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Introlaw

G.R. No. 428 April 30, 1902

JOSE ZULUETA, plaintiff-appellee,


vs.
FRANCISCA ZULUETA, defendant-appellant.

Aylett R. Cotton, for appellant.


Francisco Ortigas, for appellee.

LADD, J.:

Don Jose Zulueta and his sister, Doña Francisca Zulueta, are sole heirs under the will of their father,
Don Clemente Zulueta, who died in Iloilo in 1900. In the course of the voluntary testamentary
proceedings instituted in the Court of First Instance of Iloilo by Don Jose, three auditors were
appointed to make a division of the estate under article 1053 of the Ley de Enjuiciamiento Civil, of
whom Don Jose and Doña Francisca each nominated one, the third or auditor umpire being chosen
by common accord of the parties. The two auditors nominated by the parties respectively failed to
agree, and each rendered a separate report. The auditor umpire, whose report was filed March 29,
1901, agreed with and accepted in its entirety the report of the auditor nominated by Don Jose. The
procedure marked out in articles 1062 and 1067 of the Ley de Enjuiciamiento Civil was then
followed, and upon the application of Doña Francisca the record was on April 13 delivered to her for
examination. April 25 she filed her opposition to the report of the auditor umpire, and a meeting of
the interested parties having been had, as provided in article 1069 of the Ley de Enjuiciamiento Civil,
and no agreement having been reached, the court, by a providencia of May 4, directed that the
procedure prescribed for declarative actions be followed, and that the record be again delivered to
Doña Francisca in order that she might formulate her demand in accordance with article 1071 of
the Ley de Enjuiciamiento Civil. On petition of Don Jose the court by a providencia of May 7 fixed the
term of fifteen days as that within which Doña Francisca should formulate her demand, which term
was subsequently enlarged seven days on petition of Doña Francisca. June 5 Doña Francisca
petitioned the court, stating that the new Code of Procedure enacted by the Civil Commission was
soon to become operative, and that she deemed it more advantageous to her rights that the
declarative action which she had to bring should be governed by the new Code rather than that then
in force, and asking that proceedings in the action should be suspended till the new Code went into
effect. This petition the court denied in an auto rendered June 15, declaring, furthermore, that the
term fixed for the filing of the demand having expired, Doña Francisca has lost her right to institute
the action. June 22 Doña Francisca petitioned for the reform of this auto. On the same day this
petition was denied in an auto rendered by Don Cirilo Mapa, a justice of the peace of the city of
Iloilo, who had been designated, as would appear from the record, by the judge of the then recently
constituted Ninth Judicial District to preside in the Court of First Instance of the Province of Iloilo
during the illness of the latter. The denial of this petition was put on the ground that the auto of June
15 was not one against which the remedy of reform was available, but that the remedy was by way
of appeal under article 365 of the Ley de Enjuiciamiento Civil. On June 29 Doña Francisca
interposed an appeal against the auto of June 22, which the court, now presided over by the regular
judge of first instance of the district, declined to admit, on the ground that it was not presented within
three days, as prescribed in article 363 of the Ley de Enjuiciamiento Civil. Thereupon, upon petition
of Don Jose the partition proceedings were approved by the court by an auto of July 16 from which
Doña Francisca took the present appeal.
While the appeal was pending in this Court Doña Francisca presented a petition under Act No. 75 of
the Civil Commission, alleging that the auto of June 22 was rendered through a mistake of the acting
judge of first instance, who erroneously believed that he had jurisdiction to render the same; that
Doña Francisca was prevented from entering an appeal from that auto by her mistake as to the term
prescribed by the Ley de Enjuiciamiento Civil for entering appeals in such cases; and finally that
the auto of July 16 approving the partition proceedings was rendered by a mistake of the judge, who
erroneously believed that the auto of June 22, was valid, whereas it and all subsequent proceedings
were absolutely void; and asking that the auto of June 22, the providencia denying the admission of
the appeal, and the auto of July 16 be set aside and the proceedings restored to the condition in
which they were previous to June 22, when the first mistake was made. Upon this petition a hearing
has been had, and we have also heard arguments upon the appeal.

Taking up the petition first, we do not find it necessary to decide whether the acting judge of first
instance by whom the auto of June 22 was rendered had such de facto authority that legal validity
will be accorded to his acts. Assuming that he was without jurisdiction to render the auto, we are of
opinion that Doña Francisca can not take advantage of the error in such a proceeding as the
present. Act No. 75 provides a remedy "against judgments obtained in Courts of First Instance by
fraud, accident, or mistake," but although the language of the law is somewhat broad, the general
scope and purpose of the enactment indicate too clearly to require argument that the mistake
against which relief is provided can not be a mistake into which the court may have fallen in the
findings of fact or conclusions of law upon which its judgment is based. If such were the effect of the
enactment, every case in which a party felt himself aggrieved by the judgment of the court below
could be brought to this court for revision in this way, and the ordinary remedy by appeal or
otherwise would be thus entirely superseded by the more summary proceeding therein provided.
"The meaning of the word "mistake" as used in the statute does not extend — nor was it intended
that it should — to an error of law which may have been committed by the judge in the trial in
question. Such errors may be corrected by appeal. The statute under consideration can by no
means be employed as a substitute for that remedy." (Jose Emeterio Guevara vs. Tuason &
Company, decided October 7, 1901, p. 27, supra.) The result is that we can not set aside the auto of
June 22 on this petition, and that on July 16 stands upon precisely the same footing, the allegation
being that auto also was rendered under a mistake of law on the part of the judge.

The remaining question upon the petition is whether Doña Francisca is entitled to relief against the
consequences of her failure to interpose her appeal against the auto of June 22 within the period
fixed by the law. The mistake in this instance was her own, but it was a mistake of law, and while we
should be unwilling to say that special cases might not occur in which relief would be afforded in
such a proceeding as this against a mistake of law made by a party, we are of opinion that the
present is not such a case. Nothing is shown here except the bare fact that the party acted under
ignorance or misconception of the provisions of the law in regard to the time within which the appeal
could be taken, and there is no reason why the general principle, a principle "founded no only on
expediency and policy but on necessity," that "ignorance of the law does not excuse from
compliance therewith" (Civil Code, art. 2), should be relaxed. The framers of Act No. 75 could not
have intended to totally abrogate this principle with reference to the class of cases covered by the
act. If such were the effect of this legislation the court "would be involved and perplexed with
questions incapable of any just solution and embarrassed by inquiries almost interminable."

Act No. 75 was framed for the purpose of preventing injustice, and although the legal construction to
be placed upon its provisions can not of course be affected by any considerations as to the
hardships of the particular case in which it is invoked, it is proper to say that if the question
determined in the auto of June 15, which is that against the consequences of which the petitioner
seeks ultimately to be relieved, were to be decided upon its merits, that autowould necessarily be
sustained, so that the petitioner has in fact suffered no hardship or injustice by reason of
the auto having been left in effect as a result of the mistakes which she claims to have vitiated the
subsequent proceedings.

The petition for the suspension of the declarative action till the new Code went into effect was totally
without merit. No reason was alleged in the petition itself why the suspension should be granted
other than the mere convenience of the party, and none has been suggested on the argument. The
petition could not in any possible view that occurs to us have been granted. With reference to the
declaration in the auto that the plaintiff had lost her right to file her demand in the declarative action,
it may be said that this declaration followed as a necessary consequence from theprovidencia of
May 7, fixing the time within which the demand must be formulated, and the
subsequent providenciaenlarging the period, from neither of which providencias had any appeal or
other remedy been attempted by Doña Francisca. But going back to what may be called the
fundamental question of the right of the court to fix a definite term within which the declarative action
must be instituted, we are of opinion that such right clearly existed, and that the providencia of May 7
was in exact conformity with the procedure prescribed by article 1071 of the Ley de Enjuiciamiento
Civil. It might be claimed with much reason that if the parties interested in the partition of the estate
failed to agree on that made by the auditor, either should be allowed to institute a declarative action
against the other for the purpose of settling the dispute within such time as he might think proper, the
property remaining in the meantime undivided, were it not that the law in language of unmistakable
import prescribes a different rule of procedure. Article 1071 of the Ley de Enjuiciamiento Civil is as
follows: "If no agreement is had, the procedure prescribed for declarative actions, according to the
amount involved, shall be followed, and the delivery of the papers shall be first made to the parties
who first requested delivery to them of the partition report as provided in article 1067." Article 1067 is
as follows: "If the interested parties, or any of them, request, within eight days, that the record of the
proceedings and the report on partition be delivered to them for examination, the judge shall order
said delivery for a period of fifteen days to each person making such request." The law does not
treat the partition proceedings as terminated by the failure of the parties to agree, but provides that
"the case" shall in that event "be given the procedure of the declarative action" and goes on to
designate the party who is to take the initiative in the pleadings, a provision utterly irreconcilable with
the idea that it is optional for either party to commence the proceeding at his pleasure. And it then
proceeds by reference to article 1067 to fix the time within which the proceeding is to be instituted.
The petitioner had the benefit of that period and was accorded besides an extension of seven days,
and has consequently had all the rights to which she was strictly entitled under the law and
something more. She has, we think, no just ground to complain that she has been deprived of any
substantial right either by her own mistake or that of the court below, in any possible view in which
the facts of the case may be regarded.

What has been said with reference to the petition disposes also of the question involved in the
appeal. If Doña Francisca had, as we think must be the case, lost her right to institute the declarative
action, there was no other course for the court to take except to approve the partition proceedings,
unless there was some defect which vitiated them, and none has been pointed out. It was suggested
in the argument that the report of the auditor umpire was of prior date to that of the auditor
nominated by Don Jose, and it was claimed that this rendered the proceedings defective. An
examination of the record shows that the report of the auditor nominated by Don Jose was dated
March 24 and filed March 29, and that of the auditor umpire was dated March 28 and filed March 29.
The contention of counsel on this point is therefore not supported by the facts.

The result is that the petition must be denied and the judgment appealed from affirmed, with costs to
the appealing party both as to the petition and the appeal. So ordered.

Arellano, C.J., Torres, Cooper, and Willard, JJ., concur.


Mapa, J., did not sit in this case.
G.R. No. L-14406 June 30, 1961

MARCELINO BUYCO, petitioner-appellee,


vs.
PHILIPPINE NATIONAL BANK, ILOILO BRANCH, Iloilo City, respondent-appellant.

Efrain B. Treñas for petitioner-appellee.


Ramon B. de los Reyes and Nemesio C. Vargas for respondent-appellant.

PAREDES, J.:

Mandamus case filed by petitioner Marcelino Buyco praying that the respondent Philippine National
Bank be compelled to accept his Backpay Acknowledgment Certificate No. 4801, as payment of his
obligation with said respondent.

