EMILIO SUNTAY Y AGUINALDO, petitioner,

vs.
THE PEOPLE OF THE PHILIPPINES, THE HONORABLE NICASIO YATCO, as Judge
of te Cou!t of F"!st I#sta#$e of R"%a&, 'ue%o# C"t( B!a#$ ), a#d THE HONORABLE
CARLOS P* GARCIA, as Se$!eta!( fo! Fo!e"g# Affa"!s, respondents.
Federico Agrava for petitioner.
Office of the Solicitor, General Ambrosio Padilla, First Assistant Solicitor General Guillermo E.
Torres and Solicitor Florencio Villamor for respondents.
PADILLA, J.+
This is a petition for a writ of certiorari to annul an order of the Court of First Instance of
Quezon City directing
. . . the National Bureau of Investigation and the epart!ent of Foreign "ffairs for the!
to ta#e proper steps in order that the accused, $!ilio %untay y "guinaldo, who is alleged
to &e in the 'nited %tates, !ay &e &rought &ac# to the (hilippines, so that he !ay &e dealt
with in accordance with law, )$*hi&it +
and of prohi&ition to en,oin the %ecretary for Foreign "ffairs fro! cancelling the petitioner-s
passport without previous hearing.
.n /0 1une 2345, r. "ntonio Nu&la, father of "licia Nu&la, a !inor of 20 years, filed a verified
co!plaint against $!ilio %untay in the .ffice of the City "ttorney of Quezon City, as follows6
.n or a&out 1une /2, 2345, the accused too# "licia Nu&la fro! %t. (aul-s Colleges in
Quezon City with lewd design and too# her to so!ewhere near the '.(. co!pound in
ili!an, Quezon City and was then a&le to have carnal #nowledge of her. "licia Nu&la is
a !inor of 20 years.
.n 24 ece!&er 2345, after an investigation, an "ssistant City "ttorney reco!!ended to the
City "ttorney of Quezon City that the co!plaint &e dis!issed for lac# of !erit. .n /7 ece!&er
2345 attorney for the co!plainant addressed a letter to the City "ttorney of Quezon City wherein
he too# e*ception to the reco!!endation of the "ssistant City "ttorney referred to and urged
that a co!plaint for seduction &e filed against the herein petitioner.
.n 28 1anuary 2344 the petitioner applied for and was granted a passport &y the epart!ent of
Foreign "ffairs )No. 4392 :"73295;+. .n /8 1anuary 2344 the petitioner left the (hilippines for
%an Francisco, California, '.%."., where he is at present enrolled in school. .n 72 1anuary 2344
the offended girl su&scri&ed and swore to a co!plaint charging the petitioner with seduction
which was filed in the Court of First Instance of Quezon City after preli!inary investigation had
&een conducted )cri!. case No. Q<2430, $*hi&it B+. .n 3 Fe&ruary 2344 the private prosecutor
filed a !otion praying the Court to issue an order =directing such govern!ent agencies as !ay
&e concerned, particularly the National Bureau of Investigation and the epart!ent of Foreign
"ffairs, for the purpose of having the accused &rought &ac# to the (hilippines so that he !ay &e
dealt with in accordance with law.= )$*hi&it C.+ .n 28 Fe&ruary 2344 the Court granted the
!otion )$*hi&it +. .n > ?arch 2344 the respondent %ecretary ca&led the "!&assador to the
'nited %tates instructing hi! to order the Consul @eneral in %an Francisco to cancel the passport
issued to the petitioner and to co!pel hi! to return to the (hilippines to answer the cri!inal
charges against hi!. =The $!&assy was li#ewise directed to !a#e representation with the %tate
epart!ent that $!ilio %untay-s presence outside the (hilippines is considered detri!ental to the
&est interest of this @overn!ent, that his passport has &een withdrawn, and that he is not
considered under the protection of the (hilippines while a&road.= )$*hi&it $.+ Aowever, this
order was not i!ple!ented or carried out in view of the co!!ence!ent of this proceedings in
order that the issues raised !ay &e ,udicially resolved. .n 4 1uly 2344 counsel for the petitioner
wrote to the respondent %ecretary reBuesting that the action ta#en &y hi! &e reconsidered
)$*hi&it F+, and filed in the cri!inal case a !otion praying that the respondent Court reconsider
its order of 28 Fe&ruary 2344 )$*hi&it @+. .n > 1uly 2344 the respondent %ecretary denied
counsel-s reBuest )$*hi&it A+ and on 24 1uly 2344 the Court denied the !otion for
reconsideration )$*hi&it I+. Aence this petition.
The petitioner contends that as the order of the respondent Court directing the epart!ent of
Foreign "ffairs =to ta#e proper steps in order that the= petitioner =!ay &e &rought &ac# to the
(hilippines, so that he !ay &e &rought &ac# to the (hilippines, so that he !ay default with in
accordance with law,= !ay &e carried out only =through the cancellation of his passport,= the said
order is illegal &ecause =while a Court !ay review the action of the %ecretary of Foreign "ffairs
in cancelling a passport and grant relief when the %ecretary-s discretion is a&used, the court
cannot, in the first instance, ta#e the discretionary power away fro! the %ecretary and itself
order a passport to &e cancelled.=
The petitioner contends that as the order of the respondent Court directing the depart!ent of
Foreign "ffairs =to ta#e proper steps in order that the= petitioner =!ay &e &rought &ac# to the
(hilippines, so that he !ay &e dealt with in accordance with law,= !ay &e carried out only
=through the cancellation of his passport,= the said order is illegal &ecause -while a Court !ay
review the action of the %ecretary of Foreign "ffairs in cancelling a passport and grant relief
when the %ecretary-s discretion is a&used, the court cannot, in the first instance, ta#e the
discretionary power away fro! the %ecretary and itself order a passport to &e cancelled.= The
petitioner further contends that while the %ecretary for Foreign "ffairs has discretion in the
cancellation of passports, =such discretion cannot &e e*ercised until after hearing,= &ecause the
right to travel or stay a&road is a personal li&erty within the !eaning and protection of the
Constitution and hence he cannot &e deprived of such li&erty without due process of law.
The petitioner-s contention cannot &e sustained. The petitioner is charged with seduction. "nd the
order of the respondent Court directing the epart!ent of Foreign "ffairs =to ta#e proper steps
in order that the accused . . . !ay &e &rought &ac# to the (hilippines, so that he !ay &e dealt with
in accordance with law,= is not &eyond or in e*cess of its ,urisdiction.
Chen &y law ,urisdiction is conferred on a court or ,udicial officer, all au*iliary writs,
processes and other !eans necessary to carry it into effect !ay &e e!ployed &y such
court or officerD and if the procedure to &e followed in the e*ercise of such ,urisdiction is
not specifically pointed out &y these rules, any suita&le process or !ode of proceeding
!ay &e adopted which appears !ost confor!a&le to the spirit of said rules. )%ection 0,
Eule 2/5.+
?oreover, the respondent Court did not specify what step the respondent %ecretary !ust ta#e to
co!pel the petitioner to return to the (hilippines to answer the cri!inal charge preferred against
hi!.
%ection /4, $*ecutive .rder No. 2, series of 2350, 5/ .ff. @az, 2588, prescri&ing rules and
regulations for the grant and issuance of passports, provides that
The %ecretary of Foreign "ffairs as well as ally diplo!atic or consular officer duly
authorized &y hi!, is authoried, in his discretion, to refuse to issue a passport for use
only in certain countries, to !ithdra! or cancel a passport alread" issued, and to
withdraw a passport for the purpose its validity or use in certain countries. )$!phasis
supplied.+
True, the discretion granted, to the %ecretary for Foreign "ffairs to withdraw or cancel a passport
already issued !ay not &e e*ercised at whi!. But here the petitioner was hailed to Court to
answer a cri!inal charge for seduction and although at first all "ssistant City "ttorney
reco!!ended the dis!issal of the co!plaint previously su&scri&ed and sworn to &y the father of
the offended girl, yet the petitioner #new that no final action had &een ta#en &y the City "ttorney
of Quezon City as the case was still under study. "nd as the %olicitor @eneral puts it, =Ais
suddenly leaving the country in such a convenient ti!e, can reasona&ly &e interpreted to !ean as
a deli&erate atte!ption his part to flee fro! ,ustice, and, therefore, he cannot now &e heard to
co!plain if the strong ar! of the law should ,oin together to &ring hi! &ac# to ,ustice.= In
issuing the order in Buestion, the respondent %ecretary was convinced that a !iscarriage of
