Xanthy Sigua | 1D-UST LAW

CHAPTER VIII: STRICT AND LIBERAL CONSTRUCTION AND INTERPRETATION OF STATUTES

1. Martin Centeno vs. Hon. Victoria Villalon-Pernillos and the People of the Philippines

FACTS: The Samahang Katandaan ng Nayon ng Tikay officers launched a fund drive for the purpose of renovating
a Chapel in Bulacan. It is admitted that the solicitation was made without a permit from the DSWD. The said
officers were sentenced in violation of P.D. No. 1564, or the Solicitation Permit law, which covers solicitation for
charitable or public welfare that shall first secure a permit.

ISSUE: W/N the phrase “charitable purposes” should be construed in its broadest sense so as to include a religious
purpose.

RULING: Yes. Penal Statutes should be strictly construed against the state and liberally in favor of the accused.
The word “charitable” is a matter of description rather than a precise definition. The law does not operate in vacuo
nor should its applicability be determined by abstract circumstances. Thus, the decision is reversed and the petitioner
is acquitted.

2. Cesario Ursua vs. Court of Appeals

FACTS: The petitioner was asked to take his counsel’s the furnished copy of the complaint against him from the
office of the Ombudsman. The petitioner signed and introduced himself as “Oscar Perez” on the visitor’s logbook
and in the said office respectively. Thereafter, the petitioner was found guilty of violating Sec. 1 of C.A. No. 142.

ISSUE: W/N the use of different name belonging to another in isolated transaction is prohibited under C.A. No.
142.

RULING: No. Penal statutes should be construed strictly against the State and in favor of the accused. The use of
fictitious name that belong to another person in a single instance without any sign that the user intends to be known
by this name is not covered under C.A. No. 142. Thus, the petitioner cannot be convicted on a law that does not
clearly penalize the act done by him.

3. People of the Philippines vs. Walpan Ladjaalam y Mihajil

FACTS: Appellant Ladjaam was charged and convicted by the RTC of the crime of direct assault for filing an
unlicensed M-14 rifle at several policemen who were about to enter his house to serve a search warrant. In addition,
he was charged for illegal possession of firearms in violation of P.D. 1866.

ISSUE: W/N Ladjaalam can be convicted of violation of R.A. 8294 when he used said firearm in the commission of
another crime.

RULING: NO. Penal laws are to be construed liberally in favor of the accused. In the case, the plain reading of
R.A. 8294’s simple language is more favorable to Ladjaalam where he cannot be convicted of two separate offenses
for illegal possession of firearms and direct assault with attempted homicide.

4. Commissioner of Internal Revenue vs. La Tondena Distillers, Inc. [LTDI (now Ginebra San Miguel)]

FACTS: LTDI entered into a Plan of Merger with three corporations. The BIR issued a ruling stating that no gain or
loss shall be recognized by the absorbed corporations as transferors of all assets and liabilities.
The transfer of assets, such as real properties shall be subject to Documentary Stamp Tax (DST). However, LTDI
filed with CIR an administrative claim for tax refund representing the DST on the occasion of merger.

ISSUE: W/N property absorbed by the surviving corporation in a merger is exempt from the payment of
Documentary Stamp Tax.
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RULING: No. The Court stressed that taxes must not be imposed beyond what the law expressly and clearly
declares as tax laws must be construed strictly against the State and liberally in favor of the taxpayer. Section 196 of
the NIRC is imposed only to transfers and conveyances of real property by the way of sale. It does not include the
transfer from one corporation to another in pursuance of a merger. Thus, it is not exempted from the payment of
DST .

5. Republic of the Philippines vs. Intermediate Appellate Court and Sps. Antonio and Clara Pastor

FACTS: The Republic through the BIR commenced an action to collect from the respondent spouses deficiency
income taxes. The respondent contented that they had availed and paid amnesty taxes under P.D. Nos. 23, 213, and
270. Consequently, government is in estoppel to demand and compel further payment of income taxes from the
spouses.

ISSUE: W/N the government can still collect deficiencies income taxes from the spouses.

RULING: No. In case of doubt, tax statutes are to be construed strictly against the government and liberally in favor
of the taxpayer, for taxes, being burdens, are not to be presumed beyond what the applicable statute expressly and
clearly declares. In the case, since the spouses were granted to pay for their amnesty taxes under P.D. No. 213, it is
deemed that the government waives its right to collect what otherwise would due to it.

