THE CONCEPT OF STATE CASES

Co Kim Chan v Valdez Tan Keh

Posted on December 4, 2008 by danabatnag
Co Kim Chan v Valdez Tan Keh
Facts of the case: Co Kim Chan had a pending civil case, initiated during the Japanese
occupation, with the Court of First Instance of Manila. After the Liberation of the Manila
and the American occupation, Judge Arsenio Dizon refused to continue hearings on the
case, saying that a proclamation issued by General Douglas MacArthur had invalidated
and nullified all judicial proceedings and judgments of the courts of the Philippines and,
without an enabling law, lower courts have no jurisdiction to take cognizance of and
continue judicial proceedings pending in the courts of the defunct Republic of the
Philippines (the Philippine government under the Japanese).
The court resolved three issues:
1. Whether or not judicial proceedings and decisions made during the Japanese
occupation were valid and remained valid even after the American occupation;
2. Whether or not the October 23, 1944 proclamation MacArthur issued in which he
declared that all laws, regulations and processes of any other government in the
Philippines than that of the said Commonwealth are null and void and without legal
effect in areas of the Philippines free of enemy occupation and control invalidated all
judgments and judicial acts and proceedings of the courts;
3. And whether or not if they were not invalidated by MacArthurs proclamation, those
courts could continue hearing the cases pending before them.
Ratio: Political and international law recognizes that all acts and proceedings of a de
facto government are good and valid. The Philippine Executive Commission and the
Republic of the Philippines under the Japanese occupation may be considered de facto
governments, supported by the military force and deriving their authority from the laws
of war.
Municipal laws and private laws, however, usually remain in force unless suspended or
changed by the conqueror. Civil obedience is expected even during war, for the
existence of a state of insurrection and war did not loosen the bonds of society, or do
away with civil government or the regular administration of the laws. And if they were
not valid, then it would not have been necessary for MacArthur to come out with a
proclamation abrogating them.
The second question, the court said, hinges on the interpretation of the phrase
processes of any other government and whether or not he intended it to annul all other
judgments and judicial proceedings of courts during the Japanese military occupation.
IF, according to international law, non-political judgments and judicial proceedings of de
facto governments are valid and remain valid even after the occupied territory has been
liberated, then it could not have been MacArthurs intention to refer to judicial
processes, which would be in violation of international law.
A well-known rule of statutory construction is: A statute ought never to be construed to
violate the law of nations if any other possible construction remains.
Another is that where great inconvenience will result from a particular construction, or
great mischief done, such construction is to be avoided, or the court ought to presume
that such construction was not intended by the makers of the law, unless required by
clear and unequivocal words.
Annulling judgments of courts made during the Japanese occupation would clog the
dockets and violate international law, therefore what MacArthur said should not be
construed to mean that judicial proceedings are included in the phrase processes of
any other governments.
In the case of US vs Reiter, the court said that if such laws and institutions are
continued in use by the occupant, they become his and derive their force from him. The
laws and courts of the Philippines did not become, by being continued as required by
the law of nations, laws and courts of Japan.
It is a legal maxim that, excepting of a political nature, law once established continues
until changed by some competent legislative power. IT IS NOT CHANGED MERELY BY
CHANGE OF SOVEREIGNTY. Until, of course, the new sovereign by legislative act
creates a change.
Therefore, even assuming that Japan legally acquired sovereignty over the Philippines,
and the laws and courts of the Philippines had become courts of Japan, as the said
courts and laws creating and conferring jurisdiction upon them have continued in force
until now, it follows that the same courts may continue exercising the same jurisdiction
over cases pending therein before the restoration of the Commonwealth Government,
until abolished or the laws creating and conferring jurisdiction upon them are repealed
by the said government.
DECISION: Writ of mandamus issued to the judge of the Court of First Instance of
Manila, ordering him to take cognizance of and continue to final judgment the
proceedings in civil case no. 3012.
Summary of ratio:
1. International law says the acts of a de facto government are valid and civil laws
continue even during occupation unless repealed.
2. MacArthur annulled proceedings of other governments, but this cannot be applied on
judicial proceedings because such a construction would violate the law of nations.
3. Since the laws remain valid, the court must continue hearing the case pending before
it.
***3 kinds of de facto government: one established through rebellion (govt gets
possession and control through force or the voice of the majority and maintains itself
against the will of the rightful government)
through occupation (established and maintained by military forces who invade and
occupy a territory of the enemy in the course of war; denoted as a government of
paramount force)
through insurrection (established as an independent government by the inhabitants of a
country who rise in insurrection against the parent state)
THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,
vs.
LORETA GOZO, defendant-appellant.

