EN BANC

G.R. No. L-19982 December 29, 1922

"EL DEBATE," INC., petitioner,
vs.
JOSE TOPACIO, Director of Posts, respondent.
Manuel C. Briones, Melencio, Virata and De la Rama and Feliciano B. Gardiner for petitioner.
Attorney-General Villa-Real for respondent.

MALCOLM, J.:

On November 16, 1922, El Debate, a newspaper of the City of Manila, published a full page
announcement which in translation reads as follows:

P18,000.00
HOW WIN THEM?

READ THE FOLLOWING

GRAND NUMBER CONTEST

El Debate opens on this date two contests:

The first contest is for the award of prizes for the nearest approximate guesses as to the total
number of votes that will be cast for any of the winning candidates for Carnival Queen either in
the provinces or in Manila. This contest will close at noon, December 23d.

The second contest is for the award for the nearest approximate guesses as to the total number
of votes that the Queen elect will receive for the Carnival queenship. This second contest will
close at noon of the day in which the final canvass of the Carnival queen contest will take place.

CONDITIONS TO PARTICIPATE IN THE CONTESTS

EACH "CALCULO" (ESTIMATE OR GUESS) MUST BE EXPLAINEDAny subscriber to El Debate may

participate in these two contests by paying in advance at least the amount of the subscription of a quarter
under the following conditions: The person who pays the price of a quarterly subscription shall be given a
coupon for the first contest and another coupon for the second contest. He who pays for two quarters
shall be given two coupons for the first contest and two for the second contest. He who pays for three
quarters, that is to say, nine months, will receive three coupons for each of the said contests. And the one
paying for a whole year will receive four coupons for each of the said contests. But payment is to be
strictly in advance.

Each cálculo (estimate or guess) for any of the two contests must be accompanied by a brief statement or
explanation containing the facts upon which it is based. This explanatory statement may be in English, or
Spanish, or in any Philippine dialect. And in order that the participants may have some basis for making a
correct estimate (guess), El Debate will publish every day information about the partial results that will be
made from day to day at the Carnival offices, circulation or newspapers, etc. Estimates (guesses) without
the corresponding explanatory note will not be considered.

THE VERDICT

The decision of the first as well as the second contest will be made immediately after the Carnival
Headquarters had made public the result of the provincial elections and the final election, respectively. As
soon as a certificate of the results in the provinces and of the final result is received in our office, we will
proceed to select from the estimates (guesses), those that are the nearest in order to award the prize
winners. The statements or explanations of the winning participants upon which their estimate (guess)
was based will be punished in El Debate for the satisfaction of the public. The checking of the winners will
be made in the office of El Debate, 2 De la Rama Bldg., Sta. Cruz, Manila.

THE PRIZES

There are 110 prizes of the total value of P6,000 for the first contest, and for the second contest there are
215 prizes, the total value of which is P12,000, that is, a grand total of P18,000, based upon 20% of the
value of 6,000 full subscriptions for one year, which is the present circulation of El Debate, and should this
total value not be covered in the meantime, a proportional reduction of the number and of the amount of
the prizes will be made.lawphil.net

THE PRIZES FOR THE FIRST CONTEST

 First Prize ....................................................... P2,000.00
Second Prize ...................................................... 1,000.00
Third Prize ....................................................... 500.00
Two prizes of P200.00 each .............................. 400.00
Five prizes of P100.00 each ............................. 500.00
Ten prizes of P50.00 each ............................... 500.00
Twenty prizes of P20.00 ................................. 400.00
Seventy prizes of P10.00 ................................ 700.00

110 prizes ..................................................... 6,000.00

THE PRIZES FOR THE SECOND CONTEST

First Prize ....................................................... P4,000.00

Second Prize ............................... 2,000.00
Third Prize ............................... 1,000.00
Two prizes of P400.00 each ............................... 800.00
Ten prizes of P100.00 each ............................... 1,000.00
Twenty prizes of P50.00 each ............................... 1,000.00
Forty prizes of P20.00 ............................... 800.00
140 prizes of P10.00 ............................... 1,400.00

215 prizes ..................................................... 12,000.00

The Director of Posts, following the advice of the Attorney-General, refused to admit the issues of El
Debate, containing the advertisement, to the mails, for the reason that it fell within the provisions of the
Administrative Code concerning non-mailable matter. Not satisfied with the ruling of the Director of Posts,
the publishers of El Debate have had recourse to these original proceedings in mandamus to settle the
controversy between the newspaper and the Government.

The argument, while brilliant and informative to an unusually high degree, has covered a somewhat wider
range than is essential. The issues will be more sharply defined and, correspondingly, our burden will be
lightened, if all extraneous matter is thrown overboard.

The demurrer interposed by the Government serves to admit the fact pleaded in the complaint. The
applicable law is, likewise, conceded, as is also the extent of power of the Director of Posts.

Section 1954 (a) of the Administrative Code includes, as absolutely non-mailable matter, "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. . . ." As previously announced, the courts will not interfere with the
decision of the Director of Posts as to what is, and what is not, mailable matter, unless clearly of opinion
that it was wrong. (Sotto vs. Ruiz [1921], 41 Phil., 468; Reyes vs. Topacio, p. 207, ante.)

In the next place, the fact that an Attorney-General of the Philippines had held one way and another
Attorney-General an opposite way (and to make the record complete, we would add that an Attorney-
General in 1912 also rendered an opinion on the subject), with reference to carnival lotteries and
newspaper guessing schemes; the fact that three Attorneys-General of the United States sustained the
validity of guessing contests, only to be overruled by an Attorney-General subsequently in office; the fact
that the older authorities in the United States refused to hold such contests illegal, while a contrary view is
now entertained; and the fact that guessing contests are held not to be lotteries in England, Canada, and
other foreign countries, is relatively unimportant. Passing by the historical phases, what we want to know
is the actual state of the law, and if the doctrines announced in the authorities rest on a sound basis of
reason.

In the next place, advancing one step further toward the issues, 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 lottery are: First, consideration; second, prize; and third, chance. (Horner vs. United 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.)

Reverting then to the admitted facts, to the admitted law, and to the admitted judicial doctrines, the
fundamental question is this: Was the decision of the Director of Posts, refusing the privileges of the mails
to El Debate, clearly erroneous? And the subsidiary question is this: Is the guessing contest of El
Debate a "lottery, gift enterprise, or similar scheme depending in whole or in part upon lot or chance"
within the meaning of the law?
Counsel for the petitioner is the first to admit that the element of prize is present. We are, therefore,
relieved from considering this point. But he maintains that the element of chance "has been reduced to a
minimum and is practically nil, while the element of consideration is totally absent." Taking up, therefore,
these two points in order, we finally arrive at our task.

What may be termed "the pure chance doctrine" is no longer upheld by the weight of authority in the
United States. The element of chance is present even though it may be accompanied by an element of
calculation or even of certainly. Counsel, therefore, practically admits himself out of court when he
concedes that any element of chance is present, for let it be remembered that our law includes the phrase
"depending in whole or in part upon lot or chance." (Public Clearing House vs. Coyne, supra; People ex
rel. Ellison vs. Lavin [1904], 179 N. Y., 164; 66 L. R. A., 601 [estimate of the number of cigars on which a
tax is paid during a specified month]; 25 Ops. Atty.-Gen. U. S., 286 [estimate of the total number of paid
admissions to the World's Fair at St. Louis, Missouri, from its opening to its close, and estimate of the
popular vote cast for the winning candidate for President of the United States in 1904];
Stevens vs. Cincinnati Times-Star Company [1905], 72 Ohio St., 112; 106 A. S. R., 586 [guessing the
number of votes that will be cast for a public officer at an election]; Waite vs. Press Publishing Association
[1907], 155 Fed., 58; 12 Ann. Cas., 319 [estimate of the total popular votes to be cast in the election for
the office of President of the United States].)

It is difficult to select one of the cases cited to elucidate the point under consideration, because each and
everyone of them contains well considered opinions. It was thus the decision of the United States
Supreme Court in Public Clearing House vs. Coyne which marked the turning point toward a stricter
application of the law. It was the decision of the Court of Appeals of the State of New York in People ex
rel. Ellison vs. Lavin, which included the best dissertation on the philosophical subject of what constitutes
chance. While it was the decision of the Federal Court in Waite vs. Press Publishing Association which
had a splendid résumé of the situation, followed by all the encyclopedias. We choose the latter because
the more recent and because the briefest.

As indicated, in the case of Waite vs. Press Publishing Association, the question before the court was
whether a guessing contest inaugurated by a publishing association prior to an election, offering certain
rewards or prizes to those persons who, prior to such election, submitted to the association the nearest
correct estimates of the total number of votes cast for the office of President of the United States, and at
the time paid a certain sum as the subscription to a named periodical, was a contest of chance and a
lottery, in violation of the laws of the United States and the laws of the State of Michigan. We quote:

Several years ago it was a doubtful question whether a so-called guessing contest was valid or
not. Three attorneys-general of the United States (Miller, Griggs, and Knox) had in formal
opinions sustained the validity of similar contests, and following them, Judge Thomas, in the case
of United States vs. Rosenblum (121 Fed. Rep., 180), had refused to hold such a contest illegal,
and had sustained a demurrer to an information against the president of a corporation then
engaged in carrying on one. These rulings were in accordance with the trend of authorities in this
country and England, the cases being cited in the opinion of Judge Thomas (121 Fed. Rep., 182).
The exception to be noted was the case of Hudelson vs. State (94 Ind., 426; 48 Am. Rep., 171),
in which the Supreme Court of Indiana held that a contest dependent upon the guessing of the
nearest to the number of beans contained in a glass globe was a lottery or gift enterprise. The
cases which sustained the validity of the various guessing contests all held that, since the correct
number either did or would exist, more or less skill and judgment could be exercised in guessing
it, and therefore the estimate of the nearest number to the correct one could not properly be
considered a matter of mere chance. On the other hand, in the Hudelson case the court, for the
first time, drew attention to the fact that, while the number of beans in the glass globe would be
fixed and definite, the ascertainment of that number could be nothing other than a mere matter of
guessing, for it was impossible under the circumstances to ascertain the information upon which
a correct estimate could alone be made. Subsequent to the decision in the Hudelson case came
that of the Supreme Court of the United States in Public Clearing House vs. Coyne (194 U.S.,
497; 24 U. S. Sup. Ct. Rep., 789; 48 U. S. [L. ed.], 1092; and People vs. Lavin, 179 N. Y., 164; 1
Ann. Cas., 165; 71 N. E. Rep., 753; 66 L. R. A., 601). In the Coyne case the court sustained a
fraud order issued by the post-office department, directing the rejection of the mail of "The Public
Clearing House" on the ground that it was a fraudulent scheme and constituted a lottery. It is
unnecessary to describe the details of the scheme; the facts will be found in the opinion. The
court, speaking by Mr. Justice Brown, disposes of the matter by saying:

"The scheme lacks the elements of a legitimate business enterprise, and we think there was no
error in holding it to be lottery within the meaning of the statute."

This case was followed by Preferred Mercantile Co. vs. Hibbard (142 Fed. Rep., 877), decided by
Judge Lowell.

In the Lavin case (179 N. Y., 164; 1 Ann. Cas., 165; 71 N. E. Rep., 753; 66 L. R. A., 601), the
scheme provided for the distribution of money among those purchasers of certain brands of
cigars who should estimate most closely the number of cigars of all brands upon which the
government would collect taxes during the month named. Discussing what constitutes chance,
Judge Cullen, speaking for the court, says (page 168 of 179 N. Y., page 754 of 71 N. E. Rep.):
 "It is strictly and philosophically true in nature and reason that there is no such thing as chance or
accident; it being evident that these words do not signify anything really existing, anything that is
truly an agent or cause of any event; but they signify merely men's ignorance of the real and
immediate cause. But though nothing occurs in the world as a result of chance, the occurrence
may be a matter of chance to the observer from his ignorance of antecedent causes or of the
laws of their operation."

The court refers at some length to the Coyne Case (194 U. S., 497; 24 U. S. Sup. Ct. Rep., 789;
48 U. S. [L. ed.], 1092), and reaches the conclusion that the scheme before it falls far within the
requisites of a lottery as defined in that case, under a statute very similar to the New York one.
The two cases referred to, the Coyne case and the Lavin case, are cited by Attorney-General
Moody in his opinion of Nov. 28, 1904 (25 Opinions of Attorneys-General, 286), as authority for
the reversal of the opinions of his predecessors holding that "guessing contest" were not within
the prohibition of the federal statutes. The schemes presented to Attorney-General Moody for his
decision were dependent, the one upon estimates of the total number of paid admissions to the
World's Fair at St. Louis, and the other upon estimates of the total vote cast for President in 1904.
The conclusions he reached were as follows:

"Conceding that the estimates in such a contest (the World's Fair contest) will be to some extent
affected by intelligent calculation, the conclusion is, nevertheless, irresistible that it is largely a
matter of chance which competitor will submit the nearest correct estimate. The estimates cannot
be predicated upon natural and fixed laws, since the total number of admissions may be affected
by many conditions over which the participants in this scheme have no control and cannot
possibly foresee." (Page 290.)

And again:

"Neither of these contests is a "legitimate business enterprise." In each thousands invest small
sums in the hope and expectation that luck will enable them to win large returns. A comparatively
small percentage of the participants will realize their expectations, and thousands will get nothing.
They are, in effect, lotteries, under the guise of 'guessing contests,' "(Page 291.)

The last case to which we care to call attention upon the general question is that of
Stevens vs. Cincinnati Times-Star Co. (72 Ohio St., 112; 73 N. E. Rep., 1058; 106 Am. St. Rep.,
586). In this case the Supreme Court of Ohio passed upon a number of guessing contests carried
on by newspapers in Ohio. They involved the total vote for a state officer at a coming state
election. Respecting the nature of these contests, the court said (page 150 of 72 Ohio St., page
1061 of 73 N. E. Rep.):

"It is true that one acquainted with the results of the elections of the state in previous years and
educated in politics would have some advantages over one ignorant in those respects, yet it must
be apparent even to a casual observer that the result would depend upon so many uncertain and
unascertainable causes that the estimate of the most learned would be after all nothing more than
a random and undecisive judgment. In the sense above indicated there is an element of skill,
possibly certainty, involved, but it is clear that the controlling predominating element is mere
chance. It was a chance as to what the total vote would be; it was equally a chance as to what
the guesses of the other guessers would be."

xxx xxx xxx

We think, for the reasons given by the courts in the cases from which we have already quoted,
the guessing contest before us came within the terms of the Michigan law and the mischief at
which it was aimed. At the time the estimates on which this suit is based were submitted, the vote
was yet to be cast; indeed, on June 6, 1904, when the Battrick estimate was sent in, one of the
leading candidates for President had not yet been nominated. The number of persons who would
be qualified to vote at the election, and the number who would cast votes which would be
counted, were not only undetermined but impossible of ascertainment at the time the estimates
were submitted. A thousand causes might, in one way or another, intervene to affect the total vote
cast, so that at the best an estimate, if at all near the total vote cast, would be but a lucky guess.
In so great a vote the necessary margin of chance would be so large that no element of skill or
experience could operated to predict the result. While one skilled in national politics and
conversant with existing conditions might make a closer estimate than one wholly ignorant, yet,
after all, the successful persons in such a contest would be but makers of lucky guesses in which
skill and judgment could play no effective part.

Conceding that the views of the American decisions are sound, — and upon this point they are so full and
clear that little remains to be said; conceding that the estimates in the contest of El Debate will, to some
extent, and possibly to a great extent, be effected by intelligent calculation, as has been ingeniously
argued by counsel for the petitioner, the conclusion is nevertheless irresistible that the scheme depends
in part upon chance. The estimates cannot be predicated upon natural and fixed laws, since the total
number of votes that will be cast for the winning candidates for carnival queen may be affected by many
conditions, over which the participants in this scheme have no control and cannot possibly foresee. We
think it is perfectly clear that the dominating and controlling factor in the awarding of the prizes is chance.
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. But what may appear on its face to be a gratuitous distribution of
property by chance, has often been held to be merely a device to evade the law.

Predicated on these legal assumptions, it is argued here with much force that there is no consideration,
for the reason that a subscriber to El Debate receives the full value of his money by receiving the paper
every day for the number of months that he subscribes. The position is tenable, as respects those
persons who would subscribe to the paper regardless of the inducement to win a prize, for as to them
there is no consideration. The position is fallacious, as to other persons who subscribe merely to win a
prize (and it is to such persons that the scheme is directed), for as to them it means the payment of a sum
of money for the consideration of participating in a lottery. Moreover, the subscriber do not all receive the
same amount, for there are a few of them who will receive more than the others, and more, too, than the
value paid for their subscriptions, through the chance of a drawing. (17 R. C. L., 1222; U. S. vs. Wallis
[1893], 58 Fed., 942; State vs. Mumford [1881], 73 Mo., 647.)

The general rule, therefore, is that guessing competitions or contests are lotteries within the statutes
prohibiting lotteries. Indeed, it is very difficult, if not impossible, for the most ingenious and subtle mind to
devise any scheme or plan short of a gratuitous distribution of property, which will not be held to be in
violation of the Gambling Law, and repugnant to the Postal law. It is for the courts to look beyond the fair
exterior, to the substance, in order to unmask the real element and the pernicious tendencies which the
law is seeking to prevent.

The purpose of El Debate in devising its advertising scheme was to augment its circulation and thus to
increase the number of newspaper readers in the Philippines — which is commendable. But the
advertisement carries along with it a lottery scheme — which is not commendable.

The evils to society arising from the encouragement of the gambling spirit have been recognized here and
elsewhere. Experience has shown that the common forms of gambling are comparatively innocuous when
placed in contrast with the widespread pestilence of lotteries. The former are confined to a few persons
and places, but the latter infest the whole community; they enter every dwelling; they reach every class;
they prey upon the hard-earned wages of the poor; they plunder the ignorant and simple. Punitive and
condemnatory laws must, therefore, be interpreted and enforced by the courts in a way calculated to
secure the object sought. (U. S. vs. Salaveria [1918], 39 Phil., 102; Phalen vs. Commonwealth of Virginia
[1850], 8 How., 161; Stone vs. Mississippi [1880], 101 U.S., 814.)

Open the door of chance but a little, for one scheme, however ingeniously and meritoriously conceived, to
pass through, and soon the whole country will be flooded with lotteries.

Meeting, therefore, the issues in the case, we rule that the Director of Posts acted advisedly in refusing
the use of the mails for the issue of El Debate which contained the announcement of its guessing contest,
and that said contests is a lottery, or gift enterprise depending in part upon lot or chance, within the
meaning of the Postal Law.

The demurrer interposed by the Attorney-General is sustained, and unless the petitioner shall, within five
days, so amend the complaint as to state a cause of action, the case shall be dismissed, with costs. So
ordered.

Araullo, C. J., Avanceña, Villamor, Ostrand, Johns, and Romualdez, JJ., concur.

FIRST DIVISION

[G.R. No. 7380. September 18, 1912. ]

THE UNITED STATES, Plaintiff-Appellee, v. CAYETANO RAFAEL ET AL., Defendants-Appellants.

Juan Ledesma for Appellants.

Solicitor-General Harvey for Appellee.

SYLLABUS

1. EVIDENCE IMPROPERLY ADMITTED. — Evidence admitted as proof in criminal cases, even though
not admissible, will not affect the result when, without such proof, there remains sufficient evidence to
show the guilt of the accused beyond a reasonable doubt.