,ustice would result &y his inaction and as he issued it in the e*ercise of his sound discretion, he
cannot &e en,oined fro! carrying it out.
Counsel for the petitioner insists that his client should have &een granted a =Buasi<,udicial
hearing= &y the respondent %ecretary &efore withdrawing or cancelling the passport issued to
hi!. Aearing would have &een proper and necessary if the reason for the withdrawal or
cancellation of the passport were not clear &ut dou&tful. But where the holder of a passport is
facing a cri!inal a charge in our courts and left the country to evade cri!inal prosecution, the
%ecretary for Foreign "ffairs, in the e*ercise of his discretion to revo#e a passport already issued,
cannot &e held to have acted whi!sically or capriciously in withdrawing and cancelling such
passport. ue process does not necessarily !ean or reBuire a hearing. Chen discretion is
e*ercised &y an officer vested with it upon an undisputed fact, such as the filing of a serious
cri!inal charge against the passport holder, hearing !ay&e dispensed with &y such officer as a
prereBuisite to the cancellation of his passportD lac# of such hearing does not violate the due
process of law clause of the ConstitutionD and the e*ercise of the discretion vested in hi! cannot
&e dee!ed whi!sical and capricious of &ecause of the a&sence of such hearing. If hearing should
always &e held in order to co!ply with the due process of clause of the Constitution, then a writ
of preli!inary in,unction issued e# parte would &e violative of the said clause.
In the cases of $auer vs. Acheson, 280 F. %upp. 554D %athan, vs. &ulles, 2/3 F. %upp. 342D and
Schachtman vs. &ulles No. 2/580, /7 1une 2344, all decided &y the %tates Court of "ppeals for
the district of Colu!&ia, cited &y the petitioner, the revocation of a passport already issued or
refusal to issue a passport applied for, was on the vague reason that the continued possession or
the issuance thereof would &e contrary to the &est interest of the 'nited %tates.
The petition is denied, with costs against the petitioner.
($F"$G H%. "'IT.E @$N
@.E. No. F</79/4 ece!&er /5, 2304
F"CT%6 uring the period fro! %epte!&er 5 to .cto&er /3, 2305 the (resident of the
(hilippines, purporting to act pursuant to %ection 09 of the Eevised "d!inistrative Code, issued
$*ecutive .rders Nos. 37 to 2/2, 2/5 and 2/0 to 2/3D creating thirty<three )77+ !unicipalities
enu!erated in the !argin. %oon after the date last !entioned, or on Nove!&er 28, 2305
petitioner $!!anuel (elaez, as Hice (resident of the (hilippines and as ta*payer, instituted the
present special civil action, for a writ of prohi&ition with preli!inary in,unction, against the
"uditor @eneral, to restrain hi!, as well as his representatives and agents, fro! passing in audit
any e*penditure of pu&lic funds in i!ple!entation of said e*ecutive orders andIor any
dis&urse!ent &y said !unicipalities.
(etitioner alleges that said e*ecutive orders are null and void, upon the ground that said %ection
09 has &een i!pliedly repealed &y Eepu&lic "ct No. /7>8 effective 1anuary 2, 2308 and
constitutes an undue delegation of legislative power. The third paragraph of %ection 7 of
Eepu&lic "ct No. /7>8, reads6
Barrios shall not &e created or their &oundaries altered nor their na!es changed e*cept under the
provisions of this "ct or &y "ct of Congress.
Eespondent herein relies upon ?unicipality of Cardona vs. ?unicipality of BinaJgonan
I%%'$6 CIN the (resident, who under this new law cannot even create a &arrio, can create a
!unicipality which is
co!posed of several &arrios, since &arrios are units of !unicipalities
A$F6 .n Cardona vs ?unicipality of Binangonan, such clai! is untena&le, for said case
involved, not the creation of a new !unicipality, &ut a !ere transfer of territory fro! an
already e*isting !unicipality )Cardona+ to another !unicipality )BinaJgonan+, li#ewise, e*isting
at the ti!e of and prior to said transfer. It is o&vious, however, that, whereas the power to fi*
such co!!on &oundary, in order to avoid or settle conflicts of ,urisdiction &etween ad,oining
!unicipalities, !ay parta#e of an ad!inistrative nature involving, as it does, the adoption of
!eans and ways to carry into effect the law creating said !unicipalities the authority to create
!unicipal corporations is essentially legislative in nature. In the language of other courts, it is
Kstrictly a legislative functionL or Ksolely and e*clusively the e*ercise of legislative powerL
"lthough Congress !ay delegate to another &ranch of the @overn!ent the power to fill in the
details in the e*ecution, enforce!ent or ad!inistration of a law, it is essential, to forestall a
violation of the principle of separation of powers, that said law6 ,a- .e $o/0&ete "# "tse&f 1 "t
/ust set fo!t te!e"# te 0o&"$( to .e e2e$uted, $a!!"ed out o! "/0&e/e#ted .( te
de&egate3 1 a#d ,.- f"2 a sta#da!d 1 te &"/"ts of 4"$ a!e suff"$"e#t&( dete!/"#ate o!
dete!/"#a.&e 1 to 4"$ te de&egate /ust $o#fo!/ "# te 0e!fo!/a#$e of "s fu#$t"o#s*
Indeed, without a statutory declaration of policy, the delegate would in effect, !a#e or for!ulate
such policy, which is the essence of every lawD and, without the afore!entioned standard, there
would &e no !eans to deter!ine, with reasona&le certainty, whether the delegate has acted
within or &eyond the scope of his authority. Aence, he could there&y arrogate upon hi!self the
power, not only to !a#e the law, &ut, also and this is worse to un!a#e it, &y adopting
!easures inconsistent with the end sought to &e attained &y the "ct of Congress, thus nullifying
the principle of separation of powers and the syste! of chec#s and &alances, and, conseBuently,
under!ining the very foundation of our Eepu&lican syste!.
%ection 09 of the Eevised "d!inistrative Code does not !eet these well settled reBuire!ents for
a valid delegation of the power to fi* the details in the enforce!ent of a law. It does not
enunciate any policy to &e carried out or i!ple!ented &y the (resident. Neither does it give a
standard sufficiently precise to avoid the evil effects a&ove referred to.
The power of control under the provision %ection 28 )2+ of "rticle HII of the Consti i!plies the
right of the (resident to interfere in the e*ercise of such discretion as !ay &e vested &y law in the
officers of the e*ecutive depart!ents, &ureaus, or offices of the national govern!ent, as well as
to act in lieu of such officers. This power is denied &y the Constitution to the $*ecutive, insofar
as local govern!ents are concerned. Cith respect to the latter, the funda!ental law per!its hi!
to wield no !ore authority than that of chec#ing whether said local govern!ents or the officers
thereof perfor! their duties as provided &y statutory enact!ents. Aence, the (resident cannot
interfere with local govern!ents, so long as the sa!e or its officers act Cithin the scope of their
authority. Ae !ay not enact an ordinance which the !unicipal council has failed or refused to
pass, even if it had there&y violated a duty i!posed thereto &y law, although he !ay see to it that
the corresponding provincial officials ta#e appropriate disciplinary action therefor. Neither !ay
he vote, set aside or annul an ordinance passed &y said council within the scope of its
,urisdiction, no !atter how patently unwise it !ay &e. Ae !ay not even suspend an elective
official of a regular !unicipality or ta#e any disciplinary action against hi!, e*cept on appeal
fro! a decision of the corresponding provincial &oard.
U0o# te ote! a#d "f te P!es"de#t $ou&d $!eate a /u#"$"0a&"t(, e $ou&d, "# effe$t, !e/o5e
a#( of "ts off"$"a&s, .( $!eat"#g a #e4 /u#"$"0a&"t( a#d "#$&ud"#g te!e"# te .a!!"o "# 4"$
te off"$"a& $o#$e!#ed !es"des, fo! "s off"$e 4ou&d te!e.( .e$o/e 5a$a#t* Tus, .( /e!e&(
.!a#d"s"#g te 0o4e! to $!eate a #e4 /u#"$"0a&"t( ,"f e ad "t-, 4"tout a$tua&&( $!eat"#g
"t, e $ou&d $o/0e& &o$a& off"$"a&s to su./"t to "s d"$tat"o#, te!e.(, "# effe$t, e2e!$"s"#g
o5e! te/ te 0o4e! of $o#t!o& de#"ed to "/ .( te Co#st"tut"o#*
GONZALO SY, doing business under the name and style of GONZALO SY
TRADING, petitioner-appellant,
vs.
!NTRAL "AN# O$ T%! &%ILI&&IN!S, respondent-appellee.
De Santos, Balgos & Perez for petitioner-appellant.
F. E. Evangelista & Glecerio T. Orsolino for respondent-appellee.