Office of the Solicitor General Felix Q. Antonio, Assistant Solicitor General Jaime M.
Lantin and Solicitor Norberto P. Eduardo for plaintiff-appellee.

Jose T. Nery for defendant-appellant.

FERNANDO, J.:

Appellant seeks to set aside a judgment of the Court of First Instance of Zambales,
convicting her of a violation of an ordinance of Olongapo, Zambales, requiring a permit
from the municipal mayor for the construction or erection of a building, as well as any
modification, alteration, repair or demolition thereof. She questions its validity, or at the
very least, its applicability to her, by invoking due process, 1 a contention she would
premise on what for her is the teaching of People v. Fajardo. 2 If such a ground were far
from being impressed with solidity, she stands on quicksand when she would deny the
applicability of the ordinance to her, on the pretext that her house was constructed
within the naval base leased to the American armed forces. While yielding to the well-
settled doctrine that it does not thereby cease to be Philippine territory, she would, in
effect, seek to emasculate our sovereign rights by the assertion that we cannot exercise
therein administrative jurisdiction. To state the proposition is to make patent how much
it is tinged with unorthodoxy. Clearly then, the lower court decision must be affirmed
with the sole modification that she is given thirty days from the finality of a judgment to
obtain a permit, failing which, she is required to demolish the same.

The facts are undisputed. As set forth in the decision of the lower court: "The accused
bought a house and lot located inside the United States Naval Reservation within the
territorial jurisdiction of Olongapo City. She demolished the house and built another one
in its place, without a building permit from the City Mayor of Olongapo City, because
she was told by one Ernesto Evalle, an assistant in the City Mayor's office, as well as by
her neighbors in the area, that such building permit was not necessary for the
construction of the house. On December 29, 1966, Juan Malones, a building and lot
inspector of the City Engineer's Office, Olongapo City, together with Patrolman Ramon
Macahilas of the Olongapo City police force apprehended four carpenters working on
the house of the accused and they brought the carpenters to the Olongapo City police
headquarters for interrogation. ... After due investigation, Loreta Gozo was charged with
violation of Municipal Ordinance No. 14, S. of 1964 with the City Fiscal's Office." 3 The
City Court of Olongapo City found her guilty of violating Municipal Ordinance No. 14,
Series of 1964 and sentenced her to an imprisonment of one month as well as to pay
the costs. The Court of Instance of Zambales, on appeal, found her guilty on the above
facts of violating such municipal ordinance but would sentence her merely to pay a fine
of P200.00 and to demolish the house thus erected. She elevated the case to the Court
of Appeals but in her brief, she would put in issue the validity of such an ordinance on
constitutional ground or at the very least its applicability to her in view of the location of
her dwelling within the naval base. Accordingly, the Court of Appeals, in a resolution of
January 29, 1973, noting the constitutional question raised, certified the case to this
Court.

There is, as mentioned in the opening paragraph of this petition, no support in law for
the stand taken by appellant.

1. It would be fruitless for her to assert that local government units are devoid of
authority to require building permits. This Court, from Switzer v. Municipality of
Cebu, 4 decided in 1911, has sanctioned the validity of such measures. It is much too
late in the day to contend that such a requirement cannot be validly imposed. Even
appellant, justifiably concerned about the unfavorable impression that could be created
if she were to deny that such competence is vested in municipal corporations and
chartered cities, had to concede in her brief: "If, at all; the questioned ordinance may be
predicated under the general welfare clause ... ." 5 Its scope is wide, well-nigh all
embracing, covering every aspect of public health, public morals, public safety, and the
well being and good order of the community. 6

