herrera and Feliciano, JJ., on leave.
Decision reversed.
1. Rollo, pp. 7, 28, 29, 34.
2. Ibid, pp. 6-7; Annex B.
** Justices Coquia, Bartolome and Ejercito.
3. Rollo, pp. 6, 27, 33.
*** Judge Bethel Katalbas-Moscardon.
4. Ibid., pp. 10; 11, 14-16,76.
5. 129 SCRA 174.
6. Espiritu vs. Fugoso, 81 Phil. 637.
7. Sec. 5[2(a)], Art. X, 1973 Constitution; Sec. 5[2(a)], Art. VIII, 1987 Constitution.
9. US v. Bustos, 37 Phil. 731.
10. I Aruego, The Framing of the Constitution (1936), pp. 153-159.
11. Twinning vs. New Jersey, 2 11 U.S. 78.
12. Frankfurter, Mr. Justice Holmes and the Supreme Court, pp. 32-33.
13. David vs. Aquilizan, 94 SCRA 707; Montemayor vs. Araneta Univ. Foundation, 77 SCRA 321; Lentelera vs. Amores, 70 SCRA 37; Flores vs. Buencamino, 74 SCRA 332; DBP vs, Bautista, 26 SCRA 366; Ong So Han vs. Gutierrez David, 76 Phil 546; Banco-EspañolFilipino vs. Palanca, 37 Phil. 921.
14. Dartmouth College vs. Woodward, 4 Wheaton 518.
15. Manley v. Georgia, 279 U.S. 1; 1 Cooley 639.
16. Suntay vs. People, 101 Phil. 833.
17. 12 C.J. 1224. 18. People v. Vera Reyes, 67 Phil. 190; Ermita-Malate Hotel & Motel Operators Ass. v. City Mayor, 20 SCRA 849; Primicias V. Fugoso, 80 Phil. 75; U.S. v. Ling Su Tam 10 Phil. 114; Collins v. Wolfe, 5 Phil. 297; U.S. v. Gomez Jesus, 31 Phil. 225; Churchill v. Rafferty, 32 Phil. 603.
19. 15 Phil 85.
20. New Filipino Maritime Agencies, Inc. vs. Rivera, 83 SCRA 602; Gas Corp. of the Phil. vs. Inciong, 93 SCRA 653.
21. supra.
Philippine Communications Satellite Corporation vs. Alcuaz
December 18, 1989.
[GRN 84818 December 18, 1989.*]
PHILIPPINE COMMUNICATIONS SATELLITE CORPORATION, petitioner, vs. JOSE LUIS A. ALCUAZ, as NTC Commissioner, and NATIONAL TELECOMMUNICATIONS COMMISSION, respondents.
PETITION to review the order of the National Bureau of Telecommunications Commission.
The facts are stated in the opinion of the Court.
Rilloraza, Africa, De Ocampo & Africa for petitioner.
Victor de la Serna for respondent Alcuaz.
REGALADO, J.:
This case is posed as one of first impression in the sense that it involves the public utility services of the petitioner Philippine Communications Satellite Corporation (PHILCOMSAT, for short) which is the only one rendering such services in the Philippines,
The petition before us seeks to annul and set aside an Order1 issued by respondent Commissioner Jose Luis Alcuaz of the National Telecommunications Commission (hereafter, NTC), dated September 2, 1988, which directs the provisional reduction of the rates which may be charged by petitioner for certain specified lines of its services by fifteen percent (15%) with the reservation to make further reductions later, for being violative of the constitutional prohibition against undue delegation of legislative power and a denial of procedural, as well as substantive, due process of law.
The antecedental facts as summarized by petitioner2 are not in dispute. By virtue of Republic Act No. 5514, PHILCOMSAT was granted "a franchise to establish, construct, maintain and operate in the Philippines, at such places as the grantee may select, station or stations and associated equipment and facilities for international satellite communications." Under this franchise, it was likewise granted the authority to "construct and operate such ground facilities as needed to deliver telecommunications services from the communications satellite system and ground terminal or terminals."
Pursuant to said franchise, petitioner puts on record that it undertook the following activities and established the following installations:
1. In 1967, PHILCOMSAT established its provisional earth station in Pinugay, Rizal. 2. In 1968, earth station standard "A" antenna (Pinugay I) was established. Pinugay I provided direct satellite communication links with the Pacific Ocean Region (the United States, Australia, Canada, Hawaii, Guam, Korea, Thailand, China [PROC], New Zealand and Brunei) thru the Pacific Ocean INTELSAT satellite.
3. In 1971, a second earth station standard "A" antenna (Pinugay II) was established. Pinugay II provided links with the Indian Ocean Region (major cities in Europe, Middle East, Africa, and other Asia Pacific countries operating within the region) thru the Indian Ocean INTELSAT satellite.
4. In 1983, a third earth station standard "B" antenna (Pinugay III) was established to temporarily assume the functions of Pinugay I and then Pinugay II while they were being refurbished. Pinugay III now serves as spare or reserved antenna for possible contingencies.
5. In 1983, PHILCOMSAT constructed and installed a standard '93" antenna at Clark Air Field, Pampanga as a television receive-only earth station which provides the U.S. Military bases with a 24-hour television service.
6. In 1989, petitioner completed the installation of a third standard "A" earth station (Pinugay IV) to take over the links in Pinugay I due to obsolescence.3
By designation of the Republic of the Philippines, the petitioner is also the sole signatory for the Philippines in the Agreement and the Operating Agreement relating to the International Telecommunications Satellite Organization (INTELSAT) of 115 member nations, as well as in the Convention and the Operating Agreement of the International Maritime Satellite Organization (INMARSAT) of 53 member nations, which two global commercial telecommunications satellite corporations were collectively established by various states in line with the principles set forth in Resolution 1721 (XVI) of the General Assembly of the United Nations.
Since 1968, the petitioner has been leasing its satellite circuits to:
1. Philippine Long Distance Telephone Company;
2. Philippine Global Communications, Inc.;
S. Eastern Telecommunications Phils., Inc.;
4. Globe Mackay Cable and Radio Corp. ITT; and
5. Capitol Wireless, Inc. or their predecessors-in-interest. The satellite services thus provided by petitioner enable said international carriers to serve the public with indispensable communication services, such as overseas telephone, telex, facsimile, telegrams, high speed data, live television in full color, and television standard conversion from European to American or vice versa.
Under Section 5 of Republic Act No. 5614, petitioner was exempt from the jurisdiction of the then Public Service Commission, now respondent NTC. However, pursuant to Executive Order No. 196 issued on June 17, 1987, petitioner was placed under the jurisdiction, control and regulation of respondent NTC, including all its facilities and services and the fixing of rates. Implementing said Executive Order No. 196, respondents required petitioner to apply for the requisite certificate of public convenience and necessity covering its facilities and the services it renders, as well as the corresponding authority to charge rates therefor.
Consequently, under date of September 9, 1987, petitioner filed with respondent NTC an application4 for authority to continue operating and maintaining the same facilities it has been continuously operating and maintaining since 1967, to continue providing the international satellite communications services it has likewise been providing since 1967, and to charge the current rates applied for in rendering such services. Pending hearing, it also applied for a provisional authority so that it can continue to operate and maintain the above mentioned facilities, provide the services and charge therefor the aforesaid rates therein applied for.
On September 16, 1987, petitioner was granted a provisional authority to continue operating its existing facilities, to render the services it was then offering, and to charge the rates it was then charging. This authority was valid for six (6) months from the date of said order.5 When said provisional authority expired on March 17, 1988, it was extended for another six (6) months, or up to September 16, 1988.
The NTC order now in controversy had further extended the provisional authority of the petitioner for another six (6) months, counted from September 16, 1988, but it directed the petitioner to charge modified reduced rates through a reduction of fifteen percent (15%) on the present authorized rates. Respondent Commissioner ordered said reduction on the following ground:
"The Commission in its on-going review of present service rates takes note that after an initial evaluation by the Rates Regulation Division of the Common Carriers Authorization Department of the financial statements of applicant, there is merit in a REDUCTION in some of applicant's rates, subject to further reductions, should the Commission finds (sic) in its further evaluation that more reduction should be effected either on the basis of a provisional authorization or in the final consideration of the case."6
PHILCOMSAT assails the above-quoted order for the following reasons: 1. The enabling act (Executive Order No. 546) of respondent NTC empowering it to fix rates for public service communications does not provide the necessary standards constitutionally required, hence there is an undue delegation of legislative power, particularly the adjudicatory powers of NTC;
2. Assuming arguendo that the rate-fixing power was properly and constitutionally conferred, the same was exercised in an unconstitutional manner, hence it is ultra vires, in that (a) the questioned order violates procedural due process for having been issued without prior notice and hearing; and (b) the rate reduction it imposes is unjust, unreasonable and confiscatory, thus constitutive of a violation of substantive due process.
1. Petitioner asseverates that nowhere in the provisions of Executive Order No. 546, providing for the creation of respondent NTC and granting its rate-fixing powers, nor of Executive Order No. 196, placing petitioner under the jurisdiction of respondent NTC, can it be inferred that respondent NTC is guided by any standard in the exercise of its rate-fixing and adjudicatory powers. While petitioner in its petition-in-chief raised the issue of undue delegation of legislative power, it subsequently clarified its said submission to mean that the order mandating a reduction of certain rates is undue delegation not of legislative but of quasi- judicial power to respondent NTC, the exercise of which allegedly requires an express conferment by the legislative body.
Whichever way it is presented, petitioner is in effect questioning the constitutionality of Executive Orders Nos. 546 and 196 on the ground that the same do not fix a standard for the exercise of the power therein conferred.
We held otherwise.
Fundamental is the rule that delegation of legislative power may be sustained only upon the ground that some standard for its exercise is provided and that the legislature in making the delegation has prescribed the manner of the exercise of the delegated power. Therefore, when the administrative agency concerned, respondent NTC in this case, establishes a rate, its act must both be nonconfiscatory and must have been established in the manner prescribed by the legislature; otherwise, in the absence of a fixed standard, the delegation of power becomes unconstitutional. In case of a delegation of rate-fixing power, the only standard which the legislature is required to prescribe for the guidance of the administrative authority is that the rate be reasonable and just. However, it has been held that even in the absence of an express requirement as to reasonableness, this standard may be implied.7
It becomes important then to ascertain the nature of the power delegated to respondent NTC and the manner required by the statute for the lawful exercise thereof. Pursuant to Executive Orders Nos. 546 and 196, respondent NTC is empowered, among others, to determine and prescribe rates pertinent to the operation of public service communications which necessarily include the power to promulgate rules and regulations in connection therewith. And, under Section 15(g) of Executive Order No. 546, respondent NTC should be guided by the requirements of public safety, public interest and reasonable feasibility of maintaining effective competition of private entities in communications and broadcasting facilities. Likewise, in Section 6(d) thereof, which provides for the creation of the Ministry of Transportation and Communications with control and supervision over respondent NTC, it is specifically provided that the national economic viability of the entire network or components of the communications systems contemplated therein should be maintained at reasonable rates. We need not go into an in-depth analysis of the pertinent provisions of the law in order to conclude that respondent NTC, in the exercise of its rate-fixing power, is limited by the requirements of public safety, public interest, reasonable feasibility and reasonable rates, which conjointly more than satisfy the requirements of a valid delegation of legislative power.
II. On another tack, petitioner submits that the questioned order violates procedural due process because it was issued motu Proprio, without notice to petitioner and without the benefit of a hearing. Petitioner laments that said order was based merely on an "initial evaluation," which is a unilateral evaluation, but had petitioner been given an opportunity to present its side before the order in question was issued, the confiscatory nature of the rate reduction and the consequent deterioration of the public service could have been shown and demonstrated to respondents.
Petitioner argues that the function involved in the rate fixing-power of NTC is adjudicatory and hence quasi-judicial, not quasi-legislative; thus, notice and hearing are necessary and the absence thereof results in a violation of due process.
Respondents admit that the application of a policy like the fixing of rates as exercised by administrative bodies is quasijudicial rather than quasilegislative: that where the function of the administrative agency is legislative, notice and hearing are not required, but where an order applies to a named person, as in the instant case, the function involved is adjudicatory.8 Nonetheless, they insist that under the facts obtaining the order in question need not be preceded by a hearing, not because it was issued pursuant to respondent NTC's legislative function but because the assailed order is merely interlocutory, it being an incident in the ongoing proceedings on petitioner's application for a certificate of public convenience; and that petitioner is not the only primary source of data or information since respondent is currently engaged in a continuing review of the rates charged.
We find merit in petitioner's contention. In Vigan Electric Light Co., Inc. vs. Public Service Commission,9 we made a categorical classification as to when the ratefixing power of administrative bodies is quasi-judicial and when it is legislative, thus:
"Moreover, although the rule-making power and even the power to fix rateswhen such rules and/or rates are meant to apply to all enterprises of a given kind throughout the Philippines- may partake of a legislative character, such is not the nature of the order complained of Indeed, the same applies exclusively to petitioner herein. What is more, it is predicated upon the finding of fact-based upon a report submitted by the General Auditing Office-that petitioner is making a Profit of more than 12% of its invested capital, which is denied by Petitioner. Obviously, the latter is entitled to cross-examine the maker of said report, and to introduce evidence to disprove the contents thereof and/or explain or complement the same, as well as to refute the conclusion drawn therefrom by the respondent. In other words, in making said finding offset, respondent performed a function partaking of a quasi-judicial character, the valid exercise of which demands previous notice and hearing."
This rule was further explained in the subsequent case of The Central Bank of the Philippines vs. Cloribel, et al.10 to wit:
"It is also clear from the authorities that where the function of the administrative body is legislative, notice of hearing is not required by due process of law (See Oppenheimer, Administrative Law, 2 Md. L.R 185, 204, supra, where it is said: 'If the nature of the administrative agency is essentially legislative, the requirements of notice and hearing are not necessary. The validity of a rule of future action which affects a group, if vested rights of liberty or property are not involved, is not determined according to the same rules which apply in the case of the direct application of a policy to a specific individual') x x x It is said in 73 C.J.S. Public Administrative Bodies and Procedure, sec. 130, pages 452 and 453: 'Aside from statute, the necessity of notice and hearing in an administrative proceeding depends on the character of the proceeding and the circumstances involved. In so far as generalization is possible in view of the great variety of administrative proceedings, it may be stated as a general rule that notice and hearing are not essential to the validity of administrative action where the administrative body acts in the exercise of executive, administrative, or legislative functions; but where a public administrative body acts in a judicial or quasi-judicial matter, and its acts are particular and immediate rather than general and prospective, the person whose rights or property may be affected by the action is entitled to notice and hearing."11
The order in question which was issued by respondent Alcuaz no doubt contains all the attributes of a quasi-judicial adjudication. Foremost is the fact that said order pertains exclusively to petitioner and to no other. Further, it is premised on a finding of fact, although patently superficial, that there is merit in a reduction of some of the rates charged-based on an initial evaluation of petitioner's financial statements-without affording petitioner the benefit of an explanation as to what particular aspect or aspects of the financial statements warranted a corresponding rate reduction. No rationalization was offered nor were the attending contingencies, if any, discussed, which prompted respondents to impose as much as a fifteen percent (15%) rate reduction. It is not far-fetched to assume that petitioner could be in a better position to rationalize its rates vis-a-vis the viability of its business requirements. The rates it charges result from an exhaustive and detailed study it conducts of the multi-faceted intricacies attendant to a public service undertaking of such nature and magnitude. We are, therefore, inclined to lend greater credence to petitioner's ratiocination that an immediate reduction in its rates would adversely affect its operations and the quality of its service to the public considering the maintenance requirements, the projects it still has to undertake and the financial outlay involved. Notably, petitioner was not even afforded the opportunity to cross- examine the inspector who issued the report on which respondent NTC based its questioned order.
At any rate, there remains the categorical admission made by respondent NTC that the questioned order was issued pursuant to its quasi-judicial functions. It, however, insists that notice and hearing are not necessary since the assailed order is merely incidental to the entire proceedings and, therefore, temporary in nature. This postulate is bereft of merit.
While respondents may fix a temporary rate pending final determination of the application of petitioner, such rate-fixing order, temporary though it may be, is not exempt from the statutory procedural requirements of notice and hearing, as well as the requirement of reasonableness. Assuming that such power is vested in NTC, it may not exercise the same in an arbitrary and confiscatory manner. Categorizing such an order as temporary in nature does not perforce entail the applicability of a different rule of statutory procedure than would otherwise be applied to any other order on the same matter unless otherwise provided by the applicable law. In the case at bar, the applicable statutory provision is Section 16(c) of the Public Service Act which provides:
"Section 16. Proceedings of the Commission, upon notice and hearing.-The Commission shall have power, upon proper notice and hearing in accordance with the roles and provisions of this Act, subject to the limitations and exceptions mentioned and saving provisions to the contrary: xxx
(c) To fix and determine individual or joint rates, xxx which shall be imposed, observed and followed thereafter by any public service;
x x x." There is no reason to assume that the aforesaid provision does not apply to respondent NTC, there being no limiting, excepting, or saving provisions to the contrary in Executive Orders Nos. 546 and 196.
It is thus clear that with regard to rate-fixing, respondent has no authority to make such order without first giving petitioner a hearing, whether the order be temporary or permanent, and it is immaterial whether the same is made upon a complaint, a summary investigation, or upon the commission's own motion as in the present case. That such a hearing is required is evident in respondents' order of September 16, 1987 in NTC Case No. 8794 which granted PHILCOMSAT a provisional authority "to continue operating its existing facilities, to render the services it presently offers, and to charge the rates as reduced by them" under the condition that "(s)ubject to hearing and the final consideration of the merit of this application, the Commission may modify, revise or amend the rates x x x."12
While it may be true that for purposes of rate-fixing respondents may have other sources of information or data, still, since a hearing is essential, respondent NTC should act solely on the basis of the evidence before it and not on knowledge or information otherwise acquired by it but which is not offered in evidence or, even if so adduced, petitioner was given no opportunity to controvert.
Again, the order requires the new reduced rates to be made effective on a specified date. It becomes a final legislative act as to the period during which it has to remain in force pending the final determination of the case.13 An order of respondent NTC prescribing reduced rates, even for a temporary period, could be unjust, unreasonable or even confiscatory, especially if the rates are unreasonably low, since the utility permanently loses its just revenue during the prescribed period. In fact, such order is in effect final insofar as the revenue during the period covered by the order is concerned. Upon a showing, therefore, that the order requiring a reduced rate is confiscatory, and Will unduly deprive petitioner of a reasonable return upon its property, a declaration of its nullity becomes inductible, which brings us to the issue on substantive due process.
III. Petitioner contends that the rate reduction is confiscatory in that its implementation would virtually result in a cessation of its operations and eventual closure of business. On the other hand, respondents assert that since petitioner is operating its communications satellite facilities through a legislative franchise, as such grantee it has no vested right therein. What it has is merely a privilege or license which may be revoked at will by the State at any time without necessarily violating any vested property right of herein petitioner. While petitioner concedes this thesis of respondent, it counters that the withdrawal of such privilege should nevertheless be neither whimsical nor arbitrary, but it must be fair and reasonable. There is no question that petitioner is a mere grantee of a legislative franchise which is subject to amendment, alteration, or repeal by Congress when the common good so requires.14 Apparently, therefore, such grant cannot be unilaterally revoked absent a showing that the termination of the operation of odd utility is required by the common good.
The rule is that the power of the State to regulate the conduct and business of public utilities is limited by the consideration that it is not the owner of the property of the utility, or clothed with the general power of management incident to ownership, since the private right of ownership to such property remains and is not to be destroyed by the regulatory power. The power to regulate is not the power to destroy useful and harmless enterprises, but is the power to protect, foster, promote, preserve, and control with due regard for the interest, first and foremost, of the public, then of the utility and of its patrons. Any regulation, therefore, which operates as an effective confiscation of private property or constitutes an arbitrary or unreasonable infringement of property rights is void, because it is repugnant to the constitutional guaranties of due process and equal protection of the laws.15
Hence, the inherent power and authority of the State, or its authorized agent, to regulate the rates charged by public utilities should be subject always to the requirement that the rates so fixed shall be reasonable and just. A commission has no power to fix rates which are unreasonable or to regulate them arbitrarily. This basic requirement of reasonableness comprehends such rates which must not be so low as to be confiscatory, or too high as to be oppressive.16
What is a just and reasonable rate is not a question of formula but of sound business judgment based upon the evidence;17 it is a question of fact calling for the exercise of discretion, good sense, and a fair, enlightened and independent judgment.18 In determining whether a rate is confiscatory, it is essential also to consider the given situation, requirements and opportunities of the utility. A method often employed in determining reasonableness is the fair return upon the value of the property to the public utility. Competition is also a very important factor in determining the reasonableness of rates since a carrier is allowed to make such rates as are necessary to meet competition.19
A cursory perusal of the assailed order reveals that the rate reduction is solely and primarily based on the initial evaluation made on the financial statements of petitioner, contrary to respondent NTC's allegation that it has several other sources of information without, however, divulging such sources. Furthermore, it did not as much as make an attempt to elaborate on how it arrived at the prescribed rates. It just perfunctorily declared that based on the financial statements, there is merit for a rate reduction without any elucidation on what implications and conclusions were necessarily inferred by it from said statements. Nor did it deign to explain how the data reflected in the financial statements influenced its decision to impose a rate reduction.
On the other hand, petitioner may likely suffer a severe drawback, with the consequent detriment to the public service, should the order of respondent NTC turn out to be unreasonable and improvident. The business in which petitioner is engaged is unique in that its machinery and equipment have always to be taken in relation to the equipment on the other end of the transmission arrangement. Any lack, aging, acquisition, rehabilitation, or refurbishment of machinery and equipment necessarily entails a major adjustment or innovation on the business of petitioner. As pointed out by petitioner, any change in the sending end abroad has to be matched with the corresponding change in the receiving end in the Philippines. Conversely, any change in the receiving end abroad has to be matched with the corresponding change in the sending end in the Philippines. An inability on the part of petitioner to meet the variegations demanded by technology could result in a deterioration or total failure of the service of satellite communications.
At present, petitioner is engaged in several projects aimed at refurbishing, rehabilitating, and renewing its machinery and equipment in order to keep up with the continuing changes of the times and to maintain its facilities at a competitive level with the technological advances abroad. These projected undertakings were formulated on the premise that rates are maintained at their present or at reasonable levels. Hence, an undue reduction thereof may practically lead to a cessation of its business. While we concede the primacy of the public interest in an adequate and efficient service, the same is not necessarily to be equated with reduced rates. Reasonableness in the rates assumes that the "me is fair to both the public utility and the consumer.
Consequently, we hold that the challenged order, particularly on the issue of rates provided therein, being violative of the due process clause is void and should be nullified. Respondents should now proceed, as they should heretofore have done, with the hearing and determination of petitioner's pending application for a certificate of public convenience and necessity and in which proceeding the subject of rates involved in the present controversy, as well as other matters involved in said application, may be duly adjudicated with reasonable dispatch and with due observance of our pronouncements herein.
WHEREFORE, the writ prayed for is GRANTED and the order of respondents, dated September 2,1988, in NTC Case No. 87-94 is hereby SET ASIDE. The temporary restraining order issued under our resolution of September 13, 1988, as specifically directed against the aforesaid order of respondents on the matter of existing rates on petitioner's present authorized services, is hereby made permanent. SO ORDERED.
Fernan, (C.J.), Narvasa, Melencio-Herrera, Cruz, Paras, Feliciano, Gancayco, Bidin, Sarmiento, Cortes, Griño-Aquino and Medialdea, JJ., concur.
Gutierrez, Jr., J., Please see concurring opinion.
Padilla, J., No part in the deliberations.
GUTIERREZ, JR., J., Concurring Opinion:
I concur in the ponencia of Justice Regalado and join him in the erudite and thorough discussion of the respondent's authority. However, I have reservations about our continuing to abide by the dictum that in the exercise of quasi-legislative power, notice and hearing are not required. I believe that this doctrine is ripe for re-examination.
Senators and Congressmen are directly elected by the people. Administrative officials are not. If the members of an administrative body are, as is so often the case, appointed not on the basis of competence and qualifications but out of political or personal considerations, it is not only the sense of personal responsibility to the electorate affected by legislation which is missing. The expertise and experience needed for the issuance of sound rules and regulations would also be sorely lacking.
Congress never passes truly important legislation without holding public hearings. Yet, administrative officials who are not directly attuned to the public pulse see no need for hearings. They issue rules and circulars with far reaching effects on our economy and our nation's future on the assumption that the head of an agency knows best what is good for the people. I believe that in the exercise of quasi-legislative powers, administrative agencies, much, much more than Congress, should hold hearings and should be given guidelines as to when notices and hearings are essential even in quasi-legislation.
Writ granted. Order set aside.
1. Annex A, Petition; Rollo, 37.
2. Rollo, 6-11, 137-139, 148-150.
3. Ibid, 149.
4. Annex C, Petition; Rollo, 48.
5. Annex B, id., ibid., 41.
6. Rollo, 37. 7. 42 Am. Jur. 357-358.
8. Memorandum for Private Respondents, 9-10; Rollo, 181-182.
9. 10 SCRA 46 (1964).
10. 44 SCRA 307 (1972).
11. Citing Albert vs. Public Service Commission, 120 A. 2d. 346, 350351.
12. Rollo, 44.
13. William A. Predergast, et. al. vs. New York Tel. Co., 67 L. Ed. 853, 858.
14. Sec. 11, Art. XII, 1987 Constitution.
15. 73 C.J.S 1005.
16. Op. cit., 1010.
17. State Public Utilities Commission ex. rel. City of Springfield vs. Springfield Gas & Electric Co., 125 N.E. 891.
18. 73 C.J.S. 1010.