2. JUSTICE OF THE PEACE; RECORD OF PRELIMINARY EXAMINATION. — Under the provisions of

section 13 of Act No. 1627, justices of the peace need not reduce to writing the testimony of witnesses,
except the declaration of the accused himself. A justice of the peace need not forward to the Court of First
Instance, in cases where the accused is bound over to be tried by the Court of First Instance, the entire
record. He is only required to forward to the provincial fiscal a brief statement of the substance of the
testimony. The preliminary examination constitutes no part of the proceedings in the Scout of First
Instance; it constitutes no part of the record of the Court of First Instance, unless it is properly presented
as evidence. The trial in the Court of First Instance is a trial de novo. The record of the justice of the
peace made in the preliminary examination can not be used as the basis of the sentence of the Court of
First Instance. The declarations of witnesses made in the preliminary examination may be presented in
the Court of First Instance during the trial of the cause, for the purpose of testing the credibility of the
witnesses.

3. GAMBLING; USE OF MONEY IN "MONTE." — The use of money in playing the prohibited game of
monte is not necessary to constitute a violation of the law. The purpose of the law was to prohibit
absolutely the game of monte in the Philippine Islands. The mere fact that money was or was not used, in
no way constitutes a necessary element of the game. "Any representative of value or of any valuable
consideration or thing used in playing the prohibited game of monte, constitutes a violation of the law.

DECISION

JOHNSON, J. :

These defendants were charged with a violation of Act No. 1757. The complaint presented against them
contained the following accusations:jgc:chanrobles.com.ph

"That on or about the afternoon of August 1 of the present year, 1911, and in the jurisdiction of this
municipality of Iloilo, Philippine Islands, the said accused, Cayetano Rafael, Perseveranda Lopez, Victor
Discipulo, Victoriano Rafael and Guillermo Juanesa did intentionally, maliciously and criminally play,
making bets in money, the game of chance called monte; in violation of the law."cralaw virtua1aw library

During the trial of the cause, the complaint was dismissed against Cayetano Rafael for the reason that
there was no proof to connect him with the commission of the alleged crime, with costs de officio.

At the close of the trial and after hearing the evidence, the Honorable James S. Powell, judge, found each
of the other four defendants guilty of the crime charged, and sentenced each of them to pay a fine of
P300, and each to pay one-fifth part of the costs, and, in case of insolvency, to suffer subsidiary
imprisonment.

From that sentence Perseveranda Lopez and Victoriano Rafael only appealed.

In this court the appellants make the following assignments of error:jgc:chanrobles.com.ph

"1. It was error to admit as evidence for the prosecution the exhibits presented by the fiscal.

"2. It was error to overrule the motion of the defense that the official record of the justice of the peace
regarding the declarations made by the witnesses in the preliminary investigation of this case be annexed
to the papers in this cause.

"3. It was error to sentence the accused to pay the excessive fine of P300 each.

"4. It was error to find that the accused played monte with bets of money in the house of Cayetano
Rafael, and that they are guilty of the crime charged."cralaw virtua1aw library

With reference to the first assignment of error, the policeman who arrested the defendants at or about the
time when they were found gambling in the house of Cayetano Rafael, took possession of tally-sheets,
lead pencils, and other things which they believed had been used in connection with the game of monte,
which the defendants had been playing. If it is true that these objects had been used in connection with
the gambling game, they would be admissible in evidence, after having been properly identified. A careful
reading of the decision of the lower court, however, indicates that he based his conclusion that the
defendants were guilty of the crime charged upon the fact that the defendants had actually been aught in
the act of gabbling and that he gave no credit whatever to the exhibits in question. In other words, the
lower court found that there was sufficient evidence to prove, beyond a reasonable doubt, that the
defendants were playing at a prohibited game at the time in question without any reference to these
exhibits. The mere fact that the tally-sheets, lead pencils and other things had been found at the time the
defendants were seen gambling, could in no way furnish additional proof that two or three witnesses
presented by the prosecution had actually seen the defendants engaged in playing the prohibited game of
monte. Generally there is certain paraphernalia used in playing the prohibited game of monte. This
paraphernalia, however, is not a necessary part of the game. It is only a convenience. When the particular
paraphernalia is found, however, it of itself may furnish some evidence, although not conclusive, that the
parties using it had been playing the prohibited game. But when there were eyewitness to the playing of
the prohibited game, the existence of the paraphernalia could only be corroborative. It was not shown
during the trial of the cause that the tally sheets, lead pencils, etc., which were found at the time and
place where the defendants were gambling, had actually been used in connection with the prohibited
game. The fiscal evidently presented them as evidence, simply for the purpose of corroborating the
statements of the witnesses who swore positively that they had seen the defendants gambling. All of said
exhibits might well be eliminated from the record without affecting the positive and direct proof presented
at the trial, showing that the defendants had, beyond a reasonable doubt, been engaged in playing the
prohibited game of monte. We are of the opinion that, even though it be admitted that said exhibits were
inadmissible in evidence, the fact that they were admitted in no way prejudiced the defendants.

With reference to the second assignment of error, it will be noted by reference to section 13 of General
Orders, No. 58, and section 2 of Act No. 194, that in every preliminary examination conducted by a justice
of the peace, the declamations of the witnesses shall be reduced to writing and signed by the witnesses.
Neither General Orders, No. 58, nor said Act No. 194 requires the justice of the peace, in any case, to
forward these declamations to the Court of First Instance. Section 13 of Act No. 1627 amends section 2 of
Act No. 194 and relieves the justice of the peace who conducts a preliminary examination from the
necessity of taking down in writing the testimony of the witnesses, except the declaration of the accused
himself. Said section 13 of Act No. 1627 provides that in a criminal case appealed to the Court of First
Instance, as well as in preliminary investigations where the accused is bound over to the Court of First
Instance, the justice of the peace shall forward to the provincial fiscal a brief statement of the substance
of the testimony. The purpose of requiring the justice of the peace to forward to the provincial fiscal a brief
statement of the substance of the testimony, evidently is to enable the provincial fiscal to decide, in the
first instance, whether he shall present a complaint against the defendant, and in the second, to enable
him, in case he decides to prosecute, to properly formulate said complaint. It is practically impossible, in
the thickly populated provinces of the Philippine Islands, for the provincial fiscal to personally attend all of
the trials and preliminary investigations held before the justices of the peace. The purpose of the
provisions of said section 13 is evidently to enable the provincial fiscal to have sufficient information to
enable him to decide whether or not the defendant, in the trial before the justice of the peace or in a
preliminary investigation, shall be further prosecuted in the Court of First Instance.

In the present case if the memoranda or brief statement of the substance of the testimony taken before
the justice of the peace and later forwarded to the provincial fiscal contained any fact or information which
the defendants desired to have presented to the Court of First Instance, the law afforded them a remedy
by a subpoena duces tecum. (See sec. 402, Act No. 190.) We have decided in numerous cases that the
record of a preliminary examination constitutes no part, necessarily, of the proceedings in the Court of
First Instance; that it does not constitute a part of the record of the Court of First Instance, unless it is
properly presented as evidence. The trial in the Court of First Instance is a trial de novo. The record of the
justice of the peace made in a preliminary investigation, can not be used as the basis of the sentence of
the Court of First Instance. The only purpose of presenting the record of the preliminary examination in
the Court of First Instance is perhaps for the purpose of testing the credibility of the witnesses. The record
in the preliminary examination may be presented for the purpose of showing that certain witnesses
testified to certain facts in the preliminary examination which were contrary to their declarations in the
Court of First Instance. (U. S. v. Capisonda, 1 Phil. Rep., 575.)

With reference to the 3d assignment of error, to wit: that the lower court imposed an excessive fine in
imposing a fine of P300, it may be said that said fine is within the provisions of the law and in our opinion
is not excessive. Section 3 of said Act No. 1757 provides that any person violating this section, shall be
punished by a fine of not less than P10 nor more than P500, or by imprisonment for not more than one
year, or by both such fine and imprisonment in the discretion of the court. We find no reason in the record
for modifying the sentence of the lower court with reference to the fine imposed.

With reference to the 4th assignment of error, it will be noted that the appellants claim that the lower court
committed an error in deciding that the defendants were guilty of playing the prohibited game of monte
"con apuestas de dinero." The appellant has evidently overlooked section 7 of Act No. 1757, which
provides, among other things, that —

"The playing at and conducting of any game of monte . . . is hereby prohibited, and any person taking any
part therein . . . shall be punished as provided in section 3 hereof."cralaw virtua1aw library

While it may be true, generally that persons who play the game of monte play for money, yet,
nevertheless, the use of money in the game is not a necessary element in the crime described or defined
by the law. It seems that the purpose of the law was to prohibit absolutely the game of monte in the
Philippine Islands. The mere fact that money was or was not used in no way constitutes an element of the
crime.

In our opinion the evidence shows, beyond a reasonable doubt, that the appellants did, on or about the
1st day of August, 1911, play, in the house of one Cayetano Rafael, at the prohibited game of monte,
together with their codefendants.

After a careful examination of the evidence contained in the record, and of the assignments of error, we
find no reason for modifying the sentence of the lower court. The same is, therefore, hereby affirmed, with
costs. So ordered.

Arellano, C.J., Mapa and Trent, JJ., concur.

 FIRST DIVISION

[G.R. No. 5115. November 29, 1909. ]

THE UNITED STATES, Plaintiff-Appellee, v. MANUEL SAMANIEGO and JUANA BENEDICTO DE

PEREZ, Defendants-Appellants.

Joaquin Rodriguez Serra, for Appellants.

Solicitor-General Harvey, for Appellee.

SYLLABUS

1. ADULTERY; OFFENSES INVOLVING GRIEVOUS SCANDAL OR ENORMITY. — In order to sustain a

conviction under article 441 of the Penal Code, for an offense which "offends modesty or good morals by
grievous scandal or enormity," it is essential that the act or acts complained of should be committed in a
public place or within the public knowledge or view. (U.S. v. Catajay, 6 Phil. Rep., 398; supreme court of
Spain, April 13, 1885, December 14, 1903, January 27, 1908; Viada, vol. 3, p. 130.)

DECISION

MORELAND, J. :

On the 20th day of December, 1907, the following information was presented to the Court of First
Instance of the city of Manila against the defendants in this case:jgc:chanrobles.com.ph

"That on or about the 25th day of November, 1907, in the city of Manila, Philippine Islands, the said
Manuel Samaniego did then and there willfully, unlawfully, and feloniously lie with and have sexual
intercourse with the said accused, Juana Benedicto de Perez, who was then and there, as the said
accused Manuel Samaniego then and there well knew, a married woman and the lawfully wedded wife of
Jose Perez Siguenza; and the said accused Juana Benedicto de Perez, being then and there a married
woman and the lawfully wedded wife of the said Jose Perez Siguenza, did then and there willfully,
unlawfully, and feloniously lie with and have sexual intercourse with the said accused, Manuel
Samaniego."cralaw virtua1aw library

The defendants were arrested under said information and were confined in Bilibid, the said Samaniego on
the 21st day of December, 1907, and the said Juana Benedicto de Perez on the 26th of the same month.
After the arrest of the said defendants, Juana Benedicto de Perez, at the instance of the prosecuting
attorney, was examined by three physicians for the purpose of determining her mental condition. On the
27th day of December, 1907, the doctors made their report to the Court of First Instance, expressing the
opinion that the said Juana Benedicto de Perez was mentally deranged. On the 7th day of January, 1908,
the defendants were tried on the charge of adultery, as presented in said information, and, after the
introduction of the proofs upon the part of the Government, both the prosecuting attorney and the trial
court believed that the evidence was insufficient to warrant the conviction of either of the defendants, and
they were both accordingly acquitted of that charge. In the judgment acquitting the defendants the court
included permission to the prosecuting attorney to file against either or both of the said defendants a new
information charging them with the crime defined in article 441 of the Penal Code. On the 8th day of
January, 1908, pursuant to such permission, the prosecuting attorney presented against both of the
defendants an information charging them with the crime mentioned in said article, as
follows:jgc:chanrobles.com.ph

"That on and for many weeks prior to the 27th day of November, 1907, in the city of Manila, Philippine
Islands, the said Juana Benedicto de Perez was a married woman, and that said Manuel Samaniego
knew that she was married and united in the bonds of matrimony with and was the legitimate consort of
Jose Perez Siguenza; that during the period of time above expressed the said Manuel Samaniego and
Juana Benedicto de Perez, willfully, illegally, and criminally and scandalously, without having any
matrimonial tie between them, habitually appeared together in public places and frequented together
places of recreation, suspicious places, vacant houses, and houses of bad repute, in the daytime as well
as in the nighttime; and lewdly and indecently went to bed together in the house of the husband of the
said Juana Benedicto de Perez during the late hours of the night, dressed only in their night clothes, and
indecorously, indecently, and immodestly embraced each other and caressed each other in the presence
of the family, children, and servants of the said husband of Juana Benedicto de Perez; all with public
scandal and with scandal to the community, and with shame and humiliation to the husband and family of
the said Juana Benedicto de Perez."cralaw virtua1aw library

After the presentation of this information, it appearing that the proofs under the charge therein contained
would be the same as were those under the charge in the information first herein set forth, the
prosecuting attorney and the attorneys for the defendants agreed to submit and did submit the case to the
court for final determination upon the proofs already taken in the trial on the charge of adultery. No
witness was sworn. On the 5th day of February, 1908, the trial court rendered a decision in which he
found the defendants guilty of the crime charged, condemning the defendant Samaniego to the penalty of
arresto mayor in its maximum degree and ordering the defendant Juana Benedicto de Perez confined in
an asylum for the insane until the further order of the court. On the same day the defendants excepted to
said decision and made a motion for a new trial. On the 12th day of February said court, upon its own
motion, and, so far as appears of record, without notice to or consent of the defendants or their attorneys
made an order reopening said case "for the purpose only," as expressed in the order, "of receiving
evidence as to the publicity or nonpublicity of the acts charged in the complaint." On the 15th day of April,
following, additional evidence was taken in the case and used by the court as the basis for a further
judgment in the action. This was done over the objections and exception of defendant’s attorneys. On the
18th day of April the court rendered a decision affirming the judgment rendered by him on the 5th day of
February in the same case. In the same decision he denied defendants’ motion for a new trial.

The witnesses for the prosecution during the trial of the defendants on the charge made in the first
information, viz, that of adultery, were Jose Perez, the husband of Juana Benedicto de Perez, three of his
children, and his cochero. The husband testified that Juana, after having lived with him for more than
twenty years, and having borne him more than five children, expressed the desire to separate from him
on account of the physical abuse and ill treatment which she had received and was receiving at his
hands. He testified further that he himself desired to terminate his marital relations with her and that he
wanted a divorce; and, as a preliminary step to that end, he obtained her arrest at the hands of the police,
who, at his request, conducted her in a patrol wagon publicly through the streets of the city of Manila to an
asylum for the insane, where she was detained and imprisonment against her will. He declared further
that the reason why he thus humiliated and disgraced her and deprived her of her liberty was his ardent
desire to save her soul; that, in ordering her arrest and reclusion, he was acting under the advice and
counsel of various lawyers and doctors. He further testified that, after her arrest, she many times implored
him to give her back her liberty and permit her to return to her family; and that, during one of such
supplications, she admitted to him that the defendant Samaniego was her friend, but, at the same time,
denied that he had ever taken advantage of that friendship in any way whatever.

In attempting to prove the adultery alleged in the information, the prosecution presented as witnesses the
persons above mentioned, viz, Caridad Perez, daughter of the defendant Juana; Rafael Perez, a student
of medicine, 18 years of age, son of the defendant Juana; Concepcion Perez, 12 years of age, daughter
of the defendant Juana; together with the cochero of the family, all of whom lived with the accused,
Juana, and her husband at No. 257 Calle Nozaleda, Manila.

According to the testimony of these witnesses, the kitchen and the toilet of the house, No. 257 Nozaleda,
are situated on the ground floor. Here slept the cochero in a bed called by the family a bench. This was
the only bed in the lower part of the house which could possibly be used for any purpose.

On the night of the 6th of November, 1907, the accused, Juana Benedicto de Perez, accompanied by her
daughters, attended a dance given by a friend. The other accused, Samaniego, was also present. Juana
and her daughters returned home late at night. There were then present in the house the accused, Juana
Benedicto de Perez; her three daughters, Caridad, Rosario, and Conchita, and a friend of Conchita; her
son Rafael; a younger son, Manolo; and the cochero. When the mother and the daughters who had
attended the dance with her were preparing for bed, Conchita discovered that there was a stranger in the
lower part of the house and by her cries brought the household to the spot. She declares in her testimony
that when she first saw the stranger he was near the cochero’s bed and, while she was watching the
movements of the stranger, her mother went below and appeared to be talking with him; that not for a
moment did she lose sight of her mother during all the occurrence.

The cochero testified that the stranger was Samaniego and that he came first to the cochero’s bed and
talked with him a while, but afterwards the cochero went to sleep, and later, on hearing the cries of
Conchita, he saw Samaniego trying to conceal himself in the kitchen and also observed that the accused,
Juana Benedicto de Perez, was going up and down the stairs.

The married daughter, Caridad, who, it appears, was not at the dance, testified that, when Conchita
informed the family that a stranger was in the lower part of the house, she awoke her brother Rafael, who
accompanied her below, where they found the defendant Samaniego, dressed only in his drawers; that
she gave him a blow in the face and ordered him immediately to quit the house; that he asked her pardon
and requested permission to put on his clothes; that permission to do so was refused and she and her
brother ejected him from the house by force and later the cochero handed him his clothes over the wall.

Caridad also testified that Samaniego was once at the house and talked with her mother through the
window from the street, and on that occasion her mother delivered to him a pawn ticket; that once when
she and her mother were in a carromata on the streets the defendant approached them and spoke to her
mother. The testimony of Rafael shows that one morning, as he was returning from the hospital in
Quiapo, he saw the defendant Samaniego on foot near the carromata of his mother in the Botanical
Garden talking to her.

Luisa Avesilla testified that the accused, Juana Benedicto de Perez, paid the board of Samaniego for
three months in a restaurant where she was cashier, and that on one occasion Juana ate with Samaniego
in the restaurant. On that occasion she was accompanied by her grandson.

The cochero testified that he frequently had as passengers in the carromata the two defendants; that on
one occasion he had waited for them while they went to a house in Calle Cervantes, and on another
occasion they had gone into a house on Calle Malacañang, the witness supposing that the house was
unoccupied because the accused, Juana, had told him that she was looking for a house to rent; that the
witness at no time observed anything improper in the conduct or deportment of the two defendants. There
is no proof whatever that these places were places of bad repute or that any of them were unoccupied.

Upon the proofs above stated, which are all of the proofs adduced in the trial on the charge of adultery
and are the same proofs upon which the defendants were acquitted of that charge, the prosecuting
attorney recommended that the defendants be convicted of the crime defined in article 441 of the Penal
Code, of which they stood charge, and the court thereupon convicted them thereof.

The acts complained of lack many of the elements essential to bring them within the purview of the article
of the Penal Code invoked by the prosecution. Every act that was in anywise public fails entirely of those
qualities which offend modesty and good morals by "grievous scandal or enormity." The occurrence at the
residence on the night of the 6th of November did not have that publicity which is required by the article of
the Penal Code referred to. (U.S. v. Catajay, 6 Phil. Rep., 398; supreme court of Spain, April 13, 1885,
December 14, 1903, and January 27, 1908; Viada, vol. 3, p. 130.)

The evidence introduced on the reopening adds nothing to the case already made by the prosecution.
The case was reopened for a particular purpose and the evidence to be introduced, if any, was restricted
to a particular condition, viz, the "publicity or nonpublicity of the acts charged in the complaint." On the
reopening, evidence was presented by the prosecution in relation to the alleged occurrence between the
defendants in Plaza Palacio. Concerning this incident testimony had already been given on the trial by the
witness Rafael Perez. Testimony was also given on the reopening by the same witness as to an
occurrence between the defendants one morning in the Botanical Garden. In relation to this same event
he had already given his testimony on the trial. His evidence as to these two events given on the
reopening of the case is wholly inconsistent with, if not absolutely contradictory of, his testimony in
relation to the same events given on the trial. Such testimony can have no weight.