'ARTIN, J.:
This is an appeal from the decision of the Court of First Instance of Manila in its Civil
Case No. 81051, hich as certified to !s "# the Court of $ppeals on $u%ust &8, 1'(5,
raisin% the )uestion of hether or not petitioner-appellant*s +pecial Import ,ermit
%ranted "# the Central -an. of the ,hilippines authori/in% it to import fresh fruits from
0apan on a 1no-dollar1 "asis has alread# e2pired hen it made the importations under
liti%ation.
The petitioner-appellant is a tradin% compan# en%a%ed in the importation of fresh fruits
li.e oran%es, %rapes, apples and lemons from the different parts of the orld for the last
nineteen #ears. 3n +eptem"er &8, 1'48, it rote to the 5eput# 6overnor of the Central
-an. of the ,hilippines, Mr. $mado 7. -ri8as re)uestin% authorit# to import from the
countr# of 0apan on 1no-dollar1 "asis fresh fruits in the total amount of !+9(15,000.00.
The pertinent portions of petitioner-appellant*s letter
(
read.
:e are importers for the last 1' #ears. 3ur line of "usiness is the importation of fresh
fruits li.e fresh oran%es, %rapes and apples from various parts of the orld.
:e are full# aare of the Central -an. policies and re%ulations ith respect to imports
particularl# the effects of Central -an. Circular &40 to authori/ed a%ent "an.s. Our ite
of iportations !"ic" is fres" fruits calls for #$%& Special Tie Deposit for #'(-da)s.
*it" t"e fast approac"ing +"ristas season !e are certain !e cannot cope !it" t"e
deands of our ,u)ers of fres" fruits under t"is re-uireent iposed on iporters. :e
have "rou%ht this matter to the attention of our various shippers of fresh apples from
0apan for their proper %uidance.
222 222 222
In this connection, e respectfull# re)uest #our %ood office for an authorit# or issue us
Special .port Perit on /o-Dollar Basis, to ena"le us to receive the %oods from our
relia"le and helpful suppliers ho have complete trust and confidence in us. $s
manifested in their respective letters to us, e can pa# or remit them the pa#ment of the
fruits shipped to us even after the season, hich is around $pril of ne2t #ear, and if our
dollar position is favora"le. :e honestl# "elieve, that this offer from our suppliers is ver#
inducive and if possi"le, e ould not li.e to miss this opportunit#.
3n 3cto"er &, 1'48, Mr. 0ulian 5. Mercado, the ;2ecutive $ssistant to 5eput# 6overnor -ri8as denied
the re)uest, statin% that 1... since onl# the transactions specificall# enumerated in +entral Ban0 +ircular
/o. '1$ dated 2ul) '#, #34$ are alloed as *no-dollar importation*, e re%ret to advise that #our re)uest
cannot "e %iven due course "# this office.1
)

,etitioner-appellant sou%ht a reconsideration of this denial on 3cto"er &&, 1'48 thru 5eput# 6overnor
$mado 7. -ri8as e2plainin% that their 1... case is a ver) special one and different fro regular
iportation,5 at the same time remindin% that 1... this item of fresh apples is ver# much needed in the
coing +"ristas season and e are confident that if our re)uest "e %iven consideration, e ill "e a"le
to put %ood stoc. of fresh apples in the mar.et at a cheaper cost for the "enefit of the consumin% pu"lic.1
*

$nother letter as coursed "# petitioner-appellant on Novem"er 4, 1'48 to the Monetar# -oard of the
Central -an. thru 5eput# 6overnor $mado 7. -ri8as re)uestin% 1#our %ood office for an authorit# to
import on no <etter of Credit "asis, or issue us +pecial Import ,ermit for the amount of 6S7$#%,(((.(( on
No-5ollar -asis, to ena"le us to import the fres" fruits hich e need for Christmas, from our relia"le and
helpful suppliers.1 In this letter, petitioner-appellant points out that 1the items called for such as apples,
oran%es and %rapes are perisha"le in nature and can not "e stored for a lon%er period of time, and t"e
ain purpose of t"is iportation is to serve t"e re-uireents during t"e +"ristas Season.5
+

3n Novem"er 1', 1'48, the Monetar# -oard of the Central -an. issued 7esolution No. &0=8 approvin%
petitioner-appellant*s re)uest for +pecial Import ,ermit on No-5ollar -asis,
,
thus>
The -oard, "# unanimous vote, aut"orized Gonzalo S) Trading to iport on a no- dollar
,asis, !it"out letters of credit, fres" fruits fro 2apan valued at 78%(((.((, su"?ect to the
special time deposit of 100@ hich shall "e held "# the "an. concerned for a period of
1&0 da#s as ell as to the normal customs duties and ta2es. It is understood that there
shall "e no commitment on the part of the Central -an. to provide forei%n e2chan%e to
cover the said importation.
5eput# 6overnor $mado 7. -ri8as communicated this approval of the re)uest to petitioner-appellant, thru
its $ssistant Mana%er, Mr. ;. -. ,idlaoan on Novem"er &1, 1'48.
-

3n Novem"er &(, 1'48, petitioner-appellant sent a letter
.
to the then Chairman of the Monetar# -oard,
Mr. ;duardo 7omualde/, readin%>
Than. #ou ver# much for #our approval to our re)uest for special permit to import on no-
dollar "asis, ithout letter of credit fresh fruits valued at !+9=50,000.00.
*e noted "o!ever, t"at #((& special tie deposit for #'( da)s is re-uired. *e ,eg to
point out t"at t"is particular iportation is onl) for t"e +"ristas Season, and if e ill
deposit the amount of a"out ,1,A00,000.00 hich ill not "e touched for 1&0 da#s, and
considerin% the fact that on this importation alone, e ill pa# the %overnment in the form
of customs ta2es and duties, no less than ,(00,000.00, then e ill "e needin% more
than ,=,000,000.00.
:e "e% to re)uest therefore, for a reconsideration "# #our %ood office, and allo us to
put up &0@ special time deposit for 1&0 da#s instead of 100@.
The re)uest as denied "# 5eput# 6overnor -ri8as in a letter, dated 5ecem"er ', 1'48.
/