19. Manila Railroad Co. vs. A.L. Ammen Transportation Co., Inc., 48 Phil. 900 (1926).
Eastern Broadcasting Corporation (DYRE) vs. Dans, Jr.
July 19, 1985
[GRN L-59329 July 19, 1985.*]
EASTERN BROADCASTING CORPORATION (DYRE) petitioner, vs. THE HON. JOSE P. DANS, JR., MINISTER OF TRANSPORTATION & COMMUNICATIONS, THE HON. CEFERINO S. CARREON, COMMISSIONER, NA TIONAL TELECOM., COMMISSION, ET AL., respondents.
GUTIERREZ, JR., J.:
This petition was filed to compel the respondents to allow the reopening of Radio Station DYRE which had been summarily closed on grounds of national security.
The petitioner contended that it was denied due process when it was closed on the mere allegation that the radio station was used to incite people to sedition. It alleged that no hearing was held and not a bit of proof was submitted to establish a factual basis for the closure. The petitioner was not informed beforehand why administrative action which closed the radio station was taken against it. No action was taken by the respondents to entertain a motion seeking the reconsideration of the closure action.
The petitioner also raised the issue of freedom of speech. It appears from the records that the respondents' general charge of "inciting people to commit acts of sedition" arose from the petitioner's shift towards what it stated was the coverage of public events and the airing of programs geared towards public affairs.
On March 25, 1985. before the Court could promulgate a decision squarely passing upon all the issues raised, the petitioner through its president, Mr. Rene G. Espina suddenly filed a motion to withdraw or dismiss the petition.
The petitioner alleged:
"1. Petitioner Eastern Broadcasting Corporation has already sold its radio broadcasting station in favor of Manuel B. Pastrana as well as its rights and interest in the radio station DYRE in Cebu including its right to operate and its equipment;
"2. Respondent National Telecommunications Commission has expressed its willingness to grant to the said new owner Manuel B. Pastrana the requisite license and franchise to operate the said radio station and to approve the sale of the radio transmitter of said station DYRE;
"3. In view of the foregoing, petitioner has no longer any interest in said case, and the new owner, Manuel B. Pastrana is likewise not interested in pursuing the case any further. " The case, therefore, has become moot and academic. However, for the guidance of inferior courts and administrative tribunals exercising quasijudicial functions, the Court issues the following guidelines:
(1) The cardinal primary requirements in administrative proceedings laid down by this Court in Ang Tibay v. Court of Industrial Relations (69 Phil. 635) should be followed before a broadcast station may be closed or its operations curtailed.1
(2) It is necessary to reiterate that while there is no controlling and precise definition of due process, it furnishes an unavoidable standard to which government action must conform in order that any deprivation of life, liberty, or property, in each appropriate case, may be valid (Ermita-Malate Hotel and Motel Operators Association v. City Mayor, 20 SCRA 849).
(3) All forms of media, whether print or broadcast, are entitled to the broad protection of the freedom of speech and expression clause. The test for limitations on freedom of expression continues to be the clear and present danger rule-that words are used in such circumstances and are of such a nature as to create a clear and present danger that they will bring about the substantive evils that the lawmaker has a right to prevent. In his Constitution of the Philippines (2nd Edition, pp. 569-570) Chief Justice Enrique M. Fernando cites at least nine of our decisions which apply the test-(Primicias v. Fugoso [80 Phil. 7 11, American Bible Society v. City of Manila [101 Phil. 386], Cabansag v. Fernandez 1102 Phil. 1621, Vera v. Area [28 SCRA 3611, Navarro v. Villegas [31 SCRA 9311, Imbong v. Ferrer 135 SCRA 281, Badoy v. Commission on Elections [35 SCRA 285], People v. Ferrer [48 SCRA 382], and the Philippine Blooming Mills Employees Organization v. Philippine Blooming Mills Co., Inc, [5] SCRA 189]. More recently, the clear and present danger test was applied in J.B.L. Reyes in behalf of the Anti-Bases Coalition v. Bagatsing [125 SCRA 553].
(4) The clear and present danger test, however, does not lend itself to a simplistic and all embracing interpretation applicable to all utterances in all forums.
Broadcasting has to be licensed. Airwave frequencies have to be allocated among qualified users. A broadcast corporation cannot simply appropriate a certain frequency without regard for government regulation or for the rights of others.
All forms of communication are entitled to the broad protection of the freedom of expression clause. Necessarily, however, the freedom of television and radio broadcasting is somewhat lesser in scope than the freedom accorded to newspaper and print media.
The American Court in Federal Communications Commission v. Pacifica Foundation (438 U.S. 726), confronted with a patently offensive and indecent regular radio program, explained why radio broadcasting, more than other forms of communications, receives the most limited protection from the free expression clause. First, broadcast media have established a uniquely pervasive presence in the lives of all citizens. Material presented over the airwaves confronts the citizen, not only in public, but in the privacy of his home. Second, broadcasting is uniquely accessible to children. Bookstores and motion picture theaters may be prohibited from making certain material available to children, but the same selectivity cannot be done in radio or television, where the listener or viewer is constantly tuning in and out.
Similar considerations apply in the area of national security.
The broadcast media have also established a uniquely pervasive presence in the lives of all Filipinos. Newspapers and current books are found only in metropolitan areas and in the poblaciones of municipalities accessible to fast and regular transportation. Even here, there are low income masses who find the cost of books, newspapers, and magazines beyond their humble means. Basic needs like food and shelter perforce enjoy high priorities.
On the other hand, the transistor radio is found everywhere. The television set is also becoming universal. Their message may be simultaneously received by a national or regional audience of listeners including the indifferent or unwilling who happen to be within reach of a blaring radio or television set. The materials broadcast over the airwaves reach every person of every age, persons of varying susceptibilities to persuasion, persons of different I.Q.s and mental capabilities, persons whose reactions to inflammatory or offensive speech would be difficult to monitor or predict. The impact of the vibrant speech is forceful and immediate. Unlike readers of the printed work, the radio audience has lesser opportunity to cogitate, analyze, and reject the utterance.
(5) The clear and present danger test, therefore, must take the particular circumstances of broadcast media into account. The supervision of radio stations-whether by government or through self-regulation by the industry itself calls for thoughtful, intelligent and sophisticated handling.
The government has a right to be protected against broadcasts which incite the listeners to violently overthrow, it. Radio and television may not be used to organize a rebellion or to signal the start of widespread uprising. At the same time, the people have a right to be informed. Radio and television would have little reason for existence if broadcasts are limited to bland, obsequious, or pleasantly entertaining utterances. Since they are the most convenient and popular means of disseminating varying views on public issues, they also deserve special protection.
(6) The freedom to comment on public affairs is essential to the vitality of a representative democracy. In the 1918 case of United States v. Bustos 137 Phil, 731) this Court was already stressing that. "The interest of society and the maintenance of good government demand a full discussion of public affairs. Complete liberty to comment on the conduct of public men is a scalpel in the case of free speech. The sharp incision of its probe relieves the abscesses of officialdom. Men in public life may suffer under a hostile and an unjust accusation; the wound can be assuaged with the balm of a clear conscience. A public officer must not be too thin-skinned with reference to comment upon his official acts. (Only thus can the intelligence and dignity of the individual be exalted. "
(7) Broadcast stations deserve the special protection given to all forms of media by the due process and freedom of expression clauses of the Constitution.
WHEREFORE, the case having become moot and academic, the petitioner's motion to withdraw or dismiss the petition is hereby GRANTED.
SO ORDERED.
FERNANDO, C.J., concurring:
I concur in the ponencia of Justice Gutierrez, Jr., notable for its reiteration of the clear and present danger principle as the standard of limitation on free speech and press, as decided by a unanimous court in J.B.L. Reyes v. Bagatsing.1
As may be gleaned from the voting of the Justices, the majority favors the view that even if a case were moot and academic, a statement of the governing principle is appropriate in the resolution of dismissal for the guidance not only of the parties but of others similarly situated. There are three Justices, however, Makasiar, Concepcion, Jr. and de la Fuente, who would strictly adhere to the concept that the case being moot and academic, the appropriate disposition is that of simply dismissing the action. That is to abide by the teaching of orthodox learning. The Philippines, however, has deviated from such a strict view. Nor is this approach of recent vintage. As early as Alejandrino v. Quezon2 decided in 1924, this Court, notwithstanding the absence of jurisdiction, expressed through Justice Malcolm what principle of law should govern. Similarly in Osmeña, Jr. v. Pendatun,3 notwithstanding well-founded doubts as to jurisdiction and a finding that the case should be dismissed for being moot and academic, this Court, through the then Justice, later Chief Justice Bengzon, passed upon the legal question raised. In that sense, the Philippines has followed an approach distinct from that of the United States, notwithstanding the influence of American Constitutional law on our legal system.
Also let me state for the record that the original opinion prepared by Justice Gutierrez, Jr. could not have been released in April after the petitioner on March 25, 1985 "filed a motion to withdraw or dismiss the petition." After that date, some members of the Court wanted the matter discussed anew as to its appropriate disposition. That is the explanation why such an opinion was never sent to the Office of the Chief Justice. Nor is it to be forgotten that even if a decision signed by all the other members were thus submitted, the practice traditionally followed is for whoever is Chief Justice to take a few days for the expression of his views- if minded to do so.
TEEHANKEE, J., concurring:
Prefatory Statement: As stated in the resolution penned by Mr. Justice Gutierrez, the release in early April of this year of the Court's decision declaring null and void respondent commission's challenged summary order for closure of petitioner's radio station ("definitely attended by complete absence of any hearing before or after the closure itself") and granting the petition for issuance of a writ of mandatory injunction for the reopening of the station, was overtaken by petitioner's "suddenly filed" motion to withdraw or dismiss the petition.
Initially, Mr. Justice Gutierrez was for applying the Salonga' formula and releasing nevertheless his sixteen-page extended opinion and decision on the merits. He was of the view, fully shared by me,a that "(T)he need for guiding principles on constitutionalism is particularly keen in critical times and in periods of transition. There is then a tendency to be impulsive in the exercise of power. The use of illegal shortcuts and the breakdown of traditional restraints and discipline, unfortunately, is most pronounced in troubled times, It becomes necessary for the Court to emphasize the importance of adherence to the mandates of the Constitution. The efforts, no matter how well meaning, to quell a rebellion or to stave off economic disaster cannot succeed if they transgress basic rights and, therefore, alienate our people." But since such approach did not gain the concurrence of the majority, he has replaced his orignal ponencia with the abbreviated Resolution (of a little over four pages) now released, which carries the required majority and issues guidelines "for the guidance of inferior courts and administrative tribunals exercising quasi judicial functions."
While withdrawal of the petition for loss of interest on petitioner's part may be granted, still the Court should unequivocally set forth the guiding and controlling precepts or doctrines in pursuance of its symbolic function of educating bench and bar as in Salonga on the protection and preservation of basic constitutional rights. As stated in my separate concurring opinion, infra, public respondents' summary closure of petitioner's radio station failed to observe the special protection given to all forms of media by the due process and freedom of press and media clauses of the Constitution, as well as the basic clear and present danger test. As stated by the now Chief Justice in De la Camara vs. Enaged the fact that the case has become moot "should not preclude this Tribunal from setting forth in language clear and unmistakable. . . for the guidance of lower court judges land other public officers] the controlling and authoritative doctrines that should be observed," so that fall respect may be accorded to basic constitutional rights. My separate concurring opinion which follows hereinafter was prepared and scheduled for promulgation on or about April 9, 1985 upon its return on said date to the ponente, Mr. Justice Gutierrez, for transmittal to the Office of the Chief Justice for the purpose. But this was overtaken by the filing of petitioner's motion for withdrawal or dismissal of the petition. Hence, my said concurring opinion should be read in such time context (in the same manner as in the 1974 martial law cases of Aquino, Jr. and Diokno vs. Enrile, 59 SCRA 183, 309, September 17, 1974, wherein the promulgation of the decision and separate opinions originally schedule for September 12, 1974 was deferred to the following week with the intervening release from detention of Senator Jose W. Diokno). x x x x x x x x x
TEEHANKEE, J., concurring:
The main opinion reaffirms in language unmistakable that broadcast media (radio and television) while subject to government licensing (for allocation of the use of airwaves and frequencies and regulation (considering their pervasive presence and instant impact) are equally protected by the preferred freedoms of speech and of the press and by the rudimentary requirements of due process against arbitrary deprivation of life, liberty and property; that the basic standard for restricting or punishing the exercise of these preferred freedoms is the clear and present danger test-danger of a serious and imminent evil sought to be prevented: that the summary closure in October, 1980 of petitioner's radio station ("definitely attended by complete absence of any hearing before or after the closure itself") violated its constitutional rights and must therefore be declared null and void, and consequently, the writ of mandatory injunction for the reopening of the station, as prayed for, must issue.
Congratulations are due the ponente Justice Hugo Gutierrez, Jr. who secured the Court's near- unaminous concurrence in the recent case of Salonga vs. Paño' which went back to the fundamentals and stressed, in discharge of the Court's "symbolic function of educating bench and bar on the extent of protection given by constitutional guarantees" that "(I)nfinitely more important than conventional adherence to general rules of criminal procedure is respect for the citizen's right to be free not only from arbitrary arrest and punishment but also from unwarranted and vexatious prosecution. The integrity of a democratic society is corrupted if a person is carelessly included in the trial of around forty persons when on the very face of the record no evidence linking him to the alleged conspiracy exists," that -x x x if there is any principle of the Constitution that more imperatively calls for attachment than any other it is the principle of free thought-not free thought for those who agree with us but freedom for the thought that we hate;" that "freedom of expression is a 'preferred' right and therefore stands on a higher level than substantive economic or other liberties," that "this must be so because the lessons of history, both political and legal, illustrate that freedom of thought and speech is the indispensable condition of nearly every other form of freedom. Protection is especially mandated for political discussions. This Court is particularly concerned when allegations are made that restraints have been imposed upon mere criticisms of government and public officials. Political discussion is essential to the ascertainment of political truth. It cannot be the basis of criminal indictments;" that there must be tolerance of political hyperbole since "debate on public issues should be uninhibited, robust, and wide open and it may well include vehement, caustic, and sometimes unpleasantly sharp attacks on government and public officials," that "the constitutional guarantees of free speech and free press do not permit a State to forbid or proscribe advocacy of the use of force or of law violation except where such advocacy is directed to inciting or producing imminent lawless action and is likely to incite or produce such action;" that "political discussion even among those opposed to the present administration is within the protective clause of freedom of speech and expression. The same cannot be construed as subversive activities per se or as evidence of membership in a subversive organization" in the absence of proof that "such discussion was in furtherance of any plan to overthrow the government through illegal means;" that "respondent court should have taken these factors into consideration before concluding that a prima fade case exists against the petitioner. Evidence must not only proceed from the mouth of a credible witness but it must be credible in itself such as the common experience and observation of mankind can approve as probable under the circumstances;" and that "judge or fiscal, therefore, should not go on with the prosecution in the hope that some credible evidence might later turn up during trial for this would be a flagrant violation of a basic right which the courts are created to uphold. It bears repeating that the judiciary lives up to its mission by vitalizing and not denigrating constitutional rights. So it has been before. It should continue to be so. "
The same ponente has now likewise obtained the Court's nearunanimous approval of the decision at bar,2 which restates basic and established constitutional principles under the Rule of Law that public officials do not possess absolute power to summarily close down a broadcasting station nor to arbitrarily deny its application for renewal of license; that their broad and peremptory regulatory powers "must be exercised with punctilious regard for the due process clause" which in the words of the Chief Justice signifies "freedom from arbitrariness [and] is the embodiment of the sporting idea of fair play:3 that radio and television which "would have little reason for existence if broadcasts are limited to bland, obsequious, or pleasantly entertaining utterances" deserve the special protection of the preferred right of free press and speech; that comment on and criticism of public officials in the conduct of public affairs is not to be taken as "inciting to sedition or subversive acts"-that to curb or punish the exercise of such preferred right of comment and criticism there must exist the clear and present danger of a substantive and grave evil that the State has a clear right to prevent, and hence, there must be a clear showing to this effect of "the words used and when and how they were used; that since the 1918 case of U.S. vs. Bustos,4 the Court has taught that the interest of society and the maintenance of good government demand a full discussion of public affairs. Complete liberty to comment on the conduct of public men is a scalpel in the case of free speech. The sharp incision of its probe relieves the abcesses of officialdom;" that the guarantee of free speech is a safety valve "allowing parties the opportunity to give vent to their views, even if contrary to the prevailing climate of opinion" which 'is grounded on "faith in the power of an appeal to reason by all the peaceful means for gaining access to the mind" and "serves to avert force and explosions due to restrictions upon rational modes of communication;"5 and that through the rights of free expression, free assembly and petition, "the citizens can participate not merely in the periodic establishment of the government through their suffrage but also in the administration of public affairs as well as in the discipline of abusive public officers" and that since "the threat of sanctions may deter the exercise [of these 'delicate and vulnerable . . . and supremely precious freedoms'] almost as potently as the actual application of sanctions, they 'need breathing space to survive' permitting government regulation only 'with narrow specificity."6
The late Justice Jose Abad Santos, martyr of the Japanese occupation, left us over half a century ago the legacy of his dissent against what he deemed were unjustified "invasions on the part of the government and its employees of the sanctities of a man's home and the privacies of life" in People vs. Rubio7 that the "commendable zeal (of internal revenue agents) if allowed to override constitutional limitations would become ,obnoxious to fundamental principles of liberty.' And if we are to be saved from the sad experiences of some countries which have constitutions only in name, we must insist that governmental authority be exercised within constitutional limits; for, after all, what matters is not so much what the people write in their constitutions as the spirit in which they observe their provisions."
In the same vein, the late Chief Justice Ricardo Paras in the landmark case of Primicias vs. Fugoso8 enjoined all to abide by the teaching of the 1907 sedition case of U.S. vs. Apurado9 that instances of "disorderly conduct by individual members of a crowd [be not seized] as an excuse to characterize the assembly as a seditious and tumultuous rising against the authorities," for "if the prosecution be permitted to seize upon every in stance of such disorderly conduct by individual members of a crowd as an excuse to characterize the assembly as a seditious and tumultous rising against the authorities, then the right to assemble and to petition for redress of grievances would become a delusion and snare and the attempt to exercise it on the most righteous occasion and in the most peaceable manner would expose all those who took part therein to the severest and most unmerited punishment, if the purposes which they sought to attain did not happen to be pleasing to the prosecuting authorities, If instances of disorderly conduct occur on such occasions, the guilty individuals should be sought out and punished therefor." Indeed, as I stressed in my dissenting opinion in the recent case of German us. Barangan,10 to require the citizen at every step to assert his rights and to go to court is to render illusory his rights. All concerned, the governors as well as the governed, must observe what they have written in their constitution in their very spirit and intent, so that as written by Justice Makasiar in the PBM case11 "the Bill of Rights [might not turn out to be] a useless attempt to limit the power of government and cease to be an efficacious shield against the tyranny of officials, of Majorities, of the influential and powerful, and of oligarchs-political, economic or otherwise."
The Court's decision makes short shrift of respondents' procedural arguments that non-renewal of petitioner's license has made the petition "moot and academic" (brushed aside as "an afterthought or substitute for the respondents' original position that the closure was due to national security") and that mandamus would not lie to compel the reopening of the radio station brought about by their inaction on petitioner's timely application for renewal of the license. It serves notice that in the exercise of the judicial power vested in it by, the Constitution, it will issue the equitable writs of certiorari and mandamus to do substantial justice and restore the status quo. In this case, the summary closure of petitioner's radio station in 1980 having been declared null and void and no valid ground for non-renewal of its license having been shown, it is as if the said license has been duly extended up to the end of the current term or year. It is expected that respondents will forthwith return the crystal of the transmitter and place no further obstacle to the prompt reopening of the radio station so that petitioner may pick up the broken pieces and rightfully resume its operations (after almost five years of closure) in accordance with the judgment at bar.
ABAD SANTOS, J, concurring:
The petitioner has filed a motion to withdraw its petition for the reasons stated in its motion. The Court has granted the motion but this circumstance should not deter the Court from educating those who wield power which if exercised arbitrarily will make a mockery of the Bill of Rights.
The closure of the petitioner's radio station on grounds of national security without elaboration of the grounds and without hearing deserves to be condemned in no uncertain terms for it is manifest that due process was not observed. If there is an idea which should be impressed in the minds of those who wield power it is that power must be used in a reasonable manner. Arbitrariness must be eschewed. The main opinion, that of Justice Teehankee and the case of Ang Tibay vs. Court of Industrial Relations, 69 Phil. 635 [1940], should be made required reading materials for public officials who huff and puff with power making themselves not merely obnoxious but dangerous as well.
Motion granted. 1. G.R. No. 65366, November 9,1983, 125 SCRA 553.
2. 46 Phil. 83.
3. 109 Phil.863(1960).
1. G.R. No. 59524, Feb. 18, 1985. Eleven members concurred with abstentions of Justices Aquino, De la Fuente and Alampay.
2. Twelve members concurred. with abstentions of Justices Aquino and Concepcion, Jr.
3. Ermita-Malate Hotel & Motel Operators' Ass'n. vs. City Mayor, 20 SCRA 849.
4. 31 Phil. 731.
5. J.B.L. Reyes vs. Bagatsing, 125 SCRA 553 (1983), per Fernando, C.J.
6. PBM Employees organization vs. PBM Co., Inc., 51 SCRA 189, per Makasiar, J.
7. 57 Phil. 384 (1932).
8. 80 Phil. 71 (1948).
9. 7 Phil. 422, 426, per Carson,J.
10. G.R. No. 68828, prom march 27, 1986.
11. Supra see fn. 6.
Ang Tibay et al. vs. The Court of Industrial Relations et al.
February 27, 1940
[GRN 46496 February 27, 1940]
ANG TIBAY, represented by TORIBIO TEODORO, manager and proprietor, and NATIONAL WORKERS' BROTHERHOOD, petitioners, vs. THE COURT OF INDUSTRIAL RELATIONS and NATIONAL LABOR UNION, INC., respondents.
1. COURT OF INDUSTRIAL RELATIONS; POWER.-The nature of the Court of Industrial Relations and of its power is extensively discussed in the decision.
2. ID.; ID.; TECHNICAL RULES OF PROCEDURE; DUE PROCESS OF LAW.-The Court of Industrial Relations is not narrowly constrained by technical rules of procedure, and Commonwealth Act No. 103 requires it to act according to justice and equity and substantial merits of the case, without regard to technicalities or legal evidence but may inform its mind in such manner as it may deem just and equitable (Goseco vs. Court of Industrial Relations et al., G. R. No. 46673). The fact, however, that the Court of Industrial Relations may be said to be free from the rigidity of certain procedural requirements does not mean that it can, in justiciable cases coming before it, entirely ignore or disregard the fundamental and essential requirements of due process in trials and investigations of an administrative character.
3. ID.; ID.; ID.; ID.; CARDINAL PRIMARY RIGHTS.-There are cardinal primary rights which must be respected even in proceedings of this character. The first of these rights is the right to a hearing, which includes the right of the party interested or affected to present his own case and submit evidence in support thereof. Not only must the party be given an opportunity to present his case and to adduce evidence tending to establish the rights which he asserts but the tribunal must consider the evidence presented. While the duty to deliberate does not impose the obligation to decide right, it does imply a necessity which cannot be disregarded, namely, that of having something to support its decision. Not only must there be some evidence to support a finding or conclusion, but the evidence must be substantial. The decision must be rendered on the evidence presented at the hearing, or at least contained in the record and disclosed to the parties affected. The Court of Industrial Relations or any of its judges, therefore, must act on its or his own independent consideration of the law and facts of the controversy, and not simply accept the views of a subordinate in arriving at a decision. The Court of Industrial Relations should, in all controvercial questions, render its decision in such a manner that the parties to the proceeding can know Lin: various issues involved, and the reasons for the decisions rendered. The performance of this duty is inseparable from the authority conferred upon it. 4. ID.; ID.; ID.; ID.; ID.; CASE: AT BAR; NEW TRIAL GRANTED.-In the light of the foregoing fundamental principles, it is sufficient to observe here that, except as to the alleged agreement between the Ang Tibay and the National Workers' Brotherhood (appendix A), the record is barren and does not satisfy the thirst for a factual basis upon which to predicate, in a rational way, a conclusion of law. This result, however, does not now preclude the concession of a new trial prayed for by the respondent National Labor Union, Inc. The interest of justice would be better served if the movant is given opportunity to present at the hearing the documents referred to in his motion and such other evidence as may be relevant to the main issue involved. The legislation which created the Court of Industrial Relations and under which it acts is new. The failure to grasp the fundamental issue involved is not entirely attributable to the parties adversely affected by the result. Accordingly, the motion for a new trial should be, and the same is hereby, granted, and the entire record of this case shall be remanded to the Court of Industrial Relations, with instruction that it re-open the case, receive all such evidence as may be relevant, and otherwise proceed in accordance with the requirements set forth in the decision.
DECISION on motion for reconsideration and on motion for new trial.
The facts are stated in the opinion of the court.
Solicitor-General Ozaeta and Assistant Attorney Barcelona for the Court of Industrial Relations.
Antonio D. Paguia for National Labor Union.
Claro M. Recto for petitioner "Ang Tibay".
Jose M. Casal for National Workers' Brotherhood.