The other testimony given on the reopening by this witness and the testimony of the witness Amadeo
Pacheco can have no bearing or weight in the decision of this case because such testimony relates to
acts and relations between the defendants which are not "charged in the complaint" and concerning
which no evidence whatever had been offered on the trial.

In the judgment of this court the evidence fails to show the defendants guilty of the crime charged.

The judgment of conviction of the trial court is, therefore, reversed, the defendants acquitted and their
discharge from custody ordered.

FIRST DIVISION

[G.R. No. 2785. August 23, 1906. ]

THE UNITED STATES, Plaintiff-Appellee, v. JOSE CATAJAY, Defendant-Appellant.

G. E. Campbell, for Appellant.

Solicitor-General Araneta, for Appellee.

SYLLABUS

1. PUBLIC SANDAL. — Article 441 of the Penal Code construed. Held, That it is an essential element of
the crime defined and penalized therein that the acts complained of resulted in a grave public scandal.

DECISION

CARSON, J. :

The trial court found be accused guilty of the crime of public scandal in violation of the provisions of article
441 of Penal Code.

It appears, however, that the acts complained of were committed at night, in a private house, and at a
time when no one was present except the accused, the mistress of the house, and one servant, and we
are of opinion that these circumstances do not constitute that degree of publicity which is an essential
element of the crime defined and penalized in article 441 of the Penal Code. (Decision of the supreme
court of Spain, April 13, 1885.)

The correct construction of this article well stated by Viada in his commentary on article 457 of the Penal
Code of Spain, which exactly corresponds with the article in question.
"Constituyen el delito acqui previsto todos aquellos actos contrarios al pudor y a las buenas costumbres
que, por su publicidad, han podido ser objeto de escandalo publico para las personas que
accidentalmente los han presenciado. Aunque no lo diga el articulo, es evidente que es condicion precisa
para que exista este delito que la ofensa al pudor y a las buenas costumbre sea publica: si la ofensa no
tuviese este caracter, es claro que ya no habria de producir el grave escandalo ni la transcendencia que
requiere el articulo, y por lo tanto, ya no quedaria sujeta a la sancion del mismo, sino a la mas benigna
del No. 2 del articulo 586, que castiga como reos de una simple falta contra el orden publicio, con la pena
de arresto de uno a diez dias y multa de 5 a 50 pesetas, a los que con cualquier clase de actos
ofendieren la moral y las buenas costumbre sin cometer delito. Cuando el hecho, pues, ofensivo al pudor
se cometa publicamente, debera apreciarse como delito, puesto que esta misma publicidad es la que
produce el grave escandalo que en el se castiga: en otro caso, la disposicion citada del articulo 586 es la
que debera aplicarse." (Viada comentarios al Codigo Penal de 1870, cuarta edicion, tomo 3, pag. 130.)

There can be no doubt that the accused committed the offense defined and penalized in No. 2 of the
article 571 of the Penal Code, which corresponds with the above-mentioned number 2 of article 586 of the
Penal Code of Spain, and provides that a penalty of from one of ten days’ arrest and a fine of from 15 to
125 pesetas shall be imposed upon —

"2. Those who, by exhibiting prints or engravings, or by means of other acts, shall offend against good
morals and custom without committing a crime."cralaw virtua1aw library

Since this is a lesser offense that the one charged in the complaint, and is included therein, we find him
guilt of a violation of the provisions of the said article and, reversing the sentence of the trial court, we
impose upon the accused, Jose Catajay, the penalty of the ten days’ imprisonment (arresto), and the
payment of a fine of 125 pesetas, and the costs of the trial in both instances. After the expiration of ten
days from the date of final judgment let the cause be remanded to the lower court for proper procedure.
So ordered.

EN BANC

G.R. No. L-7491 August 8, 1955

THE PEOPLE OF THE PHILIPPINES, plaintiff-appellee,

vs.
GO PIN, defendant-appellant.

J. Perez Cardenas and Castaño and Ampil for defendant.

Office of the Solicitor General Querube C. Makalintal and Solicitor Jesus A. Avanceña for appellee.

MONTEMAYOR, J.:

Go Pin, an alien and a Chinese citizen, was charged with a violation of Article 201 of the Revised Penal
Code for having exhibited in the City of Manila at the Globe Arcade, a recreation center, a large number of
one-real 16-millimeter films about 100 feet in length each, which are allegedly indecent and/or immoral. At
first, he pleaded not guilty of the information but later was allowed by the court to change his plea to that
of guilty which he did. Not content with the plea of guilty the trial court had the films in question projected
and were viewed by it in order to evaluate the same from the standpoint of decency and morality.
Thereafter, and considering the plea of guilty entered by the accused, and the fact that after viewing the
films the trial court noted only a slight degree of obscenity, indecency and immorality in them, it sentenced
the appellant to 6 months and 1 day of prision correcciconal and to pay a fine of P300, with subsidiary
imprisonment in case of insolvency, and to pay the costs. He is now appealing from the decision.

Go Pin does not deny his guilt but he claims that under the circumstances surrounding the case,
particularly the slight degree of obscenity, indecency and immorality noted by the court in the films, the
prison sentence should be eliminated from the penalty imposed. His counsel brings to our attention some
authorities to the effect that paintings and pictures of women in the nude, including sculptures of that kind
are not offensive because they are made and presented for the sake of art. We agree with counsel for
appellant in part. If such pictures, sculptures and paintings are shown in art exhibits and art galleries for
the cause of art, to be viewed and appreciated by people interested in art, there would be no offense
committed. However, the pictures here in question were used not exactly for art's sake but rather for
commercial purposes. In other words, the supposed artistic qualities of said pictures were being
commercialized so that the cause of art was of secondary or minor importance. Gain and profit would
appear to have been the main, if not the exclusive consideration in their exhibition; and it would not be
surprising if the persons who went to see those pictures and paid entrance fees for the privilege of doing
so, were not exactly artists and persons interested in art and who generally go to art exhibitions and
galleries to satisfy and improve their artistic tastes, but rather people desirous of satisfying their morbid
curiosity and taste, and lust, and for love for excitement, including the youth who because of their
immaturity are not in a position to resist and shield themselves from the ill and perverting effects of these
pictures.
Before rendering sentence the trial court asked the prosecuting attorney for this recommendation and
said official recommendation that "considering that the accused Go Pin is an alien who is supposed to
maintain a high degree of morality while he is in the Philippines", and "considering that he engaged in a
very nefarious trade, which degenerates the moral character of our youth, who are usually the regular
customers of his trade", he recommended that appellant be sentenced to 2 years imprisonment and a fine
of P300. Notwithstanding this recommendation, the trial court as already said, probably considering its
opinion that the pictures were not so obscene, indecent and immoral but only slightly so, gave appellant
only 6 months and 1 day of prision correccional in addition to P300 fine.

The penalty imposed by the trial court is within the range provided by Article 201 of the Revised Code. We
are satisfied that in imposing the penalty the trial court made use of its sound discretion, and we find no
reason for modifying the said sentence. The Solicitor General in his brief even urges that we recommend
to the proper authorities that deportation proceedings be instituted against appellant as an undesirable
alien. The trial court could have done this but did not do so, believing perhaps that it was warranted. We
repeat that we do not feel justified in interfering with the discretion of the trial court in the imposition of the
sentence in this case.

In view of the foregoing, the decision appealed from is affirmed, with costs.

EN BANC

G.R. No. L-26391 July 28, 1927

THE PEOPLE OF THE PHILIPPINE ISLANDS, plaintiff-appellee,

vs.
JOAQUIN MIRABIEN, defendant-appellant.

Ricardo Navarro for appellant.

Attorney-General Jaranilla for appellee.

MALCOLM, J.:

The question to be here determined is whether the keeper of a house of prostitution may be punished
under existing law.

Joaquin Mirabien, the accused, was on February 20, 1926, and prior thereto, the proprietor of a bar and
restaurant called "New Bohemian Refreshment," situated in the municipality of San Pedro Makati, Rizal.
The true occupation, however, of the accused consisted in maintaining a house of prostitution. The
restaurant was merely a means by which the exploitation of women could be carried on. This was the
situation discovered when the Constabulary raided the place. Mirabien's payment of the internal revenue
and municipal licenses does not alter the facts.

The law pertaining to those who propagate and encourage prostitution leaves much to be desired. It is
neither as clear nor comprehensive as it should be. We believe nevertheless that the Vagrancy Law, Act
No. 519, is sufficiently broad when given an interpretation concordant with its purpose to cover the case.
This law enumerates as one class included in the term "vagrant," every lewd or dissolute person who
lives in and about houses of ill fame."

Giving application of the law to the admitted facts, the accused must be considered a lewd or dissolute
person, for one dedicated to the sale of human flesh could hardly be otherwise. In the second place, the
accused lived in the camouflaged restaurant for such is deduced from his own testimony. And lastly, the
restaurant was a house of ill fame, for evidence proved it to be so and the trial judge made this his finding.
Want of visible means of support is not made an ingredient of this part of the Vagrancy Law.

The decision of the Court of First Instance of Manila finding the accused guilty of a violation of the
Vagrancy Law and sentencing him to six months' imprisonment and to pay the costs being in accord with
the facts and the law, is affirmed with costs.

EN BANC

G.R. No. l-13288 September 25, 1918

 THE UNITED STATES, plaintiff-appellee,
vs.
VALENTIN GINER CRUZ, defendant-appellant.

Aurelio A. Torres for appellant.

Office of the Solicitor-General Paredes for appellee.

MALCOLM, J.:

Section 733 of the Revised Ordinances of the city of Manila enumerates eleven classes of individuals who
shall be deemed to be vagrants. The section includes any person who "acts as pimp or procurer." The
words "pimp" and "procurer," practically synonymous in signification, are terms of opprobrium. The
commonly accepted definition of the word "pimp" (alcahuete) is "one who provides gratification for the lust
of others; a procurer; a panderer." (6 Words and Phrases, 5379.) The clause in question standing alone
within semi-colons, it is not essential, in order to convict one of vagarancy because a pimp or procurer,
that this person have no visible means of support, or be an agent for a keeper of a house of prostitution,
etc.

A comparison of section 733 of the Revised Ordinances of the city of Manila of 1917 with the
corresponding section of the preceding Revised Ordinances discloses that the phrase "or acts as pimp or
procurer" was not found in the old ordinances. Since the legislative body of the city of Manila has taken
the pains to include these words in the new ordinances, it must have done so for a purpose, which plainly
is to put a stop to vile traffic in human flesh. Such a laudable object on the part of the Municipal Board of
the city of Manila should now be effectuated by judicial enforcement.

The defendant, a cochero, having solicited an American soldier to go with him in his rig to find a woman of
loose moral and having secured a Deliah for the soldier, is "a pimp or procurer," guilty of the offense
punished by section 733 of the Revised Ordinances of the city of Manila. Although this fact was only
shown by the testimony of one to support a judgment of conviction if, as in this instance, it satisfies
beyond a reasonable doubt. (U.S. vs. Olais [1917], 36 Phil., 828.)

For this offense, the defendant was sentenced in the Municipal Court and again in the Court of First
Instance of the city of Manila to three months' imprisonment and the costs. Although both of these judges
apparently took into consideration in fixing the penalty that the defendant was as recidivist, and although
we are unable to find any demonstration of this fact in the record, nevertheless, as the penalty is within
the limitations permitted by the Ordinances, and as the offense of the defendant merits no judicial
sympathy, it results that the judgment appealed from should be affirmed with costs against the appellant.

FIRST DIVISION

[G.R. No. 7529. November 19, 1912. ]

THE UNITED STATES, Plaintiff-Appellee, v. VALERIANO MOLINA, Defendant-Appellant.

Luciano de la Rosa for Appellant.

Attorney-General Villamor for Appellee.

SYLLABUS

1. VAGRANCY. — Conviction of vagrancy as defined and penalized in Act No. 519 sustained, it
appearing that defendant was an able-bodied man of 33 years of age; that he habitually neglected to
apply himself to any lawful calling; that he spent his time in loitering about the streets and frequenting
cockpits and places where games of various kinds of conducted and gambling was indulged in; that he
had one been convicted of a violation of the provisions of the Opium Law, and twice of playing monte (a
prohibited gambling game); and that he had no apparent means of existence other than the charity of his
mother, whose means are so limited that she would appear to need assistance rather than to be in
position to render it.

DECISION

CARSON, J. :

The appellant in this case was convicted of the crime of vagrancy as defined and penalized in Act No. 519
of the Philippine Commission, and was sentenced to imprisonment for two months and the payment of the
costs of the trial.
The evidence of record discloses that the defendant was discharged from Bilibid Prison some time during
the month of March, 1910, after serving a short sentence for a violation of the Opium Law; that from that
time until the date of his prosecution on this charge of vagrancy, he had been engaged in no legal
occupation, and was without any apparent means of support other than that supplied him by his mother;
that he is an able-bodied man of 33 years of age; that he habitually neglected to apply himself to any
lawful calling, and that he spent his time in loitering about the streets and frequenting cockpits and places
where games of various kinds were conducted and where gambling was carried on; that he had been
once convicted of a violation of the provisions of the Opium Law, and that he had been twice convicted on
a charge of playing monte (a prohibited gambling game) toward the latter part of the year 1910.

The accused, on his own behalf, testified that he was supported by his mother, with whom he lived, and
that he worked on her property. The evidence in this connection is not very satisfactory, but it seems clear
that his mother is a woman of very small means, and that if she has any property at all, it is so small as to
be wholly inadequate to furnish even a pretence of work for an able-bodied man. The accused, in
explaining where he got the money to bet at the cockpits, claimed that on various occasions his mother
gave him small sums for that purpose, and that when he won he brought her the proceeds. These
statements of the accused merely serve to confirm us in our opinion that the defendant was an idle,
shiftless and worthless man who made no attempt to follow any legal calling, and whose habits of life
were those of an immoral and dissolute good for nothing.

In the case of Gavin v. The State (96 Miss., 377), the court said that:jgc:chanrobles.com.ph

"In vagrancy, the offense consists in general worthlessness; that is to say, in being idle, and, though able
to work refusing to do so, and living without labor, or on the charity of others."cralaw virtua1aw library

This definition of the offense substantially corresponds with the definition of that class of vagrancy set
forth in the first part of section 1 of the Philippine Vagrancy Act (Act No. 519), which provides
that:jgc:chanrobles.com.ph

"Every person having no apparent means of subsistence, who has the physical ability to work, and who
neglects to apply himself or herself to some lawful calling . . . is a vagrant."cralaw virtua1aw library

We do not think that the claim by this able-bodied man, 33 years of age, that he was living on the charity
of his mother, can be said to rebut the other evidence in the record which tended to disclose that he had
no apparent means of support. He had no legal or moral claim upon his mother for support, and indeed,
from the indications in the record as to the scanty means possessed by the mother, it would appear that it
was his filial duty to aid her rather than to call upon her for aid.

In the case of People v. Herrick (59 Mich., 563), the court in construing the words "visible means of
support" held that the use of the word indicates that appearances must to some extent be relied; and that
the words "visible" and "apparent" were words of similar purport and meaning. Anderson’s Law Dictionary
defines the word "apparent" as follows: "Readily seen; evident; self-evident; manifest."cralaw virtua1aw
library

We are of opinion that one who makes no pretense to follow any lawful calling or occupation, who makes
no effort to support himself, whose time is spent in loitering and wandering about the streets and in
frequenting cockpits and other places where gambling is carried on, cannot be said to have any apparent,
visible, self-evident or manifest means of support, despite his claim that he is living upon the charity of his
mother, when it appears that he has no claim either legal or moral upon her for support, and that his
mother’s limited means would justify the expectation that she would receive assistance from her son
rather than render assistance to him.

The judgment of conviction and the sentence imposed by the trial court should be and hereby affirmed,
with the costs of this instance

FIRST DIVISION

[G.R. No. 8848. November 21, 1913. ]

THE UNITED STATES, Plaintiff-Appellee, v. WILLIAM C. HART, C.J. MILLER, and SERVILLANO
NATIVIDAD, Defendants-Appellants.

Pedro Abad Santos for appellants Hart and Natividad.

W.H. Booram for appellant Miller.

Solicitor-General Harvey for Appellee.

SYLLABUS
1. VAGRANCY; LOITERING ABOUT SALOONS, DRAM SHOPS, OR GAMBLING HOUSES; VISIBLE
MEANS OF SUPPORT. — A person is not guilty of vagrancy under the second paragraph of section 1 of
the Vagrancy Act for frequenting saloons, dram shops, or gambling houses, unless it be shown that he is
without visible means of support.

2. STATUTORY CONSTRUCTION; PUNCTUATION EMPLOYED. — If the punctuation of a statute gives

it a meaning which is reasonable and in apparent accord with the legislative will, it may be used as an
additional argument for adopting the literal meaning of the words of a statute as thus punctuated. But an
argument based upon punctuation alone is not conclusive, and the courts will not hesitate change the
punctuation when necessary, to give to the Act the effect intended by the Legislature, disregarding
superfluous or incorrect punctuation marks, and inserting others where necessary.

DECISION

TRENT, J. :

The appellants, Hart, Miller, and Natividad, were arraigned in the Court of First Instance of Pampanga on
a charge of vagrancy under the provision of Act No. 519, found guilty, and were each sentenced to six
months’ imprisonment. Hart and Miller were further sentenced to a fine of P200, and Natividad to a fine of
P100. All appealed.

The evidence of the prosecution as to the defendant Hart shows that he pleaded guilty and was convicted
on a gambling charge about two or three weeks before his arrest on the vagrancy charge; that he had
been conducting two gambling games, one in his saloon and the other in another house, for a
considerable length of time, the games running every night. The defense showed that Hart and one Dunn
operated a hotel and saloon at Angeles which did a business, according to the bookkeeper, of P96,000
during the nineteen months preceding the trial; that Hart was also the sole proprietor of a saloon in the
barrio of Tacondo; that he raised imparted hogs which he sold to the Army garrison at Camp Stotsenberg,
which business netted him during the preceding year about P4,000; that he was authorized to sell several
hundred hectares of land owned by one Carrillo in Tacondo; that he administered, under power of
attorney, the same property; and that he furnished a building for and paid the teacher of the first public
school in Tacondo, said school being under Government supervision. The evidence of the prosecution as
to Miller was that he had the reputation of being a gambler; that he pleaded guilty and was fined for
participating in a gambling game about two weeks before his arrest on the present charge of vagrancy;
and that he was seen in houses of prostitution and in a public dance hall in Tacondo on various
occasions. The defense showed without contradiction that Miller had been discharged from the Army
about the year previously; that during his term of enlistment he had been made sergeant; that he received
rating as "excellent" on being discharged; that since his discharge he had been engaged in tailoring
business near Camp Stotsenberg under articles of partnership with one Buckerd, Miller having
contributed P1,000 to the partnership; that the business netted each partner about P300 per month; that
Miller attended to business in an efficient manner every day; and that his work was first class.

The evidence of the prosecution as to Natividad was that he had gambled nearly every night for a
considerable time prior to his arrest on the charge of vagrancy, in the saloon of one Raymundo, as well as
in Hart’s saloon; that Natividad sometimes acted as banker; and that he had pleaded guilty to a charge of
gambling and had been sentenced to pay a fine therefor about two weeks before his arrest on the
vagrancy charge. The defense showed that Natividad was a tailor, married, and had a house of his own;
that he made good clothes, and earned from P80 to P100 per month, which was sufficient to support his
family.

From his evidence it will be noted that each of the defendants was earning a living at a lawful trade or
business, quite sufficient to support himself in comfort, and that the evidence which the prosecution must
rely upon for a conviction consists of their having spent their evenings in regularly licensed saloons,
participating in gambling games which are expressly made unlawful by the Gambling Act, No. 1757, and
that Miller frequented a dance hall and houses of prostitution.

Section 1 of Act No. 519 is divided into seven clauses, separated by semicolons. Each clause
enumerates a certain calls of person who, within the meaning of this statute, are to be considered as
vagrants. For the purpose of this discussion, we quote this section below, and number each of these
seven clauses.