Thereafter, on Fe,ruar) '%, #343, petitioner-appellant made his first importation from 0apan.
0
The "ul. of
the importations from $u%ust (, 1'4' thru Novem"er 5, 1'4' came from +an Francisco, California and
$ustralia.
(1
The importation on 0anuar# 5, 1'(0, consistin% of fresh oran%es and l#chees came from
Taipei, Taian,
((
hile those of March 14, 1'(0, consistin% of fresh oran%es, came from Israel.
()
For
these importations, the ,rudential -an. and Trust Compan# acted as the a%ent of the Central -an. in the
issuance of the correspondin% release certificates for the entr# of the %oods. -# the "e%innin% of 0une,
1'(0, the total amount used out of the 9=50,000.00 +pecial Import ,ermit as alread# 9=1A,1A&.51,
leavin% a "alance of 9=5,85(.A'.
(*

$s earl# as 3cto"er =0, 1'4', petitioner-appellant re)uested from 5eput# 6overnor $mado 7. -ri8as
(+

1an amendment of the countr) of origin of our importations to include other countries e2cept communist
countries1 since the fresh fruits from 0apan 1are seasonal BandC our shippers cannot full# fill up our
re)uirements to compl# ith their total commitments to us ithout procurin% from other sources li.e
$ustralia, Taian, !.+.$. and other countries ith hom e have trade relations.1
3n Novem"er 1', 1'4', the 5eput# 6overnor, Mr. $mado 7. -ri8as replied>
(,

This has reference to #our letter dated 3cto"er =0, 1'4' re)uestin% amendment of the
countr# of ori%in of #our importations of fresh fruits from 0apan to include other countries
e2cept communist countries as authori/ed "# Monetar# -oard 7esolution No. &0=8 dated
Novem"er 1', 1'48.
*e regret to infor )ou t"at t"e aut"orit) granted to )ou ,) t"e 9onetar) Board per
a,ove-stated 9B :esolution /o. '(8;, !as intended onl) for t"e +"ristas season of
#34; and does not e<tend t"roug" #343. Furthermore, under e2istin% re%ulations,
importations of fruits are covered "# the moratorium on the openin% of letters of credit.
It so happened that to da#s after or on Novem"er &1 1'4', 5irector $. D. $ntiporda, of the Forei%n
;2chan%e 5epartment of the Central -an., rote to Mr. 7enato <. +antos, $ssistant Dice-,resident of the
,rudential -an. and Trust Compan#, in repl# to the letters of the latter, dated Novem"er 1A and 1', 1'4',
(-
furnishin% the Forei%n ;2chan%e 5epartment copies of the release certificates the ,rudential -an. and
Trust Compan# issued to 6on/alo +# Tradin%. The pertinent portion of $ntiporda*s letter
(.
reads>
3n the "asis of #our report that the total value of the shipments so far made "# #our
client a%ainst the 9=50,000.00 %rant amounts to 91AA,=04.15 onl#, #ou ma# continue to
issue release certificates to cover the No-5ollar importations of fresh fruits "# #our client,
su,=ect to t"e sae and conditions iposed ,) 9onetar) Board under t"e
a,oveentioned resolution.
Then, on $pril 1(, 1'(0, the $ssistant to the 6overnor, Mr. Cesar <omotan, informed the ,rudential -an.
and Trust Compan#
(/
that the authorit# %ranted to petitioner-appellant under M- 7esolution No. &0=8
as intended onl# for the Christmas season of 1'48 and does not e2tend throu%h 1'4', enclosin%
thereith the letter, dated Novem"er 1', 1'4', of 5eput# 6overnor -ri8as.
3n Ma# &(, 1'(0, petitioner-appellant notified Mr. Cesar <omotan that the ,rudential -an. and Trust
Compan# refused to issue them an# release certificate for their importations due to his letter of $pril 1(,
1'(0. 3n 0une =, 1'(0, petitioner-appellant sent a follo-up letter to Mr. <omotan, reiteratin% 1our re)uest
for a reconsideration on the matter and to allo us utili/e the "alance of our ,ermit in the amount of
9=5,85(.A'.1 In the same letter, petitioner-appellant advised that 1e have shipments comin% on 0une Ath
and 0une 4th respectivel# hich is ithin the "alance of our permit.1
3n 0une 10, 1'(0, 5eput# 6overnor $mado 7. -ri8as rote petitioner-appellant that its re)uest cannot
"e %iven due course, invitin% attention to the "asic letter of Novem"er 1', 1'4', informin% it that the
+pecial Import ,ermit as intended onl# for the Christmas season of 1'48 and does not e2tend throu%h
1'4'.
(0

3n 0une 5 and 14, 1'(0, the Collector of Customs for the ,ort of Manila, Mr. 0ose T. Didu#a, issued
arrants of sei/ure and detention a%ainst>
1. (00 Cartons of Fresh 3ran%es, on "oard ++ 1Taviata1E
&. 1,000 Cartons of Fresh 3ran%es, on "oard ++ 1Fernla.e1E
=. 500 Cartons of Fresh 3ran%es, on "oard ++ 1$ri/ona1E
A. 100 Cartons of Fresh <emons and 1000 Cartons of Fresh 3ran%es, on "oard ++
1Turandot1E
5. 540 Cartons of Fresh $pples on "oard ++ 1$nshun1 and
4. 1,44& Cartons of Fresh $pples on "oard ++ 1$nshun.1E
consi%ned to petitioner-appellant, ith a total F3- value of !+91(,548.A', 5for "aving ,een iported in
violation of +entral Ban0 +ircular /o. ';3, in relation to +ection &5=0 BfC of the Tariff and Customs Code.1
)1

3n 0ul# 1(, 1'(0, 5eput# 6overnor $mado 7. -ri8as rote to the Commissioner of customs>
)(

Since fres" fruits are classified as /on-Essential +onsuer goods, and t"erefore ,anned
under +ircular /o. ';3 dated Fe,ruar) '#, #3$(, it is re)uested that the a"ove shipments
Bfresh oran%es, lemons and apples ith total value of 9&1,(4=.00C "e su"?ect to
appropriate sei/ure proceedin%s. <i.eise, all other importations of fresh fruits no under
Customs custod# should "e su"?ected to appropriate sei/ure proceedin%s and an#
release certificates issued "# the "an.s for such importations should "e disre%arded.
3n 0ul# =0, 1'(0, the Collector of Customs issued a notice for the auction sale of the confiscated 0une
1'(0 shipment on the folloin% $u%ust 1&. :hereupon, petitioner-appellant, alon% ith another importer,
Tomas F. de <eon, commenced an in?unction suit "efore the Court of First Instance of Manila, doc.eted
as Civil Case No. 80455, a%ainst the Commissioner and Collector of Customs for the ,ort of Manila. 3n
$u%ust &4, 1'(0, the Manila Court of First Instance, presided over "# trial 0ud%e Federico C. $li.pala,
ordered the release of the sei/ed %oods under "onds totallin% ,51=,845.A4. Goever, the Commissioner
and Collector of Customs elevated the matter to this Court, see.in% to have the $u%ust &4, 1'(0 order
declared null and void.
))