LAUREL, J.:
The Solicitor-General in behalf of the respondent Court of Industrial Relations in the above- entitled case has filed a motion for reconsideration and moves that, for the reasons stated in his motion, we reconsider the following legal conclusions of the majority opinion of this Court:
"2. Que un contrato de trabajo, asi individual como colectivo, sin termino fijo de duracion o que no sea para una determinada, termina o bien por voluntad de cualquiera de las partes o cada vez que llega el plazo fijado para el pago de los salarios segun costumbre en la localidad o cuando, se termine la obra;
"T. Que los obreros de una empresa fabril, que han celebrado contrato, ya individual ya colectivamente, con ella, sin tiempo fijo, y que se han visto obligados a cesar en sus trabajos por haberse declarado paro forzoso en la fibrica en la cual trabaian, de jan de ser empleados u obreros de la misma;
"3. Que un patrono o sociedad que ha celebrado un contrato colectivo de trabajo con sus obreros sin tiempo fijo de duracion y sin ser para una obra determinada y que se niega a readmitir a dichos obreros que cesaron como, consecuencia de un paro forzoso, no es culpable de prictica injusta ni incurre en la sancion penal del articulo 5 de la Ley No. 213 del Commonwealth, aunque su negativa a readmitir se deba a que dichos obreros pertenecen a un determinado, organismo obrero, puesto que tales ya han dejado de ser empleados suyos por terminacion del contrato en virtud del paro."
The respondent National Labor Union, Inc., on the other hand, prays for the vacation of the judgment rendered by the majority of this Court and the remanding of the case to the Court of Industrial Relations for a new trial, and avers:
"L That Toribio Teodoro's claim that on September 26, 1938, there was shortage of leather soles in ANG TIBAY making it necessary for him to temporarily lay off the members of the National Labor Union Inc., is entirely false and unsupported by the records of the Bureau of Customs and the Books of Accounts of native dealers in leather.
44 2. That the supposed lack of leather materials claimed by Toribio Teodoro was but a scheme adopted to systematically discharge all the members of the National Labor Union, Inc., from work.
6' 3. That Toribio Teodoro's letter to the Philippine Army dated September 29, 1938, (re supposed delay of leather soles from the States) was but a scheme to systematically prevent the forfeiture of this bond despite the breach of his CONTRACT with the Philippine Army.
"4. That the National Workers' Brotherhood of ANG TIBAY is a company or employer union dominated by Toribio Teodoro, the existence and functions of which are illegal. (281 U. S., 548, petitioner's printed memorandum, p. 25.)
"5. That in the exercise by the laborers of their rights to collective bargaining, majority rule and elective representation are highly essential and indispensable. (Sections 2 and 5, Commonwealth Act No. 213.)
"6. That the century provisious of the Civil Code which had been (the) principal source of dissensions and continuous civil war in Spain cannot and should not be made applicable in interpreting and applying the salutary provisions of a modern labor legislation of American origin where industrial peace has always been the rule. "7. That the employer Toribio Teodoro was guilty of unfair labor practice for discriminating against the National Labor Union, Inc., and unjustly favoring the National Workers' Brotherhood.
"8. That the exhibits hereto attached are so inaccessible to the respondents that even with the exercise of due diligence they could not be expected to have obtained them and offered as evidence in the Court of Industrial Relations.
"9. That the attached documents and exhibits are of such far-reaching importance and effect that their admission would necessarily mean the modification and reversal of the judgment rendered herein."
The petitioner, Ang Tibay, has filed an opposition both to the motion for reconsideration of the respondent Court of Industrial Relations and to the motion for new trial of the respondent National Labor Uuion, Inc.
In view of the conclusion reached by us and to be hereinafter stated with reference to the motion for a new trial of the respondent National Labor Union, Inc., we are of the opinion that it is not necessary to pass upon the motion for reconsideration of the Solicitor-General. We shall proceed to dispose of the motion for new trial of the respondent labor union. Before doing this, however, we deem it necessary, in the interest of orderly procedure in cases of this nature, to make several observations regarding the nature of the powers of the Court of Industrial Relations and emphasize certain guiding principles which should be observed in the trial of cases brought before it. We have re-examined the entire record of the proceedings had before the Court of Industrial Relations in this case, and we have found no substantial evidence to indicate that the exclusion of the 89 laborers here was due to their union affiliation or activity. The whole transcript taken contains what transpired during the hearing and is more of a record of contradictory and conflicting statements of opposing counsel, with sporadic conclusion drawn to suit their own views. It is evident that these statements and expressions of views of counsel have no evidentiary value.
The Court of Industrial Relations is a special court whose functions are specifically stated in the law of its creation (Commonwealth Act No. 103). It is more an administrative board than a part of the integrated judicial system of the nation. It is not intended to be a mere receptive organ of the Government. Unlike a court of justice which is essentially passive, acting only when its jurisdiction is invoked and deciding only cases that are presented to it by the parties litigant, the function of the Court of Industrial Relations, as will appear from perusal of its organic law, is more active, affirmative and dynamic. It not only exercises judicial or quasi-judicial functions in the determination of disputes between employers and employees but its functions are far more comprehensive and extensive. It has jurisdiction over the entire Philippines, to consider, investigate, decide, and settle any question, matter controversy or dispute arising between, and/or affecting, employers and employees or laborers, and landlords and tenants or farm- laborers, and regulate the relations between them, subject to, and in accordance with, the provisions of Commonwealth Act No. 103 (section 1). It shall take cognizance for purposes of prevention, arbitration, decision and settlement, of any industrial or agricultural dispute causing or likely to cause a strike or lockout, arising from differences as regards wages, shares or compensation, hours of labor or conditions of tenancy or employment, between employers and employees or laborers and between landlords and tenants or farm-laborers, provided that the number of employees, laborers or tenants or farm-laborers involved exceeds thirty, and such industrial or agricultural dispute is submitted to the Court by the Secretary of Labor or by any or both of the parties to the controversy and certified by the Secretary of Labor as existing and proper to be dealth with by the Court for the sake of public interest. (Section 4, ibid.) It shall, before hearing the dispute and in the course of such hearing, endeavor to reconcile the parties and induce them to settle the dispute by amicable agreement. (Paragraph 2, section 4, ibid.) When directed by the President of the Philippines, it shall investigate and study all pertinent facts related to the industry concerned or to the industries established in a designated locality, with a view to determining the necessity and fairness of fixing and adopting for such industry or locality a minimum wage or share of laborers or tenants, or a maximum "canon" or rental to be paid by the "inquilinos" or tenants or lessees to landowners. (Section 5, ibid.) In fine, it may appeal to voluntary arbitration in the settlement of industrial disputes; may employ mediation or conciliation for that purpose, or recur to the more effective system of official investigation and compulsory arbitration in order to determine specific controversies between labor and capital in industry and in agriculture. There is in reality here a mingling of executive and judicial functions, which is a departure from the rigid doctrine of the separation of governmental powers.
In the case of Goseco vs. Court of Industrial Relations et al., G. R. No. 46673, promulgated September 13, 1939, we had occasion to point out that the Court of Industrial Relations is not narrowly constrained by technical rules of procedure, and the Act requires it to "act according to justice and equity and substantial merits of the case, without regard to technicalities or legal forms and shall not be bound by any technical rules of legal evidence but may inform its mind in such manner as it may deem just and equitable." (Section 20, Commonwealth Act No. 103.) It shall not be restricted to the specific relief claimed or demands made by the parties to the industrial or agricultural dispute, but may include in the award, order or decision any matter or determination which may be deemed necessary or expedient for the purpose of settling the dispute or of preventing further industrial or agricultural disputes. (Section 13, ibid.) And in the light of this legislative policy, appeals to this Court have been especially regulated by the rules recently promulgated by this Court to carry into effect the avowed legislative purpose. The fact, however, that the Court of Industrial Relations may be said to be free from the rigidity of certain procedural requirements does not mean that it can, in justiciable cases coming before it, entirely ignore or disregard the fundamental and essential requirements of due process in trials and investigations of an administrative character. There are cardinal primary rights which must be respected even in proceedings of this character:
(1) The first of these rights is the right to a hearing, which includes the right of the party interested or affected to present his own case and submit evidence in support thereof. In the language of Chief Justice Hughes, in Morgan v. U. S., 304 U. S. 1, 58 S. Ct. 773, 999, 82 Law. ed. 1129, "the liberty and property of the citizen shall be protected by the rudimentary requirements of fair play."
(2) Not only must the party be given an opportunity to present his case and to adduce evidence tending to establish the rights which he asserts but the tribunal must consider the evidence presented. (Chief Justice Hughes in Morgan v. U. S. 298 U. S. 468, 56 S. Ct. 906, 80 Law. ed. 1288.) In the language of this Court in Edwards vs. McCoy, 22 Phil., 598, "the right to adduce evidence, without the corresponding duty on the part of the board to consider it, is vain. Such right is conspicuously futile if the person or persons to whom the evidence is presented can thrust it aside without notice or consideration."
(3) "While the duty to deliberate does not impose the obligation to decide right, it does imply a necessity which cannot be disregarded, namely, that of having something to support its decision. A decision with absolutely nothing to support it is a nullity, a place when directly attached." (Edwards vs. McCoy, supra.) This principle emanates from the more fundamental principle that the genius of constitutional government is contrary to the vesting of unlimited power anywhere. Law is both a grant and a limitation upon power.
(4) Not only must there be some evidence to support a finding or conclusion (City of Manila vs. Agustin, G. R. No. 45844, promulgated November 29, 1937, XXXVI 0. G. 1335), but the evidence must be "substantial. (Washing. ton, Virginia & Maryland Coach Co. v. National Labor Relations Board, 301 U. S. 142, 147, 57 S. Ct. 648, 650, 81 Law. ed. 965.) "Substantial evidence is more than a mere scintilla. It means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion."
(Appalachian Electric Power v. National Labor Relations Board, 4 Cir., 93 F. 2d 985, 989; National Labor Relations Board v. Thompson Products, 6 Cir., 97 F. 2d 13, 15; Ballston-Stillwater Knitting Co. v. National Labor Relations Board, 2 Cir., 98 F. 2d 758, 760.) * * * The statute provides that 'the rules of evidence prevailing in courts of law and equity shall not be controlling.' The obvious purpose of this and similar provisions is to free administrative boards from the compulsion of technical rules so that the mere admission of matter which would be deemed incompetent in judicial proceedings would not invalidate the administrative order. (Interstate Commerce Commission v. Baird, 194 U. S. 25, 44, 24 S. Ct. 563, 568, 48 Law. ed. 860; Interstate Commerce Commission v. Louisville & Nashville R. Co., 227 U. S. 88, 93, 33 S. Ct. 185, 187, 57 Law. ed. 431; United States v. Abilene & Southern Ry. Co., 265 U. S. 274, 288, 44 S. Ct. 565, 569, 68 Law. ed. 1016; Tagg Bros. & Moorhead v. United States, 280 U. S. 420, 442, 50 S. Ct. 220, 225, 74 Law. ed. 624.) But this assurance of a desirable flexibility in administrative procedure does not go so far as to justify orders without a basis in evidence having rational probative force. Mere uncorroboratborated hearsay or rumor does not constitute substantial evidence. (Consolidated Edison Co. v. National Labor Relations Board, 59 S. Ct. 206, 83 Law. ed. No. 4, Adv. Op., p. 131.) "
(5) The decision must be rendered on the evidence presented at the hearing, or at least contained in the record and disclosed to the parties affected. (Interstate Commence Commission vs. L. & N. R. Co., 227 U. S. 88, 33 S. Ct. 185, 57 Law. ed. 431.) Only by confining the administrative tribunal to the evidence disclosed to the parties, can the latter be protected in their right to know and meet the case against them. It should not, however, detract from their duty actively to see that the law is enforced, and for that purpose, to use the authorized legal methods of securing evidence and informing itself of facts material and relevant to the controversy. Boards of inquiry may be appointed for the purpose of investigating and determining the facts in any given case, but their report and decision are only advisory. (Section 9, Commonwealth Act No. 103.) The Court of Industrial Relations may refer any industrial or agricultural dispute or any matter under its consideration or advisement to a local board of inquiry, a provincial fiscal, a justice of the peace or any public official in any part of the Philippines for investigation, report and recommendation, and may delegate to such board or public official such powers and functions as the said Court of Industrial Relations may deem necessary, but such delegation shall not affect the exercise of the Court itself of any of its powers. (Section 10, ibid.)
(6) The Court of Industrial Relations or any of its judges, therefore, must act on its or his own independent consideration of the law and facts of the controversy, and not simply accept the views of a subordinate in arriving at a decision. It may be that the volume of work is such that it is literally impossible for the titular heads of the Court of Industrial Relations personally to decide all controversies coming before them. In the United States the difficulty is solved with the enactment of statutory authority authorizing examiners or other subordinates to render final decision, with right to appeal to board or commission, but in our case there is no such statutory authority.
(7) The Court of Industrial Relations should, in all controversial questions, render its decision in such a manner that the parties to the proceeding can know the various issues involved, and the reasons for the decisions rendered. The performance of this duty is inseparable from the authority conferred upon it.
In the light of the foregoing fundamental principles, it is sufficient to observe here that, except as to the alleged agreement between the Ang Tibay and the National Workers' Brotherhood (appendix A), the record is barren and does not satisfy the thirst for a factual basis upon which to predicate, in A rational way, a conclusion of law.
This result, however, does not now preclude the concession of a new trial prayed for by the respondent National Labor Union, Inc. In the portion of the petition hereinabove quoted of the National Labor Union, Inc., it is alleged that "the supposed lack of leather material claimed by Toribio Teodoro was but a scheme adopted to systematically discharge all the members of the National Labor Union, Inc., from work" and this averment is desired to be proved by the petitioner with the "records of the Bureau of Customs and the Books of Accounts of native dealers in leather"; that "the National Workers' Brotherhood Union of Ang Tibay is a company or employer union dominated by Toribio Teodoro, the existence and functions of which are illegal." Petitioner further alleges under oath that the exhibits attached to the petition to prove his substantial averments "are so inaccessible to the respondents that even with the exercise of due diligence they could not be expected to have obtained them and offered as evidence in the Court of Industrial Relations", and that the documents attached to the petition "are of such far reaching importance and effect that their admission would necessarily mean the modification and reversal of the judgment rendered therein." We have considered the reply of Ang Tibay and its arguments against the petition. By and large, after considerable discussion, we have come to the conclusion that the interest of justice would be better served if the movant is given opportunity to present at the hearing the documents referred to in his motion and such other evidence as may be relevant to the main issue involved. The legislation which created the Court of Industrial Relations and under which it acts is new. The failure to grasp the fundamental issue involved is not entirely attributable to the parties adversely affected by the result. Accordingly, the motion for a new trial should be, and the same is hereby granted, and the entire record of this case shall be remanded to the Court of Industrial Relations, with instruction that it reopen the cage, receive all such evidence as may be relevant, and otherwise proceed in accordance with the requirements set forth hereinabove. So ordered.
Avanceña, C. J., Villa-Real, Imperial, Diaz, Concepcion, and Moran, JJ., concur.
Motion for new trial granted and cause remanded with instructions.
Ateneo de Manila University vs. Capulong
May 27, 1993.
[GRN 99327 May 27, 1993.]
ATENEO DE MANILA UNIVERSITY, FATHER BERNAS, S.J., DEAN CYNTHIA ROXAS-DEL, JUDGE RUPERTO KAPUNAN, JR., JUSTICE VENICIO ESCOLIN, FISCAL MIGUEL ALBAR, ATTYS. MARCOS HERRAS, FERDINAND CASIS, JOSE CLARO TESORO, RAMON CAGUIOA, and RAMON ERENETA, petitioers, vs. HON. IGNACIO M. CAPULONG, Presiding Judge of the TTC Makati, Br. 134, ZOSIMO MENDOZA, JR., ERNEST MONTECILLO, ADEL ABAS, JOSEPH LLEDO, AMADO SABBAN, DALMACIO LIM, JR., MANUEL ESCALONA and JUDE FERNANDEZ, respondents
SPECIAL CIVIL ACTION for certiorari to review the order of the Regional Trial Court of Makati, Br. 134. Capulong, J.
The facts are stated in the opinion of the Court.
Bengzon, Zarraga, Narciso, Cudala, Pecson, Benson & Jimenez for petitioners.
Romulo, Mabanta, Buenaventura, Sayoc & De Los Angeles for petitioner Cynthia Roxas-del Castillo.
Fabregas, Calida & Remallo for private respondents.
ROMERO, J.:
In 1975, the Court was confronted with a mandamus proceeding to compel the Faculty Admission Committee of the Loyola School of Theology, a religious seminary which has a working arrangement with the Ateneo de Manila University regarding accreditation of common students, to allow petitioner who had taken son courses therein for credit during summer, to continue her studies.1 Squarely meeting the issue, we dismissed the petition on the ground that students in the position of petitioner possess not a right, but a privilege, to be admitted to the institution. Not having satisfied the prime and indispensable requisite of a mandamus proceeding since there is no duty, much less a clear duty, on the part of the respondent to admit the petitioner, the petition did not prosper.
In support of its decision, the Court invoked academic freedom of institutions of higher learning, as recognized by the Constitution, the concept encompassing the right of a school to choose its students.
Eighteen (18) years later, the right of a University to refuse admittance to its students, this time in Ateneo de Manila University properi is again challenged. Whereas, in the Garcia case referred to in the opening paragraph, the individual concerned was not a regular student, the respondents in the case at bar, having been previously enrolled in the University, seek readmission. Moreover, in the earlier case, the petitioner was refused admittance, not on such considerations as personality traits and character orientation, or even inability to meet the institution's academic or intellectual standards, but because of her behavior in the classroom. The school pointedly informed her that "x x x it would seem to be in your best interest to work with a Faculty that is more compatible with your orientations."
On the other hand, students who are now being refused admission into petitioner University have been found guilty of violating Rule No. 3 of the Ateneo Law School Rules on Discipline which prohibits participation in hazing activities. The case attracted much publicity due to the death of one of the neophytes and serious physical injuries inflicted on another.
Herein lies an opportunity for the Court to add another dimension to the concept of academic freedom of institutions of higher learning, this time a case fraught with social and emotional overtones.
The facts which gave rise to this case which is far from novel are as follows:
As a requisite to membership, the Aquila Legis, a fraternity organized in the Ateneo Law School, held. its initiation rites on February 8, 9 and 10, 1991, for students interested in joining its ranks. As a result of such initiation rites, Leonardo "Lennie" H. Villa, a first year student of petitioner university, died of serious physical injuries at the Chinese General Hospital on February 10, 1991. He was not the lone victim, though, for another freshman by the name of Bienvenido Marquez was also hospitalized at the Capitol Medical Center for acute renal failure occasioned by the serious physical injuries inflicted upon him on the same occasion.
I In a notice doted February 11, 1991, petitioner Dean Cynthia del Castillo created a Joint Administration-Faculty-Student Investigating Committee' which was tasked to investigate and submit a report within 72 hours on the circumstances surrounding the death of Lennie Villa. Said notice also required respondent students to submit their written statements within twenty-four (24) hours from receipt. Although respondent students received a copy of the written notice, they failed to file a reply. In the meantime, they were placed on preventive suspension.3 Through their respective counsels, they requested copies of the charges and pertinent documents or affidavits.
In a notice dated February 14, 1991, the Joint Administration FacultyStudent Investigating Committee, after receiving the written statements and hearing the testimonies of several witnesses, found a prima facie case against respondent students for violation of Rule 3 of the Law School Catalogue entitled "Discipline."4 Respondent students were then required to file their written answers to the formal charge on or before February 18, 1991;otherwise, they would be deemed to have waived their right to present their defenses.
On February 20, 1991, petitioner Dean created a Disciplinary Board composed of petitioners Judge Ruperto Kapunan, Justice Venicio Escolin, Atty. Marcos Herras, Fiscal Miguel Albar and Atty. Ferdinand Casis, to hear the charges against respondent students.
In a letter dated February 20, 1991, respondent students were informed that they had violated Rule No. 3 of the Rules on Discipline contained in the Law School Catalogue. Said letter also states: "The complaint/charge against you arose from participation in acts of hazing committed during the Aquila Legis initiations held on February 8-10, 1991. The evidence against you consist of testimonies of students, showing our participation in acts prohibited by the School regulations." Finally, it ordered respondent students to file their written answers to the above charge on or before February 22, 1991, otherwise they would be deemed to have waived their defenses.5
In a motion dated February 21,1991, respondent students, through counsel, requested that the investigation against them be held in abeyance, pending action on their request for copies of the evidence against them.6
Respondent students were then directed by the Board to appear before it at a hearing on February 28, 1991 to clarify their answers with regard to the charges filed by the investigating committee for violation of Rule No. 3. However, in a letter to petitioners dated February 27, 1991, counsel for respondent students moved to postpone the hearing from February 28, 1991 to March 1, 1991.7
Subsequently, respondent students were directed to appear on March 2, 1991 for clarificatory questions.8
They were also informed that: a) The proceedings will be summary in nature in accordance with the rules laid down in the case of Guzman vs. National University;9 b) Petitioners have no right to cross-examine the affiants-neophytes; c) Hazing which is not defined in the School catalogue shall be defined in accordance with the proposed bill of Sen. Jose Lina, Senate Bill No. 3815; d) The Board will take into consideration the degree of participation of the petitioners in the alleged hazing incident in imposing the penalty; e) The Decision of the Board shall be appealable to the President of the University, i.e. Respondent Joaquin Bernas S.J.
On March 5, 1991, petitioner Bernas wrote Dean del Castillo that, "in cases where the Disciplinary Board is not prepared to impose the penalty of dismissal, I would prefer that the Board leave the decision on the penalty to the Administration so that this case be decided not just on the Law School level but also on the University level."10
In a resolution dated March 9, 1991, the Board found respondent students guilty of violating Rule No. 3 of the Ateneo Law School Rules on Discipline which prohibits participation in hazing activities. The Board found that respondent students acted as master auxiliaries or "auxies" during the initiation rites of Aquila Legis, and exercised the "auxies privilege," which allows them to participate in the physical hazing. Although respondent students claim that they were there to assist and attend to the needs of the neophytes, actually they were assigned a definite supportive role to play in the organized activity. Their guilt was heightened by the fact that they made no effort to prevent the infliction of further physical punishment on the neophytes under their care. The Board considered respondent students part and parcel of the integral process of hazing. In conclusion, the Board pronounced respondents guilty of hazing, either by active participation or through acquiescence. However, in view of the lack of unanimity among the members of the Board on the penalty dismissal, the Board left the imposition of the penalty to the University Administration.11
Petitioner Dean del Castillo waived her prerogative to review the decision of the Board and left to the President of the University the decision of whether to expel respondent students or not.
Consequently, in a resolution dated March 10, 1991, petitioner Fr. Joaquin G. Bernas, as President of teh Ateneo de Manila University, accepted the factual findings of the Board, thus: "that as Master Auxiliaries they exercised the 'auxies's privilege;' that even assuming that they did not lay hands on teh neophytes," respondent students are still guilty in accordance with the principle that "where two or more persons act together in the commission of a crime, whether they act through the physical volition of one or all, proceeding severally or collectively, each individual whose will contributes to the wrongdoing is responsible for the whole." Fr. Bernas, in describing the offense which led to the death of Leonardo Villa, concluded that the "offense of the respondents can be characterized as grave and serious, subversive of the goals of Christian education and contrary to civilized behavior." Accordingly, he imposed the penalty of dismissal on all respondent students.12
In a resolution dated March 18, 1991 and concurred in by petitioner Fr. Bernas, 13 the Board excluded respondent students Abas and Mendoza from the coverage of the resolution of March 10, 1991, inasmuch as at the time the latter resolution was promulgated, neither had as yet submitted their case to the Board. Said resolution also set the investigation of the two students on March 21, 1991.
On March 18, 1991, respondent students filed with teh Regional Trial Court of Makati, a petition for certiorari, prohibition and mandamus with prayer for temporary restraining order and preliminary injunction14 alleging that they were currently enrolled as students for the second semester of schoolyear 1990-91. Unless a temporary restraining order is issued, they would be prevented from taking their examinations. The petition principally centered on the alleged lack of due process in their dismissal.
On the same day, Judge Madayag issued a temporary restraining order enjoining petitioners from dismissing respondent students and stopping the former from conducting hearings relative to the hazing incident.15
Hearings in connection with the issuance of the temporary restraining order were then held. On April 7, 1991, the temporary restraining order issued on March 18, 1991 lapsed. Consequently, a day after the expiration of teh temporary restraining order, Dean del Castillo created a Special Board composed of Atty.(s) Jose Claro Tesoro, Ramon Caguioa, and Ramon Ereñeta to investigate the charges of hazing against respondent students Abas and Mendoza.
Respondent students reacted immediately by filing a Supplemental Petition of certiorari, prohibition and mandamus with prayer for a temporary restraining order and preliminary injunction, to include the aforesaid members of the Special Board, as additional respondents to the original petition.16
Petitioners moved to strike out the Supplemental Petition arguing that the creation of the Special Board was totally unrelated to the original petition which alleged lack of due process in the conduct of investigations by the Disciplinary Board against respondent students; that a supplemental petition cannot be admitted without the same being set for hearing and that the supplemental petition for the issuance of a temporary restraining order will, in effect, extend the previous restraining order beyond its mandatory 20-day lifetime.17 Acting on the urgent motion to admit the supplemental petition with prayer for a temporary restraining order, Judge Amin, as pairing judge of respondent Judge Capulong, granted respondent students' prayer on April 10, 1991.18
On May 17, 1991, respondent Judge ordered petitioners to reinstate respondent students.. Simultaneously, the court ordered petitioners to conduct special examinations in lieu of the final examinations which allegedly the students were not allowed to take, and enjoined them to maintain the status quo with regard to the cases of Adel Abas and Zosimo Mendoza pending final determination of the issues of the instant case. Lastly, it directed respondent students to file a bond in the amount of P50,000.00.19
On the same date, May 17, 1991, respondent judge issued the writ of preliminary injunction upon posting by respondent students of a bond dated May 17, 1991 in the amount of P50,000.00.