"(1) Every person having no apparent means of subsistence, who had the physical ability to work, and
who neglects to apply himself or herself to some lawful calling; (2) every person found loitering about
saloons or dram shops or gambling housed, or tramping or straying through the country without visible
means of support; (3) every person known to be a pickpocket, thief, burglar, ladrone, either by his own
confession or by his having been convicted of either said offenses, and having no visible or lawful means
of support when found loitering about any gambling house, cockpit, or in any outlying barrio of a pueblo;
(4) every idle or dissolute person of associate of known thieves or ladrones who wanders about the
country at unusual hours of the night; (5) every idle person who lodges in any barn, shed, outhouse,
vessel, or place other than such as is kept for lodging purposed, without the permission of the owner or a
person entitled to the possession thereof; (6) every lewd or dissolute person who lives in and about
houses of ill fame; every common prostitute and common drunkard, is a vagrant."cralaw virtua1aw library

It is insisted by the Attorney-General that as visible means of support would not be a bar to a conviction
under any one of the last four clauses of this act, it was not the intention of the Legislature to limit the
crime of vagrancy to those having no visible means of support. Relying upon the second clause to sustain
the guilt of the defendant, the Attorney-General then proceeds to argue that "visible means of support" as
used in that clause does not apply to "every person found loitering about saloons or dram shops on
gambling houses," but is confined entirely to "or tramping or straying through the country." It is insisted
that had it been intended for "without visible means of support" to qualify the first part of the clause, either
the comma after gambling house would have been omitted, or else a comma after country would have
been inserted.

When the meaning of legislative enactment is in question, it is the duty of the courts to ascertain, if
possible, the true legislative intention, and adopt that the construction of the statute of the statute which
will give it effect. The construction finally adopted should be based upon something more substantial than
the mere punctuation found in the printed Act. If the punctuation of the statute gives it a meaning which is
reasonable and in apparent accord with the legislative will, it may be used as an additional argument for
adopting the literal meaning of the words of the statute as thus punctuated. But an argument based upon
punctuation alone is not conclusive, and the courts will not hesitate to a change the punctuation when
necessary, to give to the Act the effect intended by the Legislature, disregarding superfluous or incorrect
punctuation marks, and inserting others where necessary.

The Attorney-General has based his argument upon the proposition that neither visible means of support
not a lawful calling is a sufficient defense under the last four paragraphs of the section; hence, not being
universally a defense to a charge of vagrancy, they should not be allowed except where the Legislature
has so provided. He then proceeds to show, by a "mere grammatical criticism: of the second paragraph,
that the Legislature did not intend to allow visible means of support or a lawful calling to block a
prosecution for vagrancy founded on the charge that the defendant was found loitering around saloons,
dram shops, and gambling houses.

A most important step in this reasoning, necessary to make it sound, is to ascertain the consequences
flowing from such a construction of the law. What is loitering? The dictionaries say it is idling or wasting
one’s time. The time spent in saloons, dram shops, and gambling houses is seldom anything but that. So
that under the proposed construction, practically all who frequent such places commit a crime in so doing,
for which they are liable to punishment under the Vagrancy Law. We cannot believe that it was the
intention of the Legislature to penalize what, in the case of saloons and dram shops, is under the law’s
protection. If it be urged that what is true of saloons and dram shops is not true of gambling houses in this
respect, we encounter the wording of the law, which makes no distinction whatever between loitering
around saloon and dram shops, and loitering around gambling houses.

The offense of vagrancy and defined in Act No. 519 is the Anglo-Saxon method of dealing with the
habitually idle and harmful parasites society. While the statutes of the various States of the American
Union differ greatly as to the classification of such persons, their scope is substantially the same. Of those
statutes we have had an opportunity to examine, but two or three contain a provision similar to the second
paragraph of Act No. 519. (Mo. Ann. Stat., sec. 2228; sec 1314.) That the absence of visible means of
support or a lawful calling is necessary under these statutes to a conviction for loitering around saloons,
dram shops, and gambling houses is not even negatived by the punctuation employed. In the State of
Tennessee, however, we find an exact counterpart for paragraph 2 of section 1 of our own Act (Code of
Tenn., sec 3023), with the same punctuation:jgc:chanrobles.com.ph

". . . or for any person to be found loitering about saloons or dram shops, gambling houses, or houses of
ill fame, or tramping or strolling through the country without any visible means of support. "cralaw
virtua1aw library

A further thought suggests itself on connection with the punctuation of the paragraph in question. The
section, as stated above, is divided into seven clauses, separated by semicolons. To say that two classes
of vagrants are defined in paragraph 2, as to one of which visible means of support or a lawful calling is
not a good defense, and as to the other which such a defense is sufficient, would imply a lack of logical
classification on the part of the legislature of the various classes of vagrants. this we are not inclined to
do.

In the case at bar, all three of the defendants were earning a living by legitimate methods in a degree of
comfort higher than the average. Their sole offense was gambling, which the legislature deemed
advisable to make the subject of a penal law. the games in which they participated were apparently
played openly, in a licenses public saloon, where the officers of the law could have entered as easily as
did the patrons. It is believed that Act No. 1757 is adequate, if enforced, to suppress the gambling
proclivities of any person making a good living ar a lawful trade of busine ss.

For these reasons, the defendants are acquitted, with the costs de oficio.

Arellano, C.J., Torres and Carson, JJ., concur.

 THIRD DIVISION

G.R. No. 193854 September 24, 2012

PEOPLE OF THE PHILIPPINES, Appellee,

vs.
DINA DULAY y PASCUAL, Appellant.

DECISION

PERALTA, J.:

This is to resolve an appeal from the Decision 1 dated August 4, 2010 of the Court of Appeals (CA) in CA-
G.R. CR-HC No. 03725 affirming with modification the Decision 2 dated October 8, 2008 of the Regional
Trial Court (RTC), Branch 194, Parañaque City, finding appellant Dina Dulay guilty beyond reasonable
doubt of the crime of Rape under Article 266-A. No. 1 (a) of the Revised Penal Code (RPC) as amended
by Republic Act (R.A.) 8353 as a co-principal by indispensable cooperation.

The records bear the following factual antecedents:

Private complainant AAA3 was 12 years old when the whole incident happened. AAA's sister introduced
the appellant to AAA as someone who is nice. Thereafter, appellant convinced AAA to accompany her at a
wake at GI San Dionisio, Parañaque City. Before going to the said wake, they went to a casino to look for
appellant's boyfriend, but since he was not there, they went to Sto. Niño at Don Galo. However,
appellant's boyfriend was also not there. When they went to Bulungan Fish Port along the coastal road to
ask for some fish, they saw appellant's boyfriend. Afterwards, AAA, appellant and the latter's boyfriend
proceeded to the Kubuhan located at the back of the Bulungan Fish Port. When they reached the
Kubuhan, appellant suddenly pulled AAA inside a room where a man known by the name "Speed" was
waiting. AAA saw "Speed" give money to appellant and heard "Speed" tell appellant to look for a younger
girl. Thereafter, "Speed" wielded a knife and tied AAA's hands to the papag and raped her. AAA asked for
appellant's help when she saw the latter peeping into the room while she was being raped, but appellant
did not do so. After the rape, "Speed" and appellant told AAA not to tell anyone what had happened or
else they would get back at her.

AAA went to San Pedro, Laguna after the incident and told her sister what happened and the latter
informed their mother about it. AAA, her sister and mother, filed a complaint at Barangay San Dionisio.
Thereafter, the barangay officials of San Dionisio referred the complaint to the police station.

The Parañaque City Police Office (Women's and Children Concern Desk) asked the assistance of the
Child Protection Unit of the Philippine General Hospital, upon which the latter assigned the case to Dr.
Merle Tan. Consequently, with the consent of AAA and her mother, and in the presence of a social worker
of the Department of Social Welfare and Development (DSWD), Dr. Tan conducted the requisite interview
and physical examination on AAA. Later on, Dr. Tan issued a Medico-Legal Report 4 stating that there was
no evident injury in the body of AAA, but medical evaluation cannot exclude sexual abuse. During her
testimony, Dr. Tan explained that such impression or conclusion pertains to the ano-genital examination
and also stated that she found multiple abrasions on the back portion of the body of AAA. 5

Thus, an Information was filed, which reads as follows:

That on or about the 3rd day of July 2005, in the City of Parañaque, Philippines and within the jurisdiction
of this Honorable Court, the above-named accused, conspiring and confederating together with one alias
"Speed," whose true name and identity and present whereabouts is still unknown, and both of them
mutually helping and aiding one another, the herein accused Dina P. Dulay having delivered and offered
for a fee complainant AAA, 12 year old minor, to accused alias "Speed," who with lewd design and by
means of force and intimidation, did then and there willfully, unlawfully and feloniously have carnal
knowledge on said minor complainant AAA against her will and without her consent, which act is
prejudicial to the normal growth and development of the said child.

CONTRARY TO LAW.6

With the assistance of counsel de oficio, on August 3, 2005, appellant entered a plea of not
guilty.7 Therafter, trial on the merits ensued.

To support the above allegations, the prosecution presented the testimonies of AAA and Dr. Merle Tan.
On the other hand, the defense presented the sole testimony of appellant which can be summarized as
follows:

Appellant met AAA a few days before June 2005 when the latter was introduced to her by her cousin
Eglay Akmad during the wake of a relative of AAA at Palanyag. The cousin of appellant was AAA's
neighbor at Palanyag. Around 1 o'clock in the morning of July 3, 2005, appellant averred that she was at
La Huerta, at the Bulungan Fish Port in Parañaque City with her cousin Eglay and stayed there for about
thirty (30) minutes. They then proceeded to the house of appellant's cousin in Palanyag. In the said
house, appellant saw "Speed" and two (2) other male persons. She also saw AAA who was engaged in a
conversation with "Speed" and his two (2) companions. She asked AAA what she was doing there and the
latter said that it was none of her business ("wala kang pakialam sa akin"). Because of the response of
AAA, appellant left the house and went home to General Trias, Cavite.

On October 8, 2008, the RTC found appellant guilty beyond reasonable doubt of the crime of rape as co-
principal by indispensable cooperation. The dispositive portion of the decision reads:

WHEREFORE, finding Accused Danilo guilty beyond reasonable doubt for rape as a co-principal by
indispensable cooperation, she is hereby sentenced to suffer an imprisonment of Reclusion Perpetua
under Article 266-B of the Revised Penal Code and to pay the offended party the amount of ₱ 50,000.00
by way of damages.

The period of her detention shall be considered part of the service of her sentence.

SO ORDERED.8

Not satisfied with the judgment of the trial court, the appellant brought the case to the CA. The latter, on
August 4, 2010, promulgated its decision affirming the ruling of the RTC with a modification on the award
of damages, thus:

WHEREFORE, the appealed Decision of the court a quo is AFFIRMED with the MODIFICATION that the
accused-appellant is sentenced to suffer the penalty of reclusion perpetua and ordered to indemnify the
offended party the sum of Fifty Thousand Pesos (₱ 50,000.00) as civil indemnity, Fifty Thousand Pesos
(₱ 50,000.00) as moral damages and Twenty-Five Thousand Pesos (₱ 25,000.00) as exemplary
damages.

SO ORDERED.9

Hence, the present appeal.

In her Brief, appellant assigned the following errors:

THE COURT A QUO GRAVELY ERRED IN FINDING THE ACCUSED-APPELLANT GUILTY OF

RAPE AS CO-PRINCIPAL BY INDISPENSABLE COOPERATION.

II

THE TRIAL COURT GRAVELY ERRED IN GIVING FULL WEIGHT AND CREDENCE TO THE
TESTIMONY OF THE PRIVATE COMPLAINANT AAA.10

The Office of the Solicitor General, representing the appellee, refutes the above assignment of errors by
stating the following arguments:

I.

CONSPIRACY WAS CLEARLY ESTABLISHED IN THIS CASE.

II.

THE LOWER COURT DID NOT ERR IN BELIEVING THE TESTIMONY OF PRIVATE
COMPLAINANT.

III.

ACCUSED-APPELLANT'S DEFENSE OF DENIAL CANNOT BE GIVEN GREATER

EVIDENTIARY WEIGHT THAN THE POSITIVE TESTIMONY OF PRIVATE COMPLAINANT. 11

An appeal in a criminal case throws the whole case wide open for review and the reviewing tribunal can
correct errors, though unassigned in the appealed judgment, or even reverse the trial court's decision on
the basis of grounds other than those that the parties raised as errors. 12

The appellant in this case was charged in the Information as having committed the crime of Rape under
Article 266-A, No. 1 (a) of the RPC, as amended by R.A. 8353 in relation to Section 5 (b) of R.A. 7610.
She was eventually convicted by the trial court of the crime of rape as a co-principal by indispensable
cooperation and was sentenced to suffer imprisonment of reclusion perpetua as provided under Article
266-B of the RPC.
In sustaining the conviction of the appellant as co-principal by indispensable cooperation, the CA,
ratiocinated:

To cooperate means to desire or wish in common a thing. But that common will or purpose does not
necessarily mean previous understanding, for it can be explained or inferred from the circumstances of
each case. The cooperation must be indispensable, that is, without which the commission of the crime
would not have been accomplished. x x x

xxxx

The proven facts and circumstances obtaining in this case fall squarely on the above-cited example. It will
be noted that the cooperation of the accused-appellant consisted in performing an act which is different
from the act of execution of the crime committed by the rapist. Accused-appellant cooperated in the
perpetration of the crime of rape committed by "Speed" by acts without which the crime would not have
been consummated, since she prepared the way for the perpetration thereof, convinced the victim to go
with her under the guise of looking for her boyfriend and upon arrival at the kubuhan, she pulled the victim
inside a room where "Speed" was waiting, delivered the victim to him, and then after receiving some
amount of money from "Speed" she settled in another room together with her boyfriend so that "Speed"
might freely consummate the rape with violence and intimidation, as he did. 13

However, this Court is of another view and does not subscribe to the findings of the trial court, as
sustained by the CA that appellant is guilty beyond reasonable doubt as co-principal by indispensable
cooperation in the crime of rape.

Under the Revised Penal Code,14 an accused may be considered a principal by direct participation, by
inducement, or by indispensable cooperation. To be a principal by indispensable cooperation, one must
participate in the criminal resolution, a conspiracy or unity in criminal purpose and cooperation in the
commission of the offense by performing another act without which it would not have been
accomplished.15 Nothing in the evidence presented by the prosecution does it show that the acts
committed by appellant are indispensable in the commission of the crime of rape. The events narrated by
the CA, from the time appellant convinced AAA to go with her until appellant received money from the
man who allegedly raped AAA, are not indispensable in the crime of rape. Anyone could have
accompanied AAA and offered the latter's services in exchange for money and AAA could still have been
raped. Even AAA could have offered her own services in exchange for monetary consideration and still
end up being raped. Thus, this disproves the indispensable aspect of the appellant in the crime of rape. It
must be remembered that in the Information, as well as in the testimony of AAA, she was delivered and
offered for a fee by appellant, thereafter, she was raped by "Speed." Thus:

PROS. R. GARCIA: Now, what happened after you met this Dina Dulay?

WITNESS AAA: She invited me to go with her boyfriend, Sir.

xxxx

Q: You went to the bulungan, what happened when you reached the fish port or bulungan, AAA?

A: Pumunta kami sa kubuhan, Sir.

Q: Where is this kubuhan located in relation to the fish port?

A: At the back portion, Sir.

Q: And, when you said pumunta kami, who was then your companion in going to that kubuhan?

A: Dina Dulay and her boyfriend, Sir.

Q: Do you know the name of the boyfriend of Dina Dulay?

A: No, Sir.

xxxx

Q: All right. After reaching the kubuhan, what happened next?

A: Pina-rape po ako, Sir.

Q: What made you say AAA that accused here Dina Dulay had you raped at the kubuhan?

A: Kasi po binayaran siya nung lalaki, Sir.

Q: Now, do you know how much this Dina Dulay was paid by that person who was you said raped you?

A: No, Sir. I just saw them.

Q: And what did you see that was paid to Dina?

A: Pera, Sir.

Q: Aside from seeing a guy giving money to Dina Dulay, did you hear any conversation between this Dina
Dulay and that man who gave money to her?

A: Yes, sir.

Q: Can you tell this Honorable Court AAA, what was that conversation you heard between this Dina Dulay
and the person who gave money to her?

A: He said to look for a younger girl, Sir. 16

xxxx

PROS. R. GARCIA:

Q: Okay. After that conversation and the giving of money to Dina Dulay, what happened to you and the
man?

A: He raped me, Sir.

Q: Where were you raped?

A: At the Kubuhan, Sir. Q: Can you describe to this Honorable Court how you were raped by that person?

A: He tied me up, Sir.

Q: How were you tied up as you said?

A: He tied up both my hands, Sir.

Q: Then after tying your hands what happened next?

A: He raped me and he pointed a knife at me, Sir.

Q: When you said you were raped, are you referring to the insertion of his penis into your sex organ?

A: Yes, Sir.

Q: And, how did you feel at that time when the organ of this man was inserted into your organ?

A: It was painful, Sir.

Q: And, how did you react when as you said you were being raped by this person?

A: I cannot talk. He put clothes in my mouth, Sir.

Q: For how long did you stay in that kubuhan with this man? May isang oras ba kayo doon?

A: Yes, Sir.

Q: Now, tell us how AAA many times did this person insert his penis into your organ?

A: Only one (1) AAA, Sir.17

It must be clear that this Court respects the findings of the trial court that AAA was indeed raped by
considering the credibility of the testimony of AAA. The rule is that factual findings of the trial court and its
evaluation of the credibility of witnesses and their testimonies are entitled to great respect and will not be
disturbed on appeal.18However, the review of a criminal case opens up the case in its entirety. The totality
of the evidence presented by both the prosecution and the defense are weighed, thus, avoiding general
conclusions based on isolated pieces of evidence. 19 In the case of rape, a review begins with the reality
that rape is a very serious accusation that is painful to make; at the same time, it is a charge that is not
hard to lay against another by one with malice in her mind. Because of the private nature of the crime that
justifies the acceptance of the lone testimony of a credible victim to convict, it is not easy for the accused,
although innocent, to disprove his guilt. These realities compel this Court to approach with great caution
and to scrutinize the statements of a victim on whose sole testimony conviction or acquittal depends. 20

In this light, while this Court does not find appellant to have committed the crime of rape as a principal by
indispensable cooperation, she is still guilty of violation of Section 5 (a) of R.A. 7610, or the Special
Protection of Children Against Abuse, Exploitation and Discrimination Act, which states that:

Section 5. Child Prostitution and Other Sexual Abuse. – Children, whether male or female, who for
money, profit, or any other consideration or due to the coercion or influence of any adult, syndicate or
group, indulge in sexual intercourse or lascivious conduct, are deemed to be children exploited in
prostitution and other sexual abuse.