It goes without saying that such a power is subject to limitations. Certainly, if its exercise
is violative of any constitutional right, then its validity could be impugned, or at the very
least, its applicability to the person adversely affected could be questioned. So much is
settled law. Apparently, appellant has adopted the view that a due process question
may indeed be raised in view of what for her is its oppressive character. She is led to
such a conclusion, relying on People v. Fajardo. 7 A more careful scrutiny of such a
decision would not have led her astray, for that case is easily distinguishable. The facts
as set forth in the opinion follow: "It appears that on August 15, 1950, during the
incumbency of defendant-appellant Juan F. Fajardo as mayor of the municipality of
Baao, Camarines Sur, the municipal council passed the ordinance in question providing
as follows: "... 1. Any person or persons who will construct or repair a building should,
before constructing or repairing, obtain a written permit from the Municipal Mayor. ... 2.
A fee of not less than P2.00 should be charged for each building permit and P1.00 for
each repair permit issued. ... 3. [Penalty]-Any violation of the provisions of the above,
this ordinance, shall make the violator liable to pay a fine of not less than P25 nor more
than P50 or imprisonment of not less than 12 days nor more than 24 days or both, at
the discretion of the court. If said building destroys the view of the Public Plaza or
occupies any public property, it shall be removed at the expense of the owner of the
building or house. ... ." Four years later, after the term of appellant Fajardo as mayor
had expired, he and his son-in-law, appellant Babilonia, filed a written request with the
incumbent municipal mayor for a permit to construct a building adjacent to their gasoline
station on a parcel of land registered in Fajardo's name, located along the national
highway and separated from the public plaza by a creek ... . On January 16, 1954, the
request was denied, for the reason among others that the proposed building would
destroy the view or beauty of the public plaza ... . On January 18, 1954, defendants
reiterated their request for a building permit ..., but again the request was turned down
by the mayor. Whereupon, appellants proceeded with the construction of the building
without a permit, because they needed a place of residence very badly, their former
house having been destroyed by a typhoon and hitherto they had been living on leased
property." 8

Clearly then, the application of such an ordinance to Fajardo was oppressive. A

conviction therefore for a violation thereof both in the justice of the peace court of Baao,
Camarines Sur as well as in the Court of First Instance could not be sustained. In this
case, on the contrary, appellant never bothered to comply with the ordinance. Perhaps
aware of such a crucial distinction, she would assert in her brief: "The evidence showed
that even if the accused were to secure a permit from the Mayor, the same would not
have been granted. To require the accused to obtain a permit before constructing her
house would be an exercise in futility. The law will not require anyone to perform an
impossibility, neither in law or in fact: ... ." 9 It would be from her own version, at the very
least then, premature to anticipate such an adverse result, and thus to condemn an
ordinance which certainly lends itself to an interpretation that is neither oppressive,
unfair, or unreasonable. That kind of interpretation suffices to remove any possible
question of its validity, as was expressly announced in Primicias v. Fugoso. 10 So it
appears from this portion of the opinion of Justice Feria, speaking for the Court: "Said
provision is susceptible of two constructions: one is that the Mayor of the City of Manila
is vested with unregulated discretion to grant or refuse to grant permit for the holding of
a lawful assembly or meeting, parade, or procession in the streets and other public
places of the City of Manila; and the other is that the applicant has the right to a permit
which shall be granted by the Mayor, subject only to the latter's reasonable discretion to
determine or specify the streets or public places to be used for the purpose, with a view
to prevent confusion by overlapping, to secure convenient use of the streets and public
places by others, and to provide adequate and proper policing to minimize the risk of
disorder. After a mature deliberation, we have arrived at the conclusion that we must
adopt the second construction, that is, construe the provisions of the said ordinance to
mean that it does not confer upon the Mayor the power to refuse to grant the permit, but
only the discretion, in issuing the permit, to determine or specify the streets or public
places where the parade or procession may pass or the meeting may be held." 11 If, in a
case affecting such a preferred freedom as the right to assembly, this Court could
construe an ordinance of the City of Manila so as to avoid offending against a
constitutional provision, there is nothing to preclude it from a similar mode of approach
in order to show the lack of merit of an attack against an ordinance requiring a permit.
Appellant cannot therefore take comfort from any broad statement in the Fajardo
opinion, which incidentally is taken out of context, considering the admitted oppressive
application of the challenged measure in that litigation. So much then for the contention
that she could not have been validly convicted for a violation of such ordinance. Nor
should it be forgotten that she did suffer the same fate twice, once from the City Court
and thereafter from the Court of First Instance. The reason is obvious.Such ordinance
applies to her.