Hence, this special civil action of certiorari under Rule 65 with prayer for the issuance of a temporary restraining order questioning the order of respondent judge reinstating respondent students dated May 17, 1991. On May 30, 1991, this Court issued a temporary restraining order enjoining the enforcement of the May 17, 1991 order of respondent judge.21
In the case at bar, we come to grips with two relevant issues on academic freedom, namely: (1) whether a school is within its rights in expelling students from its academic community pursuant to tis disciplinary rules and moral standards; and (2) whether or not the penalty imposed by the school administration is proper under the circumstances.
We grant the petition and reverse the order of respondent judge ordering readmission of respondent students. Respondeng judge committed grave abuse of discretion when he ruled that respondent students had been denied due process in the investigation of the charges against them.
It is the threshold argument of respondent students that the decision of petitioner Fr. Joaquin Bernas, S.J., then President of the Ateneo de Manila University, to expel them was arrived at without affording them their right to procedural due process. We are constrained to disagree as we find no indication that such right has been violated. On the contrary, respondent students' rights in a school disciplinary proceeding, as enunciated in the cases of Guzman v. National University,22 Alcuaz v PSBA, Q.C. Branch23
and Non v. Dames II24
have been meticulously respected by petitioners in the various investigative proceedings held before they were expelled.
Corollary to their contention of denial of due process is their argument that it is the Ang Tibay case25 and not the Guzman case which is applicable in the case at bar. Though both cases essentially deal with the requirements of due process, the Guzman case is mor apropos to the instant case, since the latter deals specifically witht eh minimum standards to be satisfied in the imposition of disciplinary sanctions in academic institutions, such as petitioner university herein, thus: "(1) the students must be informed in writing of the nature and cause of any accusations against them; (2) that they shall have the right to answer the charges against them with the assistance of counsel, if desired; (3) they shall be informed of the evidence against them; (4)they shall have the right to adduce evidence in their own behalf; and (5) the evidence must be duly considered by the investigating committee or official designated by the school authorities to hear and decide the case."26
It cannot seriously be asserted that the above requirements were not met. When, in view of the death of Leonardo Villa, petitioner Cynthia del Castillo, as Dean of teh Ateneo Law School, notified and required respondent students on February 11, 1991 to submit within twenty-four- hours their written statement on the incident,27 the records show that instead of filing a reply, respondent students requested through their counsel, copies of the charges.28
While some of the students mentioned in the February 11, 1991 notice duly submitted written statements, the others failed to do so. Thus, the latter were granted an extension of up to February 18, 1991 to file their statements.29
Indubitably, the nature and cause of the accusation were adequately spelled out in petitioners' notices dated February 14 and 20, 1991.30
It is to be noted that the February 20, 1991 letter which quoted Rule No. 3 of its Rules of Discipline as contained in the Ateneo Law School Catalogue was addressed individually to respondent students. Petitioners' notices/letters dated February 11, February 14 and 20 clearyly shows that respondent students were given ample opportunity to adduce evidence in their behalf and to answer the charges leveled against them.
The requisite assistance of counsel was met when, from the very start of the investigations before the Joint Administration-Faculty-Student Committee, the law firm of Gonzales Batiller and Bilog and Associates put in its appearance and filed pleadings in behalf of respondent students.
Respondent students may not use the argument that since they were not accorded the opportunity to see and examine the written statements which became the basis of petitioners' February 14, 1991 order, they were denied procedural due process.31
Granting that they were denied such opportunity, the same may not be said to detract from the observance of due process for disciplinary cases involving students need not necessarily include the right to cross examination. An administrative proceedinc conducted to investigated students' participation in a hazing activity need not be clothed with the attributes of a judicial proceeding. A closer examination of the March 2, 1991 hearnig which characterized the rules on the investigation as being summary in nature and that respondent students have no right to examine affiants-neophytes, reveals that this is but a reiteration of our previous ruling in Alcuaz.32
Respondent student's contention that the investigating committee failed to consider their evidence is far from the truth because the February 14, 1992 order clearly states that it was reached only after receiving the written statements and hearing the testimonies of several witnesses.33
Similarly, the Disciplinary Board's resolution dated March 10, 1991 was preceded by a hearing on March 2, 1991 wherein respondent students were summoned to answer clarificatory questions.
With regard to the charge of hazing, respondent students fault petitioners for not explicitly defining the word "hazing" and allege that there is no proof that they were furnished copies of the 1990-91 Ateneo Law School Catalogue which prohibits hazing. Such flawed sophistry is not worthy of students who aspire to be future members of the Bar. It cannot be over-emphasized that the charge filed before the Joint Administration-Faculty-Student Investigating Committee and the Disciplinary Board is not a criminal case requiring proof beyond reasonable doubt but is merely administrative in character. As such, it is not subject to the rigorous requirements of criminal due process, particularly with respect to the specification of the charge involved. As we have had occasion to declare in previous cases of a similar nature, due process in disciplinary cases involving students does not entail proceedings and hearings identical to those prescribed for actions and proceedings in courts of justice.34
Accordingly, disciplinary charges against a student need not be drawn with the precision of a criminal information or complaint. Having given prior notice to the students involved that "hazing" which is not defined in the School Catalogue shall be defined in accordance with Senate Bill No. 3815, the proposed bill on the subject of Sen. Jose Lina, petitioners have said what needs to be said. We deem this sufficient for purposes of the investigation under scrutiny.
Hazing, as a ground for disciplining a student, to the extent of dismissal or expulsion, finds its raison d'etre in the increasing frequency of injury, even death, inflicted upon the neophytes by their insensate "masters." Assuredly it passes the test of reasonableness and absence of malice on the part of the school authorities. Far from fostering comradeship and esprit d'corps, it has merely fed upon the cruel and baser instincts of those who aspire to eventual leadership in our country. Respondent students argue that petitioners are not in a position to file the instant petition under Rule 65 considering that they failed to file a motion for reconsideration first before the trial court, thereby bypassing the latter and the Court of Appeals.35
It is accepted legal doctrine that an exception to the doctrine of exhaustion of remedies is when the case involves a question of law,36 as in this case, where the issue is whether or not respondent students have been afforded procedural due process prior to their dismissal from petitioner university.
Lastly, respondent students argue that we erred in issuing a Temporary Restraining Order since petitioners do not stand to suffer irreperable damage in the event that private respondents are allowed to re-enroll. No one can be so myopic as to doubt that the immediate reinstatement of respondent students who have been investigated and found by the Disciplinary Board to have violated petitioner university's disciplinary rules and standards will certainly undermine the authority of the administration of the schoo. This we would be most loathe to do.
More importantly, it will seriously impair petitioner university's academic freedom which has been enshrined in the 1935, 1973 and the present 1987 Constitutions.
At this juncture, it would be meet to recall the essential freedoms subsumed by Justice Felix Frankfurter in the term "academic freedom" cited in the case of Sweezy v. New Hampshire,37 thus; (1) who may teach; (2) what may be taught; (3) how it shall be taught; and (4) who may be admitted to study.
Socrates, the "first of the great moralists of Greece," proud to claim the title "gadfly of the State," had deservedly earned for himself a respected place in the annals of history as a martyr to the cause of free intellectual inquiry. To Plato, this great teacher of his was the "best, the most sensible, and the most just man of his age." In 399 B.C., he willingly quaffed the goblet of hemlock as punishment for alleged "corruption" of the youth of Athens. He describes in his own words how this charge of "corruption," the forefurther of the concept of academic freedom, came about:
"Young men of the richer classes, who have not much to do, come about me of their own accord: they like to hear the pretenders examined, and they often imitate me, and examine others themselves; there are plenty of persons, as they soon discover, who think that they know something, but really know little or nothing; and then those who are examined by them, instead of being angry with themselves are angry with me. This confounded Socrates, they say: This villainous misleader of youth. And then if somebody asks them, Why, what evil does he practice or teach? they do not know, and cannot tell; but in order that they may not appear to be at a loss, they repeat the ready-made charges which are used against all philosophers about teaching things up in the clouds and under the earth, and having no gods, and making the worse appear the better cause; for they do not like to confess that their pretense of knowledge has been detected --which is the truth; and as they are numerous and ambitious and energetic, and are all in battle array and have persuasive tongues, they have filled your ears with their loud and inveterate calumnies."38
Since Socrates, numberless individuals of the same heroic mold have similarly defied the stifling strictures of authority, whether State, Church, or various interest groups, to be able to give free rein to their ideas. Particularly odious were the insidious and blatant attempts at thought control during the time of the Inquisition until even the Medieval universities, renowned as intellectual centers in Europe, gradually lost their autonomy.
In time, such noble strivings, gathering libertarian encrustations along the way, were gradually crystallized in the cluster of freedoms which awaited the champions and martyrs of the dawning modern age. This was exemplified by the professors of the new German universities in the 16th and 17th centuries such as the Universitties of Leiden (1575), Helmstadt (1574) and Heidelberg (1652). The movement back to freedom of inquiry gained adherents among the exponents of fundamental human rights of the 19th and 20th centuries. "Academic freedom", the term as it evolved to describe the emerging rights related to intellectual liberty, has traditionally been associated with freedom of thought, speech, expression and the press; in other words, with the right of individuals in university communities, such as professors, researchers and administrators, to investigate, pursue, discuss and, in the immortal words of Socrates, "to follow the argument wherever it may lead," free from internal and external interference or pressure.
But obviously, its optimum impact is best realized where the freedom is exercised judiciously and does not degenerate into unbridled license. Early cases on this individual aspect of academic freedom have stressed the need for assuring to such individuals a measure of independence through the guarantees of autonomy and security of tenure. The components of this aspect of academic freedom have been categorized under the areas of: (1) who may teach and (2) how to teach.
It is to be realized that this individual aspect of academic freedom could have developed only pari passu with its institutional counterpart. As corporate entities, educational institutions of higher learning are inherently endowed with the right to establish their policies, academic and otherwise, unhampered by external controls or pressure. In the Frankfurter formulation, this is articulated in the areas of: (1) what shall be taught,e.g., the curriculum and (2) who may be admitted to study.
In the Philippines, the Acts which were passed with the change of sovereignty from the Spanish to the American government, namely, the Philippine Bill of 1902 and the Philippine Autonomy Act of 1`916 made no mention of the rights ow subsumed under the catch-all term of "academic freedom." This is most especially true with respect to the institutional aspect of the term. It had to await the drafting of the Philippine Constitutions to be recognized as deserving of legal protection.
The breakthrough for the concept itself was found in Section 5 of the 1935 Constitution which stated: "Universities established by the State shall enjoy academic freedom." The only State university at that time, being the University of the Philippines, the Charter was perceived by some as exhibiting rank favoritism for the said institution at the expense of the rest.
In an attempt to broaden the coverage of the provision, the 1973 Constitution provided in its Section 8(2); "All institutions of higher learning shall enjoy academic freedom." In his interpretation of the provision, former U.P. President Vicente G. Sinco, who was also a delegate to the 1971 Constitutional Convention, declared that it "definitely grants the right of academic freedom to the University as an institution as distinguished from the academic freedom of a university professor."39
Has the right been carried over to the present Constitution? In an attempt to give an explicit definition with an expanded coverage, the Commissiners of the Constitutional Commission of 1986 came up with this formulation: "Academic freedom shall be enjoyed by students, by teachers, and by researchers." After protracted debate and ringing speeches, the final version which was none too different from the way it was couched in the previous two (2) Constitutions, as found in Article XIV, Section 5(2) states: "Academic freedom shall be enjoyed in all institutions of higher learning." In anticipation of the question as to whether and what aspects of academic freedom are included herein, ConCom Commissioner Adolfo S. Azcuna explained: "Since academic freedom is a dynamic concept, we want to expand the frontiers of freedom, especially in education, therefore, we shall leave it to the courts to develop further the parameters of academic freedom."40
More to the point, Commissioner Jose Luis Martin C. Gascon asked: "When we speak of the sentence 'academic freedom shall be enjoyed in all institutions of higher learning,' do we mean that academic freedom shall be enjoyed by the institution itself?" Azcuna replied: "Not only that, it also includes..." Gascon finished off the broken thought,-- "the faculty and the students." Azcuna replied: "Yes."
Since Garcia v. Loyola School of Theology,41 we have consistently upheld the salutary proposition that admission to an institution of higher learning is discretionary upon a school, the same being a privilege on the part of the student rather than a right. While under the Education Act of 1982, students have a right "to freely choose their field of study, subject to existing curricula and to continue their course therein up to graduation," such right is subject, as all rights are, to the established academic and disciplinary standards laid down by the academic institution.42
"For private schools have the right to establish reasonable rules and regulations for the admission, discipline and promotion of students. This right...extends as well to parents...as parents are under a social and moral (if not legal) obligation, individually and collectively, to assist and cooperate with the schools."43
Such rules are "incident to the very object of incorporation and indispensable to the successful managament of the college. The rules may include those governing student discipline."44
Going a step further, the establishment of rules governing university-student relations, particularly those pertaining to student discipline, may be regarded as vital, not merely to the smoothe and efficient operation of the institution, but to its very survival.
Within memory of the current generation is the eruption of militancy in the academic groves as collectively, the students demanded and plucked for themselves from the panoply of academic freedom their own rights encapsulized under the rubric of "right to education" forgetting that, in Hohfeldian terms, they hava a concomitant duty, and that is, their duty to learn under the rules laid down by the school.
Considering that respondent students are proud to claim as their own a Christian school that includes Theology as part of its curriculum and assiduously strives to turn out individuals of unimpeachable morals and integrity in the mold of the founder of the order of the Society of Jesus, St. Ignatius of Loyola, and their God-fearing forbears, their barbaric and ruthless acts are the more reprehensible. It must be borne in mind that universities are established, not merely to develop the intellect and skills of the studentry, but to inculcate lofty values, ideals and attitudes; nay, the development, or flowering if you will, of the total man.
In essence, education must ultimately be religious - not in the sense that the founders or charter members of the institutiona are sectarian or profess a religious ideology. Rather, a religious education, as the renowned philosopher Alfred North Whitehead said, is "an education which inculcates duty and reverence."45
It appears that the particular brand of religious education offered by the Ateneo de Manila University has been lost on the respondent students.
Certainly, they do not deserve to claim such a venerable institution as the Ateneo de Manila University as their own a minute longer, for they may foreseeably cast a malevolent influence on the students currently enrolled, as well as those who come after them. Quite applicable to this case is our pronouncement in Yap Chin Fah v. Court of Appeals that: "The maintenance of a morally conducive and orderly educational environment will be seriously imperilled, if, under the circumstances of this case, Grace Christian is forced to admit petitioner's children and to reintegrate them to the student body."46
Thus, the decision of petitioner university to expel them is but congruent with the gravity of their misdeeds. That there must be such a congruence between the offense committed and the sanction imposed was stressed in Malabanan v. Ramento.47
Having carefully reviewed the records and the procedure followed by petitioner university, we see no reason to reverse its decision founded on the following undisputed facts: that on February 8, 9 and 10, 1991, the Aquila Legis Fraternity conducted hazing activities; that respondent students were present at the hazing as auxiliaries, and that as a result of the hazing, Leonardo Villa died from serious physical injuries, while Bienvenido Marquez was hospitalized. In light of the vicious acts of respondent students upon those whom ironically they would claim as "brothers" after the initiation rites, how can wer countenance the imposition of such nominal penalties as reprimand or even suspension? We, therefore, affirm petitioners' imposition of the penalty of dismissal upon respondent students. This finds authority and justification in Section 146 of the Manual of Regulations for Private Schools.48
WHEREFORE, the instant petition is GRANTED; the order of respondent Judge dated May 17, 1991 reinstating respondent students into petitioner university is hereby REVERSED. The resolution of petitioner Joaquin Bernas S.J., then President of Ateneo de Manila University dated March 10, 1991, is REINSTATED and the decision of the Special Board DISMISSING respondent students ADEL ABAS and ZOSIMO MENDOZA dated May 20, 1991 is hereby AFFIRMED.
SO ORDERED.
Narvasa (C.J.), Feliciano, Padilla, Bidin, Regalado, Davide, Jr., Nocon, Bellosillo, Melo and Quiason, JJ., concur.
Cruz, J., See separate concurrence.
Griño-Aquino, J., On leave.
CRUZ, J., concurring in the result.
I concur in the result. I do not join in the statements in the ponencia which seem to me to be a prejudgment of the criminal cases against the private respondents for the death of Lenny Villa.
Petition granted. 1. Garcia v. The Faculty Admission's Committee, Loyola School of Theology, No. L-40779, November 28, 1975, 68 SCRA 277-298.
2. Composed of Faculty Members: Atty(s) Jacinto Jimenez, Sedfrey Candelaria, Carlos Medina, Alternate: Dean Antonio Abed. Students: Mr. (s) Arthur Yap, Reynaldo Dizon, Ms Patricia Ty Administration: Dean Cynthia del Castillo (Chairperson).
3. Annex B, Rollo, p. 41.
4. "DISCIPLINE
Dedication to study, respect for authority, strict observance of the rules and regulations of the University and the school and unfailing courtesy are expected at all times of all Ateneo Students. The Administration reserves to itself the right to suspend, dismis from the School at any time, strike from the list of candidates for graduation and/or withhold the Ateneo diploma from or expel any student whom it may deem unworthy. Any of the following acts shall constitute a ground for suspension, dismissal striking from the list of candidates for graduation and/or withholding of the Ateneo diploma, or expulsion, depending on the severity of the offense:
5. Annex D, Rollo, p. 45.
6.Annex E, Rollo, p. 46.
7. Annex F, Rollo, p. 48.
8. Annex G, Rollo, p. 49.
9. L-68288, July 11, 1986, 142 SCRA 699.
10. Annex Q, Rollo, p. 88.
11. Annex H, Rollo, p. 175.
12. The dismissed students are: Ernest Montecillo, E. Amado Sabban, Joseph Lledo, Santiago Ranada III, Jude Fernandez, Dalmacio Lim, Adel Abas, Ronan de Guzman, Zosimo Mendoza and Manuel Escalona. Annex I, Rollo, p. 52.
13. Annex J, Rollo, p. 54.
14. Annex K, Rollo, p. 55.
15. Annex L, Rollo, p. 67.
16. Annex M, Rollo, pp. 68-73. 17. Annex N, Rollo, pp. 76-81.
18. Rollo, p. 84.
19. Annex A, Rollo, p. 40.
20. Annex M, Rollo, p. 189.
21. Of the respondent students dismissed in the March 10, 1991 Resolution, Santiago Ranada III and Ronan de Guzman are not named private respondents herein.
22. L-68288, July 11, 1986 142 SCRA 699.
23. L-76353, May 2, 1988, 161 SCRA 7.
24. G.R. No. 89317, May 20, 1990, 185 SCRA 523.
25. 69 Phil. 635 (1940).
26. Supra, at 22.
27. Annex B, Rollo, p. 41.
28. Order dated May 17, 1991, Annex A, p. 35.
29. Annex C, Rollo, p. 43.
30. See Annex B, Rollo, p.41 and Annex D, Rollo, p. 44.
31. Rollo, p. 155.
32. Supra at 20.
33. Annex C, Rollo, p. 43.
34. Alcuaz v. PSBA, QC Branch, supra at 20.
35. Rollo, pp. 99-100
36. PALEA v. PAL, Inc., No. L-31396, January 30, 1982, 111 SCRA 215 and Central Bank v. Cloribel, 44 SCRA 307, No. L026971, April 11, 1972.
37. 354 U.S. 234 (1957).
38. Riley, Woodbridge, STORY OF ETHICS, Men and Morals, Vol. II, p. 62, Doubleday, Doran and Co., Inc., 1933. 39. Sinco, PHILIPPINE POLITICAL LAW, p. 489 (1962).
40. 4 ConCom Record, p. 439.
41. No. L-40779, November 28, 1975, 68 SCRA 277. See also the cases of Tangonan v. Pano, G.R. No. L-45157, June 27, 1985, 137 SCRA 245 and Magtibay v. Garcia, No. L-28971, January 28, 1982, 120 SCRA 370.
42. Section 9(2) of Batas Pambansa Blg. 232, effective Sepember 11, 1982.
43. Yap Chin Fah v. Court of Appeals [Resolution], G.R. No. 90063, December 12, 1989.
44. Supra, at 22.
45. In his article "The Aims of Education," Alfred North Whitehead explained: "A religious education is an education which inculcates duty and reverence. Duty arises from our potential control over the course of events. Where attainable knowledge could have changed the issue, ignorance has the guilt of vice. And the foundation of reverence is this perception, that the present holds within itself the complete sum of existence, backwards and forwards, that whole amplitude of time, which is eternity." Fuess, Claude M. and Basford, Emory S., Editors UNSEEN HARVESTS, A Treasury of Teaching, p. 92, The Macmillan Company, 1947.
46. Supra, at 43.
47. G.R. No. 62270, May 21, 19184, 129 SCRA 359.
48. Ateneo de Manila v. Court of Appeals, No. L-56180, October 16, 1986, 145 SCRA 100.
ABAKADA Guro Party List vs. Ermita
EN BANC
ABAKADA GURO PARTY LIST G.R. No. 168056 (Formerly AASJAS) OFFICERS SAMSON S. ALCANTARA and ED VINCENT S. ALBANO, Petitioners, Present:
DAVIDE, JR., C.J., PUNO, PANGANIBAN, QUISUMBING, YNARES-SANTIAGO, SANDOVAL-GUTIERREZ, - versus - CARPIO, AUSTRIA-MARTINEZ, CORONA, CARPIO-MORALES, CALLEJO, SR., AZCUNA, TINGA, CHICO-NAZARIO, and GARCIA, JJ. THE HONORABLE EXECUTIVE SECRETARY EDUARDO ERMITA; HONORABLE SECRETARY OF THE DEPARTMENT OF FINANCE CESAR PURISIMA; and HONORABLE COMMISSIONER OF INTERNAL REVENUE GUILLERMO PARAYNO, JR., Respondents. x ------x
AQUILINO Q. PIMENTEL, JR., G.R. No. 168207 LUISA P. EJERCITO-ESTRADA, JINGGOY E. ESTRADA, PANFILO M. LACSON, ALFREDO S. LIM, JAMBY A.S. MADRIGAL, AND SERGIO R. OSMEÑA III, Petitioners,
- versus -
EXECUTIVE SECRETARY EDUARDO R. ERMITA, CESAR V. PURISIMA, SECRETARY OF FINANCE, GUILLERMO L. PARAYNO, JR., COMMISSIONER OF THE BUREAU OF INTERNAL REVENUE, Respondents. x ------x
ASSOCIATION OF PILIPINAS G.R. No. 168461 SHELL DEALERS, INC. represented by its President, ROSARIO ANTONIO; PETRON DEALERS’ ASSOCIATION represented by its President, RUTH E. BARBIBI; ASSOCIATION OF CALTEX DEALERS’ OF THE PHILIPPINES represented by its President, MERCEDITAS A. GARCIA; ROSARIO ANTONIO doing business under the name and style of “ANB NORTH SHELL SERVICE STATION”; LOURDES MARTINEZ doing business under the name and style of “SHELL GATE – N. DOMINGO”; BETHZAIDA TAN doing business under the name and style of “ADVANCE SHELL STATION”; REYNALDO P. MONTOYA doing business under the name and style of “NEW LAMUAN SHELL SERVICE STATION”; EFREN SOTTO doing business under the name and style of “RED FIELD SHELL SERVICE STATION”; DONICA CORPORATION represented by its President, DESI TOMACRUZ; RUTH E. MARBIBI doing business under the name and style of “R&R PETRON STATION”; PETER M. UNGSON doing business under the name and style of “CLASSIC STAR GASOLINE SERVICE STATION”; MARIAN SHEILA A. LEE doing business under the name and style of “NTE GASOLINE & SERVICE STATION”; JULIAN CESAR P. POSADAS doing business under the name and style of “STARCARGA ENTERPRISES”; ADORACION MAÑEBO doing business under the name and style of “CMA MOTORISTS CENTER”; SUSAN M. ENTRATA doing business under the name and style of “LEONA’S GASOLINE STATION and SERVICE CENTER”; CARMELITA BALDONADO doing business under the name and style of “FIRST CHOICE SERVICE CENTER”; MERCEDITAS A. GARCIA doing business under the name and style of “LORPED SERVICE CENTER”; RHEAMAR A. RAMOS doing business under the name and style of “RJRAM PTT GAS STATION”; MA. ISABEL VIOLAGO doing business under the name and style of “VIOLAGO-PTT SERVICE CENTER”; MOTORISTS’ HEART CORPORATION represented by its Vice-President for Operations, JOSELITO F. FLORDELIZA; MOTORISTS’ HARVARD CORPORATION represented by its Vice-President for Operations, JOSELITO F. FLORDELIZA; MOTORISTS’ HERITAGE CORPORATION represented by its Vice-President for Operations, JOSELITO F. FLORDELIZA; PHILIPPINE STANDARD OIL CORPORATION represented by its Vice-President for Operations, JOSELITO F. FLORDELIZA; ROMEO MANUEL doing business under the name and style of “ROMMAN GASOLINE STATION”; ANTHONY ALBERT CRUZ III doing business under the name and style of “TRUE SERVICE STATION”, Petitioners,
- versus -
CESAR V. PURISIMA, in his capacity as Secretary of the Department of Finance and GUILLERMO L. PARAYNO, JR., in his capacity as Commissioner of Internal Revenue, Respondents. x ------x
FRANCIS JOSEPH G. ESCUDERO, G.R. No. 168463 VINCENT CRISOLOGO, EMMANUEL JOEL J. VILLANUEVA, RODOLFO G. PLAZA, DARLENE ANTONINO- CUSTODIO, OSCAR G. MALAPITAN, BENJAMIN C. AGARAO, JR. JUAN EDGARDO M. ANGARA, JUSTIN MARC SB. CHIPECO, FLORENCIO G. NOEL, MUJIV S. HATAMAN, RENATO B. MAGTUBO, JOSEPH A. SANTIAGO, TEOFISTO DL. GUINGONA III, RUY ELIAS C. LOPEZ, RODOLFO Q. AGBAYANI and TEODORO A. CASIÑO, Petitioners,
- versus -
CESAR V. PURISIMA, in his capacity as Secretary of Finance, GUILLERMO L. PARAYNO, JR., in his capacity as Commissioner of Internal Revenue, and EDUARDO R. ERMITA, in his capacity as Executive Secretary, Respondents. x ------x
BATAAN GOVERNOR ENRIQUE G.R. No. 168730 T. GARCIA, JR. Petitioner,
- versus -
HON. EDUARDO R. ERMITA, in his capacity as the Executive Secretary; HON. MARGARITO TEVES, in his capacity as Secretary of Finance; HON. JOSE MARIO BUNAG, in his capacity as the OIC Commissioner of the Bureau of Internal Revenue; and HON. ALEXANDER AREVALO, in his capacity as the OIC Commissioner Promulgated: of the Bureau of Customs, Respondents. September 1, 2005 x ------x
D E C I S I O N
AUSTRIA-MARTINEZ, J.:
The expenses of government, having for their object the interest of all, should be borne by everyone, and the more man enjoys the advantages of society, the more he ought to hold himself honored in contributing to those expenses. -Anne Robert Jacques Turgot (1727-1781) French statesman and economist
Mounting budget deficit, revenue generation, inadequate fiscal allocation for education, increased emoluments for health workers, and wider coverage for full value-added tax benefits … these are the reasons why Republic Act No. 9337 (R.A. No. 9337)[1] was enacted. Reasons, the wisdom of which, the Court even with its extensive constitutional power of review, cannot probe. The petitioners in these cases, however, question not only the wisdom of the law, but also perceived constitutional infirmities in its passage.