6. Acting Commissioner of Customs vs. Manila Electric Company and Court of Tax Appeals

FACTS: Manila Electric Co. claims that it is exempt from the special import tax by virtue of Section 6 of R.A. 1934
and Paragraph 9 of Part 2 of the said law. It contented that it is exempt from tax equipment, spare parts for use in
industries and the latter part expressly exempts its insulators from all taxes whatever kind and nature. In addition, it
is exempt from the percentage tax on its gross earnings.

ISSUE: W/N the claim for exemption from tax statute be strictly construed against the respondent Meralco.

RULING: YES. As a rule, any claim for exemption from a tax statute is strictly construed against the taxpayer.
However, where the law is clear and unambiguous, the law must be taken as it is, devoid of judicial addition or
subtraction. In this case, the law provided no qualification for the granting of privilege, thus the court has no liberty
to supply any.

7. Misamis Oriental Association of Coco Traders, Inc. vs. Department of Finance Secretary, Commissioner of
the Bureau of Internal Revenue (BIR), and Revenue District Officer, BIR, Misamis Oriental

FACTS: The petitioner corporation is engaged is buying and selling of copra. It alleges that prior to the Revenue
Memorandum Circular 47-91, which implemented VAT ruling, copra was classified as an agricultural food product
under Sec. 103 (b) of the NIRC. Thus, it is exempt from VAT at all stages of production and distribution. However,
Copra was reclassified as agricultural non-food product making it exempt from VAT only if the sale is made by the
primary producer.

ISSUE: W/N the respondent commissioner erred in denying the petitioner from VAT exemption.

RULING: NO. The Court agreed with the respondents in interpreting 103 (a) and (b) of NIRC and in giving a strict
construction with the rule. Tax exemption must be strictly construed against the taxpayer and liberally in favor of the
state. In the case at bar, the Court agreed that copra per se is not food. Thus making it not exempt from VAT at all
stages of production and distribution.
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8. Resins, Incorporated vs. Auditor General of the Philippines and the Central Bank of the Philippines

FACTS: Resins, Inc. (petitioner) would seek a refund from Central Banks on the claim that it was exempted from
the margin fee under R.A. no. 2609 for the importation of urea and formaldehyde. Since the Act speaks of “urea
formaldehyde” and petitioner admittedly did import the two elements separately, its plea could be granted if the
provision of the said law could be construed as “urea & formaldehyde.”

ISSUE: W/N Resin’s contention is meritorious.

RULING: No. Tax exemption is strictly construed against the taxpayer. The law frowns on exemption from
taxation, hence and exempting provision should be construed in strictissimi juris. In this case, the refund cannot be
allowed unless granted in the most explicit and categorical language.

9. Rohm Apollo Semiconductor Philippines, vs. Commissioner of Internal Revenue

FACTS: On December 11, 200, petitioner filed an administrative claim for tax refund before the BIR. Pursuant to
1997 Tax Code, there is a periof of 120 days of filing for an application for refund or credit to which the CIR failed
to act upon, thus it expired. This prompted the petitioner to file a judicial claim before the CTA on September 11,
2002. However his petition was denied since it was acted beyond the prescriptive period.

ISSUE: W/N the CTA can assume jurisdiction over the claim for the tax refund.

RULING: No. A claim for tax refund or credit, like a claim for tax exemption, is construed strictly against the
taxpayer. In the case at bar, the CTA cannot assume jurisdiction pursuant to the 1997 Tax Code since the
administrative claim was filed beyond the 130-day mandatory jurisdictional period. Thus, the non-compliance of the
law makes the claim for refund impossible to prosper.

10. Ong Chia vs. Republic of the Philippines

FACTS: In 1989 the Chinese petitioner who lived in the Philippines for a long time filed for Filipino Citizenship
under C.A. No. 473, known as the Naturalization Law. However, he was petition was not acted upon owing to the
fact that the Special Committee on Naturalization was not reconstituted after the 1986 revolution and that the
administrative process was suspended. The state appealed that the petitioner lacks some qualifications thus denying
his application. The CA ruled reversing the Trial Court’s decision.

ISSUE: W/N the documents annexed by the State to its appellant’s brief without having been presented and
formally offered as evidence justified the reversal of the Trial Court’s decision.

RULING: No. Naturalization laws should be rigidly enforced and strictly construed in favor of the government and
against the appellant. The petitioner failed to note Rule 143 of the Rules of Court that provides that the only instance
when rule on naturalization may be applied by analogy or suppletorily is on cases when it is practicable and
convenient. The rule of strict application of the naturalization law cases defeat petitioner’s argument of “substantial
compliance” with the requirement under the Revised Naturalization Law.