Meanhile, the second shipment consi%ned to petitioner-appellant arrived at the ,ort of Manila on
+eptem"er 4 and 15, 1'(0. This shipment consisted of 1,000 cartons of fresh sun.ist oran%es, 1,000
cartons of fresh %rapes and 100 cartons of fresh lemons, all valued at ,(1,5A'.A'. <i.e the 0une, 1'(0
importation, this +eptem"er, 1'(0 shipment as also sei/ed "# the Customs authorities.
3n +eptem"er &1, 1'(0, petitioner-appellant instituted "efore the Court of First Instance of Manila the
su"?ect petition for mandamus ith dama%es hich as doc.eted as Civil Case No. 81051. This case
as consolidated ith Civil Case No. 80455 assi%ned to the sala, of trial 0ud%e Federico C. $li.pala upon
motion of petitioner-appellant.
)*
In this petition, petitioner-appellant pra#ed for the issuance of a rit of
mandamus to direct the Central -an. of the ,hilippines to release the imported fruits and to provide the
necessar# release certificates therefor. <i.eise, it pra#ed for the aard of dama%es amountin% to
,8=8,A'5.&8.
3n Novem"er &4, 1'(0, this Court promul%ated its decision in the >li0pala case
)+
sustainin% the 3rder of
$u%ust &4, 1'(0, orderin% the release of the 0une, 1'(0 importation upon "ond, ith a directive to the
importers, 6on/alo +# Tradin% and Tomas F. de <eon, to cause the reinsurance of the "onds amountin%
to more than ,=A0,000.00 not covered "# reinsurance or to put up other suret# "onds accepta"le to the
Collector of Customs. In the folloin% month, 5ecem"er, 1'(0, the 0une, 1'(0 shipment as released to
petitioner-appellant on "ond.
3n Novem"er &(, 1'(1, 0ud%e $li.pala rendered ?ud%ment in Civil Case No. 81051 dismissin% petitioner-
appellant*s complaint for mandamus ith dama%es and orderin% the Collector of Customs to proceed ith
the sei/ure proceedin%s it initiated a%ainst the 0une, 1'(0 importation and, if favora"le to the %overnment,
to enforce the same a%ainst the suret# "onds of petitioner-appellant posted upon the release of the %oods
in 5ecem"er, 1'(0. The shipment of +eptem"er, 1'(0 as condemned and onl# the recover# of
hatever char%es andHor penalties a%ainst petitioner-appellant as ordered.
From this adverse ?ud%ment, petitioner-appellant appealed to the Court of $ppeals, "ut the $ppellate
Court certified the case to !s as involvin% onl# pure )uestions of la.
:e rule that the +pecial Import ,ermit %ranted to petitioner-appellant on Novem"er 1', 1'48, alloin% it
to import fresh fruits from 0apan on a 1no-dollar1 "asis, has alread# lost its validit# hen the )uestioned
importations of 0une and +eptem"er, 1'(0 ere made.
1. It is one of the first principles in the field of administrative la that a license or a permit is not a contract
"eteen the soverei%nt# and the licensee or permitee, and is not a propert# in an# constitutional sense,
as to hich the constitutional prescription a%ainst impairment of the o"li%ation of contracts ma# e2tend. $
license is rather in the nature of a special privile%e, of a permission or authorit# to do hat is !it"in its
ters.
),
It is not in an# a# vested, permanent, or a"solute. $ license %ranted "# the +tate is ala#s
revoca"le. $s a necessar# conse)uence of its main poer to %rant license or permit, the +tate or its
instrumentalities have the correlative poer to revo.e or recall the same. $nd this poer to revo.e can
onl# "e restrained "# an e<plicit contract upon %ood consideration to that effect.
)-
The a"sence of an
e2pir# date in, a license does not ma.e it perpetual. Notithstandin% that a"sence, the license cannot last
"e#ond the life of the "asic authorit# I under hich it as issued.
).

