G.R. No.

101083 July 30, 1993

JUAN ANTONIO, ANNA ROSARIO and JOSE ALFONSO, all surnamed OPOSA,
minors vs.THE HONORABLE FULGENCIO S. FACTORAN, JR

FACTS:

The plaintiffs in this case are all minors duly represented and joined by their parents. The
first complaint was filed as a taxpayer's class suit at the Branch 66 (Makati, Metro Manila),
of the Regional Trial Court, National capital Judicial Region against defendant
(respondent) Secretary of the Department of Environment and Natural Reasources
(DENR). Plaintiffs alleged that they are entitled to the full benefit, use and enjoyment of
the natural resource treasure that is the country's virgin tropical forests. They further
asseverate that they represent their generation as well as generations yet unborn and
asserted that continued deforestation have caused a distortion and disturbance of the
ecological balance and have resulted in a host of environmental tragedies.

Plaintiffs prayed that judgement be rendered ordering the respondent, his agents,
representatives and other persons acting in his behalf to cancel all existing Timber
License Agreement (TLA) in the country and to cease and desist from receiving,
accepting, processing, renewing or approving new TLAs.

Defendant, on the other hand, filed a motion to dismiss on the ground that the complaint
had no cause of action against him and that it raises a political question.

The RTC Judge sustained the motion to dismiss, further ruling that granting of the relief
prayed for would result in the impairment of contracts which is prohibited by the
Constitution.

Plaintiffs (petitioners) thus filed the instant special civil action for certiorari and asked the
court to rescind and set aside the dismissal order on the ground that the respondent RTC
Judge gravely abused his discretion in dismissing the action.

ISSUES:
(1) Whether or not the plaintiffs have a cause of action.

(2) Whether or not the complaint raises a political question.

(3) Whether or not the original prayer of the plaintiffs result in the impairment of contracts.

RULING:

1. No, the plaintiffs have a cause of action. The complaint focuses on one
fundamental legal right -- the right to a balanced and healthful ecology which is
incorporated in Section 16 Article II of the Constitution.

The said right carries with it the duty to refrain from impairing the environment
and implies, among many other things, the judicious management and
conservation of the country's forests. Section 4 of E.O. 192 expressly
mandates the DENR to be the primary government agency responsible for the
governing and supervising the exploration, utilization, development and
conservation of the country's natural resources.

The policy declaration of E.O. 192 is also substantially re-stated in Title XIV
Book IV of the Administrative Code of 1987.

Both E.O. 192 and Administrative Code of 1987 have set the objectives which
will serve as the bases for policy formation, and have defined the powers and
functions of the DENR.

Thus, right of the petitioners (and all those they represent) to a balanced and
healthful ecology is as clear as DENR's duty to protect and advance the said
right.

A denial or violation of that right by the other who has the correlative duty or
obligation to respect or protect or respect the same gives rise to a cause of
action.

Petitioners maintain that the granting of the TLA, which they claim was done
with grave abuse of discretion, violated their right to a balance and healthful
ecology.

Hence, the full protection thereof requires that no further TLAs should be
renewed or granted.
 After careful examination of the petitioners' complaint, the Court finds it to be
adequate enough to show, prima facie, the claimed violation of their rights.

2. No, the case is not a political question. Second paragraph, Section 1 of Article VIII
of the constitution provides for the expanded jurisdiction vested upon the Supreme
Court.

It allows the Court to rule upon even on the wisdom of the decision of the
Executive and Legislature and to declare their acts as invalid for lack or excess
of jurisdiction because it is tainted with grave abuse of discretion.

3. No, the original prayer of the plaintiffs does not result in the impairment of
contracts.

The Court held that the Timber License Agreement is an instrument by which
the state regulates the utilization and disposition of forest resources to the end
that public welfare is promoted.

It is not a contract within the purview of the due process clause thus, the non-
impairment clause cannot be invoked.

It can be validly withdraw whenever dictated by public interest or public welfare

as in this case.