The case was submitted on an agreed stipulation of facts, with the pertinent documents as annexes.

On April 24, 1956, petitioner Marcelino Buyco was indebted to respondent in the amount of
P5,102.90 plus interest thereon, which represented petitioner's deficit on his 1952-53 crop loan with
respondent bank. The said loan was secured by a mortgage of real property. Petitioner is a holder of
Backpay Acknowledgment Certificate No. 4801, dated July 9, 1955, under Rep. Act No. 897 in the
amount of P22,227.69 payable in thirty (30) years. On April 24, 1956, petitioner offered to pay
respondent bank the deficit of his crop loan for the abovementioned crop year 1952-53 with his said
backpay acknowledgment certificate, but on July 18, 1956, respondent answered petitioner that
since respondent's motion for reconsideration in the case of Marcelino B. Florentino v. Philippine
National Bank, L-8782, (52 O.G. 2522) was still under consideration by this Court (S.C.) respondent
"cannot yet grant" petitioner's request (Annex A, amended petition). On February 15, 1957, and after
this Court had denied respondent's motion for reconsideration in said case No. L-8782, petitioner,
again wrote respondent, reiterating his request to pay the obligation with said certificate (Annex B).
On February 19, 1957, respondent answered petitioner that in view of the amendment of its charter
on June 16, 1956 by R.A. No. 1576, it could not accept petitioner's certificate (Annex C). Petitioner
requested respondent to reconsider its decision, in a letter dated March 26, 1957 (Annex D), which
was referred to the respondent's Legal Department. In an opinion rendered on April 23, 1957, said
department expressed the view that notwithstanding the decision of this Court, the respondent could
not accept the certificate because of the amendment of its Charter heretofore mentioned.

The Court of First Instance of Iloilo, on July 24, 1958, granted the petition and ordered the
respondent bank "to give due course on the vested right of the petitioner acquired previous to the
enactment of Republic Act No. 1576 by accepting his backpay acknowledgment certificate as
payment of the obligation of the petitioner with respondent Bank with costs of the proceedings
against respondent." Hence, this appeal by the respondent Bank.

In spousing the cause of the petitioner-appellee, the trial court made the following findings and
conclusions:

(1) That in the letter Annex A, dated July 18, 1956, the respondent has impliedly admitted the
right of petitioner to apply or offer his certificate in payment of his obligation to respondent.

(2) That the pendency of the motion for reconsideration of the Florentino case filed by
respondent-appellant, did not affect the petitioner's vested right already created and acquired
at the time he offered to pay his obligation with his certificate on April 24, 1956, and before
the passage of Rep. Act No. 1576.
(3) That Rep. Act No. 1576 does not nullify the right of the petitioner to pay his obligation with
his backpay certificate.

(4) That the writ of mandamus would lie against the appellant.

The above findings and conclusions are assigned as errors, alleged to have been committed by the
trial court.

In the light of the Supreme Court's decision in the Florentino case, the respondent Philippine
National Bank therein was declared authorized to accept backpay acknowledgment certificate as
payment of the obligation of any holder thereof. Although the Florentino case was promulgated on
April 28, 1956, four (4) days after April 24, 1956, the date the appellee offered to pay with his
backpay acknowledgment certificate, it is nevertheless obvious that on or before said April 24, 1956,
the right to have his certificate applied for the payment of his obligation with the appellant already
existed by virtue of Republic Act No. 897, which was merely construed and clarified by this Court in
the said Florentino case. So that when the appellant in its letter of July 18, 1956. replied that "in the
meantime that our motion for reconsideration of the said decision is still pending the resolution of the
Supreme Court, we regret to advise that we cannot yet grant your request", the said appellant
already knew or should have known that a right was vested, only that its enforcement had to wait the
resolution of this Court which it handed on February 15, 1957, by maintaining its decision. A vested
right or a vested interest may be held to mean some right or interest in property that has become
fixed or established, and is no longer open to doubt or controversy (Graham v. Great Falls Water
Power & Town Site Co. [Mont] 76 Pac. 808, 810, citing Evans-Snider-Buel Co. v. McFadden, 10
Fed. 293, 44 CCA 464 L.R.A. 900). Considering the facts and circumstances obtaining in the case,
we agree with the lower court that the appellant herein had impliedly admitted the right of the
petitioner to apply his backpay certificate in payment of his obligation. This notwithstanding, whether
implied or expressed the admission by the appellant of appellee's right, has already lost momentum
or importance because the law on the matter on April 25, 1956, when the offer to pay the obligation
with the certificate was made, or the law before the amendatory Act of June 16, 1956, was that the
PNB was compelled to receive petitioner's backpay certificate..

Section 9-A of Republic Act No. 1576, passed on June 17, 1956, amending the Charter of the
respondent-appellant bank, provides:

The Board of Directors shall have the power and authority:.

. . . (d) In its discretion, to accept assignment of payments certificate of indebtedness of the


government or other such similar securities: Provided, however, that the authority herein
granted shall not be used as regards backpay certificates.

What would be the effect of this law upon the case at bar? "Laws shall have no retroactive effect,
unless the contrary is provided" (Art. 4, New Civil Code). It is said that the law looks to the future
only and has no retroactive effect unless the legislator may have formally given that effect to some
legal provisions (Lopez, et al. v. Crow, 40 Phil. 997, 1007); that all statutes are to be construed as
having only prospective operation, unless the purpose and intention of the Legislature to give them a
retrospective effect is expressly declared or is necessarily implied from the language used; and that
every case of doubt must be resolved against retrospective effect (Montilla v. Agustinian Corp., 24
Phil. 220). These principles also apply to amendments of statutes. Republic Act No. 1576 does not
contain any provision regarding its retroactivity, nor such may be implied from its language. It simply
states its effectivity upon approval. The amendment, therefore, has no retroactive effect, and the
present case should be governed by the law at the time the offer in question was made. The rule is
familiar that after an act is amended, the original act continues to be in force with regard to all rights
that had accrued prior to such amendment (Fairchild v. U.S., 91 Fed. 297; Hathaway v. Mutual Life
Ins. Co. of N.Y., 99 F. 534).

It is true that "acts executed against the provisions of mandatory or prohibitory laws shall be void,
except when the law itself authorizes their validity" (Art. 5, New Civil Code). It should be recalled,
however, that since the prohibitive amendment of the appellant's charter should not be given
retroactive effect; and that the law, at the time appellee made his offer, allowed, in fact compelled,
the respondent bank to accept the appellee's certificate, the above provision finds no application
herein.

IN VIEW HEREOF, mandamus is the proper remedy (Florentino case, supra), and the judgment
appealed from is hereby affirmed with costs against the respondent-appellant.

Bengzon, C.J., Labrador, Reyes, J.B.L., Dizon, De Leon and Natividad, JJ., concur.
Padilla, Bautista Angelo, Concepcion and Barrera, JJ., took no part.
G.R. No. L-17915 January 31, 1967

TEODORO M. CASTRO, petitioner and appellant,


vs.
AMADO DEL ROSARIO as Commissioner of Civil Service, DOMINADOR AYTONA as
Secretary of Finance,
MELECIO R. DOMINGO, as Commissioner of Internal Revenue, and TOMAS C.
TOLEDO, respondents and appellants.

Ramon C. Aquino, Teodoro M. Castro, Leandro C. Sevilla and Antonio M. Castro for petitioner and
appellant.
Emma Quisumbing-Fernando and E. M. Fernando for respondent and appellant Toledo.
Office of the Solicitor General Edilberto Barot and Solicitor Ceferino S. Gaddi for respondents and
appellants Secretary of Finance, et al.

MAKALINTAL, J.:

This is a proceeding in quo warranto, certiorari and mandamus originally filed in the Court of First
Instance of Manila. The controverted position is that of Assistant Regional Revenue Director II,
Manila, which became vacant on August 24, 1959, upon the promotion of its occupant, Alfredo
Jimenez. Respondent Tomas C. Toledo was appointed in his place, and it is this appointment that is
being questioned by petitioner Teodoro M. Castro in this proceeding. The court a quo annulled
Toledo's appointment, but did not grant Castro's prayer that respondent officials be ordered to
appoint him.

Toledo's appointment by the Secretary of Finance, upon recommendation of the Commissioner of


Internal Revenue, was made on November 24, 1959, effective as of October 1, 1959. When he was
appointed Toledo's position was that of Chief Revenue Inspector, or Chief Revenue Examiner,
stationed in Manila. The appointment was protested by Castro in a letter he wrote the Commissioner
of Internal Revenue on January 19, 1960, wherein he alleged that in accordance with the provisions
of Section 23 of Republic Act No. 2260, otherwise known as the Civil Service Act of 1959, he was
the one who should have been considered for the position. Copy of the letter-protest was furnished
the Secretary of Finance. On February 8, 1960 the Commissioner of Internal Revenue, in a first
indorsement, informed Castro that "the position of Assistant Revenue Regional Director II, R-53, at
P6,000.00 adjusted to P6,597.60 per annum, is for Regional District No. 3, Manila, and the
appointment thereto had to be issued to the person actually performing the functions of the position,"
namely, respondent Toledo, who was then acting as Assistant Revenue Regional Officer II, Manila.

On March 8, 1960 Castro appealed to the Commissioner of Civil Service, who indorsed the matter to
the Commissioner of Internal Revenue with a request for a statement of the comparative
qualifications of Toledo and Castro. After setting forth the qualifications as requested, the
Commissioner explained that the next two Assistant Revenue Regional Directors in line for the
protested position, as reported for purposes of Administrative Order No. 171, were Teodoro Lucero,
Assistant Revenue Regional Director I (Regional District No. 4), with a salary of P6,900 per annum;
and Lauro Abraham, Assistant Revenue Regional Director I (Regional District No. 6), with a salary of
P6,000 per annum, but that since the protested position was for Regional District No. 3, Manila,
where Toledo was next in rank, and since he was actually performing the functions of the
controverted office, there was no need to make a comparison between his qualifications and those
of Castro.

On July 1, 1960 the Commissioner of Civil Service rendered his decision dismissing Castro's protest
on the ground that the contested position belonged properly to Regional District No. 3, where Toledo
was the next ranking employee, while Castro was in Regional District No. 5, San Pablo City. Hence,
Castro filed the present petition asking that Toledo's appointment be annulled and that he be
declared entitled to the position. As already stated, the trial court rejected Castro's claim, but at the
same time annulled Toledo's appointment — this last on the ground that his previous appointment as
Chief Revenue Examiner was illegal.

Both sides appealed from the decision. Respondents claim that the lower court should not have
nullified Toledo's appointment. They contend (1) that the question as to the legality of his previous
appointment as Chief Revenue Examiner was neither raised in the pleadings nor proven at the trial
with the consent of the parties; (2) that petitioner was precluded by laches from questioning said
appointment; and (3) that the same was not contrary to the Revised Administrative Code.