The series of correspondence e2chan%ed "eteen petitioner-appellant and respondent-appellee in the
case at "ar plainl# reveals that the +pecial Import ,ermit %ranted to petitioner-appellant covers onl# the
Christmas season of 1'48. $s reflected in its first letter, dated +eptem"er &8, 1'48, the cause or the
copelling reason h# petitioner-appellant sou%ht for the +pecial Import ,ermit on No-5ollar -asis as
"ecause the importation of fresh fruits calls for #$%& Special Tie Deposit for 1&0 da#s and 1BCith the
fast approac"ing +"ristas season,5 petitioner-appellant 1cannot cope ith the demands of JitsK "u#ers of
fresh fruits under this re)uirement imposed on importers.1 !pon denial of its re)uest, petitioner-appellant
e2plained to 5eput# 6overnor $mado 7. -ri8as in its letter of 3cto"er &&, 1'48 that their 1..., case is a
ver) special one5 and that 1... this item of fresh apples is ver) uc" needed in t"e coing +"ristas
season ...1 Complementar# to this letter, petitioner-appellant pointed out to the Monetar# -oard in its letter
of Novem"er 4, 1'48 that 1the items called for such as apples, oran%es and %rapes are perisha"le in
nature and cannot "e stored for a lon%er period of time, and t"e ain purpose of t"is iportation is to
serve t"e re-uireents during t"e +"ristas Season.5 $fter the +pecial Import ,ermit as %ranted "# the
Monetar# -oard on Novem"er 1', 1'48, petitioner-appellant e2pressed its %ratitude to the then Chairman
of the Monetar# -oard, Mr. ;duardo 7omualde/, in a letter of Novem"er &(, 1'48 and, at the same time,
re)uested that it "e alloed 1to put up &0@ special time deposit for 1&0 da#s instead of 100@. a%ain
pointin% out that 5t"is particular iportation is onl) for t"e +"ristas season ...1 It as upon all these
representations and assurances "# petitioner-appellant that the Monetar# -oard of the Central -an.
finall# issued the +pecial Import ,ermit. $s a result, the conclusion "ecomes inevita"le that the +pecial
Import ,ermit thus %ranted lasts onl# until the Christmas +eason of 1'48.
The omission of an e2pir# date in the +pecial Import ,ermit affords no le%al "asis for petitioner-appellant
to conclude that the said permit is impressed ith continuous validit#, i.e., not merel# limited to the
Christmas season of 1'48. The totalit# of petitioner appellant*s representations hich led to the issuance
of the permit cannot "e li%htl# %lossed over. It as petitioner-appellant itself hich furnished the life span
of the permit, consistentl# pointin% out that 1the main purpose of this importation is to serve the
re)uirements durin% the Christmas +eason1 of 1'48. In the lo%ical se)uence of thin%s, no imperative
reason arises for the Monetar# -oard to still specif# the e2pir# date of the permit. It ould far-fetched for
the Monetar# -oard to %rant more than hat as as.ed for, considerin% that it as opposed to the
%rantin% of the permit from the ver# start, in vie of the e2istin% strin%ent policies a%ainst 1no-dollar1
importation of 1non-essential consumer* %oods li.e fresh fruits. That is h#, the Monetar# -oard, hile it
thus issued the +pecial Import ,ermit, su,=ected the same to a 5special tie deposit of #((& hich shall
"e held "# the "an. concerned for a period of 1&0 da#s as ell as to the normal customs duties and
ta2es.1 This re)uirement as maintained "# the* Monetar# -oard even after petitioner-appellant sou%ht
for a reconsideration thereof. :ithal, it can "e %leaned that petitioner-appellant*s +pecial Import ,ermit
"ears all the mar.s of a mere special concession from the issuin% authorit#, to the effect that no e2tensive
privile%es are licitl# inferra"le from it.
,etitioner-appellant mista.enl# asserts that the continuous validit# of its +pecial Import ,ermit has
alread# "een passed upon "# this Court in +oissioner of +ustos v. >li0pala.
)/
:hat as raised in
that case is the )uestion of hether the Collector of Customs for the ,ort of Manila has o"served the
rediments of administrative due process in orderin% the sei/ure and sale at pu"lic auction of petitioner-
appellant*s imported %oods in particular that arrived in 0une, 1'(0, as ell as the )uestion of the le%alit#
of the Collector*s order re)uirin% onl# cash "ond, suret# "ond not accepted, for the release of the %oods.
The Court made no rulin% on the continuit# of petitioner-appellant*s +pecial Import ,ermit after the
Christmas season of 1'48. ,etitioner-appellant*s referral
)0
to the statement of the Court that the
Novem"er &1, 1'4' letter of Mr. $. D. $ntiporda, 5irector of the Forei%n ;2chan%e 5epartment,
authori/ed the ,rudential -an. and Trust Compan# to 'A continue to issue release certificates to cover
the No-5ollar importations of fresh fruits "# #our client1 misses the precedin% prefator# statement of the
Court in re%ard to the details of the case, thus> 5For a proper understanding and resolution of t"e issues it
is necessar) to state t"e facts in greater detail, as t"e) appear fro t"e pleadings and eoranda
su,itted ,) t"e parties as !ell as fro t"e different docuents attac"ed t"ereto ar0ed as anne<es.5 In
other ords, the su"se)uent statement of the Court on the $ntiporda letter is "ut a portion of its recital of
the facts involved ithout necessaril# ma.in% a resolution thereon.
&. Controvers# rises "eteen petitioner-appellant and respondent-appellee on the receipt of 5eput#
6overnor -ri8as letter, dated Novem"er 1', 1'4', purportedl# informin% petitioner-appellant that its
+pecial Import ,ermit 1as intended onl# for Christmas season of 1'48 and does not e2tend throu%h
1'4'.1 :hile petitioner-appellant contends that the said letter as never served upon it, respondent-
appellee maintains that it is )uite surprisin% for petitioner-appellant to disclaim receipt thereof hen all
prior and su"se)uent letters from the Central -an. have "een satisfactoril# received "# it. This )uestion is
not of decisive import. The all-%overnin% point is the reasona,le assuptions of petitioner-appellant*s
.noled%e or aareness of the duration of its +pecial Import ,ermit, since it as petitioner-appellant itself
hich esta"lished the terminal date of its permit representin% that 1the main purpose of this importation is
to serve the re)uirements durin% the Christmas season1 of 1'48, upon !"ic" representation the Monetar#
-oard finall# %ranted the permit. The e)uita"le principle of estoppel for"ids petitioner-appellant from
ta.in% an inconsistent position no and claims that the permit e2tends "e#ond the period it itself as.ed
for. :here conduct or representation has induced another to chan%e its position in %ood faith or the same
is such that reasona"le man ould rel# thereon, the conse)uences of such conduct or representation
cannot later on "e disoned.
*1
The preliminar# representations and assurances of petitioner-appellant,
most important of hich is the life span of the permit, are deemed incorporated into the +pecial Import
,ermit su"se)uentl# issued. $t most, the letter of 5eput# 6overnor -ri8as ma# serve onl# to reind
petitioner-appellant of the resolutor# period of its permit. :hether there as such letter or not, the time
limit proffered "# petitioner-appellant and approved "# the Central -an. controls.
=. The doctrine of 1promissor# estoppel1 is invo.ed "#, petitioner-appellant to preclude respondent-
appellee from contestin% the le%alit# of its importations. ,etitioner-appellant dras authorit# from the letter
of 5irector $. D. $ntiporda, dated Novem"er &1, 1'4', informin% the ,rudential -an. and Trust Compan#
that it 1ma# continue to issue release certificates to cover the No-5ollar Importations of fresh fruits "# #our
client1 after notin% that onl# 91AA,=04.15 has "een utili/ed out of the 9=50,000.00-permit. $ccordin% to
that doctrine, 1an estoppel ma# arise from the ma.in% of a promise even thou%h ithout consideration, if it
as intended that the promise should "e relied upon and in fact it as relied upon, and if a refusal to
enforce it ould "e virtuall# to sanction the perpetration of fraud or ould result in other in?ustice.1
*(
<i.e
the related principles of volenti non fit in=uria Bconsent to in?ur#C, aiver, and ac)uiescence, it finds its
ori%in %enerall# in the e)uita"le notion that one ma# not chan%e his position and profit from his on
ron%doin% hen he has caused another to suffer a detriment "# rel#in% on his former proises or
representations.
*)
-ut, a proise cannot "e the "asis of an estoppel if an# other essential element is
lac.in%. 2ustifia,le reliance or irrepara"le detriment to the promises are re)uisite factors.
**
:e failed to
see in $ntiporda*s letter the a0ing of a promise upon hich petitioner-appellant could =ustifia,l) rel#. 3n
the contrar#, hile the letter advised the a%ent "an. that it ma# continue issuin% release certificates to
cover petitioner-appellant*s 1no-dollar1 importations of fresh fruits, it at the same time su"?ects the
issuance of release certificates 1to the same terms and conditions imposed "# the Monetar# "oard1 on the
+pecial Import ,ermit, one of hich is the resolutor# term of 1'48. That is the import of the $ntiporda*s
letter e< vi terini. 5irector $ntiporda could not have modified the +pecial Import ,ermit "# creatin% a
lon%er period, for the plain reason that no such authorit# resides in him. $n administrative officer has onl#
such poers as are e2pressl# %ranted to him and those necessaril# implied in the e2ercise thereof.
*+
$s
earlier pointed out, it as the Monetar# Board hich issued the permitE correspondin%l#, it too posseses
the sole poer to modif# the same.
3n the %ratuitous assumption that the $ntiporda*s letter purported to impress, al"eit erroneousl#, that
further importations could "e made "# petitioner-appellant "e#ond the Christmas season of 1'48, the
same produces no estoppel a%ainst the issuin% authorit#. The lon%- settled ?urisprudence states that the
1doctrine of estoppel1 does not operate a%ainst the 6overnment, of hich the Central -an. is an
instrumentalit#, in its capacit# as soverei%n or assertin% %overnmental ri%htsE the 6overnment is never
estopped "# the mista.e or errors on the part of its a%ents. Moreover, estoppel cannot %ive validit# to an
act that is prohi"ited "# la or a%ainst pu"lic polic#.
*,
The erroneous application of the statute and
enforcement of the la do not "loc. su"se)uent correct application thereof
*-
or "ar a future action in
accordance ith la.
*.
To hold that merel# the $ntiporda*s letter could "e the "asis for such estoppel
ould "e %oin% in the direction of suspendin% and repealin% the conditions or terms of the +pecial Import
,ermit ithout an# action on the part of the Monetar# -oard.
*/