The granting of license does not create irrevocable rights, neither is it property
or property rights.

Moreover, the constitutional guaranty of non-impairment of obligations of

contract is limit by the exercise by the police power of the State, in the interest
of public health, safety, moral and general welfare.

In short, the non-impairment clause must yield to the police power of the State.

The instant petition, being impressed with merit, is hereby GRANTED and the
RTC decision is SET ASIDE.

G.R. No. L-13250 October 29, 1971

THE COLLECTOR OF INTERNAL REVENUE, petitioner,
vs.
ANTONIO CAMPOS RUEDA, respondent..
 FACTS:

Antonio Campos Rueda is the administrator of the estate of the deceased Maria
Cerdeira. Cerdeira is a Spanish national, by reason of her marriage to a Spanish citizen
and was a resident of Tangier, Morocco up to her death.
At the time of her demise she left, among others, intangible personal properties in the
Philippines.
The CIR then issued an assessment for state and inheritance taxes of P369,383.96.
Rueda filed an amended return stating that intangible personal properties worth
P396,308.90 should be exempted from taxes.
The CIR denied the request on the ground that the law of Tangier is not reciprocal to
Section 122 (now Section 104) of the National Internal Revenue Code.

The case was elevated to the CTA which sided with Rueda.
The CTA stated that the foreign country mentioned in Section 122 "refers to a
government of that foreign power which, although not an international person in the
sense of international law, does not impose transfer or death upon intangible person
properties of our citizens not residing therein, or whose law allows a similar exemption
from such taxes.
It is, therefore, not necessary that Tangier should have been recognized by our
Government order to entitle the petitioner to the exemption benefits of the provision of
Section 122 of our Tax. Code."

ISSUE:
1. Whether or not Tangier is a state.
2. Whether the exemption is valid.

RULING:
1. Yes. For purposes of the Tax Code, Tangier is a foreign country.
A foreign country to be identified as a state must be a politically organized
sovereign community independent of outside control bound by penalties of
nationhood, legally supreme within its territory, acting through a government
functioning under a regime of law. The stress is on its being a nation, its people
occupying a definite territory, politically organized, exercising by means of its
government its sovereign will over the individuals within it and maintaining its
separate international personality.
 Further, the Supreme Court noted that there is already an existing jurisprudence
(Collector vs De Lara) which provides that even a tiny principality, that of
Liechtenstein, hardly an international personality in the sense, did fall under the
exempt category provided for in Section 22 of the Tax Code. Thus, recognition is
not necessary. Hence, since it was proven that Tangier provides such exemption
to personal properties of Filipinos found therein so must the Philippines honor the
exemption as provided for by our tax law with respect to the doctrine of
reciprocity.

2. Yes, The controlling legal provision as noted is a proviso in Section 122 of the
National Internal Revenue Code.
It reads thus: "That no tax shall be collected under this Title in respect of
intangible personal property
(a) if the decedent at the time of his death was a resident of a foreign
country which at the time of his death did not impose a transfer tax or
death tax of any character in respect of intangible person property of the
Philippines not residing in that foreign country, or
(b) if the laws of the foreign country of which the decedent was a resident
at the time of his death allow a similar exemption from transfer taxes or
death taxes of every character in respect of intangible personal property
owned by citizens of the Philippines not residing in that foreign country."

It does not admit of doubt that if a foreign country is to be identified with a state, it
is required in line with Pound's formulation that it be a politically organized
sovereign community independent of outside control bound by penalties of
nationhood, legally supreme within its territory, acting through a government
functioning under a regime of law.

A foreign country is thus a sovereign person with the people composing it viewed
as an organized corporate society under a government with the legal competence
to exact obedience to its commands.

Even on the assumption then that Tangier is bereft of international personality, the
CIR has not successfully made out a case.

The Court did commit itself to the doctrine that even a tiny principality, like
Liechtenstein, hardly an international personality in the sense, did fall under this
exempt category.