On the other hand, petitioner argues that the lower court should have ordered respondents
Commissioner of Internal Revenue and Secretary of Finance to appoint him to the controverted
position because (1) he was senior in rank to Toledo and was the competent and qualified employee
next in line for the position; and (2) the eight other Assistant Revenue Regional Directors I had
waived their rights to the position.

Castro entered the government service in 1931 as a messenger in the Bureau of Forestry. He
became a clerk in the Bureau of Internal Revenue on February 1, 1937. Then he became
successively law clerk, income tax examiner, Chief of Tax Audit Branch and eventually, on July 1,
1957, Assistant Revenue Regional Director I.

On the other hand , Toledo first worked in the Metropolitan Water District on July 16, 1948. He
became employed in the Bureau of Internal Revenue on December 4, 1952, when he was appointed
distillery agent. At the time he left the Bureau on January 15, 1958 his position was that of income
tax examiner with a salary of P3,300 per annum. On said date he became a Technical Assistant to
the Executive Secretary of the President of the Philippines at P7,200 per annum. On July 1, 1958,
when he returned to the Bureau he was appointed Chief Revenue Inspector (a new position created
under the Appropriation Act of 1958-1959, which look effect on July 1, 1958) at P6,787 per annum.

This case is principally a special civil action in quo warranto. A quo warranto proceeding is one to
determine the right to the use or exercise of a franchise or office and to oust the holder from its
enjoyment, if his claim is not well founded, or if he has forfeited his right to enjoy the privilege.1 The
action may be commenced for the Government by the Solicitor General or by a fiscal;2 or a person
claiming to be entitled to a public office or position usurped or unlawfully held or exercised by
another may bring an action in his own name.3 Where a private person files the action, he must
prove that he is entitled to the controverted position, otherwise respondent has a right to the
undisturbed possession of his office.4

Castro claims the position by virtue of Section 23, paragraph 3, Republic Act 2260, which provides:

Whenever a vacancy occurs in any competitive or classified position in the government or in


any government-owned or controlled corporation or entity, the officer or employee next in
rank who is competent and qualified to hold the position and who possesses an appropriate
civil service eligibility shall be promoted thereto: Provided, That should there be two or more
persons under equal circumstances, seniority shall be given preference: And provided,
however, That should there be any special reason or reasons why such officer or employee
should not be promoted, such special reason or reasons shall be stated in writing by the
appointing official and the officer or employee concerned shall be informed thereof and be
given opportunity to be heard by the Commissioner of Civil Service, whose decision in such
case shall be final. If the vacancy is not filled by promotion as provided herein, then the same
shall be filled by transfer of present employees in the government service, by reinstatement,
by reemployment of persons separated through reduction in force, or by certification from
appropriate registers of eligibles in accordance with rules promulgated in pursuance of this
Act.

It appears that for internal revenue tax purposes the Philippines is divided into ten regional districts,
with Manila as District No. 3. Each district has a Revenue Regional Director and an Assistant
Revenue Regional Director. The Revenue Regional Director for the Manila District outranks the nine
other Revenue Regional Directors, while the Assistant Revenue Regional Director for Manila
outranks the nine other Assistant Revenue Regional Directors. These nine Assistant Revenue
Regional Directors therefore usually aspire to be promoted either to the position of Revenue
Regional Director or to that of Assistant Revenue Regional Director for Manila.

At the time the controverted petition became vacant Toledo was occupying the position of Chief
Revenue Inspector, (or Examiner) while the positions of Assistant Revenue Regional Director
outside the Manila District were occupied by the following:

Name Salary

1. Teodoro Lucero . . . . . . . . . . . . . P6900

2. Lauro D. Abraham . . . . . . . . . . . 6000

3. Ricardo A. Rivera . . . . . . . . . . . . 6000

4. Gaspar L. Angeles . . . . . . . . . . . 5100

5. Jaime Araneta . . . . . . . . . . . . . . 6000

6. Policronio Blanco . . . . . . . . . . . . 6000

7. Francisco Tantuico . . . . . . . . . . 6266.40

8. Pedro D. Uy . . . . . . . . . . . . . . . . 6000

9. Teodoro M. Castro . . . . . . . . . . . 6000

According to the Commissioner of Internal Revenue, the next two in line for the position in question
were Lucero and Abraham. Obviously the position of Chief Revenue Inspector (Examiner) was
considered to be of the same rank as the position of Assistant Revenue Regional Director for
regions other than Manila. And Toledo, who was then Chief Revenue Inspector (Examiner), was
chosen because in the opinion of the Commissioner of Internal Revenue he was already in the
region where the vacancy occurred and therefore was more familiar with the work there, and both
his salary range and efficiency rating5 were higher than Castro's aside from the fact that he was
already performing the functions of the office.

Even on the assumption that Castro possessed, as he claims, better qualifications and a higher
efficiency rating than Toledo, it would avail him nothing because he has failed to prove that his
position was the one next in rank to the vacant office. He was not even the most senior among the
different Assistant Revenue Regional Directors outside the Manila District. However, he insists that
the eight other Assistant Revenue Regional Directors waived their rights to the position by their
failure to complain against Toledo's appointment.
Waiver is the intentional relinquishment of a known right. The silence of the eight other Assistant
Revenue Regional Directors does not amount to a waiver on their part. Waiver must be predicated
on more concrete grounds. The evidence must be sufficient and clear to warrant a finding that the
intent to waive is unmistakable.

Castro himself, when he testified, could not categorically state that the eight others were not
interested in the position.6 Not having shown either seniority in rank among the nine Assistant
Revenue Regional Directors outside the Manila District or waiver on the part of those who were
senior to him Castro has failed to establish a clear right to the office which would entitle him to oust
respondent Toledo.

Upon the other hand, the supposed illegality of Toledo's appointment as Chief Revenue Officer of
the Manila District cannot be a ground for the annulment of his appointment to the controverted
position.7 The legality of that earlier appointment may not be questioned except in a quo
warranto proceeding brought by the proper person at the proper time. To be sure, as heretofore
stated this is principally such a proceeding, but only insofar as the position of Assistant Revenue
Regional District II is concerned. It is true there is an allegation in Castro's petition that the earlier
appointment of Toledo as Chief Revenue officer was illegal.8 But Castro does not claim to be entitled
to that other position and consequently the legality of Toledo's appointment thereto is not properly in
issue. Besides, even if Castro were the proper party to raise that issue, he did so beyond the time
limit prescribed by law.9 Toledo was appointed to said position on July 1, 1958. Castro had one year
from that date to assail the legality of the appointment. The petition here was filed only on August 6,
1960, or beyond the one-year period.

Wherefore, the judgment appealed from is modified by eliminating therefrom that portion annulling
respondent Toledo's appointment to the position in dispute, and is affirmed in other respects. Costs
against petitioner.

Concepcion, C.J., Reyes, J.B.L., Dizon, Regala, Bengzon, J.P., Zaldivar, Sanchez and Castro, JJ.,
concur.
G.R. No. L-28790 April 29, 1968

ANTONIO H. NOBLEJAS, as Commissioner of Land Registration, petitioner,


vs.
CLAUDIO TEEHANKEE, as Secretary of Justice, and RAFAEL M. SALAS, as Executive
Secretary,respondents.

Leandro Sevilla, Ramon C. Aquino and Lino M. Patajo for petitioner.


Claudio Teehankee for and in his own behalf as respondent.

REYES, J.B.L., Actg. C.J.:

Petition for a writ of prohibition with preliminary injunction to restrain the Secretary of Justice from
investigating the official actuations of the Commissioner of Land Registration, and to declare
inoperative his suspension by the Executive Secretary pending investigation.

The facts are not in dispute. Petitioner Antonio H. Noblejas is the duly appointed, confirmed and
qualified Commissioner of Land Registration, a position created by Republic Act No. 1151. By the
terms of section 2 of said Act, the said Commissioner is declared "entitled to the same
compensation, emoluments and privileges as those of a Judge of the Court of First Instance." The
appropriation laws (Rep. Acts 4642, 4856 and 5170) in the item setting forth the salary of said
officer, use the following expression:

1. One Land Registration Commissioner with the rank and privileges of district judge —
P19,000.00.

On March 7, 1968, respondent Secretary of Justice coursed to the petitioner a letter requiring him to
explain in writing not later than March 9, 1968 why no disciplinary action should be taken against
petitioner for "approving or recommending approval of subdivision, consolidation and consolidated-
subdivision plans covering areas greatly in excess of the areas covered by the original titles."
Noblejas answered and apprised the Secretary of Justice that, as he enjoyed the rank, privileges,
emoluments and compensation of a Judge of the Court of First Instance, he could only be
suspended and investigated in the same manner as a Judge of the Courts of First Instance, and,
therefore, the papers relative to his case should be submitted to the Supreme Court, for action
thereon conformably to section 67 of the Judiciary Act (R. A. No. 296) and Revised Rule 140 of the
Rules of Court.

On March 17, 1968, petitioner Noblejas received a communication signed by the Executive
Secretary, "by authority of the President", whereby, based on "finding that a prima facie case exists
against you for gross negligence and conduct prejudicial to the public interest", petitioner was
"hereby suspended, upon receipt hereof, pending investigation of the above charges."

On March 18, 1968, petitioner applied to this Court, reiterating the contentions advanced in his letter
to the Secretary of Justice, claiming lack of jurisdiction and abuse of discretion, and praying for
restraining writs. In their answer respondents admit the facts but denied that petitioner, as Land
Registration Commissioner, exercises judicial functions, or that the petitioner may be considered a
Judge of First Instance within the purview of the Judiciary Act and Revised Rules of Court 140; that
the function of investigating charges against public officers is administrative or executive in nature;
that the Legislature may not charge the judiciary with non-judicial functions or duties except when
reasonably incidental to the fulfillment of judicial duties, as it would be in violation of the principle of
the separation of powers.
Thus, the stark issue before this Court is whether the Commissioner of Land Registration may only
be investigated by the Supreme Court, in view of the conferment upon him by the Statutes
heretofore mentioned (Rep. Act 1151 and Appropriation Laws) of the rank and privileges of a Judge
of the Court of First Instance.

First to militate against petitioner's stand is the fact that section 67 of the Judiciary Act providing for
investigation, suspension or removal of Judges, specifically recites that "No District Judge shall be
separated or removed from office by the President of the Philippines unless sufficient cause shall
exist in the judgment of the Supreme Court . . ." and it is nowhere claimed, much less shown, that
the Commissioner of Land Registration is a District Judge, or in fact a member of the Judiciary at all.