2. Much less is a reversal indicated because of the alleged absence of the rather novel
concept of administrative jurisdiction on the part of Olongapo City. Nor is novelty the
only thing that may be said against it. Far worse is the assumption at war with
controlling and authoritative doctrines that the mere existence of military or naval bases
of a foreign country cuts deeply into the power to govern. Two leading cases may be
cited to show how offensive is such thinking to the juristic concept of
sovereignty, People v. Acierto, 12 and Reagan v. Commissioner of Internal
Revenue. 13 As was so emphatically set forth by Justice Tuason in Acierto: "By the
Agreement, it should be noted, the Philippine Government merely consents that the
United States exercise jurisdiction in certain cases. The consent was given purely as a
matter of comity, courtesy, or expediency. The Philippine Government has not
abdicated its sovereignty over the bases as part of the Philippine territory or divested
itself completely of jurisdiction over offenses committed therein. Under the terms of the
treaty, the United States Government has prior or preferential but not exclusive
jurisdiction of such offenses. The Philippine Government retains not only jurisdictional
rights not granted, but also all such ceded rights as the United States Military authorities
for reasons of their own decline to make use of. The first proposition is implied from the
fact of Philippine sovereignty over the bases; the second from the express provisions of
the treaty." 14 There was a reiteration of such a view in Reagan. Thus: "Nothing is better
settled than that the Philippines being independent and sovereign, its authority may be
exercised over its entire domain. There is no portion thereof that is beyond its power.
Within its limits, its decrees are supreme, its commands paramount. Its laws govern
therein, and everyone to whom it applies must submit to its terms. That is the extent of
its jurisdiction, both territorial and personal. Necessarily, likewise, it has to be exclusive.
If it were not thus, there is a diminution of sovereignty." 15 Then came this paragraph
dealing with the principle of auto-limitation: "It is to be admitted any state may, by its
consent, express or implied, submit to a restriction of its sovereign rights. There may
thus be a curtailment of what otherwise is a power plenary in character. That is the
concept of sovereignty as auto-limitation, which, in the succinct language of Jellinek, "is
the property of a state-force due to which it has the exclusive capacity of legal self-
determination and self-restriction." A state then, if it chooses to, may refrain from the
exercise of what otherwise is illimitable competence." 16 The opinion was at pains to
point out though that even then, there is at the most diminution of jurisdictional rights,
not its disappearance. The words employed follow: "Its laws may as to some persons
found within its territory no longer control. Nor does the matter end there. It is not
precluded from allowing another power to participate in the exercise of jurisdictional
right over certain portions of its territory. If it does so, it by no means follows that such
areas become impressed with an alien character. They retain their status as native soil.
They are still subject to its authority. Its jurisdiction may be diminished, but it does not
disappear. So it is with the bases under lease to the American armed forces by virtue of
the military bases agreement of 1947. They are not and cannot be foreign territory." 17

Can there be anything clearer, therefore, than that only a turnabout, unwarranted and
unjustified, from what is settled and orthodox law can lend the slightest degree of
plausibility to the contention of absence of administrative jurisdiction. If it were
otherwise, what was aptly referred to by Justice Tuason "as a matter of comity,
courtesy, or expediency" becomes one of obeisance and submission. If on a concern
purely domestic in its implications, devoid of any connection with national security, the
Military-Bases Agreement could be thus interpreted, then sovereignty indeed becomes
a mockery and an illusion. Nor does appellant's thesis rest on less shaky foundation by
the mere fact that Acierto and Reagan dealt with the competence of the national
government, while what is sought to be emasculated in this case is the so-called
administrative jurisdiction of a municipal corporation. Within the limits of its territory,
whatever statutory powers are vested upon it may be validly exercised. Any residual
authority and therein conferred, whether expressly or impliedly, belongs to the national
government, not to an alien country. What is even more to be deplored in this stand of
appellant is that no such claim is made by the American naval authorities, not that it
would do them any good if it were so asserted. To quote from Acierto anew: "The
carrying out of the provisions of the Bases Agreement is the concern of the contracting
parties alone. Whether, therefore, a given case which by the treaty comes within the
United States jurisdiction should be transferred to the Philippine authorities is a matter
about which the accused has nothing to do or say. In other words, the rights granted to
the United States by the treaty insure solely to that country and can not be raised by the
offender." 18 If an accused would suffer from such disability, even if the American armed
forces were the beneficiary of a treaty privilege, what is there for appellant to take hold
of when there is absolutely no showing of any alleged grant of what is quaintly referred
to as administrative jurisdiction? That is all, and it is more than enough, to make
manifest the futility of seeking a reversal.