11. Finman General Assurance Corporation vs. Court of Appeals

FACTS: Deceased Surposa was insured with petitioner corporation. Thereafter private respondent and the other
beneficiaries of said insurance policy denied the insurance claim contending that murder and assault are not within
the coverage of the insurance policy. Subsequently the Insurance Commission ruled in favor of the complaint.
Thereafter petitioner corporation filed a petition alleging grave abuse of discretion on the part of the appellate court
in applying the principle of “expressio unius est exclusio alterius” in considering that death resulting from murder
and/or assault is not accidental.
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ISSUE: W/N death resulting from assault or murder deemed included in the terms “accident” and “accidental.”

RULING: YES. The principle of “expressio unius est exclusio alterius” – The mention of one thing implies the
exclusion of another thing- is applicable in the circumstances in the said case. It is well settled that contracts of
insurances are to be construed liberally in favor of the insured and strictly against the insurer. In the case, the insured
died from an event that took place without his foresight or expectation. Thus petition was denied for lack of merit.

12. Government Service Insurance System vs. Marian T. Vicencio

FACTS: Petitioner Mrs. Vicencio applied for death benefits of her late husband with GSIS but her application was
denied on the ground that the illness, which caused Judge Vicencio’s death, is not considered an occupational
disease. Mrs. Vicencio filed a motion for reconsideration first in the RTC then appealed to the Employees
Compensation Commission (ECC) but her petition was denied respectively. Consequently, she filed a petition for
review under Rule 43 of the Rules of Court with the CA. Thereafter CA reversed the decision and ordered GSIS to
grant her claim for the death benefits.

ISSUE: W/N respondent’s claim for death benefits under P.D. No. 626, as amended, is compensable.

RULING: YES. P.D. No. 262 as amended is a social legislation whose primordial purpose is to provide meaningful
protection of the working class against hazards, illness and other contingencies resulting in the loss of income. It is
settled that official agents charged by law to implement social justice guaranteed by the Constitution should adopt a
liberal attitude in favor of the employee in deciding claims for compensability. Applying the said principle and
Article 4 of the New Labor Code, it is enough that the deceased Judge’s employment contributed, regardless of
degree, to the development of the disease.

13. Maria E. Manahan vs. Employee’s Compensation Commission and GSIS

FACTS: Petitioner Manahan is the widow of Nazario Manahan Jr., who died of “Enteric Fever” while employed as
classroom teacher. The petitioner filed a claim with the Government Service Insurance for death befits under P.D.
262. The said insurance denied the claim on finding that the ailment of Nazario is not an occupational disease. GSIS
and the Employee’s Compensation Commission respectively affirmed the decision of the said insurance.

ISSUE: W/N respondent’s claim for death benefits under P.D. No. 626, as amended, is compensable.

RULING: YES. It is maintained that in case of doubt, the same should be resolved in favor of the worker, and that
social legislations like the Workmen’s Compensation Act should be liberally construed to attain laudable objective,
which is to give relief to the workman and his dependents. Pursuant to such doctrine, in the case, the presumption of
compensability subsists in favor of the claimant.

14. Salvador Lazo vs. Employee’s Compensation Commission and GSIS

FACTS: Petitioner Salvador is a security guard at the Central Bank who one time on his duty stayed for several
hours after his regular time off, because the reliever did not arrive, and so he was asked to go overtime.
Unfortunately, on his way home he suffered injuries due to a vehicular accident. Consequently, Salvador filed a
claim for disability benefits under P.D. 626, as amended, but was denied by the GSIS for the reason that the accident
did not occurred at his workplace. The petitioner contends that the incident should be construed as “arising out of
and in the course of employment” and thus, compensable.

ISSUE: W/N petitioner’s injury comes within the meaning of and intendment of the phrase “arising out of and in the
course of employment.” (Section 2, Workmen’s Compensation Act).
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RULING: YES. Basically, social legislation is liberally construed and it is in favor of the workingmen. As agent
charged by law to implement social justice guaranteed and secured by the Constitution, the Employee’s
Compensation Commission should adopt a liberal attitude in favor of the employee in deciding claims for
compensability, especially where there is a some basis in the facts for inferring a work connection to the accident.

15. Domingo Vicente vs. Employee’s Compensation Commission

FACTS: Domingo a former nurse attendant at the Veterans Memorial Medical Center applied for optional
retirement after his 25 years of government service, under the provisions of Section 12 (c) of R.A. No. 1616 as a
result of physical disability. Likewise he filed with the “GSIS for income benefit claim for payment”. He then
presented a “Physician’s Certification” classifying him as being under “permanent total disability”. However, the
GSIS only granted the claim for permanent partial disability, which was affirmed by the Employee’s Compensation
Commission (ECC). Hence, the petition for certiorari.