In the second place, petitioner's theory that the grant of "privileges of a Judge of First Instance"
includes by implication the right to be investigated only by the Supreme Court and to be suspended
or removed upon its recommendation, would necessarily result in the same right being possessed by
a variety of executive officials upon whom the Legislature had indiscriminately conferred the same
privileges. These favoured officers include (a) the Judicial Superintendent of the Department of
Justice (Judiciary Act, sec. 42); (b) the Assistant Solicitors General, seven in number (Rep. Act No.
4360); (c) the City Fiscal of Quezon City (R.A. No. 4495); (d) the City Fiscal of Manila (R. A. No.
4631) and (e) the Securities and Exchange Commissioner (R. A. No. 5050, s. 2). To adopt
petitioner's theory, therefore, would mean placing upon the Supreme Court the duty of investigating
and disciplining all these officials, whose functions are plainly executive, and the consequent
curtailment by mere implication from the Legislative grant, of the President's power to discipline and
remove administrative officials who are presidential appointees, and which the Constitution
expressly placed under the President's supervision and control (Constitution, Art. VII, sec. 10[i]).

Incidentally, petitioner's stand would also lead to the conclusion that the Solicitor General, another
appointee of the President, could not be removed by the latter, since the Appropriation Acts confer
upon the Solicitor General the rank and privileges of a Justice of the Court of Appeals, and these
Justices are only removable by the Legislature, through the process of impeachment (Judiciary Act,
sec. 24, par. 2).

In our opinion, such unusual corollaries could not have been intended by the Legislature when it
granted these executive officials the rank and privileges of Judges of First Instance. This conclusion
gains strength when account is taken of the fact that in the case of the Judges of the Court of
Agrarian Relations and those of the Court of Tax Appeals, the organic statutes of said bodies
(Republic Act 1267, as amended by Act 1409; Rep. Act No. 1125) expressly provide that they are to
be removed from office for the same causes and in the same manner provided by law for Judges of
First Instance", or "members of the judiciary of appellate rank". The same is true of Judges of the
Court of Agrarian Relations (Comm. Act No. 103) and of the Commissioner of Public Service (Public
Service Act, Sec. 3). It is thereby shown that where the legislative design is to make the suspension
or removal procedure prescribed for Judges of First Instance applicable to other officers, provision to
that effect is made in plain and unequivocal language.

But the more fundamental objection to the stand of petitioner Noblejas is that, if the Legislature had
really intended to include in the general grant of "privileges" or "rank and privileges of Judges of the
Court of First Instance" the right to be investigated by the Supreme Court, and to be suspended or
removed only upon recommendation of that Court, then such grant of privileges would be
unconstitutional, since it would violate the fundamental doctrine of separation of powers, by charging
this court with the administrative function of supervisory control over executive officials, and
simultaneously reducing pro tanto the control of the Chief Executive over such officials.
Justice Cardozo ruled in In re Richardson et al., Connolly vs. Scudder (247 N. Y. 401, 160 N. E.
655), saying:

There is no inherent power in the Executive or Legislature to charge the judiciary with
administrative functions except when reasonably incidental to the fulfillment of judicial duties.

The United States Supreme Court said in Federal Radio Commission vs. General Electric Co., et al.,
281 U.S. 469, 74 Law. Ed., 972, —

But this court cannot be invested with jurisdiction of that character, whether for purposes of
review or otherwise. It was brought into being by the judiciary article of the Constitution, is
invested with judicial power only and can have no jurisdiction other than of cases and
controversies falling within the classes enumerated in that article. It cannot give decisions
which are merely advisory; nor can it exercise or participate in the exercise of functions
which are essentially legislative or administrative. Keller v. Potomac Electric Power
Co., supra (261 U.S. 444, 67 L. ed. 736, 43 Sup. Ct. Rep. 445) and cases cited; Postum
Cereal Co. vs. California Fig Nut Co. supra (272 U.S. 700, 701, 71 L. ed. 481, 47 Sup. Ct.
Rep. 284); Liberty Warehouse Co. v. Grannis, 273 U.S. 70, 74, 71 L. ed. 541, 544, 47 Sup.
Ct. Rep. 282; Willing v. Chicago Auditorium Asso. 277 U.S. 274, 289, 72 L. ed. 880, 884, 48
Sup. Ct. Rep. 507; Ex parte Bakelite Corp. 279 U.S. 438, 449, 73 L. ed. 789, 793, 49 Sup.
Ct. Rep. 411. (Federal Radio Commission v. General Electric Company, 281 U.S. 469, 74 L.
ed. 972.) (Emphasis supplied.)

In this spirit, it has been held that the Supreme Court of the Philippines and its members should
not and cannot be required to exercise any power or to perform any trust or to assume any duty not
pertaining to or connected with the administration of judicial functions; and a law requiring the
Supreme Court to arbitrate disputes between public utilities was pronounced void in Manila Electric
Co. vs. Pasay Transportation Co. (57 Phil. 600). 1äwphï1.ñët

Petitioner Noblejas seeks to differentiate his case from that of other executive officials by claiming
that under Section 4 of Republic Act No. 1151, he is endowed with judicial functions. The section
invoked runs as follows:

Sec. 4. Reference of doubtful matters to Commissioner of Land Registration. — When the


Register of Deeds is in doubt with regard to the proper step to be taken or memorandum to
be made in pursuance of any deed, mortgage, or other instrument presented to him for
registration, or where any party in interest does not agree with the Register of Deeds with
reference to any such matter, the question shall be submitted to the Commissioner of Land
Registration either upon the certification of the Register of Deeds, stating the question upon
which he is in doubt, or upon the suggestion in writing by the party in interest; and thereupon
the Commissioner, after consideration of the matter shown by the records certified to him,
and in case of registered lands, after notice to the parties and hearing, shall enter an order
prescribing the step to be taken or memorandum to be made. His decision in such cases
shall be conclusive and binding upon all Registers of Deeds: Provided, further, That, when a
party in interest disagrees with the ruling or resolution of the Commissioner and the issue
involves a question of law, said decision may be appealed to the Supreme Court within thirty
days from and after receipt of the notice thereof.

Serious doubt may well be entertained as to whether the resolution of a consulta by a Register of
Deeds is a judicial function, as contrasted with administrative process. It will be noted that by specific
provision of the section, the decision of the Land Registration Commissioner "shall be conclusive
and binding upon all Registers of Deeds" alone, and not upon other parties. This limitation1 in effect
identifies the resolutions of the Land Registration Commissioner with those of any other bureau
director, whose resolutions or orders bind his subordinates alone. That the Commissioner's
resolutions are appealable does not prove that they are not administrative; any bureau director's
ruling is likewise appealable to the corresponding department head.

But even granting that the resolution of consultas by the Register of Deeds should constitute a
judicial (or more properly quasi judicial) function, analysis of the powers and duties of the Land
Registration Commissioner under Republic Act No. 1151, sections 3 and 4, will show that the
resolution of consultas are but a minimal portion of his administrative or executive functions and
merely incidental to the latter.

Conformably to the well-known principle of statutory construction that statutes should be given,
whenever possible, a meaning that will not bring them in conflict with the Constitution,2 We are
constrained to rule that the grant by Republic Act 1151 to the Commissioner of Land Registration of
the "same privileges as those of a Judge of the Court of First Instance" did not include, and was not
intended to include, the right to demand investigation by the Supreme Court, and to be suspended or
removed only upon that Court's recommendation; for otherwise, the said grant of privileges would be
violative of the Constitution and be null and void. Consequently, the investigation and suspension of
the aforenamed Commissioner pursuant to sections 32 and 34 of the Civil Service Law (R. A. 2260)
are neither abuses of discretion nor acts in excess of jurisdiction.

WHEREFORE, the writs of prohibition and injunction applied for are denied, and the petition is
ordered dismissed. No costs.

Dizon, Makalintal, Bengzon, J.P., Zaldivar, Sanchez, Castro, Angeles and Fernando, JJ., concur.
Concepcion, C.J., is on leave.
1äw phï1.ñët
G.R. No. L-19650 September 29, 1966

CALTEX (PHILIPPINES), INC., petitioner-appellee,


vs.
ENRICO PALOMAR, in his capacity as THE POSTMASTER GENERAL, respondent-appellant.

Office of the Solicitor General for respondent and appellant.


Ross, Selph and Carrascoso for petitioner and appellee.

CASTRO, J.:

In the year 1960 the Caltex (Philippines) Inc. (hereinafter referred to as Caltex) conceived and laid
the groundwork for a promotional scheme calculated to drum up patronage for its oil products.
Denominated "Caltex Hooded Pump Contest", it calls for participants therein to estimate the actual
number of liters a hooded gas pump at each Caltex station will dispense during a specified period.
Employees of the Caltex (Philippines) Inc., its dealers and its advertising agency, and their
immediate families excepted, participation is to be open indiscriminately to all "motor vehicle owners
and/or licensed drivers". For the privilege to participate, no fee or consideration is required to be
paid, no purchase of Caltex products required to be made. Entry forms are to be made available
upon request at each Caltex station where a sealed can will be provided for the deposit of
accomplished entry stubs.

A three-staged winner selection system is envisioned. At the station level, called "Dealer Contest",
the contestant whose estimate is closest to the actual number of liters dispensed by the hooded
pump thereat is to be awarded the first prize; the next closest, the second; and the next, the third.
Prizes at this level consist of a 3-burner kerosene stove for first; a thermos bottle and a Ray-O-Vac
hunter lantern for second; and an Everready Magnet-lite flashlight with batteries and a screwdriver
set for third. The first-prize winner in each station will then be qualified to join in the "Regional
Contest" in seven different regions. The winning stubs of the qualified contestants in each region will
be deposited in a sealed can from which the first-prize, second-prize and third-prize winners of that
region will be drawn. The regional first-prize winners will be entitled to make a three-day all-
expenses-paid round trip to Manila, accompanied by their respective Caltex dealers, in order to take
part in the "National Contest". The regional second-prize and third-prize winners will receive cash
prizes of P500 and P300, respectively. At the national level, the stubs of the seven regional first-
prize winners will be placed inside a sealed can from which the drawing for the final first-prize,
second-prize and third-prize winners will be made. Cash prizes in store for winners at this final stage
are: P3,000 for first; P2,000 for second; Pl,500 for third; and P650 as consolation prize for each of
the remaining four participants.

Foreseeing the extensive use of the mails not only as amongst the media for publicizing the contest
but also for the transmission of communications relative thereto, representations were made by
Caltex with the postal authorities for the contest to be cleared in advance for mailing, having in view
sections 1954(a), 1982 and 1983 of the Revised Administrative Code, the pertinent provisions of
which read as follows:

SECTION 1954. Absolutely non-mailable matter. — No matter belonging to any of the


following classes, whether sealed as first-class matter or not, shall be imported into the
Philippines through the mails, or to be deposited in or carried by the mails of the Philippines,
or be delivered to its addressee by any officer or employee of the Bureau of Posts:
Written or printed matter in any form advertising, describing, or in any manner pertaining to,
or conveying or purporting to convey any information concerning any lottery, gift enterprise,
or similar scheme depending in whole or in part upon lot or chance, or any scheme, device,
or enterprise for obtaining any money or property of any kind by means of false or fraudulent
pretenses, representations, or promises.