Every law enjoys in its favor the presumption of constitutionality. Their arguments notwithstanding, petitioners failed to justify their call for the invalidity of the law. Hence, R.A. No. 9337 is not unconstitutional.
LEGISLATIVE HISTORY
R.A. No. 9337 is a consolidation of three legislative bills namely, House Bill Nos. 3555 and 3705, and Senate Bill No. 1950.
House Bill No. 3555[2] was introduced on first reading on January 7, 2005. The House Committee on Ways and Means approved the bill, in substitution of House Bill No. 1468, which Representative (Rep.) Eric D. Singson introduced on August 8, 2004. The President certified the bill on January 7, 2005 for immediate enactment. On January 27, 2005, the House of Representatives approved the bill on second and third reading.
House Bill No. 3705[3] on the other hand, substituted House Bill No. 3105 introduced by Rep. Salacnib F. Baterina, and House Bill No. 3381 introduced by Rep. Jacinto V. Paras. Its “mother bill” is House Bill No. 3555. The House Committee on Ways and Means approved the bill on February 2, 2005. The President also certified it as urgent onFebruary 8, 2005. The House of Representatives approved the bill on second and third reading on February 28, 2005.
Meanwhile, the Senate Committee on Ways and Means approved Senate Bill No. 1950[4] on March 7, 2005, “in substitution of Senate Bill Nos. 1337, 1838 and 1873, taking into consideration House Bill Nos. 3555 and 3705.” Senator Ralph G. Recto sponsored Senate Bill No. 1337, while Senate Bill Nos. 1838 and 1873 were both sponsored by Sens. Franklin M. Drilon, Juan M. Flavier and Francis N. Pangilinan. The President certified the bill on March 11, 2005, and was approved by the Senate on second and third reading on April 13, 2005.
On the same date, April 13, 2005, the Senate agreed to the request of the House of Representatives for a committee conference on the disagreeing provisions of the proposed bills.
Before long, the Conference Committee on the Disagreeing Provisions of House Bill No. 3555, House Bill No. 3705, and Senate Bill No. 1950, “after having met and discussed in full free and conference,” recommended the approval of its report, which the Senate did on May 10, 2005, and with the House of Representatives agreeing thereto the next day, May 11, 2005.
On May 23, 2005, the enrolled copy of the consolidated House and Senate version was transmitted to the President, who signed the same into law on May 24, 2005. Thus, came R.A. No. 9337.
July 1, 2005 is the effectivity date of R.A. No. 9337.[5] When said date came, the Court issued a temporary restraining order, effective immediately and continuing until further orders, enjoining respondents from enforcing and implementing the law.
Oral arguments were held on July 14, 2005. Significantly, during the hearing, the Court speaking through Mr. Justice Artemio V. Panganiban, voiced the rationale for its issuance of the temporary restraining order on July 1, 2005, to wit: J. PANGANIBAN : . . . But before I go into the details of your presentation, let me just tell you a little background. You know when the law took effect on July 1, 2005, the Court issued a TRO at about 5 o’clock in the afternoon. But before that, there was a lot of complaints aired on television and on radio. Some people in a gas station were complaining that the gas prices went up by 10%. Some people were complaining that their electric bill will go up by 10%. Other times people riding in domestic air carrier were complaining that the prices that they’ll have to pay would have to go up by 10%. While all that was being aired, per your presentation and per our own understanding of the law, that’s not true. It’s not true that the e-vat law necessarily increased prices by 10% uniformly isn’t it?
ATTY. BANIQUED : No, Your Honor.
J. PANGANIBAN : It is not?
ATTY. BANIQUED : It’s not, because, Your Honor, there is an Executive Order that granted the Petroleum companies some subsidy . . . interrupted
J. PANGANIBAN : That’s correct . . .
ATTY. BANIQUED : . . . and therefore that was meant to temper the impact . . . interrupted
J. PANGANIBAN : . . . mitigating measures . . .
ATTY. BANIQUED : Yes, Your Honor.
J. PANGANIBAN : As a matter of fact a part of the mitigating measures would be the elimination of the Excise Tax and the import duties. That is why, it is not correct to say that the VAT as to petroleum dealers increased prices by 10%.
ATTY. BANIQUED : Yes, Your Honor.
J. PANGANIBAN : And therefore, there is no justification for increasing the retail price by 10% to cover the E-Vat tax. If you consider the excise tax and the import duties, the Net Tax would probably be in the neighborhood of 7%? We are not going into exact figures I am just trying to deliver a point that different industries, different products, different services are hit differently. So it’s not correct to say that all prices must go up by 10%. ATTY. BANIQUED : You’re right, Your Honor.
J. PANGANIBAN : Now. For instance, Domestic Airline companies, Mr. Counsel, are at present imposed a Sales Tax of 3%. When this E-Vat law took effect the Sales Tax was also removed as a mitigating measure. So, therefore, there is no justification to increase the fares by 10% at best 7%, correct?
ATTY. BANIQUED : I guess so, Your Honor, yes.
J. PANGANIBAN : There are other products that the people were complaining on that first day, were being increased arbitrarily by 10%. And that’s one reason among many others this Court had to issue TRO because of the confusion in the implementation. That’s why we added as an issue in this case, even if it’s tangentially taken up by the pleadings of the parties, the confusion in the implementation of the E-vat. Our people were subjected to the mercy of that confusion of an across the board increase of 10%, which you yourself now admit and I think even the Government will admit is incorrect. In some cases, it should be 3% only, in some cases it should be 6% depending on these mitigating measures and the location and situation of each product, of each service, of each company, isn’t it?
ATTY. BANIQUED : Yes, Your Honor.
J. PANGANIBAN : Alright. So that’s one reason why we had to issue a TRO pending the clarification of all these and we wish the government will take time to clarify all these by means of a more detailed implementing rules, in case the law is upheld by this Court. . . .[6]
The Court also directed the parties to file their respective Memoranda.
G.R. No. 168056
Before R.A. No. 9337 took effect, petitioners ABAKADA GURO Party List, et al., filed a petition for prohibition on May 27, 2005. They question the constitutionality of Sections 4, 5 and 6 of R.A. No. 9337, amending Sections 106, 107 and 108, respectively, of the National Internal Revenue Code (NIRC). Section 4 imposes a 10% VAT on sale of goods and properties, Section 5 imposes a 10% VAT on importation of goods, and Section 6 imposes a 10% VAT on sale of services and use or lease of properties. These questioned provisions contain a uniform proviso authorizing the President, upon recommendation of the Secretary of Finance, to raise the VAT rate to 12%, effective January 1, 2006, after any of the following conditions have been satisfied, to wit:
. . . That the President, upon the recommendation of the Secretary of Finance, shall, effective January 1, 2006, raise the rate of value-added tax to twelve percent (12%), after any of the following conditions has been satisfied:
(i) Value-added tax collection as a percentage of Gross Domestic Product (GDP) of the previous year exceeds two and four-fifth percent (2 4/5%); or
(ii) National government deficit as a percentage of GDP of the previous year exceeds one and one-half percent (1 ½%).
Petitioners argue that the law is unconstitutional, as it constitutes abandonment by Congress of its exclusive authority to fix the rate of taxes under Article VI, Section 28(2) of the 1987 Philippine Constitution.
G.R. No. 168207
On June 9, 2005, Sen. Aquilino Q. Pimentel, Jr., et al., filed a petition for certiorari likewise assailing the constitutionality of Sections 4, 5 and 6 of R.A. No. 9337. Aside from questioning the so-called stand-by authority of the President to increase the VAT rate to 12%, on the ground that it amounts to an undue delegation of legislative power, petitioners also contend that the increase in the VAT rate to 12% contingent on any of the two conditions being satisfied violates the due process clause embodied in Article III, Section 1 of the Constitution, as it imposes an unfair and additional tax burden on the people, in that: (1) the 12% increase is ambiguous because it does not state if the rate would be returned to the original 10% if the conditions are no longer satisfied; (2) the rate is unfair and unreasonable, as the people are unsure of the applicable VAT rate from year to year; and (3) the increase in the VAT rate, which is supposed to be an incentive to 4 the President to raise the VAT collection to at least 2 /5 of the GDP of the previous year, should only be based on fiscal adequacy.
Petitioners further claim that the inclusion of a stand-by authority granted to the President by the Bicameral Conference Committee is a violation of the “no- amendment rule” upon last reading of a bill laid down in Article VI, Section 26(2) of the Constitution.
G.R. No. 168461
Thereafter, a petition for prohibition was filed on June 29, 2005, by the Association of Pilipinas Shell Dealers, Inc., et al., assailing the following provisions of R.A. No. 9337: 1) Section 8, amending Section 110 (A)(2) of the NIRC, requiring that the input tax on depreciable goods shall be amortized over a 60-month period, if the acquisition, excluding the VAT components, exceeds One Million Pesos (P1, 000,000.00);
2) Section 8, amending Section 110 (B) of the NIRC, imposing a 70% limit on the amount of input tax to be credited against the output tax; and
3) Section 12, amending Section 114 (c) of the NIRC, authorizing the Government or any of its political subdivisions, instrumentalities or agencies, including GOCCs, to deduct a 5% final withholding tax on gross payments of goods and services, which are subject to 10% VAT under Sections 106 (sale of goods and properties) and 108 (sale of services and use or lease of properties) of the NIRC.
Petitioners contend that these provisions are unconstitutional for being arbitrary, oppressive, excessive, and confiscatory.
Petitioners’ argument is premised on the constitutional right of non- deprivation of life, liberty or property without due process of law under Article III, Section 1 of the Constitution. According to petitioners, the contested sections impose limitations on the amount of input tax that may be claimed. Petitioners also argue that the input tax partakes the nature of a property that may not be confiscated, appropriated, or limited without due process of law. Petitioners further contend that like any other property or property right, the input tax credit may be transferred or disposed of, and that by limiting the same, the government gets to tax a profit or value-added even if there is no profit or value-added.
Petitioners also believe that these provisions violate the constitutional guarantee of equal protection of the law under Article III, Section 1 of the Constitution, as the limitation on the creditable input tax if: (1) the entity has a high ratio of input tax; or (2) invests in capital equipment; or (3) has several transactions with the government, is not based on real and substantial differences to meet a valid classification.
Lastly, petitioners contend that the 70% limit is anything but progressive, violative of Article VI, Section 28(1) of the Constitution, and that it is the smaller businesses with higher input tax to output tax ratio that will suffer the consequences thereof for it wipes out whatever meager margins the petitioners make.
G.R. No. 168463
Several members of the House of Representatives led by Rep. Francis Joseph G. Escudero filed this petition for certiorari on June 30, 2005. They question the constitutionality of R.A. No. 9337 on the following grounds:
1) Sections 4, 5, and 6 of R.A. No. 9337 constitute an undue delegation of legislative power, in violation of Article VI, Section 28(2) of the Constitution;
2) The Bicameral Conference Committee acted without jurisdiction in deleting the no pass on provisions present in Senate Bill No. 1950 and House Bill No. 3705; and
3) Insertion by the Bicameral Conference Committee of Sections 27, 28, 34, 116, 117, 119, 121, 125,[7] 148, 151, 236, 237 and 288, which were present in Senate Bill No. 1950, violates Article VI, Section 24(1) of the Constitution, which provides that all appropriation, revenue or tariff bills shall originate exclusively in the House of Representatives
G.R. No. 168730
On the eleventh hour, Governor Enrique T. Garcia filed a petition for certiorari and prohibition on July 20, 2005, alleging unconstitutionality of the law on the ground that the limitation on the creditable input tax in effect allows VAT-registered establishments to retain a portion of the taxes they collect, thus violating the principle that tax collection and revenue should be solely allocated for public purposes and expenditures. Petitioner Garcia further claims that allowing these establishments to pass on the tax to the consumers is inequitable, in violation of Article VI, Section 28(1) of the Constitution.
RESPONDENTS’ COMMENT
The Office of the Solicitor General (OSG) filed a Comment in behalf of respondents. Preliminarily, respondents contend that R.A. No. 9337 enjoys the presumption of constitutionality and petitioners failed to cast doubt on its validity.
Relying on the case of Tolentino vs. Secretary of Finance, 235 SCRA 630 (1994), respondents argue that the procedural issues raised by petitioners, i.e., legality of the bicameral proceedings, exclusive origination of revenue measures and the power of the Senate concomitant thereto, have already been settled. With regard to the issue of undue delegation of legislative power to the President, respondents contend that the law is complete and leaves no discretion to the President but to increase the rate to 12% once any of the two conditions provided therein arise.
Respondents also refute petitioners’ argument that the increase to 12%, as well as the 70% limitation on the creditable input tax, the 60-month amortization on the purchase or importation of capital goods exceeding P1,000,000.00, and the 5% final withholding tax by government agencies, is arbitrary, oppressive, and confiscatory, and that it violates the constitutional principle on progressive taxation, among others.
Finally, respondents manifest that R.A. No. 9337 is the anchor of the government’s fiscal reform agenda. A reform in the value-added system of taxation is the core revenue measure that will tilt the balance towards a sustainable macroeconomic environment necessary for economic growth.
ISSUES
The Court defined the issues, as follows:
PROCEDURAL ISSUE
Whether R.A. No. 9337 violates the following provisions of the Constitution:
a. Article VI, Section 24, and b. Article VI, Section 26(2)
SUBSTANTIVE ISSUES
1. Whether Sections 4, 5 and 6 of R.A. No. 9337, amending Sections 106, 107 and 108 of the NIRC, violate the following provisions of the Constitution:
a. Article VI, Section 28(1), and b. Article VI, Section 28(2)
2. Whether Section 8 of R.A. No. 9337, amending Sections 110(A)(2) and 110(B) of the NIRC; and Section 12 of R.A. No. 9337, amending Section 114(C) of the NIRC, violate the following provisions of the Constitution:
a. Article VI, Section 28(1), and b. Article III, Section 1
RULING OF THE COURT
As a prelude, the Court deems it apt to restate the general principles and concepts of value-added tax (VAT), as the confusion and inevitably, litigation, breeds from a fallacious notion of its nature.
The VAT is a tax on spending or consumption. It is levied on the sale, barter, exchange or lease of goods or properties and services.[8] Being an indirect tax on expenditure, the seller of goods or services may pass on the amount of tax paid to the buyer,[9] with the seller acting merely as a tax collector.[10] The burden of VAT is intended to fall on the immediate buyers and ultimately, the end- consumers.
In contrast, a direct tax is a tax for which a taxpayer is directly liable on the transaction or business it engages in, without transferring the burden to someone else.[11]Examples are individual and corporate income taxes, transfer taxes, and [12] residence taxes.
In the Philippines, the value-added system of sales taxation has long been in existence, albeit in a different mode. Prior to 1978, the system was a single-stage tax computed under the “cost deduction method” and was payable only by the original sellers. The single-stage system was subsequently modified, and a mixture of the “cost deduction method” and “tax credit method” was used to determine the value-added tax payable.[13] Under the “tax credit method,” an entity can credit against or subtract from the VAT charged on its sales or outputs the VAT paid on [14] its purchases, inputs and imports.
It was only in 1987, when President Corazon C. Aquino issued Executive Order No. 273, that the VAT system was rationalized by imposing a multi-stage [15] tax rate of 0% or 10% on all sales using the “tax credit method.”
E.O. No. 273 was followed by R.A. No. 7716 or the Expanded VAT Law,[16] R.A. No. 8241 or the Improved VAT Law,[17] R.A. No. 8424 or the Tax Reform Act of 1997,[18] and finally, the presently beleaguered R.A. No. 9337, also referred to by respondents as the VAT Reform Act.
The Court will now discuss the issues in logical sequence.
PROCEDURAL ISSUE I. Whether R.A. No. 9337 violates the following provisions of the Constitution:
a. Article VI, Section 24, and b. Article VI, Section 26(2)
A. The Bicameral Conference Committee
Petitioners Escudero, et al., and Pimentel, et al., allege that the Bicameral Conference Committee exceeded its authority by:
1) Inserting the stand-by authority in favor of the President in Sections 4, 5, and 6 of R.A. No. 9337;
2) Deleting entirely the no pass-on provisions found in both the House and Senate bills;
3) Inserting the provision imposing a 70% limit on the amount of input tax to be credited against the output tax; and
4) Including the amendments introduced only by Senate Bill No. 1950 regarding other kinds of taxes in addition to the value-added tax.
Petitioners now beseech the Court to define the powers of the Bicameral Conference Committee.
It should be borne in mind that the power of internal regulation and discipline are intrinsic in any legislative body for, as unerringly elucidated by Justice Story, “[i]f the power did not exist, it would be utterly impracticable to transact the business of the nation, either at all, or at least with decency, deliberation, and order.”[19] Thus, Article VI, Section 16 (3) of the Constitution provides that “each House may determine the rules of its proceedings.” Pursuant to this inherent constitutional power to promulgate and implement its own rules of procedure, the respective rules of each house of Congress provided for the creation of a Bicameral Conference Committee.
Thus, Rule XIV, Sections 88 and 89 of the Rules of House of Representatives provides as follows:
Sec. 88. Conference Committee. – In the event that the House does not agree with the Senate on the amendment to any bill or joint resolution, the differences may be settled by the conference committees of both chambers.
In resolving the differences with the Senate, the House panel shall, as much as possible, adhere to and support the House Bill. If the differences with the Senate are so substantial that they materially impair the House Bill, the panel shall report such fact to the House for the latter’s appropriate action.
Sec. 89. Conference Committee Reports. – . . . Each report shall contain a detailed, sufficiently explicit statement of the changes in or amendments to the subject measure.
. . .
The Chairman of the House panel may be interpellated on the Conference Committee Report prior to the voting thereon. The House shall vote on the Conference Committee Report in the same manner and procedure as it votes on a bill on third and final reading.
Rule XII, Section 35 of the Rules of the Senate states:
Sec. 35. In the event that the Senate does not agree with the House of Representatives on the provision of any bill or joint resolution, the differences shall be settled by a conference committee of both Houses which shall meet within ten (10) days after their composition. The President shall designate the members of the Senate Panel in the conference committee with the approval of the Senate.
Each Conference Committee Report shall contain a detailed and sufficiently explicit statement of the changes in, or amendments to the subject measure, and shall be signed by a majority of the members of each House panel, voting separately.
A comparative presentation of the conflicting House and Senate provisions and a reconciled version thereof with the explanatory statement of the conference committee shall be attached to the report.
. . .
The creation of such conference committee was apparently in response to a problem, not addressed by any constitutional provision, where the two houses of Congress find themselves in disagreement over changes or amendments introduced by the other house in a legislative bill. Given that one of the most basic powers of the legislative branch is to formulate and implement its own rules of proceedings and to discipline its members, may the Court then delve into the details of how Congress complies with its internal rules or how it conducts its business of passing legislation? Note that in the present petitions, the issue is not whether provisions of the rules of both houses creating the bicameral conference committee are unconstitutional, but whether the bicameral conference committee has strictly complied with the rules of both houses, thereby remaining within the jurisdiction conferred upon it by Congress.
In the recent case of Fariñas vs. The Executive Secretary,[20] the Court En Banc, unanimously reiterated and emphasized its adherence to the “enrolled bill doctrine,” thus, declining therein petitioners’ plea for the Court to go behind the enrolled copy of the bill. Assailed in said case was Congress’s creation of two sets of bicameral conference committees, the lack of records of said committees’ proceedings, the alleged violation of said committees of the rules of both houses, and the disappearance or deletion of one of the provisions in the compromise bill submitted by the bicameral conference committee. It was argued that such irregularities in the passage of the law nullified R.A. No. 9006, or the Fair Election Act.
Striking down such argument, the Court held thus:
Under the “enrolled bill doctrine,” the signing of a bill by the Speaker of the House and the Senate President and the certification of the Secretaries of both Houses of Congress that it was passed are conclusive of its due enactment. A review of cases reveals the Court’s consistent adherence to the rule. The Court finds no reason to deviate from the salutary rule in this case where the irregularities alleged by the petitioners mostly involved the internal rules of Congress, e.g., creation of the 2nd or 3rd Bicameral Conference Committee by the House. This Court is not the proper forum for the enforcement of these internal rules of Congress, whether House or Senate. Parliamentary rules are merely procedural and with their observance the courts have no concern. Whatever doubts there may be as to the formal validity of Rep. Act No. 9006 must be resolved in its favor. The Court reiterates its ruling inArroyo vs. De Venecia, viz.:
But the cases, both here and abroad, in varying forms of expression, all deny to the courts the power to inquire into allegations that, in enacting a law, a House of Congress failed to comply with its own rules, in the absence of showing that there was a violation of a constitutional provision or the rights of private individuals. InOsmeña v. Pendatun, it was held: “At any rate, courts have declared that ‘the rules adopted by deliberative bodies are subject to revocation, modification or waiver at the pleasure of the body adopting them.’ And it has been said that “Parliamentary rules are merely procedural, and with their observance, the courts have no concern. They may be waived or disregarded by the legislative body.” Consequently, “mere failure to conform to parliamentary usage will not invalidate the action (taken by a deliberative body) when the requisite number of members have agreed to a particular measure.”[21] (Emphasis supplied)
The foregoing declaration is exactly in point with the present cases, where petitioners allege irregularities committed by the conference committee in introducing changes or deleting provisions in the House and Senate bills. Akin to the Fariñas case,[22] the present petitions also raise an issue regarding the actions taken by the conference committee on matters regarding Congress’ compliance with its own internal rules. As stated earlier, one of the most basic and inherent power of the legislature is the power to formulate rules for its proceedings and the discipline of its members. Congress is the best judge of how it should conduct its own business expeditiously and in the most orderly manner. It is also the sole concern of Congress to instill discipline among the members of its conference committee if it believes that said members violated any of its rules of proceedings. Even the expanded jurisdiction of this Court cannot apply to questions regarding only the internal operation of Congress, thus, the Court is wont to deny a review of the internal proceedings of a co-equal branch of government.
Moreover, as far back as 1994 or more than ten years ago, in the case of Tolentino vs. Secretary of Finance,[23] the Court already made the pronouncement that “[i]f a change is desired in the practice [of the Bicameral Conference Committee] it must be sought in Congress since this question is not covered by any constitutional provision but is only an internal rule of each house.” [24] To date, Congress has not seen it fit to make such changes adverted to by the Court. It seems, therefore, that Congress finds the practices of the bicameral conference committee to be very useful for purposes of prompt and efficient legislative action.
Nevertheless, just to put minds at ease that no blatant irregularities tainted the proceedings of the bicameral conference committees, the Court deems it necessary to dwell on the issue. The Court observes that there was a necessity for a conference committee because a comparison of the provisions of House Bill Nos. 3555 and 3705 on one hand, and Senate Bill No. 1950 on the other, reveals that there were indeed disagreements. As pointed out in the petitions, said disagreements were as follows:
House Bill No. 3555 House Bill No.3705 Senate Bill No. 1950
With regard to “Stand-By Authority” in favor of President
Provides for 12% VAT Provides for 12% VAT in Provides for a single rate of on every sale of goods or general on sales of goods or 10% VAT on sale of goods or properties (amending properties and reduced rates properties (amending Sec. 106 Sec. 106 of NIRC); 12% for sale of certain locally of NIRC), 10% VAT on sale VAT on importation of manufactured goods of services including sale of goods (amending Sec. and petroleum products and electricity by generation 107 of NIRC); and 12% raw materials to be used in companies, transmission and VAT on sale of services the manufacture thereof distribution companies, and and use or lease of (amending Sec. 106 of use or lease of properties properties (amending NIRC); 12% VAT on (amending Sec. 108 of NIRC) Sec. 108 of NIRC) importation of goods and reduced rates for certain imported products including petroleum products (amending Sec. 107 of NIRC); and 12% VAT on sale of services and use or lease of properties and a reduced rate for certain services including power generation (amending Sec. 108 of NIRC)
With regard to the “no pass-on” provision
No similar provision Provides that the VAT Provides that the VAT imposed on power generation imposed on sales of electricity and on the sale of petroleum by generation companies and products shall be absorbed by services of transmission generation companies or companies and distribution sellers, respectively, and shall companies, as well as those of not be passed on to franchise grantees of electric consumers utilities shall not apply to residential end-users. VAT shall be absorbed by generation, transmission, and distribution companies. With regard to 70% limit on input tax credit
Provides that the input No similar provision Provides that the input tax tax credit for capital credit for capital goods on goods on which a VAT which a VAT has been paid has been paid shall be shall be equally distributed equally distributed over 5 over 5 years or the depreciable years or the depreciable life of such capital goods; the life of such capital goods; input tax credit for goods and the input tax credit for services other than capital goods and services other goods shall not exceed 90% of than capital goods shall the output VAT. not exceed 5% of the total amount of such goods and services; and for persons engaged in retail trading of goods, the allowable input tax credit shall not exceed 11% of the total amount of goods purchased.