WHEREFORE, the appealed decision of November 11, 1969 is affirmed insofar as it

found the accused, Loreta Gozo, guilty beyond reasonable doubt of a violation of
Municipal Ordinance No. 14, series of 1964 and sentencing her to pay a fine of P200.00
with subsidiary imprisonment in case of insolvency, and modified insofar as she is
required to demolish the house that is the subject matter of the case, she being given a
period of thirty days from the finality of this decision within which to obtain the required
permit. Only upon her failure to do so will that portion of the appealed decision
requiringdemolition be enforced. Costs against the accused.
Laurel vs Misa
Facts: the Supreme Court, in a resolution, acted on the petition for the writ ofhabeas corpus
filed by petitioner anastacio laurel based on the theory that a Filipino citizen who adhered to
the enemy giving the latter aid and comfort during the Japanese occupation cannot be
prosecuted for the crime of treason definedand penalized by article 114 of the revised penal
code for the reason that 1) that the sovereignty of the legitimate government in the Philippines
and consequently, the correlative allegiance of Filipino citizens therto was then suspended;and
2) that there was a change of sovereignty over these islands upon the proclamation of the
Philippine republic.Issues:Whether or not the allegiance of the accused as a Filipino citizen was
suspendedand that there was a change of sovereignty over the Phil Islands.Held:No, a citizen or
subject owes, not a qualified and temporary, but an absolute and permanent allegiance, which
consists in the obligation of fidelity and obedience to his government of sovereign. The
absolute and permanent allegiance of theinhabitants of a territory occupied by the enemy to
their legitimate governmentor sovereign is not abrogated or severed by the enemy occupation,
because the sovereignty of the government or sovereign de jure is not transferred thereby
theoccupier.Just as treason may be committed against the Federal as well as against the State
Govt, in the same way treason may have been committed during the Japanese occupation
against the sovereignty of the US as well as against the sovereignty of the Phil Commonwealth;
and that the change of our form of govt from commonwealthto republic does not affect the
prosecution of those charged with the crime of treason committed during the commonwealth,
bec it is an offense against the samegovt and the same sovereign people.
RUFFY v. CHIEF OF STAFF

75 PHIL 875

FACTS:

Ramon Ruffy was the provincial commander stationed in Mindoro at the outbreak of war on
December 8, 1941. When the Japanese forces landed in Mindoro on February 27, 1942, Mayor
Ruffy retreated to the mountains and organized and led a guerrilla outfit known as the Bolo
Combat team of Bolo Area. The case at bar is a petition for prohibition praying that
respondents be commanded to desist from further proceedings in the trial of the petitioners on
the ground that petitioners were not subject to military law at the time of offense.

ISSUE:

1. Are the petitioners subject to military law at the time of war and Japanese occupation?

2. Is 93d Article of War constitutional?

HELD:

Petitioners were subject to military jurisdiction as provided for in Article of War (2d). The Bolo
Area was a contingent of the 6th military district which had been recognized by the United
States army. The petitioners assailed the constitutionality of 93d Article of War on the ground
that it violates Article VIII Section 2 par. 4 of the Constitution which provides that National
Assembly may not deprive the Supreme Court of its original jurisdiction over all criminal cases
in which the penalty imposed is death or life imprisonment. The petitioners are in error for
courts martial are agencies of executive character and are not a portion of the judiciary. The
petition thus has no merits and is dismissed with costs.
 Collector of Internal Revenue vs
Antonio Campos Rueda [G.R. L-13250]
October 29, 1971
by Quolete
En Banc

Facts:
Maria Cerdiera is a Spanish national (Filipina married to a Spanish citizen), lived in Morocco and died there.
In the Philippines, she left intangible properties. The person tasked as administrator of the intangible properties
is Antonio Campos Rueda. He filed a provisional estate and inheritance tax return on all properties left by her.
The Collector of Internal Revenue, the respondent, pending the investigation of the tax value of the properties,
issued an assessment for estate tax worth P111,592.48 and inheritance tax worth P187,791.48 with a total
amount of P369,383.96. These tax liabilities were paid by Antonio Rueda.