"SECTION 1982. Fraud orders.—Upon satisfactory evidence that any person or company is
engaged in conducting any lottery, gift enterprise, or scheme for the distribution of money, or
of any real or personal property by lot, chance, or drawing of any kind, or that any person or
company is conducting any scheme, device, or enterprise for obtaining money or property of
any kind through the mails by means of false or fraudulent pretenses, representations, or
promises, the Director of Posts may instruct any postmaster or other officer or employee of
the Bureau to return to the person, depositing the same in the mails, with the word
"fraudulent" plainly written or stamped upon the outside cover thereof, any mail matter of
whatever class mailed by or addressed to such person or company or the representative or
agent of such person or company.

SECTION 1983. Deprivation of use of money order system and telegraphic transfer
service.—The Director of Posts may, upon evidence satisfactory to him that any person or
company is engaged in conducting any lottery, gift enterprise or scheme for the distribution
of money, or of any real or personal property by lot, chance, or drawing of any kind, or that
any person or company is conducting any scheme, device, or enterprise for obtaining money
or property of any kind through the mails by means of false or fraudulent pretenses,
representations, or promise, forbid the issue or payment by any postmaster of any postal
money order or telegraphic transfer to said person or company or to the agent of any such
person or company, whether such agent is acting as an individual or as a firm, bank,
corporation, or association of any kind, and may provide by regulation for the return to the
remitters of the sums named in money orders or telegraphic transfers drawn in favor of such
person or company or its agent.

The overtures were later formalized in a letter to the Postmaster General, dated October 31, 1960, in
which the Caltex, thru counsel, enclosed a copy of the contest rules and endeavored to justify its
position that the contest does not violate the anti-lottery provisions of the Postal Law. Unimpressed,
the then Acting Postmaster General opined that the scheme falls within the purview of the provisions
aforesaid and declined to grant the requested clearance. In its counsel's letter of December 7, 1960,
Caltex sought a reconsideration of the foregoing stand, stressing that there being involved no
consideration in the part of any contestant, the contest was not, under controlling authorities,
condemnable as a lottery. Relying, however, on an opinion rendered by the Secretary of Justice on
an unrelated case seven years before (Opinion 217, Series of 1953), the Postmaster General
maintained his view that the contest involves consideration, or that, if it does not, it is nevertheless a
"gift enterprise" which is equally banned by the Postal Law, and in his letter of December 10, 1960
not only denied the use of the mails for purposes of the proposed contest but as well threatened that
if the contest was conducted, "a fraud order will have to be issued against it (Caltex) and all its
representatives".

Caltex thereupon invoked judicial intervention by filing the present petition for declaratory relief
against Postmaster General Enrico Palomar, praying "that judgment be rendered declaring its
'Caltex Hooded Pump Contest' not to be violative of the Postal Law, and ordering respondent to
allow petitioner the use of the mails to bring the contest to the attention of the public". After issues
were joined and upon the respective memoranda of the parties, the trial court rendered judgment as
follows:
In view of the foregoing considerations, the Court holds that the proposed 'Caltex Hooded
Pump Contest' announced to be conducted by the petitioner under the rules marked as
Annex B of the petitioner does not violate the Postal Law and the respondent has no right to
bar the public distribution of said rules by the mails.

The respondent appealed.

The parties are now before us, arrayed against each other upon two basic issues: first, whether the
petition states a sufficient cause of action for declaratory relief; and second, whether the proposed
"Caltex Hooded Pump Contest" violates the Postal Law. We shall take these up in seriatim.

1. By express mandate of section 1 of Rule 66 of the old Rules of Court, which was the applicable
legal basis for the remedy at the time it was invoked, declaratory relief is available to any person
"whose rights are affected by a statute . . . to determine any question of construction or validity
arising under the . . . statute and for a declaration of his rights thereunder" (now section 1, Rule 64,
Revised Rules of Court). In amplification, this Court, conformably to established jurisprudence on the
matter, laid down certain conditions sine qua non therefor, to wit: (1) there must be a justiciable
controversy; (2) the controversy must be between persons whose interests are adverse; (3) the party
seeking declaratory relief must have a legal interest in the controversy; and (4) the issue involved
must be ripe for judicial determination (Tolentino vs. The Board of Accountancy, et al., G.R. No. L-
3062, September 28, 1951; Delumen, et al. vs. Republic of the Philippines, 50 O.G., No. 2, pp. 576,
578-579; Edades vs. Edades, et al., G.R. No. L-8964, July 31, 1956). The gravamen of the
appellant's stand being that the petition herein states no sufficient cause of action for declaratory
relief, our duty is to assay the factual bases thereof upon the foregoing crucible.

As we look in retrospect at the incidents that generated the present controversy, a number of
significant points stand out in bold relief. The appellee (Caltex), as a business enterprise of some
consequence, concededly has the unquestioned right to exploit every legitimate means, and to avail
of all appropriate media to advertise and stimulate increased patronage for its products. In contrast,
the appellant, as the authority charged with the enforcement of the Postal Law, admittedly has the
power and the duty to suppress transgressions thereof — particularly thru the issuance of fraud
orders, under Sections 1982 and 1983 of the Revised Administrative Code, against legally non-
mailable schemes. Obviously pursuing its right aforesaid, the appellee laid out plans for the sales
promotion scheme hereinbefore detailed. To forestall possible difficulties in the dissemination of
information thereon thru the mails, amongst other media, it was found expedient to request the
appellant for an advance clearance therefor. However, likewise by virtue of his jurisdiction in the
premises and construing the pertinent provisions of the Postal Law, the appellant saw a violation
thereof in the proposed scheme and accordingly declined the request. A point of difference as to the
correct construction to be given to the applicable statute was thus reached. Communications in
which the parties expounded on their respective theories were exchanged. The confidence with
which the appellee insisted upon its position was matched only by the obstinacy with which the
appellant stood his ground. And this impasse was climaxed by the appellant's open warning to the
appellee that if the proposed contest was "conducted, a fraud order will have to be issued against it
and all its representatives."

Against this backdrop, the stage was indeed set for the remedy prayed for. The appellee's insistent
assertion of its claim to the use of the mails for its proposed contest, and the challenge thereto and
consequent denial by the appellant of the privilege demanded, undoubtedly spawned a live
controversy. The justiciability of the dispute cannot be gainsaid. There is an active antagonistic
assertion of a legal right on one side and a denial thereof on the other, concerning a real — not a
mere theoretical — question or issue. The contenders are as real as their interests are substantial.
To the appellee, the uncertainty occasioned by the divergence of views on the issue of construction
hampers or disturbs its freedom to enhance its business. To the appellant, the suppression of the
appellee's proposed contest believed to transgress a law he has sworn to uphold and enforce is an
unavoidable duty. With the appellee's bent to hold the contest and the appellant's threat to issue a
fraud order therefor if carried out, the contenders are confronted by the ominous shadow of an
imminent and inevitable litigation unless their differences are settled and stabilized by a tranquilizing
declaration (Pablo y Sen, et al. vs. Republic of the Philippines, G.R. No. L-6868, April 30, 1955).
And, contrary to the insinuation of the appellant, the time is long past when it can rightly be said that
merely the appellee's "desires are thwarted by its own doubts, or by the fears of others" — which
admittedly does not confer a cause of action. Doubt, if any there was, has ripened into a justiciable
controversy when, as in the case at bar, it was translated into a positive claim of right which is
actually contested (III Moran, Comments on the Rules of Court, 1963 ed., pp. 132-133, citing:
Woodward vs. Fox West Coast Theaters, 36 Ariz., 251, 284 Pac. 350).

We cannot hospitably entertain the appellant's pretense that there is here no question of
construction because the said appellant "simply applied the clear provisions of the law to a given set
of facts as embodied in the rules of the contest", hence, there is no room for declaratory relief. The
infirmity of this pose lies in the fact that it proceeds from the assumption that, if the circumstances
here presented, the construction of the legal provisions can be divorced from the matter of their
application to the appellee's contest. This is not feasible. Construction, verily, is the art or process of
discovering and expounding the meaning and intention of the authors of the law with respect to its
application to a given case, where that intention is rendered doubtful, amongst others, by reason of
the fact that the given case is not explicitly provided for in the law (Black, Interpretation of Laws, p.
1). This is precisely the case here. Whether or not the scheme proposed by the appellee is within the
coverage of the prohibitive provisions of the Postal Law inescapably requires an inquiry into the
intended meaning of the words used therein. To our mind, this is as much a question of construction
or interpretation as any other.

Nor is it accurate to say, as the appellant intimates, that a pronouncement on the matter at hand can
amount to nothing more than an advisory opinion the handing down of which is anathema to a
declaratory relief action. Of course, no breach of the Postal Law has as yet been committed. Yet, the
disagreement over the construction thereof is no longer nebulous or contingent. It has taken a fixed
and final shape, presenting clearly defined legal issues susceptible of immediate resolution. With the
battle lines drawn, in a manner of speaking, the propriety — nay, the necessity — of setting the
dispute at rest before it accumulates the asperity distemper, animosity, passion and violence of a
full-blown battle which looms ahead (III Moran, Comments on the Rules of Court, 1963 ed., p. 132
and cases cited), cannot but be conceded. Paraphrasing the language in Zeitlin vs. Arnebergh 59
Cal., 2d., 901, 31 Cal. Rptr., 800, 383 P. 2d., 152, cited in 22 Am. Jur., 2d., p. 869, to deny
declaratory relief to the appellee in the situation into which it has been cast, would be to force it to
choose between undesirable alternatives. If it cannot obtain a final and definitive pronouncement as
to whether the anti-lottery provisions of the Postal Law apply to its proposed contest, it would be
faced with these choices: If it launches the contest and uses the mails for purposes thereof, it not
only incurs the risk, but is also actually threatened with the certain imposition, of a fraud order with
its concomitant stigma which may attach even if the appellee will eventually be vindicated; if it
abandons the contest, it becomes a self-appointed censor, or permits the appellant to put into effect
a virtual fiat of previous censorship which is constitutionally unwarranted. As we weigh these
considerations in one equation and in the spirit of liberality with which the Rules of Court are to be
interpreted in order to promote their object (section 1, Rule 1, Revised Rules of Court) — which, in
the instant case, is to settle, and afford relief from uncertainty and insecurity with respect to, rights
and duties under a law — we can see in the present case any imposition upon our jurisdiction or any
futility or prematurity in our intervention.