The penalty of reclusion temporal in its medium period to reclusion perpetua shall be imposed upon the
following:

(a) Those who engage in or promote, facilitate or induce child prostitution which include, but are not
limited to, the following:

(1) Acting as a procurer of a child prostitute;

(2) Inducing a person to be a client of a child prostitute by means of written or oral advertisements
or other similar means;

(3) Taking advantage of influence or relationship to procure a child as a prostitute;

(4) Threatening or using violence towards a child to engage him as a prostitute; or

(5) Giving monetary consideration goods or other pecuniary benefit to a child with intent to
engage such child in prostitution.21

The elements of paragraph (a) are:

1. the accused engages in, promotes, facilitates or induces child prostitution;

2. the act is done through, but not limited to, the following means:

a. acting as a procurer of a child prostitute;

b. inducing a person to be a client of a child prostitute by means of written or oral

advertisements or other similar means;

c. taking advantage of influence or relationship to procure a child as a prostitute;

d. threatening or using violence towards a child to engage him as a prostitute; or

e. giving monetary consideration, goods or other pecuniary benefit to a child with intent to
engage such child in prostitution;

3. the child is exploited or intended to be exploited in prostitution and

4. the child, whether male or female, is below 18 years of age. 22

Paragraph (a) essentially punishes acts pertaining to or connected with child prostitution. It contemplates
sexual abuse of a child exploited in prostitution. In other words, under paragraph (a), the child is abused
primarily for profit.23

As alleged in the Information and proven through the testimony of AAA, appellant facilitated or induced
child prostitution. Children, whether male or female, who for money, profit, or any other consideration or
due to the coercion or influence of any adult, syndicate or group, indulge in sexual intercourse or
lascivious conduct, are deemed to be children exploited in prostitution and other sexual abuse. 24 Thus, the
act of apellant in convincing AAA, who was 12 years old at that time, to go with her and thereafter, offer
her for sex to a man in exchange for money makes her liable under the above-mentioned law. The
purpose of the law is to provide special protection to children from all forms of abuse, neglect, cruelty,
exploitation and discrimination, and other conditions prejudicial to their development. 25 A child exploited in
prostitution may seem to "consent" to what is being done to her or him and may appear not to complain.
However, we have held that a child who is "a person below eighteen years of age or those unable to fully
take care of themselves or protect themselves from abuse, neglect, cruelty, exploitation or discrimination
because of their age or mental disability or condition" is incapable of giving rational consent 26 to any
lascivious act or sexual intercourse.

It must be noted that in the Information, it was alleged that appellant was accused of Rape under Article
266-A, No. 1 (a) of the RPC, as amended by R.A. 8353 in relation to Section 5 (b) of R.A. 7610, and then
went on to enumerate the elements of Section 5 (a) of R.A. 7610 in its body. The Information partly reads:

x x x the herein accused Dina P. Dulay having delivered and offered for a fee complainant AAA, 12 year
old minor, to accused alias "Speed," who with lewd design and by means of force and intimidation, did
then and there willfully, unlawfully and feloniously have carnal knowledge on said minor complainant AAA
against her will and without her consent x x x 27

Undoubtedly, the above-quoted falls under Section 5 (a) of R.A. 7610, the appellant acting as a procurer
of a child and inducing the latter into prostitution. It must be remembered that the character of the crime is
not determined by the caption or preamble of the information nor from the specification of the provision of
law alleged to have been violated, they may be conclusions of law, but by the recital of the ultimate facts
and circumstances in the complaint or information. 28 The sufficiency of an information is not negated by an
incomplete or defective designation of the crime in the caption or other parts of the information but by the
narration of facts and circumstances which adequately depicts a crime and sufficiently apprises the
accused of the nature and cause of the accusation against him.29 1âwphi1

To dispute the allegation and the evidence presented by the prosecution, appellant merely interposes the
defense of denial. It is well settled that denial is essentially the weakest form of defense and it can never
overcome an affirmative testimony, particularly when it comes from the mouth of a credible witness.30

Anent the penalty, for violation of the provisions of Section 5, Article III of R.A. 7610, the penalty
prescribed is reclusion temporal in its medium period to reclusion perpetua. Therefore, in the absence of
any mitigating or aggravating circumstance, the proper imposable penalty is reclusion temporal in its
maximum period, the medium of the penalty prescribed by the law. 31 Notwithstanding that R.A. 7610 is a
special law, appellant may enjoy the benefits of the Indeterminate Sentence Law. 32 Since the penalty
provided in R.A. 7610 is taken from the range of penalties in the Revised Penal Code, it is covered by the
first clause of Section 1 of the Indeterminate Sentence Law. 33 Thus, appellant is entitled to a maximum
term which should be within the range of the proper imposable penalty of reclusion temporal in its
maximum period (ranging from 17 years, 4 months and 1 day to 20 years) and a minimum term to be
taken within the range of the penalty next lower to that prescribed by the law: prision mayor in its medium
period to reclusion temporal in its minimum period (ranging from 8 years and 1 day to 14 years and 8
months).34

As to the award of damages, the same must be consistent with the objective of R.A. 7610 to afford
children special protection against abuse, exploitation and discrimination and with the principle that every
person who contrary to law, willfully or negligently causes damage to another shall indemnify the latter for
the same.35 Therefore, civil indemnity to the child is proper in a case involving violation of Section 5 (a),
Article III of R.A. 7610. This is also in compliance with Article 100 of the RPC which states that every
person criminally liable is civilly liable. Hence, the amount of ₱ 50,000.00 civil indemnity ex delicto as
awarded in cases of violation of Section 5 (b), Article III of R.A. 7610 36 shall also be the same in cases of
violation of Section 5 (a), Article III of R.A. 7610.

WHEREFORE, the appeal of appellant Dina Dulay y Pascual is hereby DISMISSED. However, the
Decision of the CA is hereby MODIFIED as appellant is not guilty beyond reasonable doubt of the crime
of rape, but of violating Section 5 (a), Article III R.A. 7610, amended, for which she is sentenced to
fourteen (14) years and eight (8) months of reclusion temporal, as minimum, to twenty (20) years of
reclusion temporal, as maximum. Appellant is also ORDERED to pay AAA the amount of ₱ 50,000.00 as
civil indemnity.

SO ORDERED.

DIOSDADO M. PERALTA
Associate Justice

SECOND DIVISION

G.R. No. 211465 December 3, 2014

PEOPLE OF THE :PHILIPPINES, Plaintiff-appellee,

vs.
SHIRLEY A. CASIO, Accused-appellant.

DECISION
LEONEN, J.:

"Chicks mo dong?"1

With this sadly familiar question being used on the streets of many of our cities, the fate of many
desperate women is sealed and their futures vanquished. This case resulted in the rescue of two minors
from this pernicious practice. Hopefully, there will be more rescues. Trafficking in persons is a deplorable
crime. It is committed even though the minor knew about or consented to the act of trafficking.

This case involves Republic Act No. 9208,2 otherwise known as the "Anti-Trafficking in Persons Act of
2003."3

Accused Shirley A. Casio was charged for the violation of Republic Act No. 9208, Section 4(a), qualified
by Section 6(a). The information against accused, dated May 5, 2008, states:

That on or about the 3rd day of May 2008, at about 1:00 o’clock A.M., in the City of Cebu, Philippines, and
within the jurisdiction of this Honorable Court, the said accused, with deliberate intent, with intent to gain,
did then and there hire and/or recruit AAA, a minor, 17 years old and BBB for the purpose of prostitution
and sexual exploitation, by acting as their procurer for different customers, for money, profit or any other
consideration, in Violation of Sec. 4, Par. (a), Qualified by Sec. 6, Par. (a), of R.A. 9208 (Qualified
Trafficking in Persons).

CONTRARY TO LAW.4

The facts, as found by the trial court and the Court of Appeals, are as follows:

On May 2, 2008, International Justice Mission (IJM),5 a nongovernmental organization, coordinated with
the police in order to entrap persons engaged in human trafficking in Cebu City.6

Chief PSI George Ylanan, SPO1 Felomino Mendaros, SPO1 Fe Altubar, PO1 Albert Luardo, and PO1
Roy Carlo Veloso composed the team of police operatives. 7 PO1 Luardo and PO1 Veloso were
designated as decoys, pretending to be tour guides looking for girls to entertain their guests. 8 IJM
provided them with marked money, which was recorded in the police blotter.9

The team went to Queensland Motel and rented Rooms 24 and 25. These rooms were adjacent to each
other. Room 24 was designated for the transaction while Room 25 was for the rest of the police team. 10

PO1 Luardo and PO1 Veloso proceeded to D. Jakosalem Street in Barangay Kamagayan, Cebu City’s
red light district. Accused noticed them and called their attention by saying "Chicks mo dong?" (Do you
like girls, guys?).11

During trial, PO1 Luardo and PO1 Veloso testified that their conversation with accused went as follows:

Accused: Chicks mo dong?(Do you like girls, guys?)

PO1 Luardo: Unya mga bag-o? Kanang batan-on kay naa mi guests naghulat sa motel. (Are they new?
They must be young because we have guests waiting at the motel.)

Accused: Naa, hulat kay magkuha ko. (Yes, just wait and I’ll get them.) 12

At that point, PO1 Luardo sent a text message to PSI Ylanan that they found a prospective subject. 13

After a few minutes, accused returned with AAA and BBB, private complainants in this case. 14 Accused:
Kining duha kauyon mo ani? (Are you satisfied with these two?)

PO1 Veloso: Maayo man kaha na sila modala ug kayat? (Well, are they good in sex?) 15 Accused gave the
assurance that the girls were good in sex. PO1 Luardo inquired how much their serviceswould cost.
Accused replied, "Tag kinientos" (₱500.00).16

PO1 Veloso and PO1 Luardo convinced accused to come with them to Queensland Motel. Upon
proceeding toRoom 24, PO1 Veloso handed the marked money to accused. 17

As accused counted the money, PO1 Veloso gave PSI Ylanan a missed call. This was their pre-arranged
signal. The rest of the team proceeded to Room 24, arrested accused, and informed her of her
constitutional rights. The police confiscated the marked money from accused. 18 Meanwhile, AAA and BBB
"were brought to Room 25 and placed in the custody of the representatives from the IJM and the
DSWD."19

During trial, AAA testified that she was born on January 27, 1991. This statement was supported by a
copy of her certificate of live birth.20
AAA narrated that in 2007, she worked as a house helper in Mandaue City. In March 2008 she stopped
working as a house helper and transferred to Cebu City. She stayed with her cousin, but she
subsequently moved to a boarding house. It was there where she met her friend, Gee Ann. AAA knew that
Gee Ann worked in a disco club. When Gee Ann found out that AAA was no longer a virgin, she offered
AAA work. AAA agreed because she needed the money in order to helpher father. AAA recalled that she
had sex with her first customer. She was paid ₱200.00 and given an additional ₱500.00 as tip. For the
first few weeks, Gee Ann provided customers for AAA. Eventually, Gee Ann brought her to Barangay
Kamagayan, telling her that there were more customers in that area. 21

AAA stated that she knew accused was a pimp because AAA would usually see her pimping girls to
customers in Barangay Kamagayan.22 AAA further testified that on May 2, 2008, accused solicited her
services for a customer. That was the first time that she was pimped by accused. 23 Accused brought her,
BBB, and a certain Jocelyn to Queensland Motel.24

AAA testified that Jocelyn stayed inthe taxi, while she and BBB went to Room 24. It was in Room 24
where the customer paid Shirley. The police rushed in and toldAAA and BBB to go to the other room. AAA
was then met by the Department of Social Welfare and Development personnel who informed her that
she was rescued and not arrested.25

AAA described that her job as a prostitute required her to display herself, along with other girls, between 7
p.m. to 8 p.m. She received ₱400.00 for every customer who selected her. 26

The prosecution also presented the police operatives during trial. PSI Ylanan, SPO1 Mendaros, and
SPO1 Altubar testified that after PO1 Veloso had made the missed call to PSI Ylanan, they "rushed to
Room 24 and arrested the accused." 27 SPO1 Altubar retrieved the marked money worth ₱1,000.00 from
accused’s right hand "and upon instruction from PCINSP Ylanan recorded the same at the ‘police blotter
prior operation’. . . ."28

The trial court noted that AAA requested assistance from the IJM "in conducting the operation against the
accused."29

Version of the accused

In defense, accused testified thatshe worked as a laundry woman. On the evening of May 2, 2008, she
went out to buy supper. While walking, she was stopped by two men on board a blue car. The two men
asked her if she knew someone named Bingbing. She replied that she only knew Gingging but not
Bingbing. The men informed her that they were actually looking for Gingging, gave her a piece of paper
witha number written on it, and told her to tell Gingging to bring companions. When accused arrived
home, she contacted Gingging. Gingging convinced her to come because allegedly, she would be given
money by the two males.30 Ruling of the trial court

The Regional Trial Court, Branch 14 in Cebu City found accused guilty beyond reasonable doubt and
held31 that:

Accused had consummated the act of trafficking of person[s] . . . as defined under paragraph (a), Section
3 of R.A. 9208 for the purpose of letting her engage in prostitution asdefined under paragraph [c] of the
same Section; the act of "sexual intercourse" need not have been consummated for the mere
"transaction" i.e. the ‘solicitation’ for sex and the handing over of the "bust money" of Php1,000.00 already
consummated the said act.

....

WHEREFORE, the Court finds accused, SHIRLEY A. CASIO, GUILTY beyond reasonable doubt of
trafficking in persons under paragraph (a), Section 4 as qualified under paragraph (a), Section 6 of R.A.
9208 and sentenced to suffer imprisonment of TWENTY (20) YEARS and to pay a fine of ONE MILLION
(Php1,000,000.00).

Finally, accused is ordered to pay the costs of these proceedings.

SO ORDERED[.]32

Ruling of the Court of Appeals

The Court of Appeals affirmed the findings of the trial court but modified the fine and awarded moral
damages. The dispositive portion of the decision33 reads:

WHEREFORE, in view of the foregoing premises, the instant appeal is hereby DENIED. The assailed
Decision dated 10 August 2010 promulgated by the Regional Trial Court, Branch 14 in Cebu City in Crim.
Case No. CBU-83122 is AFFIRMED WITH MODIFICATIONS. The accused-appellant is accordingly
sentenced to suffer the penalty of life imprisonment and a fine of Php2,000,000 and is ordered to pay
each of the private complainants Php150,000 as moral damages.
SO ORDERED.34

Accused filed a notice of appeal35 on August 28, 2013, which the Court of Appeals noted and gavedue
course in its resolution36 dated January 6, 2014. The case records of CA-G.R. CEB-CR No. 01490 were
received by this court on March 17, 2014.37

In the resolution38 dated April 29, 2014, this court resolved to notify the parties that they may file their
respective supplemental briefs within 30 days from notice. This court also required the Superintendent of
the Correctional Institution for Women to confirm the confinement of accused. 39

Counsel for accused40 and the Office of the Solicitor General41 filed their respective manifestations, stating
that they would no longer file supplemental briefs considering that all issues had been discussed in the
appellant’s brief and appellee’s brief filed before the Court of Appeals. Through a letter 42 dated June 17,
2014, Superintendent IV Rachel D. Ruelo confirmed accused’s confinement at the Correctional Institution
for Women since October 27, 2010.

The sole issue raised by accused is whether the prosecution was able to prove her guilt beyond
reasonable doubt.

However, based on the arguments raised in accused’s brief, the sole issue may be dissected into the
following:

(1) Whether the entrapment operation conducted by the police was valid, considering that there
was no prior surveillance and the police did not know the subject of the operation; 43

(2) Whether the prosecution was able to prove accused’s guilt beyond reasonable doubt even
though there was no evidence presented to show that accused has a history of engaging in
human trafficking;44 and

(3) Whether accused was properly convicted of trafficking in persons, considering that AAA
admitted that she works as a prostitute.45

Arguments of accused

Accused argues that there was no valid entrapment. Instead, she was instigated into committing the
crime.46 The police did not conduct prior surveillance and did not evenknow who their subject
was.47 Neither did the police know the identities of the alleged victims.

Accused further argues that under the subjective test, she should be acquitted because the prosecution
did notpresent evidence that would prove she had a history of engaging in human trafficking or any other
offense. She denied being a pimp and asserted that she was a laundry woman. 48 In addition, AAA
admitted that she worked as a prostitute. Thus, it was her decision to display herself to solicit customers. 49

Arguments of the plaintiff-appellee

The Office of the Solicitor General, counsel for plaintiff-appellee People of the Philippines, argued that the
trial court did not err in convicting accused because witnesses positively identified her as the person who
solicited customers and received money for AAA and BBB. 50 Entrapment operations are valid and have
been recognized by courts.51Likewise, her arrest in flagrante delicto is valid. 52 Hence, the trial court was
correct in stating that accused had "fully consummated the act of trafficking of persons. . ." 53

We affirm accused Shirley A. Casio’s conviction.

I.

Background of Republic Act No. 9208

The United Nations Convention against Transnational Organized Crime (UN CTOC) was "adopted and
opened for signature, ratification and accession" 54 on November 15, 2000. The UN CTOC is
supplemented by three protocols: (1) the Protocol to Prevent, Suppress and Punish Trafficking in
Persons, Especially Women and Children; (2) the Protocol against the Smuggling of Migrants by Land,
Sea and Air; and, (3) the Protocol against the Illicit Manufacturing of and Trafficking in Firearms, their
Parts and Components and Ammunition.55

On December 14, 2000, the Philippines signed the United Nations "Protocol to Prevent, Suppress and
Punish Trafficking in Persons, Especially Women and Children" (Trafficking Protocol). 56 This was ratified
by the Philippine Senate on September 30, 2001. 57 The Trafficking Protocol’s entry into force was on
December 25, 2003.58

In the Trafficking Protocol, human trafficking is defined as:

Article 3 Use of terms For the purposes of this Protocol:

(a) "Trafficking in persons" shall mean the recruitment, transportation, transfer, harbouring or
receipt of persons, by means of the threat or use of force or other forms of coercion, of abduction,
of fraud, of deception, of the abuse of power or of a position of vulnerability or of the giving or
receiving of payments or benefits to achieve the consent of a person having control over another
person, for the purpose of exploitation. Exploitation shall include, at a minimum, the exploitation
of the prostitution of others or other forms of sexual exploitation, forced labour or services, slavery
or practices similar to slavery, servitude or the removal of organs;

(b) The consent of a victim of trafficking in persons to the intended exploitation set forth in
subparagraph (a) of this article shall be irrelevant where any of the means set forth in
subparagraph (a) have been used;

(c) The recruitment, transportation, transfer, harbouring or receipt of a child for the purpose of
exploitation shall be considered "trafficking in persons" even if this does not involve any of the
means set forth in subparagraph (a) of this article;

(d) "Child" shall mean any person under eighteen years of age.

Senator Loren Legarda, in her sponsorship speech, stated that the "Anti-Trafficking Act will serve as the
enabling law of the country’s commitment to [the] protocol." 59

Senator Luisa Ejercito Estrada also delivered a sponsorship speech and described trafficking in persons
as follows:

Trafficking in human beings, if only to emphasize the gravity of its hideousness, is tantamount to modern-
day slavery at work. It is a manifestation of one of the most flagrant forms of violence against human
beings. Its victims suffer the brunt of this insidious form of violence. It is exploitation, coercion, deception,
abduction, rape, physical, mental and other forms of abuse, prostitution, forced labor, and indentured
servitude.

....

As of this time, we have signed the following: the Convention on the Elimination of all Forms of
Discrimination Against Women; the 1995 Convention on the Rights of the Child; the United Nations
Convention on the Protection of Migrant Workers and their Families; and the United Nations’ Resolution
on Trafficking in Women and Girls, among others.

Moreover, we have also expressed our support for the United Nations’ Convention Against Organized
Crime, including the Trafficking Protocol in October last year.

At first glance, it appears thatwe are very responsive to the problem. So it seems.

Despite these international agreements, we have yet to come up with a law that shall squarely address
human trafficking.60

During the interpellation of Republic Act No. 9208, then numbered as Senate Bill No. 2444, Senator
Teresa Aquino-Oreta asked if there was a necessity for an anti-trafficking law when other laws exist that
cover trafficking.61

Senator Luisa Ejercito Estrada explained:

At present, Mr. President, the relevant laws to the trafficking issue are the Revised Penal Code, Republic
Act No. 8042 or the Migrant Workers and Overseas Filipino Act, R[epublic] A[ct] No. 6955 or the Mail-
Order Bride Act, and Republic Act No. 8239 or the Philippine Passport Act. These laws address issues
such as illegal recruitment, prostitution, falsification of public documents and the mail-order bride scheme.
These laws do not respond to the issue of recruiting, harboring or transporting persons resulting in
prostitution, forced labor, slavery and slavery-like practices. They only address to one or some elements
of trafficking independent of their results or consequence. 62(Emphasis supplied)

Thus, Republic Act No. 9208 was enacted in order to fully address the issue of human trafficking.
Republic Act No. 9208 was passed on May 12, 2003, and approved on May 26, 2003.