A. The cases of :aos v. +entral Ban0
*0
and +oissioner of +ustos v. >u)ong ?ian
+1
cannot "e
relied upon "# petitioner-appellant to fore close the issue on the continuous validit# of its +pecial Import
,ermit. In :aos, the Court held that after the Central -an. has made e2press commitments to
petitioners therein that it ould support the 3verseas -an. of Manila, and avoid its li)uidation if the
petitioners ould e2ecute BaC the Dotin% Trust $%reement turnin% over the mana%ement of 3-M to the C-
or its nominees, and B"C mort%a%e or assi%n their properties to the Central -an. to cover the overdraft
"alance of 3-M hich petitioners did, the. Central -an. ma# not retreat from its representations and
li)uidate the 3verseas -an. of Manila, to the pre?udice of petitioners, depositors and other creditors,
under the rule of 1promissor# estoppel.1 The Central -an. cannot ?ust unilaterall# disre%ard its
representations and promises to reha"ilitate and normali/e the financial condition of the 3-M ithout
violatin% $rticle 115' of the Civil Code of the ,hilippines, hich provides that 1BoC"li%ations arisin% from
contracts have the force of la "eteen the contractin% parties and should "e complied ith in %ood
faith,1 as ell as $rticle 1=15, statin% that 5@cAontracts are perfected "# mere consent, and from that
moment the parties are "ound not onl# to the fulfillment of hat has "een e2pressl# stipulated "ut also to
all the conse)uences hich, accordin% to their nature, ma# "e in .eepin% ith %ood faith, usa%e and la.1
In other ords, "# ma.in% the fore%oin% representations and commitments to the 3-M the Central -an.
had there"# assumed a contractual o,ligation in favor of the 3-M such that it cannot unceremoniousl#
i%nore the same. No such .ind of contractual o"li%ation or commitments have "een perfected "eteen
the Central -an. and the petitioner-appellant in the present case. The issuance of the +pecial Import
,ermit "# the Monetar# -oard to the petitioner-appellant can hardl# "e considered as constitutive of a
contractual o"li%ation assumed "# the Central -an. in favor of petitioner-appellant. This is "ecause a
permit is not, "# its ver# nature, a contract "ut a mere special privile%e. For a permit to "e impressed ith
a contractual character, it must "e cate%oricall# demonstrated that the ver# administrative a%enc#, hich
is the source of the permit, ould place such a "urden on itself.
+(
>u)ong ?ian on the other hand, tells of
an importation of old nespapers in four shipments under a 1no-dollar1 arran%ement, pursuant to a
license issued "# the Import Control Commission. :hen the last shipment arrived in Manila, the Customs
authorities sei/ed the same on the %round that the importation as made ithout the license re)uired
under Central -an. Circular No. A5.
+)
:hile the sei/ure proceedin%s ere pendin% "efore the Collector
of Customs, the ,resident of the ,hilippines, actin% throu%h its Ca"inet, cancelled the aforesaid license
for t"e reason t"at it !as illegall) issued 1in that no fi2ed date of e2piration is stipulated.1 3n revie, the
Court held that the cancellation of the license on the sole %round that it does not "ear a# e2pir# date even
if the importation had alread# "een accomplished as ine)uita"le. In the present case, hoever, no such
cancellation of license or permit appears the legalit) of t"e issuance of petitioner-appellant*s +pecial
Import ,ermit is not in )uestion. 3n the contrar#, hat is "ein% sou%ht in this case is the enforceent of
the terms and conditions of the +pecial Import ,ermit, one of hich, is the resolutor# period of 1'48. $s
earlier discussed, after the lapse of this period, the permit can no lon%er #ield valid effect.
5. The authorit# of the Central -an. to re%ulate 1no-dollar1 imports, oin% to the influence and effect that
the same ma# e2ert upon the sta"ilit# of our peso and its international value, cannot "e seriousl#
contested. +uch authorit# clearl# emanates from its "road poers to maintain our monetar# sta"ilit# and
to preserve the international value of our currenc#
+*
as ell as its corollar# poer to issue such rules and
re%ulations for the effective dischar%e of its responsi"ilities and e2ercise of poers.
++
3n Fe"ruar# =1,
1'(0, the Central -an. promul%ated its Circular No. &4', prohi"itin% the importation of 1non-essential
consumer1 %oods li.e fresh fruits. +ection 5 thereof directs that 1BaCuthori/ed a%ent "an.s ma# sell forei%n
e2chan%e for imports e<cept those fallin% under the !C, +!C and /E+ cate%ories, ithout prior specific
approval of the Central -an..1 In the recent case of Balaceda vs. +oroinas
+,
:e ruled that 1the entr#
of N;C B1non-essential commodities1C is thus halted at "a#.1 :ith re%ard to 1no- dollar1 imports, the
Central -an. promul%ated Circular No. &A( on 0ul# &1, 1'4(, specificall# enumeratin% the items
e2empted from the re)uirement of release certificates. The enumeration mostl# refers to personal effects
and %ifts of returnin% residents, tourists, immi%rants, etc. Fresh fruits are not included. Circular No. &A(
as amended "# Circular No. &'A on March 10, 1'(0, providin% that 1BnCo-dollar imports not covered "#
Circular No. &A( shall not "e issued an# release certificates and shall "e referred to the Central -an. for
official transittal to the -ureau of Customs for appropriate seizure proceedings. 1 3n March &0, 1'(0,
Circular No. &'5 as passed. This circular reiterates the e2emption of the 1no-dollar1 imports enumerated
under Circular No. &A( from the release certificate re)uirements, "ut imposes an e<press ,an on all other
1no-dollar1 imports not covered "# Circular No. &A(. These include 1fresh fruits1 li.e fresh apples oran%es,
%rapes, and lemons.
+-
It can thus "e readil# seen that petitioner-appellant*s 1fresh fruits1 importations of
0une and +eptem"er, 1'(0 violate the )uoted Central -an. Circulars, hence, lia"le to sei/ure action "#
the Customs authorities. :hile the said %oods ma# not "e considered 1merchandise of prohi"ited
importation,1 the# nevertheless fall ithin the other cate%or# of merchandise imported 1contrar# to la1,
"ecause re%ulations issued pursuant to 1customs la1 form part thereof. The term 1customs la1 includes
not onl# the provisions of said la proper "ut also an# re%ulations made pursuant thereto li.e the
aforementioned Central -an. circulars,
+.
hich also have the force and effect of la.
+/
Conse)uentl#,
violation of these circulars comes ithin the purvie of +ection &5=0 BfC of the Tariff and Customs Code,
hich authori/es the forfeiture of 1BaCn# article the importation or e2portation of hich is effected or
attempted contrar# to la.1
+0

4. ,etitioner-appellant disputes the disposition of the trial court directin% the Collector of Customs to
proceed a%ainst the suret# "onds it posted for the release of its 0une, 1'(0 importation sometime in
5ecem"er, 1'(0. There is no dou"t that the suret# "onds ere posted "# petitioner-appellant in +ivil
+ase /o. ;(4%%, hich as terminated "# the mutual a%reement of the parties
,1
after the Court has
handed don its decision thereon on appeal.
,(
Goever, it must "e remem"ered that the said suret#
"onds ere underta.en "# petitioner-appellant for the release of its 0une, 1'(0 importation. $ fortiori in
an# liti%ation here in an# liti%ation here the release of this 0une, 1'(0 shipment is involved, the said
suret# "onds are ansera"le. The statutor# underta.in% of a "ond is to anser for all dama%es that ma#
result from an in?unction should the court finall# decide that the in?unction as not proper or that the part#
in hose favor the in?unctive rit as issued as not entitled thereto.
,)
$lthou%h petitioner-appellant*s
suret# "onds ere filed in Civil Case No. 80455, the underta.in% therein to anser for dama%es in case
the release of the 0une, 1'(0 shipment is found improper attaches to the present case, Civil Case No.
81051. The case here the +uret# "onds ere posted is "ut incidental. The all-important factor to
consider is the event or ?udicial action secured "# the "onds. +ince the suret# "onds in )uestion ere
intended to secure the lia"ilities hich petitioner-appellant ma# incur for the release of its 0une, 1'(0
importation, the said "onds can "e proceeded a%ainst in an# case here the propriet# of impropriet# of
said release has "een resolved. The "onds "ecome immediatel# ansera"le for the underta.in% once
this condition has occurred.
,*
It ould "e a useless e2pense of ?udicial time and effort if the suret# "onds
ere #et to "e liti%ated in another suit ?ust to enforce the underta.in% therein. This is speciall# true hen
the sufficienc# or solvenc# of the "onds has "een previousl# passed upon "# the same trial ?ud%e hearin%
the second case. -esides, Civil Case No. 80455 has alread# "een terminated "# the mutual a%reement of
the parties such that no enforcement of the underta.in% of the "onds could "e easil# made therein.
,+