With regard to amendments to be made to NIRC provisions regarding income and excise taxes
No similar provision No similar provision Provided for amendments to several NIRC provisions regarding corporate income, percentage, franchise and excise taxes
The disagreements between the provisions in the House bills and the Senate bill were with regard to (1) what rate of VAT is to be imposed; (2) whether only the VAT imposed on electricity generation, transmission and distribution companies should not be passed on to consumers, as proposed in the Senate bill, or both the VAT imposed on electricity generation, transmission and distribution companies and the VAT imposed on sale of petroleum products should not be passed on to consumers, as proposed in the House bill; (3) in what manner input tax credits should be limited; (4) and whether the NIRC provisions on corporate income taxes, percentage, franchise and excise taxes should be amended.
There being differences and/or disagreements on the foregoing provisions of the House and Senate bills, the Bicameral Conference Committee was mandated by the rules of both houses of Congress to act on the same by settling said differences and/or disagreements. The Bicameral Conference Committee acted on the disagreeing provisions by making the following changes:
1. With regard to the disagreement on the rate of VAT to be imposed, it would appear from the Conference Committee Report that the Bicameral
Conference Committee tried to bridge the gap in the difference between the 10% VAT rate proposed by the Senate, and the various rates with 12% as the highest VAT rate proposed by the House, by striking a compromise whereby the present
10% VAT rate would be retained until certain conditions arise, i.e., the value- added tax collection as a percentage of gross domestic product (GDP) of the previous year exceeds 2 4/5%, or National Government deficit as a percentage of
GDP of the previous year exceeds 1½%, when the President, upon recommendation of the Secretary of Finance shall raise the rate of VAT to 12% effective January 1, 2006.
2. With regard to the disagreement on whether only the VAT imposed on electricity generation, transmission and distribution companies should not be passed on to consumers or whether both the VAT imposed on electricity generation, transmission and distribution companies and the VAT imposed on sale of petroleum products may be passed on to consumers, the Bicameral Conference Committee chose to settle such disagreement by altogether deleting from its Report any no pass-on provision.
3. With regard to the disagreement on whether input tax credits should be limited or not, the Bicameral Conference Committee decided to adopt the position of the House by putting a limitation on the amount of input tax that may be credited against the output tax, although it crafted its own language as to the amount of the limitation on input tax credits and the manner of computing the same by providing thus:
(A) Creditable Input Tax. – . . .
. . .
Provided, The input tax on goods purchased or imported in a calendar month for use in trade or business for which deduction for depreciation is allowed under this Code, shall be spread evenly over the month of acquisition and the fifty-nine (59) succeeding months if the aggregate acquisition cost for such goods, excluding the VAT component thereof, exceeds one million Pesos (P1,000,000.00): PROVIDED, however, that if the estimated useful life of the capital good is less than five (5) years, as used for depreciation purposes, then the input VAT shall be spread over such shorter period: . . .
(B) Excess Output or Input Tax. – If at the end of any taxable quarter the output tax exceeds the input tax, the excess shall be paid by the VAT-registered person. If the input tax exceeds the output tax, the excess shall be carried over to the succeeding quarter or quarters: PROVIDED that the input tax inclusive of input VAT carried over from the previous quarter that may be credited in every quarter shall not exceed seventy percent (70%) of the output VAT: PROVIDED, HOWEVER, THAT any input tax attributable to zero-rated sales by a VAT-registered person may at his option be refunded or credited against other internal revenue taxes, . . .
4. With regard to the amendments to other provisions of the NIRC on corporate income tax, franchise, percentage and excise taxes, the conference committee decided to include such amendments and basically adopted the provisions found in Senate Bill No. 1950, with some changes as to the rate of the tax to be imposed.
Under the provisions of both the Rules of the House of Representatives and Senate Rules, the Bicameral Conference Committee is mandated to settle the differences between the disagreeing provisions in the House bill and the Senate bill. The term “settle” is synonymous to “reconcile” and “harmonize.”[25] To reconcile or harmonize disagreeing provisions, the Bicameral Conference Committee may then (a) adopt the specific provisions of either the House bill or Senate bill, (b) decide that neither provisions in the House bill or the provisions in the Senate bill would be carried into the final form of the bill, and/or (c) try to arrive at a compromise between the disagreeing provisions.
In the present case, the changes introduced by the Bicameral Conference Committee on disagreeing provisions were meant only to reconcile and harmonize the disagreeing provisions for it did not inject any idea or intent that is wholly foreign to the subject embraced by the original provisions.
The so-called stand-by authority in favor of the President, whereby the rate of 10% VAT wanted by the Senate is retained until such time that certain conditions arise when the 12% VAT wanted by the House shall be imposed, appears to be a compromise to try to bridge the difference in the rate of VAT proposed by the two houses of Congress. Nevertheless, such compromise is still totally within the subject of what rate of VAT should be imposed on taxpayers.
The no pass-on provision was deleted altogether. In the transcripts of the proceedings of the Bicameral Conference Committee held on May 10, 2005, Sen. Ralph Recto, Chairman of the Senate Panel, explained the reason for deleting the no pass-on provision in this wise:
. . . the thinking was just to keep the VAT law or the VAT bill simple. And we were thinking that no sector should be a beneficiary of legislative grace, neither should any sector be discriminated on. The VAT is an indirect tax. It is a pass on-tax. And let’s keep it plain and simple. Let’s not confuse the bill and put a no pass-on provision. Two-thirds of the world have a VAT system and in this two-thirds of the globe, I have yet to see a VAT with a no pass-though provision. So, the thinking of the Senate is basically simple, let’s keep the VAT simple.[26](Emphasis supplied) Rep. Teodoro Locsin further made the manifestation that the no pass- [27] on provision “never really enjoyed the support of either House.”
With regard to the amount of input tax to be credited against output tax, the Bicameral Conference Committee came to a compromise on the percentage rate of the limitation or cap on such input tax credit, but again, the change introduced by the Bicameral Conference Committee was totally within the intent of both houses to put a cap on input tax that may be credited against the output tax. From the inception of the subject revenue bill in the House of Representatives, one of the major objectives was to “plug a glaring loophole in the tax policy and administration by creating vital restrictions on the claiming of input VAT tax credits . . .” and “[b]y introducing limitations on the claiming of tax credit, we are capping a major leakage that has placed our [28] collection efforts at an apparent disadvantage.”
As to the amendments to NIRC provisions on taxes other than the value- added tax proposed in Senate Bill No. 1950, since said provisions were among those referred to it, the conference committee had to act on the same and it basically adopted the version of the Senate.
Thus, all the changes or modifications made by the Bicameral Conference Committee were germane to subjects of the provisions referred to it for reconciliation. Such being the case, the Court does not see any grave abuse of discretion amounting to lack or excess of jurisdiction committed by the Bicameral Conference Committee. In the earlier cases of Philippine Judges Association vs. Prado[29] and Tolentino vs. Secretary of Finance,[30] the Court recognized the long- standing legislative practice of giving said conference committee ample latit ude for compromising differences between the Senate and the House. Thus, in theTolentino case, it was held that:
. . . it is within the power of a conference committee to include in its report an entirely new provision that is not found either in the House bill or in the Senate bill. If the committee can propose an amendment consisting of one or two provisions, there is no reason why it cannot propose several provisions, collectively considered as an “amendment in the nature of a substitute,” so long as such amendment is germane to the subject of the bills before the committee. After all, its report was not final but needed the approval of both houses of Congress to become valid as an act of the legislative department. The charge that in this case the Conference Committee acted as a third legislative chamber is thus without any basis.[31] (Emphasis supplied)
B. R.A. No. 9337 Does Not Violate Article VI, Section 26(2) of the Constitution on the “No-Amendment Rule”
Article VI, Sec. 26 (2) of the Constitution, states:
No bill passed by either House shall become a law unless it has passed three readings on separate days, and printed copies thereof in its final form have been distributed to its Members three days before its passage, except when the President certifies to the necessity of its immediate enactment to meet a public calamity or emergency. Upon the last reading of a bill, no amendment thereto shall be allowed, and the vote thereon shall be taken immediately thereafter, and the yeas and nays entered in the Journal.
Petitioners’ argument that the practice where a bicameral conference committee is allowed to add or delete provisions in the House bill and the Senate bill after these had passed three readings is in effect a circumvention of the “no amendment rule” (Sec. 26 (2), Art. VI of the 1987 Constitution), fails to convince the Court to deviate from its ruling in the Tolentino case that:
Nor is there any reason for requiring that the Committee’s Report in these cases must have undergone three readings in each of the two houses. If that be the case, there would be no end to negotiation since each house may seek modification of the compromise bill. . . .
Art. VI. § 26 (2) must, therefore, be construed as referring only to bills introduced for the first time in either house of Congress, not to the conference committee report.[32] (Emphasis supplied)
The Court reiterates here that the “no-amendment rule” refers only to the procedure to be followed by each house of Congress with regard to bills initiated in each of said respective houses, before said bill is transmitted to the other house for its concurrence or amendment. Verily, to construe said provision in a way as to proscribe any further changes to a bill after one house has voted on it would lead to absurdity as this would mean that the other house of Congress would be deprived of its constitutional power to amend or introduce changes to said bill. Thus, Art. VI, Sec. 26 (2) of the Constitution cannot be taken to mean that the introduction by the Bicameral Conference Committee of amendments and modifications to disagreeing provisions in bills that have been acted upon by both houses of Congress is prohibited.
C. R.A. No. 9337 Does Not Violate Article VI, Section 24 of the Constitution on Exclusive Origination of Revenue Bills
Coming to the issue of the validity of the amendments made regarding the NIRC provisions on corporate income taxes and percentage, excise taxes. Petitioners refer to the following provisions, to wit:
Section 27 Rates of Income Tax on Domestic Corporation 28(A)(1) Tax on Resident Foreign Corporation 28(B)(1) Inter-corporate Dividends 34(B)(1) Inter-corporate Dividends 116 Tax on Persons Exempt from VAT 117 Percentage Tax on domestic carriers and keepers of Garage 119 Tax on franchises 121 Tax on banks and Non-Bank Financial Intermediaries 148 Excise Tax on manufactured oils and other fuels 151 Excise Tax on mineral products 236 Registration requirements 237 Issuance of receipts or sales or commercial invoices 288 Disposition of Incremental Revenue
Petitioners claim that the amendments to these provisions of the NIRC did not at all originate from the House. They aver that House Bill No. 3555 proposed amendments only regarding Sections 106, 107, 108, 110 and 114 of the NIRC, while House Bill No. 3705 proposed amendments only to Sections 106, 107,108, 109, 110 and 111 of the NIRC; thus, the other sections of the NIRC which the Senate amended but which amendments were not found in the House bills are not intended to be amended by the House of Representatives. Hence, they argue that since the proposed amendments did not originate from the House, such amendments are a violation of Article VI, Section 24 of the Constitution.
The argument does not hold water.
Article VI, Section 24 of the Constitution reads:
Sec. 24. All appropriation, revenue or tariff bills, bills authorizing increase of the public debt, bills of local application, and private bills shall originate exclusively in the House of Representatives but the Senate may propose or concur with amendments.
In the present cases, petitioners admit that it was indeed House Bill Nos. 3555 and 3705 that initiated the move for amending provisions of the NIRC dealing mainly with the value-added tax. Upon transmittal of said House bills to the Senate, the Senate came out with Senate Bill No. 1950 proposing amendments not only to NIRC provisions on the value-added tax but also amendments to NIRC provisions on other kinds of taxes. Is the introduction by the Senate of provisions not dealing directly with the value- added tax, which is the only kind of tax being amended in the House bills, still within the purview of the constitutional provision authorizing the Senate to propose or concur with amendments to a revenue bill that originated from the House?
The foregoing question had been squarely answered in the Tolentino case, wherein the Court held, thus:
. . . To begin with, it is not the law – but the revenue bill – which is required by the Constitution to “originate exclusively” in the House of Representatives. It is important to emphasize this, because a bill originating in the House may undergo such extensive changes in the Senate that the result may be a rewriting of the whole. . . . At this point, what is important to note is that, as a result of the Senate action, a distinct bill may be produced. To insist that a revenue statute – and not only the bill which initiated the legislative process culminating in the enactment of the law – must substantially be the same as the House bill would be to deny the Senate’s power not only to “concur with amendments” but also to “propose amendments.” It would be to violate the coequality of legislative power of the two houses of Congress and in fact make the House superior to the Senate.
…
…Given, then, the power of the Senate to propose amendments, the Senate can propose its own version even with respect to bills which are required by the Constitution to originate in the House. . . .
Indeed, what the Constitution simply means is that the initiative for filing revenue, tariff or tax bills, bills authorizing an increase of the public debt, private bills and bills of local application must come from the House of Representatives on the theory that, elected as they are from the districts, the members of the House can be expected to be more sensitive to the local needs and problems. On the other hand, the senators, who are elected at large, are expected to approach the same problems from the national perspective. Both views are thereby made to bear on the enactment of such laws.[33] (Emphasis supplied)
Since there is no question that the revenue bill exclusively originated in the House of Representatives, the Senate was acting within its constitutional power to introduce amendments to the House bill when it included provisions in Senate Bill No. 1950 amending corporate income taxes, percentage, excise and franchise taxes. Verily, Article VI, Section 24 of the Constitution does not contain any prohibition or limitation on the extent of the amendments that may be introduced by the Senate to the House revenue bill.
Furthermore, the amendments introduced by the Senate to the NIRC provisions that had not been touched in the House bills are still in furtherance of the intent of the House in initiating the subject revenue bills. The Explanatory Note of House Bill No. 1468, the very first House bill introduced on the floor, which was later substituted by House Bill No. 3555, stated:
One of the challenges faced by the present administration is the urgent and daunting task of solving the country’s serious financial problems. To do this, government expenditures must be strictly monitored and controlled and revenues must be significantly increased. This may be easier said than done, but our fiscal authorities are still optimistic the government will be operating on a balanced budget by the year 2009. In fact, several measures that will result to significant expenditure savings have been identified by the administration. It is supported with a credible package of revenue measures that include measures to improve tax administration and control the leakages in revenues from income taxes and the value-added tax (VAT). (Emphasis supplied)
Rep. Eric D. Singson, in his sponsorship speech for House Bill No. 3555, declared that:
In the budget message of our President in the year 2005, she reiterated that we all acknowledged that on top of our agenda must be the restoration of the health of our fiscal system.
In order to considerably lower the consolidated public sector deficit and eventually achieve a balanced budget by the year 2009, we need to seize windows of opportunities which might seem poignant in the beginning, but in the long run prove effective and beneficial to the overall status of our economy. One such opportunity is a review of existing tax rates, evaluating the relevance given our present conditions.[34] (Emphasis supplied)
Notably therefore, the main purpose of the bills emanating from the House of Representatives is to bring in sizeable revenues for the government to supplement our country’s serious financial problems, and improve tax administration and control of the leakages in revenues from income taxes and value-added taxes. As these house bills were transmitted to the Senate, the latter, approaching the measures from the point of national perspective, can introduce amendments within the purposes of those bills. It can provide for ways that would soften the impact of the VAT measure on the consumer, i.e., by distributing the burden across all sectors instead of putting it entirely on the shoulders of the consumers. The sponsorship speech of Sen. Ralph Recto on why the provisions on income tax on corporation were included is worth quoting:
All in all, the proposal of the Senate Committee on Ways and Means will raise P64.3 billion in additional revenues annually even while by mitigating prices of power, services and petroleum products.
However, not all of this will be wrung out of VAT. In fact, only P48.7 billion amount is from the VAT on twelve goods and services. The rest of the tab – P10.5 billion- will be picked by corporations.
What we therefore prescribe is a burden sharing between corporate Philippines and the consumer. Why should the latter bear all the pain? Why should the fiscal salvation be only on the burden of the consumer?
The corporate world’s equity is in form of the increase in the corporate income tax from 32 to 35 percent, but up to 2008 only. This will raise P10.5 billion a year. After that, the rate will slide back, not to its old rate of 32 percent, but two notches lower, to 30 percent.
Clearly, we are telling those with the capacity to pay, corporations, to bear with this emergency provision that will be in effect for 1,200 days, while we put our fiscal house in order. This fiscal medicine will have an expiry date.
For their assistance, a reward of tax reduction awaits them. We intend to keep the length of their sacrifice brief. We would like to assure them that not because there is a light at the end of the tunnel, this government will keep on making the tunnel long.
The responsibility will not rest solely on the weary shoulders of the small man. Big business will be there to share the burden.[35]
As the Court has said, the Senate can propose amendments and in fact, the amendments made on provisions in the tax on income of corporations are germane to the purpose of the house bills which is to raise revenues for the government.
Likewise, the Court finds the sections referring to other percentage and excise taxes germane to the reforms to the VAT system, as these sections would cushion the effects of VAT on consumers. Considering that certain goods and services which were subject to percentage tax and excise tax would no longer be VAT-exempt, the consumer would be burdened more as they would be paying the VAT in addition to these taxes. Thus, there is a need to amend these sections to soften the impact of VAT. Again, in his sponsorship speech, Sen. Recto said:
However, for power plants that run on oil, we will reduce to zero the present excise tax on bunker fuel, to lessen the effect of a VAT on this product.
For electric utilities like Meralco, we will wipe out the franchise tax in exchange for a VAT.
And in the case of petroleum, while we will levy the VAT on oil products, so as not to destroy the VAT chain, we will however bring down the excise tax on socially sensitive products such as diesel, bunker, fuel and kerosene.
. . .
What do all these exercises point to? These are not contortions of giving to the left hand what was taken from the right. Rather, these sprang from our concern of softening the impact of VAT, so that the people can cushion the blow of higher prices they will have to pay as a result of VAT.[36]
The other sections amended by the Senate pertained to matters of tax administration which are necessary for the implementation of the changes in the VAT system.
To reiterate, the sections introduced by the Senate are germane to the subject matter and purposes of the house bills, which is to supplement our country’s fiscal deficit, among others. Thus, the Senate acted within its power to propose those amendments.
SUBSTANTIVE ISSUES I. Whether Sections 4, 5 and 6 of R.A. No. 9337, amending Sections 106, 107 and 108 of the NIRC, violate the following provisions of the Constitution:
a. Article VI, Section 28(1), and b. Article VI, Section 28(2) A. No Undue Delegation of Legislative Power
Petitioners ABAKADA GURO Party List, et al., Pimentel, Jr., et al., and Escudero, et al. contend in common that Sections 4, 5 and 6 of R.A. No. 9337, amending Sections 106, 107 and 108, respectively, of the NIRC giving the President the stand-by authority to raise the VAT rate from 10% to 12% when a certain condition is met, constitutes undue delegation of the legislative power to tax.
The assailed provisions read as follows:
SEC. 4. Sec. 106 of the same Code, as amended, is hereby further amended to read as follows:
SEC. 106. Value-Added Tax on Sale of Goods or Properties. –
(A) Rate and Base of Tax. – There shall be levied, assessed and collected on every sale, barter or exchange of goods or properties, a value-added tax equivalent to ten percent (10%) of the gross selling price or gross value in money of the goods or properties sold, bartered or exchanged, such tax to be paid by the seller or transferor: provided, that the President, upon the recommendation of the Secretary of Finance, shall, effective January 1, 2006, raise the rate of value-added tax to twelve percent (12%), after any of the following conditions has been satisfied.
(i) value-added tax collection as a percentage of Gross Domestic Product (GDP) of the previous year exceeds two and four-fifth percent (2 4/5%) or
(ii) national government deficit as a percentage of GDP of the previous year exceeds one and one-half percent (1 ½%).
SEC. 5. Section 107 of the same Code, as amended, is hereby further amended to read as follows:
SEC. 107. Value-Added Tax on Importation of Goods. – (A) In General. – There shall be levied, assessed and collected on every importation of goods a value-added tax equivalent to ten percent (10%) based on the total value used by the Bureau of Customs in determining tariff and customs duties, plus customs duties, excise taxes, if any, and other charges, such tax to be paid by the importer prior to the release of such goods from customs custody: Provided, That where the customs duties are determined on the basis of the quantity or volume of the goods, the value- added tax shall be based on the landed cost plus excise taxes, if any: provided, further, that the President, upon the recommendation of the Secretary of Finance, shall, effective January 1, 2006, raise the rate of value-added tax to twelve percent (12%) after any of the following conditions has been satisfied.
(i) value-added tax collection as a percentage of Gross Domestic Product (GDP) of the previous year exceeds two and four-fifth percent (2 4/5%) or (ii) national government deficit as a percentage of GDP of the previous year exceeds one and one-half percent (1 ½%).
SEC. 6. Section 108 of the same Code, as amended, is hereby further amended to read as follows:
SEC. 108. Value-added Tax on Sale of Services and Use or Lease of Properties –
(A) Rate and Base of Tax. – There shall be levied, assessed and collected, a value-added tax equivalent to ten percent (10%) of gross receipts derived from the sale or exchange of services: provided, that the President, upon the recommendation of the Secretary of Finance, shall, effective January 1, 2006, raise the rate of value-added tax to twelve percent (12%), after any of the following conditions has been satisfied.
(i) value-added tax collection as a percentage of Gross Domestic Product (GDP) of the previous year exceeds two and four-fifth percent (2 4/5%) or (ii) national government deficit as a percentage of GDP of the previous year exceeds one and one-half percent (1 ½%). (Emphasis supplied)
Petitioners allege that the grant of the stand-by authority to the President to increase the VAT rate is a virtual abdication by Congress of its exclusive power to tax because such delegation is not within the purview of Section 28 (2), Article VI of the Constitution, which provides:
The Congress may, by law, authorize the President to fix within specified limits, and may impose, tariff rates, import and export quotas, tonnage and wharfage dues, and other duties or imposts within the framework of the national development program of the government.
They argue that the VAT is a tax levied on the sale, barter or exchange of goods and properties as well as on the sale or exchange of services, which cannot be included within the purview of tariffs under the exempted delegation as the latter refers to customs duties, tolls or tribute payable upon merchandise to the government and usually imposed on goods or merchandise imported or exported.
Petitioners ABAKADA GURO Party List, et al., further contend that delegating to the President the legislative power to tax is contrary to republicanism. They insist that accountability, responsibility and transparency should dictate the actions of Congress and they should not pass to the President the decision to impose taxes. They also argue that the law also effectively nullified the President’s power of control, which includes the authority to set aside and nullify the acts of her subordinates like the Secretary of Finance, by mandating the fixing of the tax rate by the President upon the recommendation of the Secretary of Finance.
Petitioners Pimentel, et al. aver that the President has ample powers to cause, influence or create the conditions provided by the law to bring about either or both the conditions precedent.
On the other hand, petitioners Escudero, et al. find bizarre and revolting the situation that the imposition of the 12% rate would be subject to the whim of the Secretary of Finance, an unelected bureaucrat, contrary to the principle of no taxation without representation. They submit that the Secretary of Finance is not mandated to give a favorable recommendation and he may not even give his recommendation. Moreover, they allege that no guiding standards are provided in the law on what basis and as to how he will make his recommendation. They claim, nonetheless, that any recommendation of the Secretary of Finance can easily be brushed aside by the President since the former is a mere alter ego of the latter, such that, ultimately, it is the President who decides whether to impose the increased tax rate or not.
A brief discourse on the principle of non-delegation of powers is instructive.
The principle of separation of powers ordains that each of the three great branches of government has exclusive cognizance of and is supreme in [37] matters falling within its own constitutionally allocated sphere. A logical corollary to the doctrine of separation of powers is the principle of non-delegation of powers, as expressed in the Latin maxim: potestas delegata non delegari potest which means “what has been delegated, cannot be delegated.”[38] This doctrine is based on the ethical principle that such as delegated power constitutes not only a right but a duty to be performed by the delegate through the instrumentality of his own judgment and not through the intervening [39] mind of another.
With respect to the Legislature, Section 1 of Article VI of the Constitution provides that “the Legislative power shall be vested in the Congress of the Philippines which shall consist of a Senate and a House of Representatives.” The powers which Congress is prohibited from delegating are those which are strictly, or inherently and exclusively, legislative. Purely legislative power, which can never be delegated, has been described as the authority to make a complete law – complete as to the time when it shall take effect and as to whom it shall be applicable – and to determine the expediency of its enactment.[40] Thus, the rule is that in order that a court may be justified in holding a statute unconstitutional as a delegation of legislative power, it must appear that the power involved is purely legislative in nature – that is, one appertaining exclusively to the legislative department. It is the nature of the power, and not the liability of its use or the manner of its exercise, which determines the validity of its delegation.
Nonetheless, the general rule barring delegation of legislative powers is subject to the following recognized limitations or exceptions:
(1) Delegation of tariff powers to the President under Section 28 (2) of Article VI of the Constitution; (2) Delegation of emergency powers to the President under Section 23 (2) of Article VI of the Constitution; (3) Delegation to the people at large; (4) Delegation to local governments; and (5) Delegation to administrative bodies.