II.

Elements of trafficking in persons

The elements of trafficking inpersons can be derived from its definition under Section 3(a) of Republic Act
No. 9208, thus:
 (1) The act of "recruitment, transportation, transfer or harbouring, or receipt of persons with or
without the victim’s consent or knowledge, within or across national borders."

(2) The means used which include "threat or use of force, or other forms of coercion, abduction,
fraud, deception, abuse of power or of position, taking advantage of the vulnerability of the
person, or, the giving or receiving of payments or benefits to achieve the consent of a person
having control over another; and

(3) The purpose of trafficking is exploitation which includes "exploitation or the prostitution of
others or other forms of sexual exploitation, forced labor or services, slavery, servitude or the
removal or sale of organs."63

On January 28, 2013,Republic Act No. 10364 64 was approved, otherwise known as the "Expanded Anti-
Trafficking in Persons Act of 2012." Section 3(a) of Republic Act No. 9208 was amended by Republic Act
No. 10364 as follows:

SEC. 3. Section 3 of Republic Act No. 9208 is hereby amended to read as follows:

"SEC. 3. Definition of Terms. – As used in this Act:

"(a) Trafficking in Persons – refers to the recruitment, obtaining, hiring, providing, offering, transportation,
transfer, maintaining, harboring, or receipt of persons with or without the victim’s consent or knowledge,
within or across national borders by means of threat, or use of force, or other forms of coercion,
abduction, fraud, deception, abuse of power or of position, taking advantage of the vulnerability of the
person, or, the giving or receiving of payments or benefits to achieve the consent of a person having
control over another person for the purpose of exploitation which includes at a minimum, the exploitation
or the prostitution of others or other forms of sexual exploitation, forced labor or services, slavery,
servitude or the removal or sale of organs.

"The recruitment, transportation, transfer, harboring, adoption or receipt of a child for the purpose of
exploitation or when the adoption is induced by any form of consideration for exploitative purposes shall
also be considered as ‘trafficking in persons’ even if it does not involve any of the means set forth in the
preceding paragraph. (Emphasis supplied)

Under Republic Act No. 10364, the elements of trafficking in persons have been expanded to include the
following acts:

(1) The act of "recruitment, obtaining, hiring, providing, offering, transportation, transfer,
maintaining, harboring, or receipt of persons with or without the victim’s consent or knowledge,
within or across national borders;"

(2) The means used include "by means of threat, or use of force, or other forms of coercion,
abduction, fraud, deception, abuse of power or of position, taking advantage of the vulnerability of
the person, or, the giving or receiving of payments or benefits to achieve the consent of a person
having control over another person"

(3) The purpose of trafficking includes "the exploitation or the prostitution of others or other forms
of sexual exploitation, forced labor or services, slavery, servitude or the removal or sale of
organs" (Emphasis supplied)

The Court of Appeals found thatAAA and BBB were recruited by accused when their services were
peddled to the police who acted as decoys. 65 AAA was a child at the time that accused peddled her
services.66 AAA also stated that she agreed to work as a prostitute because she needed
money.67 Accused took advantage of AAA’s vulnerability as a child and as one who need money, as
proven by the testimonies of the witnesses.68

III.

Knowledge or consent of the minor is not a defense under Republic Act No. 9208.

Accused claims that AAA admitted engaging in prostitution even before May 2, 2008. She concludes that
AAA was predisposed to having sex with "customers" for money. 69 For liability under our law, this
argument is irrelevant. As defined under Section 3(a) of Republic Act No. 9208, trafficking in persons can
still becommitted even if the victim gives consent.

SEC. 3. Definition of Terms.— As used in this Act:

a. Trafficking in Persons - refers to the recruitment, transportation, transfer or harboring, or receipt

of persons with or without the victim's consent or knowledge, within or across national borders by
means of threat or use of force, or other forms of coercion, abduction, fraud, deception, abuse of
power or of position, taking advantage of the vulnerability of the persons, or, the giving or
 receiving of payments or benefits to achieve the consent of a person having control over another
person for the purpose of exploitation which includes ata minimum, the exploitation or the
prostitution of others or other forms of sexual exploitation, forced labor or services, slavery,
servitude or the removal or sale of organs.

The recruitment transportation, transfer, harboring or receipt of a child for the purpose of exploitation shall
also be considered as "trafficking in persons" even if it does not involve any of the means set forth in the
preceding paragraph.70 (Emphasis supplied)

The victim’s consent is rendered meaningless due to the coercive, abusive, or deceptive means
employed by perpetrators of human trafficking. 71 Even without the use of coercive, abusive, or deceptive
means, a minor’s consent is not given out of his or her own free will.

Section 4 of Republic Act No. 9208 enumerates the different acts of trafficking in persons. Accused was
charged under Section 4(a), which states:

SEC. 4. Acts of Trafficking in Persons.— It shall be unlawful for any person, natural or judicial, to commit
any of the following acts.

a. To recruit, transport, transfer, harbor, provide, or receive a person by any means, including
those done under the pretext of domestic or overseas employment or training or apprenticeship,
for the purpose of prostitution, pornography, sexual exploitation, forced labor, slavery, involuntary
servitude or debt bondage;72

Republic Act No. 9208 further enumerates the instances when the crime of trafficking in persons is
qualified.

SEC. 6. Qualified Trafficking in Persons.— The following are considered as qualified trafficking: a. When
the trafficked person is a child;

b. When the adoption is effected through Republic Act No. 8043, otherwise known as the "Inter-
Country Adoption Act of 1995" and said adoption is for the purpose of prostitution, pornography,
sexual exploitation,forced labor, slavery, involuntary servitude or debt bondage;

c. When the crime is committed by a syndicate, or in large scale. Trafficking is deemed committed
by a syndicate if carried out by a group of three (3) or more persons conspiring or confederating
with one another. It is deemed committed in large scale if committed against three (3) or more
persons, individually or as a group;

d. When the offender is an ascendant, parent, sibling, guardian or a person who exercise
authority over the trafficked person or when the offense is committed by a public officer or
employee;

e. When the trafficked person is recruited to engage in prostitution with any member of the
military or law enforcement agencies;

f. When the offender is a member of the military or law enforcement agencies; and

g. When by reason or on occasion of the act of trafficking in persons, the offended party dies,
becomes insane, suffers mutilation or is afflicted with Human Immunod eficiency Virus (HIV) or
the Acquired Immune Deficiency Syndrome (AIDS). (Emphasis supplied) 73

Section 3 (b) of Republic Act No. 9208 defines "child" as:

SEC. 3. Definition of Terms.— As used in this Act:

....

b. Child- refers to a person below eighteen (18) years of age or one who is over eighteen (18) but
isunable to fully take care of or protect himself/herself from abuse, neglect, cruelty, exploitation, or
discrimination because of a physical or mental disability or condition. 74

Based on the definition of trafficking in persons and the enumeration of acts of trafficking in persons,
accused performed all the elements in the commission of the offense when she peddled AAA and BBB
and offered their services to decoys PO1 Veloso and PO1 Luardo in exchange for money. The offense
was also qualified because the trafficked persons were minors.

Here, AAA testified as to how accused solicited her services for the customers waiting at Queensland
Motel. AAA also testified that she was only 17 years old when accused peddled her. Her certificate of live
birth was presented as evidence to show that she was born on January 27, 1991.
The prosecution was able to prove beyond reasonable doubt that accused committed the offense of
trafficking in persons, qualified by the fact that one of the victims was a child. As held by the trial court:

[T]he act of "sexual intercourse" need not have been consummated for the mere "transaction" i.e. that
‘solicitation’ for sex and the handing over of the "bust money" of Php.1,000.00 already consummated the
said act.75

IV.

Validity of the entrapment operation

In People v. Doria,76 this court discussed the objective test and the subjective test to determine whether
there was a valid entrapment operation:

. . . American federal courts and a majority of state courts use the "subjective" or "origin of intent" test laid
down in Sorrells v. United States to determine whether entrapment actually occurred. The focus of the
inquiry is on the accused's predisposition to commit the offense charged, his state of mind and inclination
before his initial exposure to government agents. All relevant facts such as the accused's mental and
character traits, his past offenses, activities, his eagerness in committing the crime, his reputation, etc.,
are considered to assess his state of mind before the crime. The predisposition test emphasizes the
accused's propensity to commit the offense rather than the officer's misconduct and reflects an attempt to
draw a line between a "trap for the unwary innocent and the trap for the unwary criminal." If the accused
was found to have been ready and willing to commit the offense at any favorable opportunity, the
entrapment defense will fail even if a police agent usedan unduly persuasive inducement.

Some states, however, have adopted the "objective" test. . . . Here, the court considers the nature of the
police activity involved and the propriety of police conduct. The inquiry is focused on the inducements
used by government agents, on police conduct, not on the accused and his predisposition to commit the
crime.For the goal of the defense is to deter unlawful police conduct. The test of entrapment is whether
the conduct of the law enforcement agent was likely to induce a normally law-abiding person, other than
one who is ready and willing, to commit the offense; for purposes of this test, it is presumed that a law-
abiding person would normally resist the temptation to commit a crime that is presented by the simple
opportunity to act unlawfully. (Emphasis supplied, citations omitted) 77

Accused argued that in our jurisprudence, courts usually apply the objective test in determining the
whether there was an entrapment operation or an instigation. 78 However, the use of the objective test
should not preclude courts from also applying the subjective test. She pointed out that:

Applying the "subjective"test it is worth invoking that accusedappellant procures income from being a
laundry woman. The prosecution had not shown any proof evidencing accused-appellant’s history in
human trafficking or engagement in any offense. She is not even familiar to the team who had has [sic]
been apprehending human traffickers for quite some time. 79 (Citations omitted)

Accused further argued that the police should have conducted a prior surveillance before the entrapment
operation.

Time and again, this court has discussed the difference between entrapment and instigation. In Chang v.
People,80this court explained that:

There is entrapment when law officers employ ruses and schemes to ensure the apprehension of the
criminal while in the actual commission of the crime. There is instigation when the accused is induced to
commit the crime. The difference in the nature of the two lies in the origin of the criminal intent. In
entrapment, the mens reaoriginates from the mind of the criminal. The idea and the resolve to commit the
crime comes from him. In instigation, the law officer conceives the commission of the crime and suggests
to the accused who adopts the idea and carries it into execution. 81

Accused contends that using the subjective test, she was clearly instigated by the police to commit the
offense. She denied being a pimp and claimed that she earned her living as a laundrywoman. On this
argument, we agree with the finding of the Court of Appeals:

[I]t was the accused-appellant who commenced the transaction with PO1 Luardo and PO1 Veloso by
calling their attention on whether they wanted girls for that evening, and when the officers responded, it
was the accused-appellant who told them to wait while she would fetch the girls for their perusal. 82

This shows that accused was predisposed to commit the offense because she initiated the transaction. As
testified by PO1 Veloso and PO1 Luardo, accused called out their attention by saying "Chicks mo dong?"
If accused had no predisposition to commit the offense, then she most likely would not have asked PO1
Veloso and PO1 Luardo if they wanted girls.
The entrapment would still be valid using the objective test. The police merely proceeded to D. Jakosalem
Street in Barangay Kamagayan. It was accused who asked them whether they wanted girls. There was
no illicit inducement on the part of the police for the accused to commit the crime.

When accused was arrested, she was informed of her constitutional rights. 83 The marked money retrieved
from her was recorded in the police blotter prior to the entrapment operation and was presented in court
as evidence.84

On accused’s alibi thatshe was merely out to buy her supper that night, the Court of Appeals noted that
accused never presented Gingging in court. Thus, her alibi was unsubstantiated and cannot be given
credence.85

With regard to the lack of prior surveillance, prior surveillance is not a condition for an entrapment
operation’s validity.86 In People v. Padua87 this court underscored the value of flexibility in police
operations:

A prior surveillance is not a prerequisite for the validity of an entrapment or buy-bust operation, the
conduct of which has no rigid or textbook method. Flexibility is a trait of good police work. However the
police carry out its entrapment operations, for as long as the rights of the accused have not been violated
in the process, the courts will not pass on the wisdom thereof. The police officers may decide that time is
of the essence and dispense with the need for prior surveillance. 88 (Citations omitted)

This flexibility is even more important in cases involving trafficking of persons. The urgency of rescuing
the victims may at times require immediate but deliberate action on the part of the law enforcers.

V.

Imposition of fine and award of damages

The Court of Appeals properly imposed the amount of 2,000,000.00. Section 10 (b) of Republic Act No.
9208 provides that:

SEC. 10. Penalties and Sanctions.— The following penalties and sanctions are hereby established for the
offenses enumerated in this Act:

....

c. Any person found guilty of qualified trafficking under Section 6 shall suffer the penalty of life
imprisonment and a fine of not less than Two million pesos (₱2,000,000.00) but not more than Five million
pesos (₱5,000,000.00);

However, we modify by raising the award of moral damages from ₱150,000.00 89 to ₱500,000.00. We also
award exemplary damages in the amount of ₱100,000.00. These amounts are in accordance with the
ruling in People v. Lalli90 where this court held that:

The payment of ₱500,000 as moral damages and ₱100,000 as exemplary damages for the crime of
Trafficking in Persons as a Prostitute finds basis in Article 2219 of the Civil Code, which states:

Art. 2219. Moral damages may be recovered in the following and analogous cases:

(1) A criminal offense resulting in physical injuries;

(2) Quasi-delicts causing physical injuries;

(3) Seduction, abduction, rape, or other lascivious acts;

(4) Adultery or concubinage;

(5) Illegal or arbitrary detention or arrest;

(6) Illegal search;

(7) Libel, slander or any other form of defamation;

(8) Malicious prosecution;

(9) Acts mentioned in Article 309;

(10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.
 ....

The criminal case of Trafficking in Persons as a Prostitute is an analogous case to the crimes of
seduction, abduction, rape, or other lascivious acts. In fact, it is worse. To be trafficked as a prostitute
without one’s consent and to be sexually violated four to five times a day by different strangers is
horrendous and atrocious. There is no doubt that Lolita experienced physical suffering, mental anguish,
fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, and social humiliation
when she was trafficked as a prostitute in Malaysia. Since the crime of Trafficking in Persons was
aggravated, being committed by a syndicate, the award of exemplary damages is likewise justified. 91

Human trafficking indicts the society that tolerates the kind of poverty and its accompanying desperation
that compels our women to endure indignities. It reflects the weaknesses of that society even as it
convicts those who deviantly thrive in such hopelessness. We should continue to strive for the best of our
world, where our choices of human intimacies are real choices, and not the last resort taken just to
survive. Human intimacies enhance our best and closest relationships. It serves as a foundation for two
human beings to face life’s joys and challenges while continually growing together with many shared
experiences. The quality of our human relationships defines the world that we create also for others.

Regardless of the willingness of AAA and BBB, therefore, to be trafficked, we affirm the text and spirit of
our laws. Minors should spend their adolescence moulding their character in environments free of the
vilest motives and the worse of other human beings. The evidence and the law compel us to affirm the
conviction of accused in this case.

But this is not all that we have done. By fulfilling our duties, we also express the hope that our people and
our government unite against everything inhuman. We contribute to a commitment to finally stamp out
slavery and human trafficking.

There are more AAA's and BBBs out there. They, too, deserve to be rescued. They, too, need to be
shown that in spite of what their lives have been, there is still much good in our world.

WHEREFORE, premises considered, we AFFIRM the decision of the Court of Appeals dated June 27,
2013, finding accused Shirley A. Casio guilty beyond reasonable doubt of violating Section 4(a), qualified
by Section 6(a) of Republic Act No. 9208, and sentencing her to suffer the penalty of life imprisonment
and a fine of ₱2,000,000.00, with the MODIFICATION that accused-appellant shall not be eligible for
parole under Act No. 4103 (Indeterminate Sentence Law) in accordance with Section 3 of Republic Act
No. 9346.92

The award of damages is likewise MODIFIED as follows:

Accused is ordered to pay each of the private complainants:

(1) ₱500,000.00 as moral damages; and

(2) ₱100,000.00 as exemplary damages.

SO ORDERED.

THIRD DIVISION

January 11, 2017

G.R. No. 223528

PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee,

vs.
JEFFREY HIRANG y RODRIGUEZ, Defendant-Appellant.

DECISION

REYES, J.:

This is an appeal from the Decision1 dated March 9, 2015 of the Court of Appeals (CA) in CA-G.R. CR-HC
No. 05129, which affirmed the conviction of defendant-appellant Jeffrey Hirang y Rodriguez (Hirang) for
violation of Section 6 of Republic Act (R.A.) No. 9208, otherwise known as the Anti-Trafficking in Persons
Act of 2003.
The Facts

Hirang, also known as Jojit and Jojie, was charged before the Regional Trial Court (RTC) of Pasig City
with the crime of qualified trafficking in persons, as defined and penalized under Section 4(a), in relation
to Section 6(a) and (c), and Section 3(a), (b) and (c) of R.A. No. 9208, via an Amended Information2 that
reads:

That on or about June 27, 2007, at Taguig City and within the jurisdiction of this Honorable Court, the
above named accused, did then and there, willfully, unlawfully and feloniously recruited, transported
and provided in a large scale minors [AAA],3 17 years old, [BBB], 17 years old, [CCC], 14 years old
and [DDD], 17 years old, for the purpose of prostitution by taking advantage of their vulnerability as
young girls through promise of a good time or "gimik" in a disco and good food if they would simply
accompany him in meeting and entertaining his Korean friends and to induce their full consent further
promise them Five Thousand Pesos (Php5,000.00) to Ten Thousand Pesos (Php10,000.00) each
afterwards when in truth and in fact peddled them for sexual favors and pleasure in consideration of
Twenty Thousand Pesos (Php20,000.00) each and engaged' their services in prostitution as in fact he
already received Seven Thousand Pesos down payment from the Korean national who engaged their
services.