The appellant, we apprehend, underrates the force and binding effect of the ruling we hand down in
this case if he believes that it will not have the final and pacifying function that a declaratory
judgment is calculated to subserve. At the very least, the appellant will be bound. But more than this,
he obviously overlooks that in this jurisdiction, "Judicial decisions applying or interpreting the law
shall form a part of the legal system" (Article 8, Civil Code of the Philippines). In effect, judicial
decisions assume the same authority as the statute itself and, until authoritatively abandoned,
necessarily become, to the extent that they are applicable, the criteria which must control the
actuations not only of those called upon to abide thereby but also of those in duty bound to enforce
obedience thereto. Accordingly, we entertain no misgivings that our resolution of this case will
terminate the controversy at hand.

It is not amiss to point out at this juncture that the conclusion we have herein just reached is not
without precedent. In Liberty Calendar Co. vs. Cohen, 19 N.J., 399, 117 A. 2d., 487, where a
corporation engaged in promotional advertising was advised by the county prosecutor that its
proposed sales promotion plan had the characteristics of a lottery, and that if such sales promotion
were conducted, the corporation would be subject to criminal prosecution, it was held that the
corporation was entitled to maintain a declaratory relief action against the county prosecutor to
determine the legality of its sales promotion plan. In pari materia, see also: Bunis vs. Conway, 17
App. Div. 2d., 207, 234 N.Y.S. 2d., 435; Zeitlin vs. Arnebergh, supra; Thrillo, Inc. vs. Scott, 15 N.J.
Super. 124, 82 A. 2d., 903.

In fine, we hold that the appellee has made out a case for declaratory relief.

2. The Postal Law, chapter 52 of the Revised Administrative Code, using almost identical
terminology in sections 1954(a), 1982 and 1983 thereof, supra, condemns as absolutely non-
mailable, and empowers the Postmaster General to issue fraud orders against, or otherwise deny
the use of the facilities of the postal service to, any information concerning "any lottery, gift
enterprise, or scheme for the distribution of money, or of any real or personal property by lot,
chance, or drawing of any kind". Upon these words hinges the resolution of the second issue posed
in this appeal.

Happily, this is not an altogether untrodden judicial path. As early as in 1922, in "El Debate", Inc. vs.
Topacio, 44 Phil., 278, 283-284, which significantly dwelt on the power of the postal authorities
under the abovementioned provisions of the Postal Law, this Court declared that —

While countless definitions of lottery have been attempted, the authoritative one for this
jurisdiction is that of the United States Supreme Court, in analogous cases having to do with
the power of the United States Postmaster General, viz.: The term "lottery" extends to all
schemes for the distribution of prizes by chance, such as policy playing, gift exhibitions, prize
concerts, raffles at fairs, etc., and various forms of gambling. The three essential elements of
a lottery are: First, consideration; second, prize; and third, chance. (Horner vs. States [1892],
147 U.S. 449; Public Clearing House vs. Coyne [1903], 194 U.S., 497; U.S. vs. Filart and
Singson [1915], 30 Phil., 80; U.S. vs. Olsen and Marker [1917], 36 Phil., 395; U.S. vs. Baguio
[1919], 39 Phil., 962; Valhalla Hotel Construction Company vs. Carmona, p. 233, ante.)

Unanimity there is in all quarters, and we agree, that the elements of prize and chance are too
obvious in the disputed scheme to be the subject of contention. Consequently as the appellant
himself concedes, the field of inquiry is narrowed down to the existence of the element of
consideration therein. Respecting this matter, our task is considerably lightened inasmuch as in the
same case just cited, this Court has laid down a definitive yard-stick in the following terms —

In respect to the last element of consideration, the law does not condemn the gratuitous
distribution of property by chance, if no consideration is derived directly or indirectly from the
party receiving the chance, but does condemn as criminal schemes in which a valuable
consideration of some kind is paid directly or indirectly for the chance to draw a prize.

Reverting to the rules of the proposed contest, we are struck by the clarity of the language in which
the invitation to participate therein is couched. Thus —

No puzzles, no rhymes? You don't need wrappers, labels or boxtops? You don't have to buy
anything? Simply estimate the actual number of liter the Caltex gas pump with the hood at
your favorite Caltex dealer will dispense from — to —, and win valuable prizes . . . ." .

Nowhere in the said rules is any requirement that any fee be paid, any merchandise be bought, any
service be rendered, or any value whatsoever be given for the privilege to participate. A prospective
contestant has but to go to a Caltex station, request for the entry form which is available on demand,
and accomplish and submit the same for the drawing of the winner. Viewed from all angles or turned
inside out, the contest fails to exhibit any discernible consideration which would brand it as a lottery.
Indeed, even as we head the stern injunction, "look beyond the fair exterior, to the substance, in
order to unmask the real element and pernicious tendencies which the law is seeking to prevent" ("El
Debate", Inc. vs. Topacio, supra, p. 291), we find none. In our appraisal, the scheme does not only
appear to be, but actually is, a gratuitous distribution of property by chance.

There is no point to the appellant's insistence that non-Caltex customers who may buy Caltex
products simply to win a prize would actually be indirectly paying a consideration for the privilege to
join the contest. Perhaps this would be tenable if the purchase of any Caltex product or the use of
any Caltex service were a pre-requisite to participation. But it is not. A contestant, it hardly needs
reiterating, does not have to buy anything or to give anything of value. 1awphîl.nèt

Off-tangent, too, is the suggestion that the scheme, being admittedly for sales promotion, would
naturally benefit the sponsor in the way of increased patronage by those who will be encouraged to
prefer Caltex products "if only to get the chance to draw a prize by securing entry blanks". The
required element of consideration does not consist of the benefit derived by the proponent of the
contest. The true test, as laid down in People vs. Cardas, 28 P. 2d., 99, 137 Cal. App. (Supp.) 788,
is whether the participant pays a valuable consideration for the chance, and not whether those
conducting the enterprise receive something of value in return for the distribution of the prize.
Perspective properly oriented, the standpoint of the contestant is all that matters, not that of the
sponsor. The following, culled from Corpus Juris Secundum, should set the matter at rest:

The fact that the holder of the drawing expects thereby to receive, or in fact does receive,
some benefit in the way of patronage or otherwise, as a result of the drawing; does not
supply the element of consideration. Griffith Amusement Co. vs. Morgan, Tex. Civ. App., 98
S.W., 2d., 844" (54 C.J.S., p. 849).

Thus enlightened, we join the trial court in declaring that the "Caltex Hooded Pump Contest"
proposed by the appellee is not a lottery that may be administratively and adversely dealt with under
the Postal Law.

But it may be asked: Is it not at least a "gift enterprise, or scheme for the distribution of money, or of
any real or personal property by lot, chance, or drawing of any kind", which is equally prescribed?
Incidentally, while the appellant's brief appears to have concentrated on the issue of consideration,
this aspect of the case cannot be avoided if the remedy here invoked is to achieve its tranquilizing
effect as an instrument of both curative and preventive justice. Recalling that the appellant's action
was predicated, amongst other bases, upon Opinion 217, Series 1953, of the Secretary of Justice,
which opined in effect that a scheme, though not a lottery for want of consideration, may
nevertheless be a gift enterprise in which that element is not essential, the determination of whether
or not the proposed contest — wanting in consideration as we have found it to be — is a prohibited
gift enterprise, cannot be passed over sub silencio.

While an all-embracing concept of the term "gift enterprise" is yet to be spelled out in explicit words,
there appears to be a consensus among lexicographers and standard authorities that the term is
commonly applied to a sporting artifice of under which goods are sold for their market value but by
way of inducement each purchaser is given a chance to win a prize (54 C.J.S., 850; 34 Am. Jur.,
654; Black, Law Dictionary, 4th ed., p. 817; Ballantine, Law Dictionary with Pronunciations, 2nd ed.,
p. 55; Retail Section of Chamber of Commerce of Plattsmouth vs. Kieck, 257 N.W., 493, 128 Neb.
13; Barker vs. State, 193 S.E., 605, 56 Ga. App., 705; Bell vs. State, 37 Tenn. 507, 509, 5 Sneed,
507, 509). As thus conceived, the term clearly cannot embrace the scheme at bar. As already noted,
there is no sale of anything to which the chance offered is attached as an inducement to the
purchaser. The contest is open to all qualified contestants irrespective of whether or not they buy the
appellee's products.

Going a step farther, however, and assuming that the appellee's contest can be encompassed within
the broadest sweep that the term "gift enterprise" is capable of being extended, we think that the
appellant's pose will gain no added comfort. As stated in the opinion relied upon, rulings there are
indeed holding that a gift enterprise involving an award by chance, even in default of the element of
consideration necessary to constitute a lottery, is prohibited (E.g.: Crimes vs. States, 235 Ala 192,
178 So. 73; Russell vs. Equitable Loan & Sec. Co., 129 Ga. 154, 58 S.E., 88; State ex rel. Stafford
vs. Fox-Great Falls Theater Corporation, 132 P. 2d., 689, 694, 698, 114 Mont. 52). But this is only
one side of the coin. Equally impressive authorities declare that, like a lottery, a gift enterprise comes
within the prohibitive statutes only if it exhibits the tripartite elements of prize, chance and
consideration (E.g.: Bills vs. People, 157 P. 2d., 139, 142, 113 Colo., 326; D'Orio vs. Jacobs, 275 P.
563, 565, 151 Wash., 297; People vs. Psallis, 12 N.Y.S., 2d., 796; City and County of Denver vs.
Frueauff, 88 P., 389, 394, 39 Colo., 20, 7 L.R.A., N.S., 1131, 12 Ann. Cas., 521; 54 C.J.S., 851,
citing: Barker vs. State, 193 S.E., 605, 607, 56 Ga. App., 705; 18 Words and Phrases, perm. ed., pp.
590-594). The apparent conflict of opinions is explained by the fact that the specific statutory
provisions relied upon are not identical. In some cases, as pointed out in 54 C.J.S., 851, the terms
"lottery" and "gift enterprise" are used interchangeably (Bills vs. People, supra); in others, the
necessity for the element of consideration or chance has been specifically eliminated by statute. (54
C.J.S., 351-352, citing Barker vs. State, supra; State ex rel. Stafford vs. Fox-Great Falls Theater
Corporation, supra). The lesson that we derive from this state of the pertinent jurisprudence is,
therefore, that every case must be resolved upon the particular phraseology of the applicable
statutory provision.