Later, Campos Rueda filed an amended tax return wherein the properties worth P396,308.90 are claimed as
exempted from taxes. Respondent, still pending investigation on the same subject, issued another assessment
for estate tax worth P202,262.40 and inheritance taxed worth P267,402.84 with a total amount of P469,665.24.

Issues:
Respondents reply to the request for exemption of taxes, etc.:

(1) There is no reciprocity as it did not meet the requirements mentioned in Section 122 of the National
Internal Revenue Code. Tangier is a mere principality and not a foreign country.

(Note: As argued, section 122, in relation to the case, grants certain exemption of taxes provided that
reciprocity be met and for reciprocity to be met, Tangier must be a foreign country within the meaning of
Section 122).

(2) Respondent denied request for exemption because the law of Tangier is not reciprocal to Section 122 of the
National Internal Revenue Code.
(3) Respondent demanded the payment of the sums of 239,439.49 representing deficiency estate and
inheritance tax including ad valorem penalties, surcharges, interests and compromise penalties.

The Court of Tax Appeals ruled:

(1) Tangier allows a similar law for the exemption of taxes. Such exemption is sufficient to entitle Antonio
Rueda to the exemption benefits. There is no lacking of reciprocity.

The Collector of Internal Revenue asked a question of law:

(1) Whether the requisites of statehood is necessary (sine qua non) for the acquisition of international
personality.

(2) Whether acquisition of international personality is required for a foreign country to fall within the
exemption of Section 122 of the National Internal Revenue Code.

The Supreme Court referred the case back to the Court of Tax Appeals to determine whether the alleged law of
Tangier did grant the reciprocal tax exemption required by Section 122.

Held:
(1) Requisite of Statehood is necessary.

It does not admit of doubt that if a foreign country is to be identified with a state, it is required in line with
Pounds 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.
(2) Tangier is a state.

(3) Section 122 does not require that the foreign country possess an international personality. In other words,
international personality is not a requisite.