CONTRARY TO LAW.4 (Emphasis and underlining in the original)

5
Upon arraignment, Hirang entered a plea of not guilty. After pre-trial, trial on the merits ensued.

Version of the Prosecution

The private complainants are minor victims of Hirang in his prostitution activities. The following persons
testified for the prosecution: victims DDD, AAA, CCC and BBB, International Justice Mission (UM)
Investigators Alvin Sarmiento (Sarmiento) and Jeffrey Villagracia (Villagracia), National Bureau of
Investigation (NBI) Special Investigator (SI) Menandro Cariaga (Cariaga), SI Anson L. Chumacera and
forensic chemist Loren J. Briones. 6

AAA was born on November 25, 1989. She was only 16 years old when Hirang recruited her in August of
2006 as a sex worker, for which she was paid ₱1,000.00 per day, less Hirang's commission of ₱200.00.
She was later prodded to work as a sexy dancer and prostitute at the Catwalk Club along Quezon
Avenue. She joined her customers in their tables at the club, and gave sexual services in hotels. She left
the club after two nights, upon her live-in partner's order. Still, Hirang sourced several other prostitution
jobs for AAA. He convinced AAA to work in a cybersex den in Muñoz, Quezon City. She received ₱700.00
a month, less ₱200.00 commission received by Hirang. In September 2006, Hirang made AAA work again
as a sexy dancer at Philippine Village bar in Puerto Galera. AAA had to quit her job when she got
pregnant, but resumed work for Hirang after she gave birth. 7

CCC was born on December 19, 1992. She was 14 years old when she was recruited by Hirang for his
illicit activities. She met Hirang at the house of Ka Lolet, her best friend's mother. She knew Hirang to be
scouting young girls who could be traded for sex. Sometime in June 2007, Hirang asked CCC to go with
him and meet some Koreans. 8

DDD, who was born on February 11, 1991, was 16 years old when she ran away from home in 2007 and
stayed at a friend's house in Sta. Ana, Taguig City. As she was then in need of money, she accepted an
offer from one Ate Lolet, a pimp, that she be introduced to a male customer, with whom she had sexual
intercourse for ₱2,500.00. It was Ate Lolet who later introduced DDD to Hirang. 9

BBB was born on March 28, 1990. CCC is her younger sister. She was 17 years old when on June 27,
2007, she visited CCC at Ka Lolet's house. There she saw Hirang, who invited her to come with him in
meeting some Koreans that evening. Later in the evening, at around 8:00 p.m., BBB went back to the
house of Ka Lo let to meet Hirang. It was then on June 27, 2007 that Hirang sold BBB, along with AAA,
CCC and DDD, to his Korean customers for sexual activities. Hirang told his victims that they would
receive ₱5,000.00 after a "gimik" 10 with them. At around 10:00 p.m., their group proceeded to meet with
the Koreans at Chowking restaurant, C-5 in Taguig City. Hirang instructed the girls to tell the Koreans that
they were 16 years of age, as this was their customers' preference. 11

When their group arrived at Chowking, Hirang talked to a Korean and then introduced the girls to him.
The Korean handed money to Hirang and as the latter was counting it, NBI agents arrived at the scene
and announced a raid. NBI agents arrested Hirang, while a social worker approached the girls and
brought them to the NBI for their statements. 12

The raid was conducted following a prior investigation conducted by IJM, a non-profit organization that
renders legal services and is based in Washington, D.C. IJM's investigators Sarmiento and Villagracia
gathered data on human trafficking in Metro Manila, after information that Hirang was selling minors for
prostitution. Hirang was introduced by a confidential informant to Villagracia, who posed as a travel
agency employee having Korean friends. Villagracia claimed to have Korean friends as they knew Hirang
to be transacting only with foreign customers. 13
Hirang and Villagracia first agreed to meet on June 20, 2007 at Chowking restaurant along C-5 Road in
Taguig City. Villagracia introduced Hirang to Sarmiento, who introduced himself as Korean national
studying English in Manila. Hirang informed Sarmiento that he had with him AAA, who was good in bed,
only 15 years old and could perform any sexual position, for a fee of ₱20,000.00. Sarmiento, however,
told Hirang that he and his other Korean friends had other plans for the night. Hirang demanded a
cancellation fee of ₱1,500.00 and scheduled another meeting with Sarmiento and the other Koreans on
June 26, 2007. 14

Thereafter, IJM submitted a report to the NBI-Field Office Division, and asked for the agency's
investigative assistance and operation against Hirang. On June 26, 2007, IJM and NBI operatives agreed
during a conference that they would conduct an entrapment operation on June 27, 2007. Sarmiento reset
his meeting with Hirang to June 27, 2007. Hirang initially got mad, but was appeased after Sarmiento
promised to give a bonus of ₱20,0000.00. Cariaga prepared the marked money to be used during the
entrapment, and was tasked to be the driver of poseur-customer Sarmiento. Several other NBI and IJM
agents served as back-up during the operation, in case any untoward incident should happen. 15

On June 27, 2007, the entrapment was conducted with proper coordination with local authorities. A social
worker from the Deartment of Social Welfare and Development and members of the media for the
segment XXX of ABS-CBN Channel 2 joined the operation. Villagracia secretly recorded his conversation
with Hirang. 16

Hirang introduced AAA, BBB, CCC and DDD to Sarmiento, who feigned his desire to pursue the
transaction. Hirang specified the sexual services that the girls could offer, and assured Sarmiento that the
girls could fulfill their customers' sexual fantasies. 17 Sarmiento then handed to Hirang a fictitious check
amounting to ₱20,000.00, while Cariaga handed the ₱7,000.00 marked money. As Hirang was counting
the cash, he complained that the amount was not enough as he charged ₱20,000.00 per girl, plus bonus.
At this point, Cariaga performed the pre-arranged signal with NBI operatives, who declared the
entrapment operation and arrested Hirang. An ultraviolet dust examination later performed upon Hirang
rendered positive result for fluorescent powder specks. 18

Version of the Defense

Hirang and his mother Myrna Hirang (Myrna) testified for the defense.

Hirang claimed to be self-employed, selling longganisa and other wares for a living. He denied dealing
with sexual trade. It was upon the instigation of Villagracia, who was introduced to him by his friend Jun
Valentin (Valentin), that he agreed to bring the girls for the supposed Korean clients. Hirang described
Villagracia as a drug addict who frequently visited Valentin's house for pot sessions. Villagracia told
Hirang that he knew of Koreans looking for girls and were willing to pay ₱20,000.00 to ₱25,000.00 for
each girl who must be 13 to 14 years old. 19

On June 20, 2007, Hirang, Valentin and two girls went to meet up with Villagracia at Chowking in C-5
Road, but the Koreans cancelled the transaction. Villagracia was disappointed that the girls brought by
Hirang were already 23 years old. They agreed to meet again, but Villagracia reminded Hirang to bring
young girls next time. Hirang promised to do so, and then received ₱500.00 from Villagracia. 20

When they later talked again over the telephone, Villagracia advised Hirang to convince the Koreans to
hire the girls so that Hirang and Valentin could receive the ₱5,000.00 commission per girl. Another Korean
promised to give a bonus of ₱10,000.00 if Hirang could provide young girls. Since Hirang claimed to have
no girls for the service, he went to the house of Ka Lolet with whom he had previously transacted
whenever he needed girls for sexual services. Ka Lolet provided BBB, CCC and DDD, while Hirang
personally talked to AAA. Hirang and Ka Lolet agreed to give each girl ₱5,000.00, while a ₱5,000.00
commission for each girl would be divided among him, Ka Lolet, Villagracia and Valentin. 21

Hirang and Villagracia met again on June 26, 2007 at Valentin's house. Villagracia reminded Hirang that
the girls should be young. He also gave instructions on the dresses that the girls should wear during their
meeting. On the evening of June 27, 2007, Hirang went to Ka Lolet's house and from there, brought the
girls to Chowking in C-5 Road on board a van provided by Ka Lolet. One Korean national gave Hirang
money for their food. As their order was being served at the restaurant, NBI operatives approached
Hirang and arrested him. 22

In her testimony, defense witness Myrna claimed knowing Villagracia, as the latter frequently talked to
Hirang over the cellphone. There were times that she answered Villagracia's calls, and the latter
introduced himself as a friend of Hirang with whom he had an arrangement. 23

Ruling of the RTC

On June 25, 2011, the RTC of Pasig City, Branch 163, Taguig City Station rendered its
Decision24 convicting Hirang of the crime of human trafficking. The dispositive portion of the decision
reads:
WHEREFORE, [HIRANG] is hereby found GUILTY beyond reasonable doubt of the crime of Violation of
Section 6 of [R.A.] No. 9208 and is hereby sentenced to suffer the penalty of life imprisonment and a fine
of Two Million Pesos (Php2,000,000.00).

SO ORDERED.25

Feeling aggrieved, Hirang appealed26 to the CA based on the following assignment of errors:

I. THE TRIAL COURT GRAVELY ERRED IN REJECTING [HIRANG'S] DEFENSE.

II. THE TRIAL COURT GRAVELY ERRED IN GIVING CREDENCE TO THE CONFLICTING AND
IMPROBABLE TESTIMONIES OF THE PROSECUTION WITNESSES.

III. THE TRIAL COURT GRAVELY ERRED IN NOT FINDING THAT [HIRANG'S] RIGHTS UNDER [R.A.]
NO. 7438 (AN ACT DEFINING CERTAIN RIGHTS OF PERSON ARRESTED, DETAINED OR UNDER
CUSTODIAL INVESTIGATION AS WELL AS THE DUTIES OF THE ARRESTING, DETAINING AND
INVESTIGATING OFFICERS, AND PROVIDING PENALTIES FOR VIOLATIONS THEREOF) WERE
VIOLATED.27

Ruling of the CA

The CA denied the appeal via a Decision28 dated March 9, 2015, with dispositive portion that reads:

WHEREFORE, the appeal is DENIED. The Decision dated June 25, 2011 of the [RTC] of Pasig City,
Branch 163, Taguig City Station in Criminal Case No. 135682 is AFFIRMED in toto.

SO ORDERED.29

Hence, this appeal. 30

The Present Appeal

On June 13, 2016, the Court issued a Resolution notifying the parties that they could file their respective
supplemental briefs.31 However, both Hirang and the Office of the Solicitor General, as counsel for
plaintiff-appellee People of the Philippines, manifested that they would no longer file supplemental briefs,
as their respective briefs filed with the CA sufficiently addressed their particular arguments. 32

Based on the parties' contentions as raised before the CA, the Court is called upon to resolve the
following issues: (1) whether the prosecution was able to prove beyond reasonable doubt the guilt of
Hirang for the crime charged; and (2) whether Hirang should be acquitted in view of the failure of the
arresting officers to observe R.A. No. 7438.

Ruling of the Court

The Court affirms Hirang's conviction.

Hirang was charged and convicted for qualified trafficking in persons under Section 4(a), in relation to
Section 6(a) and (c), and Section 3(a), (b) and (c) of R.A. No. 9208, which read:

Section 4. Acts of Trafficking in Persons. - It shall be unlawful for any person, natural or juridical, to
commit any of the following acts:

(a) To recruit, transport, transfer; harbor, provide, or receive a person by any means, including those done
under the pretext of domestic or overseas employment or training or apprenticeship, for the purpose of
prostitution, pornography, sexual exploitation, forced labor, slavery, involuntary servitude or debt bondage;

Section 6. Qualified Trafficking in Persons. - The following are considered as qualified trafficking:

(a) When the trafficked person is a child;

xxxx

(c) When the crime is committed by a syndicate, or in large scale. Trafficking is deemed committed by a
syndicate if carried out by a group of three (3) or more persons conspiring or confederating with one
another. It is deemed committed in large scale if committed against three (3) or more persons, individually
or as a group;

Section 3. Definition of Terms. - As used in this Act:

(a) Trafficking in Persons - refers to the recruitment, transportation, transfer or harboring, or receipt of
persons with or without the victim's consent or knowledge, within or across national borders by means of
threat or use of force, or other forms of coercion, abduction, fraud, deception, abuse of power or of
position, taking advantage of the vulnerability of the person, or, the giving or receiving of payments or
benefits to achieve the consent of a person having control over another person for the purpose of
exploitation which includes at a minimum, the exploitation or the prostitution of others or other forms of
sexual exploitation, forced labor or services, slavery, servitude or the removal or sale of organs.

The recruitment, transportation, transfer, harboring or receipt of a child for the purpose of exploitation
shall also be considered as "trafficking in persons" even if it does not involve any of the means set forth in
the preceding paragraph.

(b) Child - refers to a person below eighteen (18) years of age or one who is over eighteen (18) but is
unable to fully take care of or protect himself/herself from abuse, neglect, cruelty, exploitation, or
discrimination because of a physical or mental disability or condition.

(c) Prostitution - refers to any act, transaction, scheme or design involving the use of a person by another,
for sexual intercourse or lascivious conduct in exchange for money, profit or any other consideration.

In People v. Casio,33 the Court defined the elements of trafficking in persons, as derived from the
aforequoted Section 3(a), to wit:

(1) The act of "recruitment, transportation, transfer or harbouring, or receipt of persons with or without the
victim's consent or knowledge, within or across national borders";

(2) The means used which include "threat or use of force, or other forms of coercion, abduction, fraud,
deception, abuse of power or of position, taking advantage of the vulnerability of the person, or, the giving
or receiving of payments or benefits to achieve the consent of a person having control over another"; and

(3) The purpose of trafficking is exploitation which includes "exploitation or the prostitution of others or
other forms of sexual exploitation, forced labor or services, slavery, servitude or the removal or sale of
organs."34 (Citation omitted and italics in the original)

The information filed against Hirang sufficiently alleged the recruitment and transportation of the minor
victims for sexual activities and exploitation, with the offender taking advantage of the vulnerability of the
young girls through the guarantee of a good time and financial gain. Pursuant to Section 6 of R.A. No.
9208, the crime committed by Hirang was qualified trafficking, as it was committed in a large scale and his
four victims were under 18 years of age.

The presence of the crime's elements was established by the prosecution witnesses who testified during
the trial.1âwphi1The young victims themselves testified on their respective ages, and how they were lured
by Hirang to participate in the latter's illicit sex trade. Hirang recruited the girls to become victims of sexual
abuse and exploitation. Mainly upon a promise of financial benefit, the girls agreed and, thus, joined him
on June 27, 2007 in meeting with the Korean customers in search for prostitutes. Police authorities
personally, witnessed Hirang's unlawful activity, as they conducted the entrapment operations and
arrested him after Hirang transacted with the supposed customers and received payment therefor.

Hirang still sought an acquittal by claiming that the prosecution witnesses' testimonies were conflicting
and improbable. Such alleged inconsistencies pertained to the supposed participation of Ka Lolet in the
recruitment of the victims, how the IJM agents came to personally know of Hirang, and other incidents
that involved prior surveillance and the entrapment operation itself. It is evident, however, that the
supposed inconsistencies in the witnesses' testimonies pertained to minor details that, in any case, could
not negate Hirang's unlawful activity and violation of R.A. No. 9208. Moreover, the Court has ruled time
and again that factual findings of the trial court, its assessment of the credibility of witnesses and the
probative weight of their testimonies and the conclusions based on these factual findings are to be given
the highest respect. As a rule, the Court will not weigh anew the evidence already passed on by the trial
court and affirmed by the CA. 35

Hirang argued that he was merely instigated to commit the offense, but even such defense deserves
scant consideration.1âwphi1 It has been established by the prosecution that Hirang has been engaged in
the illegal activities leading young women to prostitution, and the police officers merely employed means
for his capture. Trafficking of women was his habitual trade; he was merely entrapped by
authorities.36 Entrapment is an acceptable means to capture a wrongdoer. In People v. Bartolome,37the
Court distinguished between entrapment and instigation, as it explained:

Instigation is the means by which the accused is lured into the commission of the offense charged in
order to prosecute him. On the other hand, entrapment is the employment of such ways and means for
the purpose of trapping or capturing a lawbreaker. Thus, in instigation, officers of the law or their agents
incite, induce, instigate or lure an accused into committing an offense which he or she would otherwise
not commit and has no intention of committing. But in entrapment, the criminal intent or design to commit
the offense charged originates in the mind of the accused, and law enforcement officials merely facilitate
the apprehension of the criminal by employing ruses and schemes; thus, the accused cannot justify his or
her conduct. In instigation, where law enforcers act as co-principals, the accused will have to be
acquitted. But entrapment cannot bar prosecution and conviction. As has been said, instigation is a "trap
for the unwary innocent" while entrapment is a "trap for the unwary criminal." 38

In this case, it was established during trial that Hirang had been recruiting and deploying young girls for
customers in the sex trade. The IJM personnel approached him for girls precisely because of his illicit
activities. Also, Hirang was not first approached for prostitutes by police or government authorities, but by
investigators of IJM, which is a non-profit and non-governmental organization. IJM only sought
coordination with the police officers after Hirang, Sarmiento and Villagracia had determined to meet on
June 27, 2007 for the transaction with the purported Korean customers. Clearly, there could be no
instigation by officers, as barred by law, to speak of.

Even as the Court considers the alleged failure of the apprehending police officers to inform Hirang of the
Miranda rights upon his arrest, there is no sufficient ground for the Court to acquit him. The CA correctly
explained that any defect in the arrest of the accused was cured by his voluntary act of entering a plea
and participating in the trial without raising the issue. 39 In People v. Vasquez,40the Court held:

[T]he Court rules that the appellant can no longer assail the validity of his arrest. We reiterated in People
v. Tampis that "[a]ny objection, defect or irregularity attending an arrest must be made before the accused
enters his plea on arraignment. Having failed to move for the quashing of the information against them
before their arraignment, appellants are now estopped from questioning the legality of their arrest. Any
irregularity was cured upon their voluntary submission to the trial court's jurisdiction. x x x. 41 (Citations
omitted)

Given the foregoing, there is no cogent reason for the Court to reverse Hirang's conviction for qualified
trafficking under R.A. No. 9208. The RTC and CA correctly imposed the penalty of life imprisonment and
fine of ₱2,000,000.00, applying Section 10(c) of R.A. No. 9208, to wit:

Section 10. Penalties and Sanctions. - The following penalties and sanctions are hereby established for
the offenses enumerated in this Act:

xxxx

(c) Any person found guilty of qualified trafficking under Section 6 shall suffer the penalty of life
imprisonment and a fine of not less than Two million pesos (P2,000,000.00) but not more than Five million
pesos (5,000,000.00)[.]

Damages in favor of the victims should, however, also be awarded. In line with prevailing
jurisprudence,42 each victim is entitled to ₱500,000.00 as moral damages, and ₱100,000.00 as exemplary
damages. This is supported by Article 2219 of the New Civil Code, which reads:

Article 2219. Moral damages may be recovered in the following and analogous cases:

(1) A criminal offense resulting in physical injuries;

(2) Quasi-delicts causing physical injuries;

(3) Seduction, abduction, rape, or other lascivious acts;

(4) Adultery or concubinage;

(5) Illegal or arbitrary detention or arrest;

(6) Illegal search;

(7) Libel, slander or any other form of defamation;

(8) Malicious prosecution;

(9) Acts mentioned in A1iicle 309;

(10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34 and 35.

xxxx

The criminal case of Trafficking in Persons as a Prostitute is an analogous case to the crimes of
seduction, abduction, rape, or other lascivious acts. In fact, it is worse, thereby justifying the award of
moral damages. When the crime is aggravated, the award of exemplary damages is also justified. 43
WHEREFORE, the appeal is DISMISSED. The Decision dated March 9, 2015 of the Court of Appeals in
CA-G.R. CR-HC No. 05129 is AFFIRMED with MODIFICATION in that victims AAA, BBB, CCC and DDD
are each entitled to ₱500,000.00 as moral damages and ₱100,000.00 as exemplary damages.

SO ORDERED.

BIENVENIDO L. REYES
Associate Justice

SECOND DIVISION

G.R. No. 195419 October 12, 2011

PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee,

vs.
HADJA JARMA LALLI y PURIH, RONNIE ARINGOY y MASION, and NESTOR RELAMPAGOS (at
large),Accused.
HADJA JARMA LALLI y PURIH and RONNIE ARINGOY Accused-Appellants.

DECISION

CARPIO, J.:

The Case

This is a consolidated criminal case filed against the accused-appellants for the crimes of Illegal
Recruitment (Criminal Case No. 21930) and Trafficking in Persons (Criminal Case No. 21908).

The Regional Trial Court (RTC) of Zamboanga City, in its Decision dated 29 November 2005 (RTC
Decision),1 found accused-appellants guilty beyond reasonable doubt of the crimes of Illegal Recruitment
and Trafficking in Persons committed by a syndicate, and sentenced each of the accused to suffer the
penalty of life imprisonment plus payment of fines and damages. On appeal, the Court of Appeals (CA) in
Cagayan de Oro, in its Decision dated 26 February 2010 (CA Decision), 2 affirmed in toto the RTC
Decision. The accused-appellants appealed to this Court by filing a Notice of Appeal 3 in accordance with
Section 3(c), Rule 122 of the Rules of Court.