$CC375IN6<F, the ?ud%ment of the loer court, su"?ect matter of this present revie, is here"# affirmed.
Costs a%ainst petitioner-appellant.
Philippine Communications v. Alcuaz | Regalado, J.December 18, 1989 rate-
fxing power
FACTS
This case is one of frst impression as it involves the public utilit services
rendered onl b petitioner !hilippine "ommunications #atellite "orporation
$!%&'"()#*T+.
R.*. ,o. --1. granted a /franchise to establish, construct, maintain and
operate in the !hilippines0 stations and e1uipment and facilities for
international satellite communications.
The satellite services provided b !%&'"()#*T enable international carriers
to serve the public 2ith indispensable communications services.
#ec. 3 of R*. ,o. --1. e4empted !%&'"()#*T from the 5urisdiction of the
,ational Telecommunications "ommission $,T"+, then !ublic #ervice
"ommission. %o2ever, the issuance of 6.(. ,o. 193, placed !%&'"()#*T
under the control, 5urisdiction and regulation of ,T", including the f4ing of
rates.
&n implementing said 6.(., ,T" re1uired !%'"()#*T to appl for the re1uisite
certifcate of public convenience and necessity covering services rendered
and authorit to charge rates.
!%&'"()#*T applied for authorit to continue operating and maintaining
facilities it has been operating since 1937 and to charge currents for
rendering services. !ending hearing, it applied for provisional authority to
continue operations if such facilities.
,T" granted the provisional authorit for 3 months, 2hich 2as e4tended for
another 3 months. *fter the end of such period, ,T" further e4tended to
another 3 months but ,T" "ommissioner *lcua8 ordered !%&'"()#*T to
reduce rates b 1-9.
o The reduction 2as based on the evaluation conducted on the fnancial
statements of !%&'"()#*T.
!%&'"()#*T assails that 6.(. -.3 undul delegated legislative po2er,
particularl ad5udicative po2ers, to ,T" b empo2ering the latter to f4 rates
for public service communications and not proving the necessar standards
constitutionall re1uired.
o &f the rate:f4ing po2er 2as propert conferred, it 2as e4ercised in an
unconstitutional manner in violating procedural and substantive due
process.
ISSUS ! "#$
$1+ ;(, there 2as a valid delegation of legislative po2er in granting ,T" authorit
to f4 rates. %S.
$<+ ;(, the ,T"=s order 2as violative of !%&'"()#*T=s right to substantive and
procedural process. %S& the or'er is voi' an' nullife'.
(ATI)*A#
&ssue >1
Delegation of legislative po2er ma be sustained onl upon the ground that
some standard for its e4ercise is provided and that the legislature in ma?ing
the delegation has prescribed the manner of the e4ercise of the delegated
po2er. ;hen the administrative agenc establishes a rate, its act must both
be non:confscator and must have been established in the manner
prescribed b the legislature@ in the absence of a f4ed standard, the
delegation of po2er becomes unconstitutional.
&n case of a delegation of rate:f4ing po2er, the onl standard 2hich the
legislature is re1uired to prescribe for the guidance of the administrative
authorit is that the rate be reasonable and 5ust. 6ven in the absence of an
e4press re1uirement, this standard of reasonableness ma be implied.
!ursuant to 64ecutive (rders -.3
1
and 193
<
, ,T" is empo2ered to determine
and prescribe rates pertinent to operation of public service communications.
,T" in the e4ercise of rate:f4ing po2er is limited b the re1uirements of
public safet, public interest, reasonable fnalit and reasonable rates, 2hich
con5ointl more than satisf the re1uirements of a valid delegation of
legislative po2er.
&ssue ><
Proce'ural 'ue process
!%&'"()#*T argues that the order 2as issued 2ithout notice to them and
2ithout the beneft of hearing@ that the order 2as based on an /initial
evaluationA 2hich 2as a unilateral evaluation. &t is also argued that the rate:
f4ing po2er is an ad5udicator function, hence 1uasi:5udicial, not 1uasi:
legislative, 2hich re1uires notice and hearing.
,T" admits that the rate:f4ing po2er is 1uasi:5udicial but 2here an order
applies to a named person, the function involved is ad5udicator. ,T" insists
that a hearing is not necessar because the said order is merel
2
%ection 24)g+ of $*ecutive .rder No. 450 states that NTC should &e guided &y the reBuire!ents of pu&lic safety,
pu&lic interest and reasona&le feasi&ility of !aintaining effective co!petition of private entities in co!!unications
and &roadcasting facilities. Chile %ec. 0)d+ provides that the national econo!ic via&ility of the entire networ# or
co!ponents of the co!!unications syste!s conte!plated therein should &e !aintained at reasona&le rates.
/
interlocutor@ it onl being an incident in the ongoing proceedings for
!%&'"()#*T=s application.
Vigan Electric vs. Public Service Commission made a categorical classifcation
as to 2hen the rate:f4ing po2er is 1uasi:5udicial or 2hen legislativeB
o The rate f4ed 2as /predicated upon the fnding of fact:based upon a
report submitted b the Ceneral *uditing (Dce. &n ma?ing said fnding
of fact, respondent performed a function parta?ing of a 1uasi:5udicial
character, the valid e4ercise of 2hich demands previous notice and
hearing.A
&n Central Bank vs. Cloribel, et alB as a general rule, notice and hearing are
not essential to the validit of administrative action 2here the administrative
bod acts in the e4ercise of e4ecutive, administrative, or legislative functions@
but 2here a public administrative bod acts in a 5udicial or 1uasi:5udicial
matter, and its acts are particular and immediate rather than general and
prospective, the person 2hose rights or propert ma be aEected b the
action is entitled to notice and hearing.
The order in 1uestion 2as a +uasi-,u'icial a',u'ication. &t pertains to
!%&'"()#*T e4clusivel and it 2as premised on fnding of fact that there is
merit in reduction of rates charged. This deduction 2as onl based on an
initial evaluation of !%&'"()#*T=s fnancial statements. ,o rationali8ation
2as discussed that prompted the 1-9 reduction b ,T".
P"I#C)-SAT ma. fx a temporar. rate pen'ing fnal 'etermination o/
its application 0ut even i/ such is temporar. it is not exempt /rom
the statutor. proce'ural re+uirements o/ notice an' hearing& as well
as the re+uirement o/ reasona0leness. ,T"
F
ma not e4ercise such
po2er in an arbitrar and confscator manner.
,T" has no authorit to issue rate:f4ing orders 2ithout frst giving
!%&'"()#*T a hearing, 2hether the order is permanent or not. &t is
immaterial if the order is made upon a complaint, a summar investigation or
motu propio.
#ince a hearing is essential, ,T" should act solel on basis of evidence before
it and not on information not oEered in evidence.
The order ma?es the reduced rates eEective on a specifc date. &t is a fnal
legislative act during the period it has to remain in force, 2hile the case is
still pending. &n the case at bar, the order is fnal 2ith regard to the revenue
covered b the period.
Su0stantive 'ue process
!%&'"()#*T asserts that the reduction in rate is confscator and 2ould
virtuall result in the closure of the business.
!%&'"()#*T is a mere grantee of a legislative franchise 2hich is sub5ect to
amendment, alteration, or repeal b "ongress 2hen the common good so
re1uires. %o2ever, such grant cannot be unilaterall revo?ed absent a
sho2ing that the termination of the operation of the utilit is re1uired b the
common good.
*n regulation, 2hich operates as an eEective confscation of private
7
%ection 20. The Co!!ission shall have power, upon proper notice and *** )c+ To fi* and deter!ine individual or
,oint rates, ... which shall &e i!posed, o&served and followed thereafter &y any pu&lic serviceD ...
propert or constitutes an arbitrar or unreasonable infringement of propert
rights is void, because it is repugnant to the constitutional guaranties of due
process and e1ual protection of the la2s.
The inherent po2er and authorit of the #tate, or its authori8ed agent, to
regulate rates charged b public utilities is al2as sub5ect to the re1uirement
that the rates f4ed are reasonable and 5ust.
o The basic re1uirement of reasonablenessB not so lo2 as to be
confscator or too high as to be oppressive.
o &t is a 1uestion of sound business 5udgment and a 1uestion of fact
calling for the e4ercise of discretion.
o "ompetition is considered a factor since a carrier is allo2ed to ma?e
such rates as are necessar to meet competition.
o Reasonableness assumes that the rates are fair to both the public
utilit and consumer.
"ourt held that the reduction 2as solel based on he initial evaluation made
of !%&'"()#*T=s fnancial statements. ,T" provided no e4planation ho2 such
fnancial data inGuenced it to arrive at the reduced rate. ,T"=s decision could
result in detriment in the public service $if the order turns out to be
unreasonable+ or in the cessation of the business.