(4) Supreme Court affirms Court of Tax Appeals ruling. (Note: Look at the ruling of the Court of Appeals
found in the issue.)
Magallona v Ermita
In March 2009, Republic Act 9522, an act defining the archipelagic baselines of the
Philippines was enacted the law is also known as the Baselines Law. This law was meant
to comply with the terms of the third United Nations Convention on the Law of the Sea
(UNCLOS III), ratified by the Philippines in February 1984.
Professor Merlin Magallona et al questioned the validity of RA 9522 as they contend,
among others, that the law decreased the national territory of the Philippines hence the law
is unconstitutional. Some of their particular arguments are as follows:
a. the law abandoned the demarcation set by the Treaty of Paris and other ancillary treaties
this also resulted to the exclusion of our claim over Sabah;
b. the law, as well as UNCLOS itself, describes the Philippine waters as archipelagic
waters which, in international law, opens our waters landward of the baselines to maritime
passage by all vessels (innocent passage) and aircrafts (overflight), undermining Philippine
sovereignty and national security, contravening the countrys nuclear-free policy, and
damaging marine resources, in violation of relevant constitutional provisions;
c. the classification of the Kalayaan Island Group (KIG), as well as the Scarborough Shoal
(bajo de masinloc), as a regime of islands pursuant to UNCLOS results in the loss of a
large maritime area but also prejudices the livelihood of subsistence fishermen.
ISSUE: Whether or not the contentions of Magallona et al are tenable.
HELD: No. The Supreme Court emphasized that RA 9522, or UNCLOS, itself is not a
means to acquire, or lose, territory. The treaty and the baseline law has nothing to do with
the acquisition, enlargement, or diminution of the Philippine territory. What controls when it
comes to acquisition or loss of territory is the international law principle on occupation,
accretion, cession and prescription and NOT the execution of multilateral treaties on the
regulations of sea-use rights or enacting statutes to comply with the treatys terms to delimit
maritime zones and continental shelves.
The law did not decrease the demarcation of our territory. In fact it increased it. Under the
old law amended by RA 9522 (RA 3046), we adhered with the rectangular lines enclosing
the Philippines. The area that it covered was 440,994 square nautical miles (sq. na. mi.).
But under 9522, and with the inclusion of the exclusive economic zone, the extent of our
maritime was increased to 586,210 sq. na. mi. (See image below for comparison)
If any, the baselines law is a notice to the international community of the scope of the
maritime space and submarine areas within which States parties exercise treaty-based
rights.
Anent their particular contentions:
a. The law did not abandon the Sabah claim. This is evident on the provision of Section 2 of
RA 9522:
Section 2. The definition of the baselines of the territorial sea of the Philippine Archipelago
as provided in this Act is without prejudice to the delineation of the baselines of the
territorial sea around the territory of Sabah, situated in North Borneo, over which the
Republic of the Philippines has acquired dominion and sovereignty.
b. UNCLOS may term our waters as archipelagic waters and that we may term it as our
internal waters, but the bottom line is that our country exercises sovereignty over these
waters and UNCLOS itself recognizes that. However, due to our observance of international
law, we allow the exercise of others of their right of innocent passage. No modern State can
validly invoke its sovereignty to absolutely forbid innocent passage that is exercised in
accordance with customary international law without risking retaliatory measures from the
international community.
c. The classification of the KIG (or the Spratlys), as well as the Scarborough Shoal, as a
regime of islands did not diminish our maritime area. Under UNCLOS and under the
baselines law, since they are regimes of islands, they generate their own maritime zones
in short, they are not to be enclosed within the baselines of the main archipelago (which is
the Philippine Island group). This is because if we do that, then we will be enclosing a larger
area which would already depart from the provisions of UNCLOS that the demarcation
should follow the natural contour of the archipelago.
Nevertheless, we still continue to lay claim over the KIG and the Scarborough Shoal
through effective occupation.
NOTES:
Under UNCLOS and the baselines law, we have three levels of maritime zones where we
exercisetreaty-based rights:
a. territorial waters 12 nautical miles from the baselines; where we exercise sovereignty
b. contiguous zone 24 nautical miles from the baselines; jurisdiction where we can
enforcecustoms, fiscal, immigration, and sanitation laws (CFIS).
c. exclusive economic zone 200 nautical miles from the baselines; where we have the
right to exploit the living and non-living resources in the exclusive economic zone
Note: a fourth zone may be added which is the continental shelf this is covered by Article
77 of the UNCLOS.
BACANI V NACOCO G.R. No. L-6957, November 29, 1956

FACTS:

Herein petitioners are stenographers in Branch VI of the CIF Manila.

In a pending civil case where the public respondents are involved, they
requested for the services of the stenographers and thereby paid them for the
said transcript at the rate of P1 per page, amounting to P714 in total.

However, upon inspecting the books of the corporation, the Auditor General
disallowed the payment of such fees and sought for the recovery of the amounts
paid. Consequently, the AG required the petitioners to reimburse the amounts
invoking that the National Coconut Corporation is a government entity within
the purview of section 2 of the Revised Administrative Code of 1917 which states
that: The Government of the Philippine Islands is a term which refers to the corporate

governmental entity through which the functions of government are exercised throughout
the Philippine Islands, including, save as the contrary appears from the context, the
various arms through which political authority is made effective in said Islands, whether
pertaining to the central Government or to the provincial or municipal branches or other
form of local government., hence, exempted from the payment of the fees in
question.
ISSUE: Whether the NCC is a government entity and is exempted from the
payments in question?
RULING: The Court held No. Discussing, there are two-fold functions of the
government namely: constituent and ministrant. The constituent function refers
to the bonds of society and are compulsory in nature, while ministrant is more
on public welfare like public works, education, charity, health and safety. From
such, we may infer that there are functions which our government is required to
exercise to promote its objectives as expressed in our Constitution and which are
exercised by it as an attribute of sovereignty, and those which it may exercise to
promote merely the welfare, progress and prosperity of the people.