ISSUE: W/N the petitioner suffers from payment total disability as he claims, or from permanent partial disability
as held by the respondent Commission.

RULING: YES. The sympathy of the law on social security is towards its beneficiaries and the law by its own
terms, requires a construction of utmost liberality. In the case at bar, the approval of the petitioner’s optional
retirement application proves that he was no longer fit to continue in his employment. Also, his permanent disability
is established beyond doubt by several factors and circumstance. Thus, the decision of the Commission is set aside
and the petitioner is declared as one suffering from permanent disability.

16. Francisco S. Tantuico, Jr. vs. Hon. Eufemio Domingo

FACTS: Petitioner Tantuico was appointed Chairman of the Commission on Audit (COA) to serve a term for 7
years until 1987. Meanwhile Tantuico discharged the function of the COA in an acting capacity since 1975.
Consequently, 1985 he applied from all money, property and other accountabilities in preparation for his retirement.
His clearance had all the necessary signatures except for the signature of his predecessor Guingona. The second
predecessor and respondent Chairman informed the petitioner of his approval of his application for retirement under
R.A. 1568. However ½ of petitioner’s retirement benefits pending final result of his final accountability as former
COA chairman.

ISSUE: W/N petitioner’s retirement benefits can be withheld pending investigation of his responsibility.

RULING: NO. Well settled is the rule that retirement laws are liberally interpreted in favor of the retiree and Under
Section 4 of R.A. No. 1568 the benefits granted by this law shall not be subject to garnishment. In this case the
employee had been cleared by the National Treasurer from all money and property responsibility, and held that the
retirement pay accruing to a public officer may not be withheld and applied to his indebtedness to the government.

17. Vice Mayor Marcelina S. Engle vs. Commission on Elections En Banc and Winston B. Menzon

FACTS: A Petition to Deny Due Course and/ or Cancel the Certificate of Candidacy (COC) of petitioner on the
grounds that the latter misrepresented that she is qualified to substitute her late husband for the position of Vice-
Mayor of the Municipality of Babatngon, Leyte. Accordinlgy, the COMELEC found sufficient basis to cancel
petitoner’s COC on the ground that LAKAS CMD failed to submit to the said Commission Law Department
Romualdez’s authority to sign late Engle’s Certificate of Nomination and Acceptance (CONA) on behalf of the
aforesaid party. Such failure deemed the candidate to be independent, which automatically cannot be substituted.
Thereafter, COMELEC 2nd Divison held that private respondent, 2nd placer, should be declared the winner in line
with the jurisprudence stating that unsigned COC of the winning part is void ab initio.

ISSUE: W/N petitioner can validly substitute her husband James Engle after his unexpected demise.
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RULING: YES. The Court recognizes the power of the COMELEC by law to prescribe such efficacious rules on
elections. However, jurisprudence provides that rules and regulations for the conduct of elections are mandatory
before the election, but become mere directory after election. Also, Laws governing election contests must be
liberally construed to the end that the will of the people in the choice of public officials may not be defeated by mere
technical objections. The petitioner was obviously the undisputed choice of the people and in such case mere
technicality cannot be used to defeat the will of the electorate in a fair and honest election.

18. DSM Construction and Development Corporation, vs. Court of Appeals and Megaworld Globus Asia, Inc.

FACTS: Petitioner and respondent entered into agreements for the construction of a condominium project owned by
respondent called “The Salcedo Park”, with petitioner as contractor. In the course of the project’s construction,
differences with respect to billings arose between the parties. Petitioner thus filed a complaint for compulsory
arbitration before the CIAC claiming payment for the outstanding balance due from respondent pursuant to the
agreements. The CIAC rendered a decision partially granting both petitioner’s and respondent’s claims in favor of
petitioner. This award was affirmed by the Court of Appeals. Thereafter, the Supreme Court promulgated
its Decision affirming the judgment of the Court of Appeals and lifting the TRO that was then still in effect.
Petitioner centers on attempts, regrettably entertained by respondent Court of Appeals, to thwart the execution of a
final and executory decision of the Supreme Court.

ISSUE: Whether or not the Court of Appeals gravely abused its discretion when it issued a Resolution enjoining the
enforcement of Alias Writ of Execution.

RULING:
YES. Rule 1, Section 6 of the Rules of Court provides that the Rules shall be liberally construed in order to
promote their objective of securing a just, speedy and inexpensive disposition of every action and proceeding. The
abuse of discretion amounting to lack or excess of jurisdiction in this case was made manifest by the fact that the
appellate court not only took cognizance of the case and issued the assailed restraining order. It eventually decided
the case in petitioner’s (respondent herein) favor as well notwithstanding the dearth of any basis for doing so.