In every case of permissible delegation, there must be a showing that the delegation itself is valid. It is valid only if the law (a) is complete in itself, setting forth therein the policy to be executed, carried out, or implemented by the delegate;[41] and (b) fixes a standard — the limits of which are sufficiently determinate and determinable — to which the delegate must conform in the performance of his functions.[42] A sufficient standard is one which defines legislative policy, marks its limits, maps out its boundaries and specifies the public agency to apply it. It indicates the circumstances under which the legislative command is to be effected.[43] Both tests are intended to prevent a total transference of legislative authority to the delegate, who is not allowed to step into the shoes of [44] the legislature and exercise a power essentially legislative.
In People vs. Vera,[45] the Court, through eminent Justice Jose P. Laurel, expounded on the concept and extent of delegation of power in this wise:
In testing whether a statute constitutes an undue delegation of legislative power or not, it is usual to inquire whether the statute was complete in all its terms and provisions when it left the hands of the legislature so that nothing was left to the judgment of any other appointee or delegate of the legislature.
. . .
‘The true distinction’, says Judge Ranney, ‘is between the delegation of power to make the law, which necessarily involves a discretion as to what it shall be, and conferring an authority or discretion as to its execution, to be exercised under and in pursuance of the law. The first cannot be done; to the latter no valid objection can be made.’
. . .
It is contended, however, that a legislative act may be made to the effect as law after it leaves the hands of the legislature. It is true that laws may be made effective on certain contingencies, as by proclamation of the executive or the adoption by the people of a particular community. In Wayman vs. Southard, the Supreme Court of the United States ruled that the legislature may delegate a power not legislative which it may itself rightfully exercise. The power to ascertain facts is such a power which may be delegated. There is nothing essentially legislative in ascertaining the existence of facts or conditions as the basis of the taking into effect of a law. That is a mental process common to all branches of the government.Notwithstanding the apparent tendency, however, to relax the rule prohibiting delegation of legislative authority on account of the complexity arising from social and economic forces at work in this modern industrial age, the orthodox pronouncement of Judge Cooley in his work on Constitutional Limitations finds restatement in Prof. Willoughby's treatise on the Constitution of the United States in the following language — speaking of declaration of legislative power to administrative agencies: The principle which permits the legislature to provide that the administrative agent may determine when the circumstances are such as require the application of a law is defended upon the ground that at the time this authority is granted, the rule of public policy, which is the essence of the legislative act, is determined by the legislature. In other words, the legislature, as it is its duty to do, determines that, under given circumstances, certain executive or administrative action is to be taken, and that, under other circumstances, different or no action at all is to be taken. What is thus left to the administrative official is not the legislative determination of what public policy demands, but simply the ascertainment of what the facts of the case require to be done according to the terms of the law by which he is governed. The efficiency of an Act as a declaration of legislative will must, of course, come from Congress, but the ascertainment of the contingency upon which the Act shall take effect may be left to such agencies as it may designate. The legislature, then, may provide that a law shall take effect upon the happening of future specified contingencies leaving to some other person or body the power to determine when the specified contingency has arisen. (Emphasis supplied).[46]
[47] In Edu vs. Ericta, the Court reiterated:
What cannot be delegated is the authority under the Constitution to make laws and to alter and repeal them; the test is the completeness of the statute in all its terms and provisions when it leaves the hands of the legislature. To determine whether or not there is an undue delegation of legislative power, the inquiry must be directed to the scope and definiteness of the measure enacted. The legislative does not abdicate its functions when it describes what job must be done, who is to do it, and what is the scope of his authority. For a complex economy, that may be the only way in which the legislative process can go forward. A distinction has rightfully been made between delegation of power to make the laws which necessarily involves a discretion as to what it shall be, which constitutionally may not be done, and delegation of authority or discretion as to its execution to be exercised under and in pursuance of the law, to which no valid objection can be made. The Constitution is thus not to be regarded as denying the legislature the necessary resources of flexibility and practicability. (Emphasis supplied).[48]
Clearly, the legislature may delegate to executive officers or bodies the power to determine certain facts or conditions, or the happening of contingencies, on which the operation of a statute is, by its terms, made to depend, but the legislature must prescribe sufficient standards, policies or limitations on their authority.[49] While the power to tax cannot be delegated to executive agencies, details as to the enforcement and administration of an exercise of such power may be left to them, including the power to determine the existence of facts on which its [50] operation depends.
The rationale for this is that the preliminary ascertainment of facts as basis for the enactment of legislation is not of itself a legislative function, but is simply ancillary to legislation. Thus, the duty of correlating information and making recommendations is the kind of subsidiary activity which the legislature may perform through its members, or which it may delegate to others to perform. Intelligent legislation on the complicated problems of modern society is impossible in the absence of accurate information on the part of the legislators, and any reasonable method of securing such information is proper.[51] The Constitution as a continuously operative charter of government does not require that Congress find for itself every fact upon which it desires to base legislative action or that it make for itself detailed determinations which it has declared to be prerequisite to application of legislative policy to particular facts and circumstances impossible for Congress [52] itself properly to investigate.
In the present case, the challenged section of R.A. No. 9337 is the common proviso in Sections 4, 5 and 6 which reads as follows:
That the President, upon the recommendation of the Secretary of Finance, shall, effective January 1, 2006, raise the rate of value-added tax to twelve percent (12%), after any of the following conditions has been satisfied:
(i) Value-added tax collection as a percentage of Gross Domestic Product (GDP) of the previous year exceeds two and four-fifth percent (2 4/5%); or
(ii) National government deficit as a percentage of GDP of the previous year exceeds one and one-half percent (1 ½%).
The case before the Court is not a delegation of legislative power. It is simply a delegation of ascertainment of facts upon which enforcement and administration of the increase rate under the law is contingent. The legislature has made the operation of the 12% rate effective January 1, 2006, contingent upon a specified fact or condition. It leaves the entire operation or non-operation of the 12% rate upon factual matters outside of the control of the executive.
No discretion would be exercised by the President. Highlighting the absence of discretion is the fact that the word shall is used in the common proviso. The use of the word shall connotes a mandatory order. Its use in a statute denotes an imperative obligation and is inconsistent with the idea of discretion.[53] Where the law is clear and unambiguous, it must be taken to mean exactly what it says, and [54] courts have no choice but to see to it that the mandate is obeyed.
Thus, it is the ministerial duty of the President to immediately impose the 12% rate upon the existence of any of the conditions specified by Congress. This is a duty which cannot be evaded by the President. Inasmuch as the law specifically uses the word shall, the exercise of discretion by the President does not come into play. It is a clear directive to impose the 12% VAT rate when the specified conditions are present. The time of taking into effect of the 12% VAT rate is based on the happening of a certain specified contingency, or upon the ascertainment of certain facts or conditions by a person or body other than the legislature itself.
The Court finds no merit to the contention of petitioners ABAKADA GURO Party List, et al. that the law effectively nullified the President’s power of control over the Secretary of Finance by mandating the fixing of the tax rate by the President upon the recommendation of the Secretary of Finance. The Court cannot also subscribe to the position of petitioners Pimentel, et al. that the word shall should be interpreted to mean may in view of the phrase “upon the recommendation of the Secretary of Finance.” Neither does the Court find persuasive the submission of petitioners Escudero, et al. that any recommendation by the Secretary of Finance can easily be brushed aside by the President since the former is a mere alter ego of the latter.
When one speaks of the Secretary of Finance as the alter ego of the President, it simply means that as head of the Department of Finance he is the assistant and agent of the Chief Executive. The multifarious executive and administrative functions of the Chief Executive are performed by and through the executive departments, and the acts of the secretaries of such departments, such as the Department of Finance, performed and promulgated in the regular course of business, are, unless disapproved or reprobated by the Chief Executive, presumptively the acts of the Chief Executive. The Secretary of Finance, as such, occupies a political position and holds office in an advisory capacity, and, in the language of Thomas Jefferson, "should be of the President's bosom confidence" and, in the language of Attorney-General Cushing, is “subject to the direction of [55] the President."
In the present case, in making his recommendation to the President on the existence of either of the two conditions, the Secretary of Finance is not acting as the alter ego of the President or even her subordinate. In such instance, he is not subject to the power of control and direction of the President. He is acting as the agent of the legislative department, to determine and declare the event upon which its expressed will is to take effect.[56] The Secretary of Finance becomes the means or tool by which legislative policy is determined and implemented, considering that he possesses all the facilities to gather data and information and has a much broader perspective to properly evaluate them. His function is to gather and collate statistical data and other pertinent information and verify if any of the two conditions laid out by Congress is present. His personality in such instance is in reality but a projection of that of Congress. Thus, being the agent of Congress and not of the President, the President cannot alter or modify or nullify, or set aside the findings of the Secretary of Finance and to substitute the judgment of the former for that of the latter.
Congress simply granted the Secretary of Finance the authority to ascertain the existence of a fact, namely, whether by December 31, 2005, the value-added tax collection as a percentage of Gross Domestic Product (GDP) of the previous 4 year exceeds two and four-fifth percent (2 /5%) or the national government deficit as a percentage of GDP of the previous year exceeds one and one-half percent (1½%). If either of these two instances has occurred, the Secretary of Finance, by legislative mandate, must submit such information to the President. Then the 12% VAT rate must be imposed by the President effective January 1, 2006. There is no undue delegation of legislative power but only of the discretion as to the execution of a law. This is constitutionally permissible.[57] Congress does not abdicate its functions or unduly delegate power when it describes what job must be done, who must do it, and what is the scope of his authority; in our complex economy that is frequently the only way in which the legislative process can go [58] forward.
As to the argument of petitioners ABAKADA GURO Party List, et al. that delegating to the President the legislative power to tax is contrary to the principle of republicanism, the same deserves scant consideration. Congress did not delegate the power to tax but the mere implementation of the law. The intent and will to increase the VAT rate to 12% came from Congress and the task of the President is to simply execute the legislative policy. That Congress chose to do so in such a manner is not within the province of the Court to inquire into, its task [59] being to interpret the law.
The insinuation by petitioners Pimentel, et al. that the President has ample powers to cause, influence or create the conditions to bring about either or both the conditions precedent does not deserve any merit as this argument is highly speculative. The Court does not rule on allegations which are manifestly conjectural, as these may not exist at all. The Court deals with facts, not fancies; on realities, not appearances. When the Court acts on appearances instead of realities, justice and law will be short-lived.
B. The 12% Increase VAT Rate Does Not Impose an Unfair and Unnecessary Additional Tax Burden
Petitioners Pimentel, et al. argue that the 12% increase in the VAT rate imposes an unfair and additional tax burden on the people. Petitioners also argue that the 12% increase, dependent on any of the 2 conditions set forth in the contested provisions, is ambiguous because it does not state if the VAT rate would be returned to the original 10% if the rates are no longer satisfied. Petitioners also argue that such rate is unfair and unreasonable, as the people are unsure of the applicable VAT rate from year to year.
Under the common provisos of Sections 4, 5 and 6 of R.A. No. 9337, if any of the two conditions set forth therein are satisfied, the President shall increase the VAT rate to 12%. The provisions of the law are clear. It does not provide for a return to the 10% rate nor does it empower the President to so revert if, after the 4 rate is increased to 12%, the VAT collection goes below the 2 /5 of the GDP of the previous year or that the national government deficit as a percentage of GDP of the previous year does not exceed 1½%.
Therefore, no statutory construction or interpretation is needed. Neither can conditions or limitations be introduced where none is provided for. Rewriting the [60] law is a forbidden ground that only Congress may tread upon.
Thus, in the absence of any provision providing for a return to the 10% rate, which in this case the Court finds none, petitioners’ argument is, at best, purely speculative. There is no basis for petitioners’ fear of a fluctuating VAT rate because the law itself does not provide that the rate should go back to 10% if the conditions provided in Sections 4, 5 and 6 are no longer present. The rule is that where the provision of the law is clear and unambiguous, so that there is no occasion for the court's seeking the legislative intent, the law must be taken as it is, [61] devoid of judicial addition or subtraction.
Petitioners also contend that the increase in the VAT rate, which was allegedly an incentive to the President to raise the VAT collection to at least 4 2 /5 of the GDP of the previous year, should be based on fiscal adequacy.
Petitioners obviously overlooked that increase in VAT collection is not the only condition. There is another condition, i.e., the national government deficit as a percentage of GDP of the previous year exceeds one and one-half percent (1 ½%).
Respondents explained the philosophy behind these alternative conditions:
1. VAT/GDP Ratio > 2.8%
The condition set for increasing VAT rate to 12% have economic or fiscal meaning. If VAT/GDP is less than 2.8%, it means that government has weak or no capability of implementing the VAT or that VAT is not effective in the function of the tax collection. Therefore, there is no value to increase it to 12% because such action will also be ineffectual.
2. Nat’l Gov’t Deficit/GDP >1.5%
The condition set for increasing VAT when deficit/GDP is 1.5% or less means the fiscal condition of government has reached a relatively sound position or is towards the direction of a balanced budget position. Therefore, there is no need to increase the VAT rate since the fiscal house is in a relatively healthy position. Otherwise stated, if the ratio is more than 1.5%, there is indeed a need to increase the VAT rate.[62]
That the first condition amounts to an incentive to the President to increase the VAT collection does not render it unconstitutional so long as there is a public purpose for which the law was passed, which in this case, is mainly to raise revenue. In fact, fiscal adequacy dictated the need for a raise in revenue.
The principle of fiscal adequacy as a characteristic of a sound tax system was originally stated by Adam Smith in his Canons of Taxation (1776), as:
IV. Every tax ought to be so contrived as both to take out and to keep out of the pockets of the people as little as possible over and above what it brings into the public treasury of the state.[63]
It simply means that sources of revenues must be adequate to meet [64] government expenditures and their variations.
The dire need for revenue cannot be ignored. Our country is in a quagmire of financial woe. During the Bicameral Conference Committee hearing, then Finance Secretary Purisima bluntly depicted the country’s gloomy state of economic affairs, thus:
First, let me explain the position that the Philippines finds itself in right now. We are in a position where 90 percent of our revenue is used for debt service. So, for every peso of revenue that we currently raise, 90 goes to debt service. That’s interest plus amortization of our debt. So clearly, this is not a sustainable situation. That’s the first fact.
The second fact is that our debt to GDP level is way out of line compared to other peer countries that borrow money from that international financial markets. Our debt to GDP is approximately equal to our GDP. Again, that shows you that this is not a sustainable situation.
The third thing that I’d like to point out is the environment that we are presently operating in is not as benign as what it used to be the past five years.
What do I mean by that?
In the past five years, we’ve been lucky because we were operating in a period of basically global growth and low interest rates. The past few months, we have seen an inching up, in fact, a rapid increase in the interest rates in the leading economies of the world. And, therefore, our ability to borrow at reasonable prices is going to be challenged. In fact, ultimately, the question is our ability to access the financial markets.
When the President made her speech in July last year, the environment was not as bad as it is now, at least based on the forecast of most financial institutions. So, we were assuming that raising 80 billion would put us in a position where we can then convince them to improve our ability to borrow at lower rates. But conditions have changed on us because the interest rates have gone up. In fact, just within this room, we tried to access the market for a billion dollars because for this year alone, the Philippines will have to borrow 4 billion dollars. Of that amount, we have borrowed 1.5 billion. We issued last January a 25-year bond at 9.7 percent cost. We were trying to access last week and the market was not as favorable and up to now we have not accessed and we might pull back because the conditions are not very good.
So given this situation, we at the Department of Finance believe that we really need to front-end our deficit reduction. Because it is deficit that is causing the increase of the debt and we are in what we call a debt spiral. The more debt you have, the more deficit you have because interest and debt service eats and eats more of your revenue. We need to get out of this debt spiral. And the only way, I think, we can get out of this debt spiral is really have a front-end adjustment in our revenue base.[65]
The image portrayed is chilling. Congress passed the law hoping for rescue from an inevitable catastrophe. Whether the law is indeed sufficient to answer the state’s economic dilemma is not for the Court to judge. In the Fariñas case, the Court refused to consider the various arguments raised therein that dwelt on the wisdom of Section 14 of R.A. No. 9006 (The Fair Election Act), pronouncing that:
. . . policy matters are not the concern of the Court. Government policy is within the exclusive dominion of the political branches of the government. It is not for this Court to look into the wisdom or propriety of legislative determination. Indeed, whether an enactment is wise or unwise, whether it is based on sound economic theory, whether it is the best means to achieve the desired results, whether, in short, the legislative discretion within its prescribed limits should be exercised in a particular manner are matters for the judgment of the legislature, and the serious conflict of opinions does not suffice to bring them within the range of judicial cognizance.[66]
In the same vein, the Court in this case will not dawdle on the purpose of Congress or the executive policy, given that it is not for the judiciary to "pass upon [67] questions of wisdom, justice or expediency of legislation.”
II. Whether Section 8 of R.A. No. 9337, amending Sections 110(A)(2) and 110(B) of the NIRC; and Section 12 of R.A. No. 9337, amending Section 114(C) of the NIRC, violate the following provisions of the Constitution:
a. Article VI, Section 28(1), and b. Article III, Section 1
A. Due Process and Equal Protection Clauses
Petitioners Association of Pilipinas Shell Dealers, Inc., et al. argue that Section 8 of R.A. No. 9337, amending Sections 110 (A)(2), 110 (B), and Section 12 of R.A. No. 9337, amending Section 114 (C) of the NIRC are arbitrary, oppressive, excessive and confiscatory. Their argument is premised on the constitutional right against deprivation of life, liberty of property without due process of law, as embodied in Article III, Section 1 of the Constitution.
Petitioners also contend that these provisions violate the constitutional guarantee of equal protection of the law. The doctrine is that where the due process and equal protection clauses are invoked, considering that they are not fixed rules but rather broad standards, there is a need for proof of such persuasive character as would lead to such a conclusion. [68] Absent such a showing, the presumption of validity must prevail.
Section 8 of R.A. No. 9337, amending Section 110(B) of the NIRC imposes a limitation on the amount of input tax that may be credited against the output tax. It states, in part: “[P]rovided, that the input tax inclusive of the input VAT carried over from the previous quarter that may be credited in every quarter shall not exceed seventy percent (70%) of the output VAT: …”
Input Tax is defined under Section 110(A) of the NIRC, as amended, as the value-added tax due from or paid by a VAT-registered person on the importation of goods or local purchase of good and services, including lease or use of property, in the course of trade or business, from a VAT-registered person, and Output Tax is the value-added taxdue on the sale or lease of taxable goods or properties or services by any person registered or required to register under the law.
Petitioners claim that the contested sections impose limitations on the amount of input tax that may be claimed. In effect, a portion of the input tax that has already been paid cannot now be credited against the output tax.
Petitioners’ argument is not absolute. It assumes that the input tax exceeds 70% of the output tax, and therefore, the input tax in excess of 70% remains uncredited. However, to the extent that the input tax is less than 70% of the output tax, then 100% of such input tax is still creditable.
More importantly, the excess input tax, if any, is retained in a business’s books of accounts and remains creditable in the succeeding quarter/s. This is explicitly allowed by Section 110(B), which provides that “if the input tax exceeds the output tax, the excess shall be carried over to the succeeding quarter or quarters.” In addition, Section 112(B) allows a VAT-registered person to apply for the issuance of a tax credit certificate or refund for any unused input taxes, to the extent that such input taxes have not been applied against the output taxes. Such unused input tax may be used in payment of his other internal revenue taxes.
The non-application of the unutilized input tax in a given quarter is not ad infinitum, as petitioners exaggeratedly contend. Their analysis of the effect of the 70% limitation is incomplete and one-sided. It ends at the net effect that there will be unapplied/unutilized inputs VAT for a given quarter. It does not proceed further to the fact that such unapplied/unutilized input tax may be credited in the subsequent periods as allowed by the carry-over provision of Section 110(B) or that it may later on be refunded through a tax credit certificate under Section 112(B).
Therefore, petitioners’ argument must be rejected.
On the other hand, it appears that petitioner Garcia failed to comprehend the operation of the 70% limitation on the input tax. According to petitioner, the limitation on the creditable input tax in effect allows VAT-registered establishments to retain a portion of the taxes they collect, which violates the principle that tax collection and revenue should be for public purposes and expenditures
As earlier stated, the input tax is the tax paid by a person, passed on to him by the seller, when he buys goods. Output tax meanwhile is the tax due to the person when he sells goods. In computing the VAT payable, three possible scenarios may arise:
First, if at the end of a taxable quarter the output taxes charged by the seller are equal to the input taxes that he paid and passed on by the suppliers, then no payment is required;
Second, when the output taxes exceed the input taxes, the person shall be liable for the excess, which has to be paid to the Bureau of Internal Revenue [69] (BIR); and
Third, if the input taxes exceed the output taxes, the excess shall be carried over to the succeeding quarter or quarters. Should the input taxes result from zero- rated or effectively zero-rated transactions, any excess over the output taxes shall instead be refunded to the taxpayer or credited against other internal revenue taxes, [70] at the taxpayer’s option.
Section 8 of R.A. No. 9337 however, imposed a 70% limitation on the input tax. Thus, a person can credit his input tax only up to the extent of 70% of the output tax. In layman’s term, the value-added taxes that a person/taxpayer paid and passed on to him by a seller can only be credited up to 70% of the value-added taxes that is due to him on a taxable transaction. There is no retention of any tax collection because the person/taxpayer has already previously paid the input tax to a seller, and the seller will subsequently remit such input tax to the BIR. The party directly liable for the payment of the tax is the seller.[71] What only needs to be done is for the person/taxpayer to apply or credit these input taxes, as evidenced by receipts, against his output taxes.
Petitioners Association of Pilipinas Shell Dealers, Inc., et al. also argue that the input tax partakes the nature of a property that may not be confiscated, appropriated, or limited without due process of law.
The input tax is not a property or a property right within the constitutional purview of the due process clause. A VAT-registered person’s entitlement to the creditable input tax is a mere statutory privilege.
The distinction between statutory privileges and vested rights must be borne in mind for persons have no vested rights in statutory privileges. The state may change or take away rights, which were created by the law of the state, although it [72] may not take away property, which was vested by virtue of such rights.
Under the previous system of single-stage taxation, taxes paid at every level of distribution are not recoverable from the taxes payable, although it becomes part of the cost, which is deductible from the gross revenue. When Pres. Aquino issued E.O. No. 273 imposing a 10% multi-stage tax on all sales, it was then that the crediting of the input tax paid on purchase or importation of goods and services by VAT-registered persons against the output tax was introduced.[73] This was adopted by the Expanded VAT Law (R.A. No. 7716),[74] and The Tax Reform Act of 1997 (R.A. No. 8424).[75] The right to credit input tax as against the output tax is clearly a privilege created by law, a privilege that also the law can remove, or in this case, limit.
Petitioners also contest as arbitrary, oppressive, excessive and confiscatory, Section 8 of R.A. No. 9337, amending Section 110(A) of the NIRC, which provides:
SEC. 110. Tax Credits. –
(A) Creditable Input Tax. – …
Provided, That the input tax on goods purchased or imported in a calendar month for use in trade or business for which deduction for depreciation is allowed under this Code, shall be spread evenly over the month of acquisition and the fifty-nine (59) succeeding months if the aggregate acquisition cost for such goods, excluding the VAT component thereof, exceeds One million pesos (P1,000,000.00): Provided, however, That if the estimated useful life of the capital goods is less than five (5) years, as used for depreciation purposes, then the input VAT shall be spread over such a shorter period: Provided, finally, That in the case of purchase of services, lease or use of properties, the input tax shall be creditable to the purchaser, lessee or license upon payment of the compensation, rental, royalty or fee.
The foregoing section imposes a 60-month period within which to amortize the creditable input tax on purchase or importation of capital goods with acquisition cost of P1 Million pesos, exclusive of the VAT component. Such spread out only poses a delay in the crediting of the input tax. Petitioners’ argument is without basis because the taxpayer is not permanently deprived of his privilege to credit the input tax.
It is worth mentioning that Congress admitted that the spread-out of the creditable input tax in this case amounts to a 4-year interest-free loan to the government.[76] In the same breath, Congress also justified its move by saying that the provision was designed to raise an annual revenue of 22.6 billion.[77] The legislature also dispelled the fear that the provision will fend off foreign investments, saying that foreign investors have other tax incentives provided by law, and citing the case of China, where despite a 17.5% non-creditable VAT, foreign investments were not deterred.[78] Again, for whatever is the purpose of the 60-month amortization, this involves executive economic policy and legislative wisdom in which the Court cannot intervene.
With regard to the 5% creditable withholding tax imposed on payments made by the government for taxable transactions, Section 12 of R.A. No. 9337, which amended Section 114 of the NIRC, reads:
SEC. 114. Return and Payment of Value-added Tax. –
(C) Withholding of Value-added Tax. – The Government or any of its political subdivisions, instrumentalities or agencies, including government-owned or controlled corporations (GOCCs) shall, before making payment on account of each purchase of goods and services which are subject to the value-added tax imposed in Sections 106 and 108 of this Code, deduct and withhold a final value- added tax at the rate of five percent (5%) of the gross payment thereof: Provided, That the payment for lease or use of properties or property rights to nonresident owners shall be subject to ten percent (10%) withholding tax at the time of payment. For purposes of this Section, the payor or person in control of the payment shall be considered as the withholding agent.
The value-added tax withheld under this Section shall be remitted within ten (10) days following the end of the month the withholding was made.
Section 114(C) merely provides a method of collection, or as stated by respondents, a more simplified VAT withholding system. The government in this case is constituted as a withholding agent with respect to their payments for goods and services.
Prior to its amendment, Section 114(C) provided for different rates of value- added taxes to be withheld -- 3% on gross payments for purchases of goods; 6% on gross payments for services supplied by contractors other than by public works contractors; 8.5% on gross payments for services supplied by public work contractors; or 10% on payment for the lease or use of properties or property rights to nonresident owners. Under the present Section 114(C), these different rates, except for the 10% on lease or property rights payment to nonresidents, were deleted, and a uniform rate of 5% is applied.