The NCC has that function because the corporation promotes certain aspects of
the economic life of the people. In short, NCC belongs to what we call the
government-owned and controlled corporation which is governed by
Corporation Law.

Albeit the NCC performs governmental functions for the peoples welfare,
however, it was given a corporate power separate and distinct from our
government, for it was made subject to the provisions of our Corporation Law in
so far as its corporate existence and the powers that it may exercise are
concerned.

To recapitulate, we may mention that the term Government of the Republic of

the Philippines used in section 2 of the Revised Administrative Code refers only
to that government entity through which the functions of the government are
exercised as an attribute of sovereignty, and in this are included those arms
through which political authority is made effective whether they be provincial,
municipal or other form of local government.

Therefore, NCC is not a government entity and is not exempted from the
payment of fees in question; petitioners are not subject to reimbursement.

Petition GRANTED.
PVTA vs CIR

G.R. No. L-32052

65 SCRA 416

July 25, 1975

Petitioner: Philippine Virginia Tobacco Administration

Respondent: Court of Industrial Relations

FACTS: Private respondents filed a petition seeking relief for their alleged overtime services (in
excess of their 8 regular hours a day) and the failure to pay for said compensation in
accordance with Commonwealth Act No. 444.

Section 1: The legal working day for any person employed by another shall not be of more than
eight (8) hours daily.

Petitioner denies allegations for lack of a cause of action and jurisdiction.

Respondents filed a Petition for Certiorari on grounds that the corporation is exercising
governmental functions and is therefore exempt from CA No. 444 which was denied and
dismissed by RTC and CA. Motion for Reconsideration were also DENIED.

ISSUE: Whether or not PVTA discharges governmental and not proprietary functions and is
exempt from CA No. 444.

HELD: It is an inherent state function which makes government required to support its people
and promote their general welfare. This case explains and portrays the expanded role of
government necessitated by the increased responsibility to provide for the general welfare.
The Court held that the distinction and between constituent and ministrant functions, which
the Chief Justice points out, is already irrelevant considering the needs of the present time. He
says that "The growing complexities of modern society have rendered this traditional
classification of the functions of government obsolete." The distinction between constituent
and ministrant functions is now considered obsolete.

The Court affirms that the Petition as well as the subsequent Motion for Reconsideration be
DENIED.
December 13, 1916

Petitioner: Government of the Philippine Islands, represented by Executive Treasurer

Respondent: El Monte de Piedad Y Caja de Ajorras de Manila

FACTS: On June 3, 1863, a devastating earthquake in the Philippines took place. The Spanish
dominions provided $400,000 aid as received by the National Treasury as relief of the victims of
the earthquake. The government used the money as such but $80,000 was left untouched and
was thus invested to Monte de Piedad bank, which was in turn invested as jewelries, equivalent
to the same amount.

In June 1983, the Department of Finance called upon the same bank to return the $80,000
deposited from before. The Monte de Piedad declined to comply with this order on the ground
that the Governor-General of the Philippine Islands and not the Department of Finance had the
right to order the reimbursement because the Philippine government is not the affected party.
On account of various petitions of the persons, the Philippine Islands brought a suit against
Monte de Piedad for a recovery of the $80,000 together with interest, for the benefit of those
persons and their heirs. Respondent refuse to provide the money, hence, this appeal.

ISSUE: Whether or not the Philippine government is authorized to file a reimbursement of the
money of the people deposited in respondent bank.

HELD: The Court held that the Philippine government is competent to file a
complaint/reimbursement against respondent bank in accordance to the Doctrine of Parens
Patriae. The government is the sole protector of the rights of the people thus, it holds an
inherent supreme power to enforce laws which promote public interest. The government has
the right to "take back" the money intended fro people. The government has the right to
enforce all charities of public nature, by virtue of its general superintending authority over the
public interests, where no other person is entrusted with it.
Appellate court decision was affirmed. Petition was thereby GRANTED. The Court ordered that
respondent bank return the amount to the rightful heirs with interest in gold or coin in
Philippine peso.

Constitutional Law 1: State Functions / Concept of State (Textbook: Cruz, Professor: Atty. Usita)