Taking this cue, we note that in the Postal Law, the term in question is used in association with the
word "lottery". With the meaning of lottery settled, and consonant to the well-known principle of legal
hermeneutics noscitur a sociis — which Opinion 217 aforesaid also relied upon although only insofar
as the element of chance is concerned — it is only logical that the term under a construction should
be accorded no other meaning than that which is consistent with the nature of the word associated
therewith. Hence, if lottery is prohibited only if it involves a consideration, so also must the term "gift
enterprise" be so construed. Significantly, there is not in the law the slightest indicium of any intent to
eliminate that element of consideration from the "gift enterprise" therein included.

This conclusion firms up in the light of the mischief sought to be remedied by the law, resort to the
determination thereof being an accepted extrinsic aid in statutory construction. Mail fraud orders, it is
axiomatic, are designed to prevent the use of the mails as a medium for disseminating printed
matters which on grounds of public policy are declared non-mailable. As applied to lotteries, gift
enterprises and similar schemes, justification lies in the recognized necessity to suppress their
tendency to inflame the gambling spirit and to corrupt public morals (Com. vs. Lund, 15 A. 2d., 839,
143 Pa. Super. 208). Since in gambling it is inherent that something of value be hazarded for a
chance to gain a larger amount, it follows ineluctably that where no consideration is paid by the
contestant to participate, the reason behind the law can hardly be said to obtain. If, as it has been
held —

Gratuitous distribution of property by lot or chance does not constitute "lottery", if it is not
resorted to as a device to evade the law and no consideration is derived, directly or
indirectly, from the party receiving the chance, gambling spirit not being cultivated or
stimulated thereby. City of Roswell vs. Jones, 67 P. 2d., 286, 41 N.M., 258." (25 Words and
Phrases, perm. ed., p. 695, emphasis supplied).

we find no obstacle in saying the same respecting a gift enterprise. In the end, we are persuaded to
hold that, under the prohibitive provisions of the Postal Law which we have heretofore examined, gift
enterprises and similar schemes therein contemplated are condemnable only if, like lotteries, they
involve the element of consideration. Finding none in the contest here in question, we rule that the
appellee may not be denied the use of the mails for purposes thereof.

Recapitulating, we hold that the petition herein states a sufficient cause of action for declaratory
relief, and that the "Caltex Hooded Pump Contest" as described in the rules submitted by the
appellee does not transgress the provisions of the Postal Law.

ACCORDINGLY, the judgment appealed from is affirmed. No costs.

Concepcion, C.J., Reyes, J.B.L., Barrera, Dizon, Regala, Makalintal, Bengzon, J.P., Zaldivar and
Sanchez, JJ., concur.
G.R. No. L-38161 March 29, 1974

JUAN BELLO, FILOMENA C. BELLO, petitioners,


vs.
HON. COURT OF APPEALS, * HON. FRANCISCO LLAMAS, as Judge of Pasay City Court, and REPUBLIC OF THE
PHILIPPINES, respondents.

Martinez and Martinez for petitioners.

Office of the Solicitor General, Dept. of Justice, for respondent.

TEEHANKEE, J.:p

The Court holds that the court of first instance of Pasay City in an appeal erroneously taken to it from the city court's judgment convicting
petitioners-accused of the charge of estafa within the concurrent original jurisdiction of said courts should grant petitioners-accused's timely
petition for certifying their appeal to the Court of Appeals as the proper court rather than peremptorily grant the prosecution's motion for
dismissal of the appeal and order the remand of the case to the city court for execution of judgment. The appellate court's decision denying
the relief sought by petitioners of compelling the elevation of their appeal to it as the proper court simply because of the non-impleader of the
court of first instance as a nominal party notwithstanding that it was duly represented by the respondent People as the real party in interest
through the Solicitor General who expressed no objection to the setting aside of the court of first instance's dismissal order is set aside as
sacrificing substance to form and subordinating substantial justice to a mere matter of procedural technicality.

Petitioners spouses were charged on August 25, 1970 for estafa before the City Court of Pasay1 for
allegedly having misappropriated a lady's ring with a value of P1,000.00 received by them from Atty.
Prudencio de Guzman for sale on commission basis. After trial, they were convicted and sentenced
under respondent city court's decision of February 26, 1971 to six (6) months and one (1) day
of prision correccional and to indemnify the offended party in the sum of P1,000.00 with costs of suit.

Petitioners filed their notice of appeal of the adverse judgment to the Court of First Instance of Pasay
City, but the prosecution filed a "petition to dismiss appeal" on the ground that since the case was
within the concurrent jurisdiction of the city court and the court of first instance and the trial in the city
court had been duly recorded, the appeal should have been taken directly to the Court of Appeals as
provided by section 87 of the Judiciary Act, Republic Act 296, as amended.2

Petitioners opposed the prosecution's dismissal motion and invoking the analogous provision of Rule
50, section 3 directing that the Court of Appeals in cases erroneously brought to it "shall not dismiss
the appeal, but shall certify the case to the proper court, with a specific and clear statement of the
grounds therefor," prayed of the court of first instance if it should find the appeal to have been
wrongly brought before it, to certify the same "to either the Court of Appeals or the Supreme Court."3

The court of first instance per its order of October 29, 1971 did find that the appeal should have been
taken directly to the Court of Appeals but ordered the dismissal of the appeal and remand of the
records to the city court "for execution of judgment."4

Petitioners aver that they were not notified of the order of dismissal of their appeal and learned of it
only when they were called by the Pasay city court for execution of the judgment of conviction.
Hence, they filed with the city court their "motion to elevate appeal to Court of Appeals" of December
7, 1971 stating that "through inadvertence and/or excusable neglect" they had erroneously filed a
notice of appeal to the court of first instance instead of to the Court of Appeals as the proper court
and prayed that the city court, following precedents of this Court remanding appeals before it to the
proper court instead of dismissing appeals, "elevate the records ... to the Court of Appeals for proper
review."5
Respondent city court per its order of December 11, 1971 denied petitioners' motion "for having
been erroneously addressed to this court" instead of to the court of first instance6 ignoring petitioners'
predicament that the court of first instance had already turned them down and ordered the dismissal
of their appeal without notice to them and that as a consequence it was poised to execute its
judgment of conviction against them.

Petitioners spouses then filed on January 14, 1972 their petition for prohibition and mandamus
against the People and respondent city court to prohibit the execution of the judgment and to compel
respondent city court to elevate their appeal to the Court of Appeals.7

The Solicitor General filed respondents' answer to the petition manifesting that "we shall not
interpose any objection whichever view point is adopted by this Honorable Court in resolving the two
apparently conflicting or clashing principles of law — finality of judicial decision or equity in judicial
decision," after observing that "(F)rom the view point of equity considering that petitioners' right to
appeal lapsed or was lost through the fault, though not excusable, of their counsel, and compounded
by the alleged error of judgment committed by the Court of First Instance to which the appeal was
erroneously brought, we sympathize with petitioners' plight."

The Court of Appeals, however, per its decision of December 17, 1973 dismissed the petition, after
finding that the city court's judgment was directly appealable to it. Although recognizing that the "CFI
instead of dismissing appeal, could have in the exercise of its inherent powers directed appeal to be
endorsed to this Court of Appeals" it held that since petitioners did not implead the court of first
instance as "principal party respondent" it could not "grant any relief at all even on the assumption
that petitioners can be said to deserve some equities," as follows:

... therefore, when they appealed to CFI, that was procedurally wrong; of course, CFI
instead of dismissing appeal, could have in the exercise of its inherent powers,
directed appeal to be endorsed to this Court of Appeals, but when instead of doing
so, it dismissed, it also had power to do so, and correction of it is difficult to see to be
remediable by mandamus, but ignoring this altogether, what this Court finds is that
since it was CFI that dismissed the appeal and according to petitioners, wrongly, it
must follow that if CFI was wrong, this plea for mandamus to compel it to act
"correctly" should have been directed against said CFI, it should have been the CFI,
Hon. Francisco de la Rosa, who should have been made under Rule 65 Sec. 3,
herein principal party respondent, but he was not, this being the situation, this Court
can not see how it can grant any relief at all even on the assumption that petitioners
can be said to deserve some equities.

Petitioners moved for reconsideration on January 2, 19748 and for elevation of their appeal to the
Court of Appeals, stressing the merits of their appeal and of their defense to the charge, viz, that the
offended party Atty. de Guzman had represented their son who was a suspect with two others for
robbery before the Pasay city fiscal's office and upon dismissal of the charge demanded payment
from them as parents the sum of P1,000.00 as attorney's fees, and since they had no money to pay
him required them to sign the receipt dated June 25, 1970 in his favor for an imaginary lady's ring to
sell "on commission basis" for P1,000.00 (their "commission" to be any overprice) to assure payment
of the sum by the stated deadline of July 9, 1970 under penalty, of criminal prosecution for estafa;
and that they had then newly met Atty. de Guzman, whose services had been secured not by them
but by the family of one of the other suspects, implying the incredibility of his entrusting a lady's ring
to both of them (husband and wife) for sale on commission basis when his only association with
them was his demand of payment of his P1,000-attorney's fee for having represented their son-
suspect.
Reconsideration having been denied by the appellate court "for lack of sufficient merit," petitioners
filed the present petition for review.9 The Court required the Solicitor General's comment on behalf of
the People of the Philippines, and upon receipt thereof resolved to consider the case as a special
civil action with such comment as answer and the case submitted for decision in the interest of
justice and speedy adjudication.

The Court finds merits in the petition and holds that the court of first instance acted with grave abuse
of discretion in dismissing petitioners-accused's appeal which was erroneously brought to it and
ordering remand of the records to the city court for execution of judgment instead of certifying and
endorsing the appeal to the Court of Appeals as the proper court as timely prayed for by petitioners-
accused in their opposition to the prosecution's motion to dismiss appeal. We find that the Court of
Appeals also acted with grave abuse of discretion in dismissing their petition instead of setting aside
the challenged order of the court of first instance peremptorily dismissing the appeal pursuant to
which respondent city court was poised to execute its judgment of conviction simply because the
court of first instance which is but a nominal party had not been impleaded as party respondent in
disregard of the substantive fact that the People as plaintiff and the real party in interest was duly
impleaded as principal party respondent and was represented in the proceedings by the Solicitor
General.

The appellate court while recognizing that petitioners' appeal taken to the court of first instance was
"procedurally wrong" and that the court of first instance "in the exercise of its inherent powers could
have certified the appeal to it as the proper court instead of dismissing the appeal, gravely erred in
holding that it could not "correct" the court of first instance's "wrong action" and grant the relief
sought of having the appeal elevated to it since said court's presiding judge "who should have been-
made under Rule 65, sec. 3 10 herein principal party respondent, but he was not." The Court has
always stressed as in Torre vs. Ericta 11 that a respondent judge is "merely a nominal party" in
special civil actions for certiorari, prohibition and mandamus and that he "is not a person "in interest"
within the purview (of Rule 65, section 5 12)" and "accordingly, he has no standing or authority to
appeal from or seek a review on certiorari" of an adverse decision of the appellate court setting aside
his dismissal of a party's appeal and issuing the writ of mandamus for him to allow the appeal.