The Court observes, however, that the law the used the word final. In tax usage, final, as opposed to creditable, means full. Thus, it is provided in Section 114(C): “final value-added tax at the rate of five percent (5%).”
In Revenue Regulations No. 02-98, implementing R.A. No. 8424 (The Tax Reform Act of 1997), the concept of final withholding tax on income was explained, to wit:
SECTION 2.57. Withholding of Tax at Source
(A) Final Withholding Tax. – Under the final withholding tax system the amount of income tax withheld by the withholding agent is constituted as full and final payment of the income tax due from the payee on the said income. The liability for payment of the tax rests primarily on the payor as a withholding agent. Thus, in case of his failure to withhold the tax or in case of underwithholding, the deficiency tax shall be collected from the payor/withholding agent. …
(B) Creditable Withholding Tax. – Under the creditable withholding tax system, taxes withheld on certain income payments are intended to equal or at least approximate the tax due of the payee on said income. … Taxes withheld on income payments covered by the expanded withholding tax (referred to in Sec. 2.57.2 of these regulations) and compensation income (referred to in Sec. 2.78 also of these regulations) are creditable in nature.
As applied to value-added tax, this means that taxable transactions with the government are subject to a 5% rate, which constitutes as full payment of the tax payable on the transaction. This represents the net VAT payable of the seller. The other 5% effectively accounts for the standard input VAT (deemed input VAT), in [79] lieu of the actual input VAT directly or attributable to the taxable transaction.
The Court need not explore the rationale behind the provision. It is clear that Congress intended to treat differently taxable transactions with the government.[80] This is supported by the fact that under the old provision, the 5% tax withheld by the government remains creditable against the tax liability of the seller or contractor, to wit:
SEC. 114. Return and Payment of Value-added Tax. –
(C) Withholding of Creditable Value-added Tax. – The Government or any of its political subdivisions, instrumentalities or agencies, including government-owned or controlled corporations (GOCCs) shall, before making payment on account of each purchase of goods from sellers and services rendered by contractors which are subject to the value-added tax imposed in Sections 106 and 108 of this Code, deduct and withhold the value-added tax due at the rate of three percent (3%) of the gross payment for the purchase of goods and six percent (6%) on gross receipts for services rendered by contractors on every sale or installment payment which shall be creditable against the value-added tax liability of the seller or contractor: Provided, however, That in the case of government public works contractors, the withholding rate shall be eight and one- half percent (8.5%): Provided, further, That the payment for lease or use of properties or property rights to nonresident owners shall be subject to ten percent (10%) withholding tax at the time of payment. For this purpose, the payor or person in control of the payment shall be considered as the withholding agent.
The valued-added tax withheld under this Section shall be remitted within ten (10) days following the end of the month the withholding was made. (Emphasis supplied)
As amended, the use of the word final and the deletion of the word creditable exhibits Congress’s intention to treat transactions with the government differently. Since it has not been shown that the class subject to the 5% final withholding tax has been unreasonably narrowed, there is no reason to invalidate the provision. Petitioners, as petroleum dealers, are not the only ones subjected to the 5% final withholding tax. It applies to all those who deal with the government.
Moreover, the actual input tax is not totally lost or uncreditable, as petitioners believe. Revenue Regulations No. 14-2005 or the Consolidated Value- Added Tax Regulations 2005 issued by the BIR, provides that should the actual input tax exceed 5% of gross payments, the excess may form part of the cost. Equally, should the actual input tax be less than 5%, the difference is treated [81] as income.
Petitioners also argue that by imposing a limitation on the creditable input tax, the government gets to tax a profit or value-added even if there is no profit or value-added.
Petitioners’ stance is purely hypothetical, argumentative, and again, one- sided. The Court will not engage in a legal joust where premises are what ifs, arguments, theoretical and facts, uncertain. Any disquisition by the Court on this point will only be, as Shakespeare describes life in Macbeth,[82] “full of sound and fury, signifying nothing.”
What’s more, petitioners’ contention assumes the proposition that there is no profit or value-added. It need not take an astute businessman to know that it is a matter of exception that a business will sell goods or services without profit or value-added. It cannot be overstressed that a business is created precisely for profit.
The equal protection clause under the Constitution means that “no person or class of persons shall be deprived of the same protection of laws which is enjoyed [83] by other persons or other classes in the same place and in like circumstances.”
The power of the State to make reasonable and natural classifications for the purposes of taxation has long been established. Whether it relates to the subject of taxation, the kind of property, the rates to be levied, or the amounts to be raised, the methods of assessment, valuation and collection, the State’s power is entitled to presumption of validity. As a rule, the judiciary will not interfere with such power [84] absent a clear showing of unreasonableness, discrimination, or arbitrariness.
Petitioners point out that the limitation on the creditable input tax if the entity has a high ratio of input tax, or invests in capital equipment, or has several transactions with the government, is not based on real and substantial differences to meet a valid classification.
The argument is pedantic, if not outright baseless. The law does not make any classification in the subject of taxation, the kind of property, the rates to be levied or the amounts to be raised, the methods of assessment, valuation and collection. Petitioners’ alleged distinctions are based on variables that bear different consequences. While the implementation of the law may yield varying end results depending on one’s profit margin and value-added, the Court cannot go beyond what the legislature has laid down and interfere with the affairs of business.
The equal protection clause does not require the universal application of the laws on all persons or things without distinction. This might in fact sometimes result in unequal protection. What the clause requires is equality among equals as determined according to a valid classification. By classification is meant the grouping of persons or things similar to each other in certain particulars and [85] different from all others in these same particulars.
Petitioners brought to the Court’s attention the introduction of Senate Bill No. 2038 by Sens. S.R. Osmeña III and Ma. Ana Consuelo A.S. – Madrigal on
June 6, 2005, and House Bill No. 4493 by Rep. Eric D. Singson. The proposed legislation seeks to amend the 70% limitation by increasing the same to 90%. This, according to petitioners, supports their stance that the 70% limitation is arbitrary and confiscatory. On this score, suffice it to say that these are still proposed legislations. Until Congress amends the law, and absent any unequivocal basis for its unconstitutionality, the 70% limitation stays.
B. Uniformity and Equitability of Taxation
Article VI, Section 28(1) of the Constitution reads:
The rule of taxation shall be uniform and equitable. The Congress shall evolve a progressive system of taxation.
Uniformity in taxation means that all taxable articles or kinds of property of the same class shall be taxed at the same rate. Different articles may be taxed at different amounts provided that the rate is uniform on the same class everywhere [86] with all people at all times.
In this case, the tax law is uniform as it provides a standard rate of 0% or 10% (or 12%) on all goods and services. Sections 4, 5 and 6 of R.A. No. 9337, amending Sections 106, 107 and 108, respectively, of the NIRC, provide for a rate of 10% (or 12%) on sale of goods and properties, importation of goods, and sale of services and use or lease of properties. These same sections also provide for a 0% rate on certain sales and transaction.
Neither does the law make any distinction as to the type of industry or trade that will bear the 70% limitation on the creditable input tax, 5-year amortization of input tax paid on purchase of capital goods or the 5% final withholding tax by the government. It must be stressed that the rule of uniform taxation does not deprive Congress of the power to classify subjects of taxation, and only demands [87] uniformity within the particular class.
R.A. No. 9337 is also equitable. The law is equipped with a threshold margin. The VAT rate of 0% or 10% (or 12%) does not apply to sales of goods or services with gross annual sales or receipts not exceeding P1,500,000.00.[88] Also, basic marine and agricultural food products in their original state are still not subject to the tax,[89] thus ensuring that prices at the grassroots level will remain accessible. As was stated in Kapatiran ng mga Naglilingkod sa Pamahalaan ng [90] Pilipinas, Inc. vs. Tan:
The disputed sales tax is also equitable. It is imposed only on sales of goods or services by persons engaged in business with an aggregate gross annual sales exceeding P200,000.00. Small corner sari-sari stores are consequently exempt from its application. Likewise exempt from the tax are sales of farm and marine products, so that the costs of basic food and other necessities, spared as they are from the incidence of the VAT, are expected to be relatively lower and within the reach of the general public.
It is admitted that R.A. No. 9337 puts a premium on businesses with low profit margins, and unduly favors those with high profit margins. Congress was not oblivious to this. Thus, to equalize the weighty burden the law entails, the law, under Section 116, imposed a 3% percentage tax on VAT-exempt persons under Section 109(v), i.e., transactions with gross annual sales and/or receipts not exceeding P1.5 Million. This acts as a equalizer because in effect, bigger businesses that qualify for VAT coverage and VAT-exempt taxpayers stand on equal-footing.
Moreover, Congress provided mitigating measures to cushion the impact of the imposition of the tax on those previously exempt. Excise taxes on petroleum products[91]and natural gas[92] were reduced. Percentage tax on domestic carriers [93] [94] was removed. Power producers are now exempt from paying franchise tax.
Aside from these, Congress also increased the income tax rates of corporations, in order to distribute the burden of taxation. Domestic, foreign, and non-resident corporations are now subject to a 35% income tax rate, from a previous 32%.[95] Intercorporate dividends of non-resident foreign corporations are still subject to 15% final withholding tax but the tax credit allowed on the corporation’s domicile was increased to 20%.[96] The Philippine Amusement and Gaming Corporation (PAGCOR) is not exempt from income taxes anymore.[97] Even the sale by an artist of his works or services performed for the production of such works was not spared.
All these were designed to ease, as well as spread out, the burden of taxation, which would otherwise rest largely on the consumers. It cannot therefore be gainsaid that R.A. No. 9337 is equitable.
C. Progressivity of Taxation
Lastly, petitioners contend that the limitation on the creditable input tax is anything but regressive. It is the smaller business with higher input tax-output tax ratio that will suffer the consequences.
Progressive taxation is built on the principle of the taxpayer’s ability to pay. This principle was also lifted from Adam Smith’s Canons of Taxation, and it states:
I. The subjects of every state ought to contribute towards the support of the government, as nearly as possible, in proportion to their respective abilities; that is, in proportion to the revenue which they respectively enjoy under the protection of the state. Taxation is progressive when its rate goes up depending on the resources of [98] the person affected.
The VAT is an antithesis of progressive taxation. By its very nature, it is regressive. The principle of progressive taxation has no relation with the VAT system inasmuch as the VAT paid by the consumer or business for every goods bought or services enjoyed is the same regardless of income. In other words, the VAT paid eats the same portion of an income, whether big or small. The disparity lies in the income earned by a person or profit margin marked by a business, such that the higher the income or profit margin, the smaller the portion of the income or profit that is eaten by VAT. A converso, the lower the income or profit margin, the bigger the part that the VAT eats away. At the end of the day, it is really the lower income group or businesses with low-profit margins that is always hardest hit.
Nevertheless, the Constitution does not really prohibit the imposition of indirect taxes, like the VAT. What it simply provides is that Congress shall "evolve a progressive system of taxation." The Court stated in the Tolentino case, thus:
The Constitution does not really prohibit the imposition of indirect taxes which, like the VAT, are regressive. What it simply provides is that Congress shall ‘evolve a progressive system of taxation.’ The constitutional provision has been interpreted to mean simply that ‘direct taxes are . . . to be preferred [and] as much as possible, indirect taxes should be minimized.’ (E. FERNANDO, THE CONSTITUTION OF THE PHILIPPINES 221 (Second ed. 1977)) Indeed, the mandate to Congress is not to prescribe, but to evolve, a progressive tax system. Otherwise, sales taxes, which perhaps are the oldest form of indirect taxes, would have been prohibited with the proclamation of Art. VIII, §17 (1) of the 1973 Constitution from which the present Art. VI, §28 (1) was taken. Sales taxes are also regressive.
Resort to indirect taxes should be minimized but not avoided entirely because it is difficult, if not impossible, to avoid them by imposing such taxes according to the taxpayers' ability to pay. In the case of the VAT, the law minimizes the regressive effects of this imposition by providing for zero rating of certain transactions (R.A. No. 7716, §3, amending §102 (b) of the NIRC), while granting exemptions to other transactions. (R.A. No. 7716, §4 amending §103 of [99] the NIRC)
CONCLUSION
It has been said that taxes are the lifeblood of the government. In this case, it is just an enema, a first-aid measure to resuscitate an economy in distress. The Court is neither blind nor is it turning a deaf ear on the plight of the masses. But it does not have the panacea for the malady that the law seeks to remedy. As in other cases, the Court cannot strike down a law as unconstitutional simply because of its yokes.
Let us not be overly influenced by the plea that for every wrong there is a remedy, and that the judiciary should stand ready to afford relief. There are undoubtedly many wrongs the judicature may not correct, for instance, those involving political questions. . . .
Let us likewise disabuse our minds from the notion that the judiciary is the repository of remedies for all political or social ills; We should not forget that the Constitution has judiciously allocated the powers of government to three distinct and separate compartments; and that judicial interpretation has tended to the preservation of the independence of the three, and a zealous regard of the prerogatives of each, knowing full well that one is not the guardian of the others and that, for official wrong-doing, each may be brought to account, either by impeachment, trial or by the ballot box.[100]
The words of the Court in Vera vs. Avelino[101] holds true then, as it still holds true now. All things considered, there is no raison d'être for the unconstitutionality of R.A. No. 9337.
WHEREFORE, Republic Act No. 9337 not being unconstitutional, the petitions in G.R. Nos. 168056, 168207, 168461, 168463, and 168730, are hereby DISMISSED.
There being no constitutional impediment to the full enforcement and implementation of R.A. No. 9337, the temporary restraining order issued by the Court on July 1, 2005 is LIFTED upon finality of herein decision.
SO ORDERED.
C E R T I F I C A T I O N
Pursuant to Section 13, Article VIII of the Constitution, it is hereby certified that the conclusions in the above Decision were reached in consultation before the case was assigned to the writer of the opinion of the Court.
HILARIO G. DAVIDE, JR. Chief Justice
[1] Entitled “An Act Amending Sections 27, 28, 34, 106, 107, 108, 109, 110, 111, 112, 113, 114, 116, 117, 119, 121, 148, 151, 236, 237, and 288 of the National Internal Revenue Code of 1997, As Amended and For Other Purposes.” [2] Entitled, “An Act Restructuring the Value-Added Tax, Amending for the Purpose Sections 106, 107, 108, 110 and 114 of the National Internal Revenue Code of 1997, As Amended, and For Other Purposes.” [3] Entitled, “An Act Amending Sections 106, 107, 108, 109, 110 and 111 of the National Internal Revenue Code of 1997, As Amended, and For Other Purposes.” [4] Entitled, “An Act Amending Sections 27, 28, 34, 106, 108, 109, 110, 112, 113, 114, 116, 117, 119, 121, 125, 148, 151, 236, 237 and 288 of the National Internal Revenue Code of 1997, As Amended, and For Other Purposes.” [5] Section 26, R.A. No. 9337. [6] TSN, July 14, 2005. [7] Section 125 of the National Internal Revenue Code, as amended, was not amended by R.A. No. 9337, as can be gleaned from the title and body of the law. [8] Section 105, National Internal Revenue of the Philippines, as amended. [9] Ibid. [10] Deoferio, Jr., V.A. and Mamalateo, V.C., The Value Added Tax in the Philippines (First Edition 2000). [11] Maceda vs. Macaraig, Jr., G.R. No. 88291, May 31, 1991, 197 SCRA 771. [12] Maceda vs. Macaraig, Jr., G.R. No. 88291, June 8, 1993, 223 SCRA, 217. [13] Id., Deoferio, Jr., V.A. and Mamalateo, V.C., The Value Added Tax in the Philippines (First Edition 2000). [14] Commissioner of Internal Revenue vs. Seagate, G.R. No. 153866, February 11, 2005. [15] Kapatiran ng mga Naglilingkod sa Pamahalaan ng Pilipinas, Inc. vs. Tan, G.R. Nos. L-81311, L-81820, L-81921, L-82152, June 30, 1988, 163 SCRA 371. [16] Entitled, “An Act Restructuring the Value-Added Tax (VAT) System, Widening its Tax Base and Enhancing its Administration, And for these Purposes Amending and Repealing the Relevant Provisions of the National Internal Revenue Code, as amended, and for other Purposes.” [17] Entitled, “An Act Amending Republic Act No. 7716, otherwise known as the Value-Added Tax Law and Other Pertinent Provisions of the National Internal Revenue Code, as Amended.” [18] Entitled, “An Act Amending the National Internal Revenue Code, as Amended, and for other Purposes.” [19] Story, Commentaries 835 (1833). [20] G.R. No. 147387, December 10, 2003, 417 SCRA 503. [21] Id., pp. 529-530. [22] Supra., Note 20. [23] G.R. No. 115455, August 25, 1994, 235 SCRA 630. [24] Id., p. 670. [25] Wester’s Third New International Dictionary, p. 1897. [26] TSN, Bicameral Conference Committee on the Disagreeing Provisions of Senate Bill No. 1950 and House Bill Nos. 3705 and 3555, May 10, 2005, p. 4. [27] Id., p. 3. [28] Sponsorship Speech of Representative Teves, in behalf of Representative Jesli Lapus, TSN, January 7, 2005, pp. 34-35. [29] G.R. No. 105371, November 11, 1993, 227 SCRA 703. [30] Supra, Note 23. [31] Id., p. 668. [32] Id., p. 671. [33] Id., pp. 661-663. [34] Transcript of Session Proceedings, January 7, 2005, pp. 19-20. [35] Journal of the Senate, Session No. 67, March 7, 2005, pp. 727-728. [36] Id., p. 726. [37] See Angara vs. Electoral Commission, No. 45081, July 15, 1936, 63 Phil. 139, 156. [38] Defensor-Santiago vs. Commission on Elections, G.R. No. 127325, March 19, 1997, 270 SCRA 106, 153; People vs. Rosenthal, Nos. 46076 & 46077, June 12, 1939, 68 Phil. 328; ISAGANI A. CRUZ, Philippine Political Law 86 (1996). Judge Cooley enunciates the doctrine in the following oft-quoted language: "One of the settled maxims in constitutional law is, that the power conferred upon the legislature to make laws cannot be delegated by that department to any other body or authority. Where the sovereign power of the state has located the authority, there it must remain; and by the constitutional agency alone the laws must be made until the Constitution itself is changed. The power to whose judgment, wisdom, and patriotism this high prerogative has been intrusted cannot relieve itself of the responsibility by choosing other agencies upon which the power shall be devolved, nor can it substitute the judgment, wisdom, and patriotism of any other body for those to which alone the people have seen fit to confide this sovereign trust." (Cooley on Constitutional Limitations, 8th ed., Vol. I, p. 224) [39] United States vs. Barrias, No. 4349, September 24, 1908, 11 Phil. 327, 330. [40] 16 Am Jur 2d, Constitutional Law, § 337. [41] Pelaez vs. Auditor General, No. L-23825, December 24, 1965, 122 Phil. 965, 974 citing Calalang vs. Williams, No. 47800, December 2, 1940, 70 Phil. 726; Pangasinan Transp. Co. vs. Public Service Commission, No. 47065, June 26, 1940, 70 Phil. 221; Cruz vs. Youngberg, No. 34674, October 26, 1931, 56 Phil. 234; Alegre vs. Collector of Customs, No. 30783, August 27, 1929, 53 Phil. 394 et seq. [42] Pelaez vs. Auditor General, supra, citing People vs. Lim Ho, No. L-12091-2, January 28, 1960, 106 Phil. 887; People vs. Jolliffee, No. L-9553, May 13, 1959, 105 Phil 677; People vs. Vera, No. 45685, November 16, 1937, 65 Phil. 56; U.S. vs. Nag Tang Ho, No. L-17122, February 27, 1922, 43 Phil. 1; Compañia General de Tabacos vs. Board of Public Utility, No. 11216, March 6, 1916, 34 Phil. 136 et seq. [43] Edu vs. Ericta, No. L-32096, October 24, 1970, 35 SCRA 481, 497. [44] Eastern Shipping Lines, Inc. vs. POEA, No. L-76633, October 18, 1988, 166 SCRA 533, 543-544. [45] No. 45685, November 16, 1937, 65 Phil. 56. [46] Id., pp. 115-120. [47] Supra, note 43. [48] Id., pp. 496-497. [49] 16 C.J.S., Constitutional Law, § 138. [50] Ibid. [51] 16 Am Jur 2d, Constitutional Law § 340. [52] Yajus vs. United States, 321 US 414, 88 L Ed 834, 64 S Ct. 660, 28 Ohio Ops 220. [53] Province of Batangas vs. Romulo, G.R. No. 152774, May 27, 2004; Enriquez vs. Court of Appeals, G.R. No. 140473, January 28, 2003, 396 SCRA 377; Codoy vs. Calugay, G.R. No. 123486, August 12, 1999, 312 SCRA 333. [54] Province of Batangas vs. Romulo, supra; Quisumbing vs. Meralco, G.R. No. 142943, April 3, 2002, 380 SCRA 195; Agpalo, Statutory Construction, 1990 ed., p. 45. [55] Villena vs. Secretary of Interior, No. 46570, April 21, 1939, 67 Phil 451, 463-464. [56] Alunan vs. Mirasol, G.R. No. 108399, July 31, 1997, 276 SCRA 501, 513-514, citing Panama Refining Co. vs. Ryan, 293 U.S. 388, 79 L.Ed. 469 (1935). [57] Compañia General de Tabacos de Filipinas vs. The Board of Public Utility Commissioners, No. 11216, 34 Phil. 136; Cruz vs. Youngberg, No. 34674, October 26, 1931, 56 Phil. 234; People vs. Vera, No. 45685, November 16, 1937, 65 Phil. 56, 113; Edu vs. Ericta, No. L-32096, October 24, 1970, 35 SCRA 481; Tatad vs. Secretary of the Department of Energy, G.R. No. 124360, November 5, 1997, 281 SCRA 330; Alunan vs. Mirasol, supra. [58] Bowles vs. Willinghan, 321 US 503, 88 l Ed 892, 64 S Ct 641, 28 Ohio Ops 180. [59] United Residents of Dominican Hill, Inc. vs. Commission on the Settlement of Land Problems, G.R. No. 135945, March 7, 2001, 353 SCRA 782; Commissioner of Internal Revenue vs. Santos, G.R. No. 119252, August 18, 1997, 277 SCRA 617, 630. [60] Commission on Internal Revenue vs. American Express International, Inc. (Philippine Branch), G.R. No. 152609, June 29, 2005. [61] Acting Commissioner of Customs vs. MERALCO, No. L-23623, June 30, 1977, 77 SCRA 469, 473. [62] Respondents’ Memorandum, pp. 168-169. [63] The Wealth of Nations, Book V, Chapter II. [64] Chavez vs. Ongpin, G.R. No. 76778, June 6, 1990, 186 SCRA 331, 338. [65] TSN, Bicameral Conference Committee on the Disagreeing Provisions of Senate Bill No. 1950 and House Bill Nos. 3705 and 3555, April 25, 2005, pp. 5-6. [66] G.R. No. 147387, December 10, 2003, 417 SCRA 503, 524. [67] National Housing Authority vs. Reyes, G.R. No. L-49439, June 29, 1983, 123 SCRA 245, 249. [68] Sison vs. Ancheta, G.R. No. L-59431, July 25, 1984, 130 SCRA 654, 661. [69] Section 8, R.A. No. 9337, amending Section 110(A)(B),NIRC. [70] Ibid. [71] Commissioner of Internal Revenue vs. Benguet Corp., G.R. Nos. 134587 & 134588, July 8, 2005. [72] United Paracale Mining Co. vs. Dela Rosa, G.R. Nos. 63786-87, April 7, 1993, 221 SCRA 108, 115. [73] E.O. No. 273, Section 1. [74] Section 5. [75] Section 110(B). [76] Journal of the Senate, Session No. 71, March 15, 2005, p. 803. [77] Id., Session No. 67, March 7, 2005, p. 726. [78] Id., Session No. 71, March 15, 2005, p. 803. [79] Revenue Regulations No. 14-2005, 4.114-2(a). [80] Commissioner of Internal Revenue vs. Philam, G.R. No. 141658, March 18, 2005. [81] Revenue Regulations No. 14-2005, Sec. 4. 114-2. [82] Act V, Scene V. [83] Philippine Rural Electric Cooperatives Association, Inc. vs. DILG, G.R. No. 143076, June 10, 2003, 403 SCRA 558, 565. [84] Aban, Benjamin, Law of Basic Taxation in the Philippines (First Edition 1994). [85] Philippine Judges Association case, supra., note 29. [86] Commissioner of Internal Revenue vs. Court of Appeals, G.R. No. 119761, August 29, 1996, 261 SCRA 236, 249. [87] Kee vs. Court of Tax Appeals, No. L-18080, April 22, 1963, 117 Phil 682, 688. [88] Section 7, R.A. No. 9337. [89] Ibid. [90] No. L-81311, June 30, 1988, 163 SCRA 371, 383. [91] Section 17, R.A. No. 9337, amending Section 148, NIRC. [92] Section 18, amending Section 151, NIRC. [93] Section 14, amending Section 117, NIRC. [94] Section 15, amending Section 119, NIRC. [95] Sections 1 and 2, amending Sections 27 and 28, NIRC. [96] Section 2, amending Section 28, NIRC. [97] Section 1, amending Section 27(C), NIRC. [98] Reyes vs. Almanzor, G.R. Nos. 49839-46, April 26, 1991, 196 SCRA 322, 327. [99] Tolentino vs. Secretary of Finance, G.R. No. 115455, October 30, 1995, 249 SCRA 628, 659. [100] Vera vs. Avelino, G.R. No. L-543, August 31, 1946, 77 Phil. 365. [101] Ibid.