It is readily seen from the cited Rule that the court of first instance or presiding judge who issued the
challenged order or decision is but a nominal party, the real parties in interest being "the person or
persons interested in sustaining the proceedings in the court" and who are charged with the duty of
appearing and defending the challenged act both "in their own behalf and in behalf of the court or
judge affected by the proceedings." Hence, theformal impleading of the court of first instance which
issued the challenged order of dismissal was not indispensable and could be "overlooked in the
interest of speedy adjudication." 13

Since the real party in interest, the People as plaintiff in the criminal proceeding against petitioners-
accused was duly impleaded and represented by the Solicitor General to defend the proceedings in
the court of first instance and had expressed no objection to the appellate court's setting aside of the
court of first instance's dismissal order, in the interest of justice and equity the appellate court's act of
dismissing the petition and denying the relief sought of endorsing the appeal to the proper court
simply because of the non impleader of the court of first instance as a nominal party was tantamount
to sacrificing substance to form and to subordinating substantial justice to a mere matter of
procedural technicality. The procedural infirmity of petitioners mis-directing their appeal to the court
of first instance rather than to the Court of Appeals, which they had timely sought to correct in the
court of first instance itself by asking that court to certify the appeal to the Court of Appeals as the
proper court, should not be over-magnified as to totally deprive them of their substantial right of
appeal and leave them without any remedy.
The Court therefore grants herein the relief denied by respondent appellate court of mandamus to
compel respondent city court to elevate petitioners' appeal to the Court of Appeals as the proper
court as being within the context and spirit of Rule 50, section 3, providing for certification to the
proper court by the Court of Appeals of appealed cases erroneously brought to it, 14 particularly
where petitioners-accused have shown prima facie (and without this Court prejudging the merits of
their appeal) that they have a valid cause for pursuing in good faith their appeal (as against a
manifestly dilatory or frivolous appeal) and to have a higher court appreciate their evidence in
support of their defense that they were prosecuted and sentenced to imprisonment (for estafa) for
failure to pay a purely civil indebtedness (the attorney's fee owed by their son to the complainant).

Here, petitioners-accused's counsel, misdirected their appeal to the court of first instance, confronted
with the thorny question (which has confused many a practitioner) 15 of concurrent criminal
jurisdiction of city courts and municipal courts of provincial and sub-provincial capitals with courts of
first instance under sections 44 (f) and 87 (c) of the Judiciary Act where the appeal from the
municipal or city court's judgment should be taken directly to the Court of Appeals as held in Esperat
vs. Avila 16 as distinguished however from judgments of ordinary municipal courts in similar cases
within the concurrent jurisdiction of the courts of first instance where as held by this Court in People
vs. Valencia 17 the appeal should nevertheless be brought to the court of first instance which retains
its appellate jurisdiction under section 45 of the Judiciary Act.

It certainly was within the inherent power of the court of first instance in exercise of its power to
"control its process and orders so as to make them conformable to law and justice" 18 to grant
petitioners-accused's timely plea to endorse their appeal to the Court of Appeals as the proper court
and within the context and spirit of Rule 50, section 3. In a mis-directed appeal to the Court of
Appeals of a case that pertains to the court of first instance's jurisdiction, the said Rule expressly
provides that the Court of Appeals "shall not dismiss the appeal but shall certify the case to the
proper court" viz, the court of first instance in the given example. There is no logical reason why in
all fairness and justice the court of first instance in a misdirected appeal to it should not be
likewise bound by the same rule and therefore enjoined not to dismiss the appeal but to certify the
case to the Court of Appeals as the proper court. The paucity of the language of the Rule and its
failure to expressly provide for such cases of misdirected appeals to the court of first instance (owing
possibly to the fact that at the time of the revision of the Rules of Court in 1963 section 87 (c) had
been newly amended under Republic Act 2613 approved on June 22, 1963 to enlarge the
jurisdiction of city courts and municipal courts of provincial capitals and provide for
their concurrent jurisdiction with the courts of first instance and direct appeal from their judgments in
such cases to the Court of Appeals) should not be a cause for unjustly depriving petitioners of their
substantial right of appeal.

This Court has in many cases involving the construction of statutes always cautioned
against "narrowly" interpreting a statute "as to defeat the purpose of the legislator" " 19 and stressed
that "it is of the essence of judicial duty to construe statutes so as to avoid such a deplorable result
(of injustice or absurdity)" 20 and that therefore "a literal interpretation is to be rejected if it would
be unjust or lead to absurd results". 21 In the construction of its own Rules of Court, this Court is all
the more so bound to liberally construe them to avoid injustice, discrimination and unfairness and to
supply the void — that is certainly within the spirit and purpose of the Rule to eliminate repugnancy
and inconsistency — by holding as it does now that courts of first instance are equally bound as the
higher courts not to dismiss misdirected appeals timely made but to certify them to the proper
appellate court.

ACCORDINGLY, the decision of the Court of Appeals dismissing the petition is hereby set aside and
in lieu thereof, judgment is hereby rendered granting the petition for prohibition against respondent
city court which is hereby enjoined from executing its judgment of conviction against petitioners-
accused and further commanding said city court to elevate petitioners' appeal from its judgment to
the Court of Appeals for the latter's disposition on the merits. No costs.

Makalintal, C.J., Zaldivar, Castro, Fernando, Barredo, Makasiar, Antonio, Fernandez, Muñoz Palma
and Aquino, JJ., concur.

Separate Opinions

ESGUERRA, J., dissenting:

I beg to dissent from the opinion that Section 3 of Rule 50 of the Rules of Court may be applied by
analogy to this case, considering that the dispositive portion of the draft decision commands the City
Court to elevate the case to the Court of Appeals. Under Section 31 of the Judiciary Act (Republic
Act No. 296), "all cases erroneously brought to the Supreme Court or to the Court of Appeals shall
be sent to the proper court, which shall hear the same, as if it had originally been brought before it."
Section 3 of Rule 50 provides that "when the appealed case has been erroneously brought to the
Court of Appeals, it shall not dismiss the appeal but shall certify the case to the proper court, with a
specific and clear statement of the grounds therefor." These are the only legal provisions governing
the handling and disposition of erroneous appeals. Neither the Legislature nor the Rules of Court
has provided the rules for erroneous appeal to the Court of First Instance from the judgment of a City
Court or the Municipal Court of a provincial or sub-provincial capital in cases falling within their
concurrent jurisdiction under the Judiciary Act, as amended. I do not think the Supreme Court, by
judicial fiat, can supply the deficiency unless it formally promulgates a rule governing transfer or
certification of cases erroneously appealed to the Court of First Instance from judgments of inferior
courts in cases directly appealable to the Court of Appeals. The void in the law is in the certification
by the Court of First Instance to the Court of Appeals in such cases.

We cannot apply Section 31 of the Judiciary Act and Section 3 of Rule 50 by analogy because We
have to compel the Court of First Instance to certify the case to the Court of Appeals. We cannot
also compel the City Court of Pasay City to do the same because the case was not appealed to it as
it was its decision which was erroneously appealed to the Court of First Instance. The proper court to
certify and to be commanded to do so by mandamus is the Court of First Instance, but this Court is
not a party to this case and cannot be bound by any judgment rendered herein.

That the People of the Philippines was impleaded as a party and represented by the Solicitor
General is of no significance to me. The People is not the one to be compelled to perform the act but
the Judge of First Instance that dismissed the appeal; and neither said Court nor the Judge thereof
is a party respondent in these proceedings.

The petitioners here should have known, through their counsel, that the People of the Philippines
and the Court of First Instance of Pasay City are not one and the same entity, and that the former
may not be compelled to perform the act of certifying the case to the Court of Appeals while the
latter can be. The respondent-appellate Court was right in dismissing the petition to prohibit the
execution of the judgment and to compel the City Court to elevate the case to the Court of Appeals.
Petitioners should have known that the Court of First Instance is an indispensable party to these
proceedings. For their counsel's fatal error, they should pay the price of having the judgment of
conviction become final.

Separate Opinions

ESGUERRA, J., dissenting:

I beg to dissent from the opinion that Section 3 of Rule 50 of the Rules of Court may be applied by
analogy to this case, considering that the dispositive portion of the draft decision commands the City
Court to elevate the case to the Court of Appeals. Under Section 31 of the Judiciary Act (Republic
Act No. 296), "all cases erroneously brought to the Supreme Court or to the Court of Appeals shall
be sent to the proper court, which shall hear the same, as if it had originally been brought before it."
Section 3 of Rule 50 provides that "when the appealed case has been erroneously brought to the
Court of Appeals, it shall not dismiss the appeal but shall certify the case to the proper court, with a
specific and clear statement of the grounds therefor." These are the only legal provisions governing
the handling and disposition of erroneous appeals. Neither the Legislature nor the Rules of Court
has provided the rules for erroneous appeal to the Court of First Instance from the judgment of a City
Court or the Municipal Court of a provincial or sub-provincial capital in cases falling within their
concurrent jurisdiction under the Judiciary Act, as amended. I do not think the Supreme Court, by
judicial fiat, can supply the deficiency unless it formally promulgates a rule governing transfer or
certification of cases erroneously appealed to the Court of First Instance from judgments of inferior
courts in cases directly appealable to the Court of Appeals. The void in the law is in the certification
by the Court of First Instance to the Court of Appeals in such cases.

We cannot apply Section 31 of the Judiciary Act and Section 3 of Rule 50 by analogy because We
have to compel the Court of First Instance to certify the case to the Court of Appeals. We cannot
also compel the City Court of Pasay City to do the same because the case was not appealed to it as
it was its decision which was erroneously appealed to the Court of First Instance. The proper court to
certify and to be commanded to do so by mandamus is the Court of First Instance, but this Court is
not a party to this case and cannot be bound by any judgment rendered herein.

That the People of the Philippines was impleaded as a party and represented by the Solicitor
General is of no significance to me. The People is not the one to be compelled to perform the act but
the Judge of First Instance that dismissed the appeal; and neither said Court nor the Judge thereof
is a party respondent in these proceedings.

The petitioners here should have known, through their counsel, that the People of the Philippines
and the Court of First Instance of Pasay City are not one and the same entity, and that the former
may not be compelled to perform the act of certifying the case to the Court of Appeals while the
latter can be. The respondent-appellate Court was right in dismissing the petition to prohibit the
execution of the judgment and to compel the City Court to elevate the case to the Court of Appeals.
Petitioners should have known that the Court of First Instance is an indispensable party to these
proceedings. For their counsel's fatal error, they should pay the price of having the judgment of
conviction become final.