The Facts

The findings of fact of the RTC, which were affirmed in toto by the CA, are as follows:

In the evening of June 3, 2005, while Lolita Sagadsad Plando, 23 years old, single, was in Tumaga,
Zamboanga City on her way to the house of her grandfather, she met Ronnie Masion Aringoy and Rachel
Aringoy Cañete. Ronnie greeted Lolita, "Oy, it’s good you are here" ("oy, maayo kay dia ka"). Rachel
asked Lolita if she is interested to work in Malaysia. x x x Lolita was interested so she gave her cellphone
number to Ronnie. After their conversation, Lolita proceeded to her grandfather’s house.

xxx

On June 4, 2005, at about 7:00 o’clock in the morning, Lolita received a text message from Ronnie
Aringoy inviting her to go to the latter’s house. At 7:30 in the morning, they met at Tumaga on the road
near the place where they had a conversation the night before. Ronnie brought Lolita to the house of his
sister in Tumaga. Lolita inquired what job is available in Malaysia. Ronnie told her that she will work as a
restaurant entertainer. All that is needed is a passport. She will be paid 500 Malaysian ringgits which is
equivalent to ₱7,000.00 pesos in Philippine currency. Lolita told Ronnie that she does not have a
passport. Ronnie said that they will look for a passport so she could leave immediately. Lolita informed
him that her younger sister, Marife Plando, has a passport. Ronnie chided her for not telling him
immediately. He told Lolita that she will leave for Malaysia on June 6, 2005 and they will go to Hadja
Jarma Lalli who will bring her to Malaysia. Ronnie sent a text message to Lalli but the latter replied that
she was not in her house. She was at the city proper.

On June 5, 2005, at about 6:00 o’clock in the evening, Ronnie Aringoy and Rachel Aringoy Cañete arrived
on board a tricycle driven by Ronnie at the house where Lolita was staying at Southcom Village. Ronnie
asked if Lolita already had a passport. Lolita said that she will borrow her sister’s passport. Ronnie,
Rachel and Lolita went to Buenavista where Lolita’s other sister, Gina Plando was staying. Her sister
Marife Plando was there at that time. Lolita asked Marife to let her use Marife’s passport. Marife refused
but Lolita got the passport. Marife cried. Ronnie, Rachel and Lolita proceeded to Tumaga. Ronnie, Rachel
and Lolita went to the house of Hadja Jarma Lalli just two hundred meters away from the house of Ronnie
in Tumaga. Ronnie introduced Lolita to Hadja Jarma, saying "Ji, she is also interested in going to
Malaysia." Lolita handed a passport to Hadja Jarma telling her that it belongs to her sister Marife Plando.
Hadja Jarma told her it is not a problem because they have a connection with the DFA (Department of
Foreign Affairs) and Marife’s picture in the passport will be substituted with Lolita’s picture. Nestor
Relampagos arrived driving an owner-type jeep. Hadja Jarma introduced Nestor to Lolita as their financier
who will accompany them to Malaysia. x x x Lolita noticed three other women in Hadja Jarma’s house.
They were Honey, about 20 years old; Michele, 19 years old, and another woman who is about 28 years
old. The women said that they are from Ipil, Sibugay Province. Ronnie told Lolita that she will have many
companions going to Malaysia to work. They will leave the next day, June 6, and will meet at the wharf at
2:30 in the afternoon.

On June 6, 2005, Lolita went to Zamboanga City wharf at 2:00 o’clock in the afternoon bringing a bag
containing her make-up and powder. She met at the wharf Hadja Jarma Lalli, Ronnie Aringoy, Honey and
Michele. Ronnie gave to Lolita her boat ticket for the vessel M/V Mary Joy bound for Sandakan, Malaysia;
a passport in the name of Marife Plando but with Lolita’s picture on it, and ₱1,000.00 in cash. Hadja
Jarma, Lolita, Honey, Michele and two other women boarded the boat M/V Mary Joy bound for Sandakan.
Ronnie Aringoy did not go with them. He did not board the boat. x x x After the boat sailed, Hadja Jarma
Lalli and Nestor Relampagos approached Lolita and her companions. Nestor told them that they will have
a good job in Malaysia as restaurant entertainers. They will serve food to customers. They will not be
harmed.

M/V Mary Joy arrived at the port of Sandakan, Malaysia at 10:00 o’clock in the morning of June 7, 2005.
After passing through the immigration office, Hadja Jarma Lalli, Nestor Relampagos, Lolita, Honey,
Michele and two other women boarded a van for Kota Kinabalu. x x x At the hotel, Nestor Relampagos
introduced to Lolita and her companions a Chinese Malay called "Boss" as their employer. After looking at
the women, "Boss" brought Lolita, Honey, Diane and Lorraine to a restaurant near the hotel. Diane and
Lorraine were also on baord M/V Mary Joy when it left the port of Zamboanga for Sandakan on June 6,
2005. When they were already at the restaurant, a Filipina woman working there said that the place is a
prostitution den and the women there are used as prostitutes. Lolita and her companions went back to the
hotel. They told Hadja Jarma and Nestor that they do not like to work as prostitutes. x x x After about five
minutes, another person called "boss" arrived. x x x [T]hey were fetched by a van at about 7:00 o’clock in
the evening and brought to Pipen Club owned by "Boss Awa", a Malaysian. At the club, they were told
that they owe the club 2,000 ringgits each as payment for the amount given by the club to Hadja Jarma
Lalli and Nestor Relampagos. They will pay for the said amount by entertaining customers. The
customers will pay 300 ringgits for short time services of which 50 ringgits will go to the entertainer, and
500 ringgits for over night service of which 100 ringgits will be given to the entertainer. Pipen Club is a big
club in a two-storey building. There were about 100 women working in the club, many of them were
Filipina women.

Lolita Plando was forced to work as entertainer at Pipen Club. She started working at 8:30 in the evening
of June 14, 2005. She was given the number 60 which was pinned on her. That night, she had her first
customer who selected her among the other women at the club. He was a very big man, about 32 years
old, a Chinese-Malay who looked like a wrestler. The man paid for short time service at the counter. Lolita
was given by the cashier a small pink paper. She was instructed to keep it. A small yellow paper is given
to the entertainer for overnight services. The customer brought Lolita to a hotel. She did not like to go with
him but a "boss" at the club told her that she could not do anything. At the hotel, the man poked a gun at
Lolita and instructed her to undress. She refused. The man boxed her on the side of her body. She could
not bear the pain. The man undressed her and had sexual intercourse with her. He had sexual
intercourse with her every fifteen minutes or four times in one hour. When the customer went inside the
comfort room, Lolita put on her clothes and left. The customer followed her and wanted to bring her back
to the hotel but Lolita refused. At about 1:00 o’clock in the morning of June 15, 2005, Lolita was chosen
by another customer, a tall dark man, about 40 years old. The customer paid for an overnight service at
the counter and brought Lolita to Mariner Hotel which is far from Pipen Club. At the hotel, the man told
Lolita to undress. When she refused, the man brought her to the comfort room and bumped her head on
the wall. Lolita felt dizzy. The man opened the shower and said that both of them will take a bath. Lolita’s
clothes got wet. She was crying. The man undressed her and had sexual intercourse with her. They
stayed at the hotel until 11:00 o’clock in the morning of June 15, 2005. The customer used Lolita many
times. He had sexual intercourse with her every hour.

Lolita worked at Pipen Club from June 14 to July 8, 2005. Every night, a customer used her. She had at
least one customer or more a night, and at most, she had around five customers a night. They all had
sexual intercourse with her. On July 9, 2005, Lolita was able to contact by cellphone at about 10:00
o’clock in the morning her sister Janet Plando who is staying at Sipangkot Felda x x x. Janet is married to
Said Abubakar, an Indonesian national who is working as a driver in the factory. x x x Lolita told Janet that
she is in Labuan, Malaysia and beg Janet to save her because she was sold as a prostitute. Janet told
Lolita to wait because her husband will go to Pipen Club to fetch Lolita at 9:00 o’clock that evening of that
day. x x x She told Janet to instruct her husband to ask for No. 60 at Pipen Club. x x x At 9:00 o’clock in
the evening, Lolita was told by Daddy Richard, one of the bosses at the club, that a customer requested
for No. 60. The man was seated at one of the tables. Lolita approached the man and said, "good
evening." The man asked her is she is the sister of Janet Plando. Lolita replied that she is, and asked the
man if he is the husband of her sister. He said, "yes." The man had already paid at the counter. He stood
up and left the place. Lolita got her wallet and followed him. x x x Lolita told her sister about her ordeal.
She stayed at her sister’s house until July 22, 2005. On July 21, 2005 at 7:00 o’clock in the evening, a
policeman went to her sisters house and asked if there is a woman staying in the house without a
passport. Her sister told the policeman that she will send Lolita home on July 22. At dawn on July 22,
Lolita and her brother-in-law took a taxi from Sipangkot Felda to Mananamblas where Lolita will board a
speedboat to Sibuto, Tawi-Tawi. x x x

Upon arrival in Zamboanga City on July 24, 2005, Lolita went directly to the house of her eldest sister
Alejandra Plando Maywila at Sta. Catalina, Zamboanga City. She left her things at her sister’s house and
immediately went to the sister of Ronnie Aringoy in Tumaga. Ronnie was not there. She asked Russel,
niece of Ronnie, to call for the latter. Ronnie arrived and said to her, "so you are here, you arrived
already." He said he is not involved in what happened to her. Lolita asked Ronnie to accompany her to the
house of Nestor Relampagos because she has something to get from him. Ronnie refused. He told Lolita
not to let them know that she had already arrived from Malaysia.

Lolita was advised to file a complaint with the police regarding her ordeal in Malaysia. On August 2, 2005,
at past 9:00 o’clock in the morning, Lolita Plando went to Zamboanga Police Office at Gov. Lim Avenue to
file her complaint. x x x

In her Counter-Affidavit (Exh. "1"; "1-A"-Lalli), Hadja Jarma Lalli admitted that she met Lolita Plando on
June 6, 2005 on board M/V Mary Joy while the said vessel was at sea on its way to Sandakan, Malaysia.
The meeting was purely coincidental. By coincidence also, Hadja Jarma, Nestor Relampagos and Lolita
Plando boarded the same van for Kota Kinabalu, Malaysia. Upon arrival, they parted ways. They did not
see each other anymore at Kota Kinabalu, Malaysia. She did not know what happened to them. She went
to Kota Kinabalu to visit his son-in-law. She denied having recruited Lolita Plando for employment abroad
(Exh. "1"; "1-A"). x x x

In his Counter-Affidavit (Exh. "1"-Aringoy), Ronnie Aringoy affirmed that he personally knows Lolita
Plando since she was a teenager and he knows for a fact that her name is Cristine and not Marife "as she
purports it to appear." Sometime in the first week of June 2005, Lolita borrowed ₱1,000.00 from Ronnie
because she wanted to go to Malaysia to work as a guest relation officer (GRO). Ronnie lent her
₱1,000.00. He told her that he knows "a certain Hadja Jarma Lalli, distant neighbor, who frequents to
Malaysia and with whom she can ask pertinent information on job opportunities." The entries in Philippine
Passport No. MM401136 issued to Hadja Jarma Lalli on January 29, 2004 (Exh. "2"; "2-A" to "2-Q")
showed that she traveled to Malaysia no less than nine (9) times within the period from March 2004 to
June 2005.

xxx

Nora Mae Adling, ticketing clerk of Aleson Shipping Lines, owner of the vessel M/V Mary Joy 2 plying
Zamboanga City to Sandakan, Malaysia route and of M/V Kristel Jane 3, testified that Hadja Jarma Lalli
bought passenger tickets for her travel to Sandakan, not only for herself but also for other women
passengers.

xxx

Ronnie Aringoy submitted the Affidavit of his witness Rachel Cañete (Exh. "2") and the Joint Affidavits of
witnesses Mercedita Salazar and Estrella Galgan. Rachel Canete declared that Lolita Plando whom she
knows as Cristine Plando worked as a GRO (guest relation officer) and massage attendant at Magic 2
Videoke and Massage Parlor, that Lolita Plando has four children sired by different men; and that she
knows for a fact that Lolita Plando has been going to and from Malaysia to work in bars. When she
testified in court, Rachel did not present other evidence to substantiate her allegations. Mercedita Salazar
and Estrella Galgan declared in their Joint Affidavit that Lolita Plando who is known to them as Marife
Plando was their co-worker as massage attendant and GRO (guest relation officer) at Magic 2 Massage
Parlor and Karaoke bar where she used the names Gina Plando and Cristine Plando. She worked in the
said establishment for nine months from February to October 2002. She has four children from four
different men. No other evidence was submitted in court to prove their assertions. 4

The Decision of the Trial Court

The Regional Trial Court rendered its Decision on 29 November 2005, with its dispositive portion
declaring:

WHEREFORE, the Court finds accused HADJA JARMA LALLI y PURIH and RONNIE ARINGOY y
MASION GUILTY beyond reasonable doubt in Criminal Case No. 21908 of the Crime of Trafficking in
Persons defined in Section 3(a) and penalized under Section 10(c) in relation to Sections 4(a) and 6(c) of
Republic Act No. 9208 known as the "Anti-Trafficking in Persons Act of 2003" and in Criminal Case No.
21930 of the crime of Illegal Recruitment defined in Section 6 and penalized under Section 7(b) of
Republic Act No. 8042 known as the "Migrant Workers and Overseas Filipinos Act of 1995" and
SENTENCES each of said accused:

1. In Criminal Case No. 21908, to suffer the penalty of LIFE IMPRISONMENT and to pay a fine of
₱2,000,000.00 pesos;
 2. In Criminal Case No. 21930, to suffer the penalty of LIFE IMPRISONMENT and to pay a fine of
₱500,000.00 pesos;

3. To pay the offended party Lolita Plando y Sagadsad, jointly and severally, the sum of
₱50,000.00 as moral damages, and ₱50,000.00 as exemplary damages; and

4. To pay the costs.

SO ORDERED.5

The trial court did not find credible the denials of the accused-appellants over the candid, positive and
convincing testimony of complainant Lolita Plando (Lolita). The accused, likewise, tried to prove that Lolita
was a Guest Relations Officer (GRO) in the Philippines with four children fathered by four different men.
However, the trial court found these allegations irrelevant and immaterial to the criminal prosecution.
These circumstances, even if true, would not exempt or mitigate the criminal liability of the accused. The
trial court found that the accused, without a POEA license, conspired in recruiting Lolita and trafficking her
as a prostitute, resulting in crimes committed by a syndicate. 6 The trial court did not pronounce the liability
of accused-at-large Nestor Relampagos (Relampagos) because jurisdiction was not acquired over his
person.

The Decision of the Court of Appeals

On 26 February 2010, the Court of Appeals affirmed in toto the RTC Decision and found accused-
appellants guilty beyond reasonable doubt of the crimes of Illegal Recruitment and Trafficking in Persons.

The Issue

The only issue in this case is whether the Court of Appeals committed a reversible error in affirming in
toto the RTC Decision.

The Ruling of this Court

We dismiss the appeal for lack of merit.

We modify and increase the payment of damages in the crime of Trafficking in Persons from ₱50,000 to
₱500,000 for moral damages and ₱50,000 to ₱100,000 for exemplary damages.

Grounds for Appeal

In his Appeal Brief,7 Ronnie Aringoy (Aringoy) admits that he referred Lolita to a certain Hadja Jarma Lalli
(Lalli), Aringoy’s neighbor who frequents Malaysia and from whom Lolita could ask pertinent information
on job opportunities.8 Aringoy claims that he learned later that Lolita left for Malaysia. 9 He denies knowing
Relampagos to whom Lolita paid ₱28,000 as placement fee for finding her work in Malaysia. 10

Aringoy presented three witnesses: his niece Rachel Aringoy Cañete (Rachel), Mercedita Salazar
(Mercedita), and Estrella Galgan (Estrella). In her testimony, Rachel declared that: (1) Lolita is a GRO and
Massage Attendant at Magic 2 Videoke and Massage Parlor; (2) Lolita has four children sired by different
men; and (3) Lolita has been travelling to Malaysia to work in bars. Mercedita and Estrella, on the other
hand, declared in their testimonies that Lolita was their co-worker as Massage Attendant and GRO in
Magic 2 Massage Parlor and Karaoke Bar from February to October 2002. 11

Aringoy assailed the credibility of Lolita’s testimony because of inconsistencies with regard to: (1) Lolita’s
grandfather’s status and name; (2) the persons (Ronnie and Rachel) who approached Lolita to talk about
the job opportunity in Malaysia; (3) certain statements in Lolita’s testimony that were not alleged in her
Sworn Statement; (4) payment of placement fee of ₱ 28,000; and (5) names of the other female recruits
who were with Lolita in the boat going to Sandakan and Kota Kinabalu. 12 Aringoy likewise claims that he
was never included in the initial complaint filed by Lolita, and Lolita’s statements about her meetings with
him, Lalli and Relampagos on 3, 4, 5 and 6 June 2005 were not corroborated by any witness. 13

On the other hand, in her Appeal Brief, 14 Lalli claims that she simply met Lolita on 6 June 2005 on board
the ship M/V Mary Joy bound for Sandakan, Malaysia. 15 Lalli denies having met Lolita prior to their
meeting on board M/V Mary Joy.16 Lalli claims she was going to Malaysia to visit her daughter and son-in-
law who was a Malaysian national.17 Lalli further claims that she only spoke to Lolita aboard the ship for
idle conversation to pass away the time.18 In this conversation, she learned that Lolita was with a party of
girls accompanied by Relampagos, and the latter was bringing them to Malaysia to work as sales
ladies.19 Lalli admits that Lolita, Relampagos and the other girls rode in Lalli’s van in Sandakan, driven by
a friend of Lalli’s son-in-law. 20 They all rode together because Relampagos talked to the van driver,
requesting if he and his party of girls could board the van and pay their fare when they reach the city
proper of Kota Kinabalu.21 Lalli boarded the van with Lolita, Relampagos and their companions. 22 Upon
reaching her destination, Lalli got off the van, leaving Lolita, Relampagos and their other companions to
continue their journey towards the city proper of Kota Kinabalu. 23 After spending several days in Malaysia
with her daughter and son-in-law, Lalli went to Brunei to visit a cousin on 12 June 2005, and headed back
to Malaysia on 14 June 2005.24

Lalli assails the credibility of Lolita due to inconsistencies in her testimony with regard to: (1) Lolita not
being in Southcom Village on 5 June 2005 at 6:00 p.m., as she claimed, but in Buenavista Village; and (2)
Lolita’s claim that Lalli and Relampagos on 12 June 2005 brought the girls to Labuan, when in fact, Lalli
was already in Brunei on 12 June 2005, as evidenced by the stamp in her passport. 25

Credibility of Testimonies

Both Aringoy and Lalli, in their respective Appeal Briefs, assail the testimony of Lolita due to its alleged
inconsistency on immaterial facts, such as the status of Lolita’s grandfather, the name of the village she
was in, the date she was brought to Labuan, Malaysia, and the like. In a long line of cases, the Court has
ruled that inconsistencies pointed out by the accused in the testimony of prosecution witnesses relating to
minor details do not destroy the credibility of witnesses. 26 On the contrary, they indicate that the witnesses
were telling the truth and not previously rehearsed.27

The clear material inconsistency in this case, however, lies in the testimonies of accused Aringoy and
Lalli. Aringoy admitted that he referred Lolita to a certain Hadja Jarma Lalli, his neighbor who frequents
Malaysia and with whom Lolita could ask pertinent information on job opportunities. 28 Lalli, on the other
hand, denies having met Lolita prior to their meeting on board M/V Mary Joy on 6 June 2005, 29 and claims
that her meeting with Lolita was purely coincidental. 30 Lalli admits that, even if she met Relampagos,
Lolita and their companions only on that day on board M/V Mary Joy, she allowed these people to ride
with her in Malaysia using the van driven by the friend of Lalli’s son-in-law. 31 Lastly, Lalli claims that she
often goes to Malaysia to visit her daughter and son-in-law. 32 However, this does not explain why Lalli
purchased boat tickets, not only for herself, but for the other women passengers going to
Malaysia.33 From March 2004 to June 2005, Lalli traveled to Malaysia no less than nine (9) times. 34 Nora
Mae Adling, ticketing clerk of Aleson Shipping Lines, owner of the vessel M/V Mary Joy 2 plying
Zamboanga City to Sandakan, Malaysia route and of M/V Kristel Jane 3, testified in open court that
"Hadja Jarma Lalli bought passenger tickets for her travel to Sandakan, not only for herself but also for
other women passengers."35 Clearly, it is not Lolita’s testimony that is materially inconsistent, but the
testimonies of Lalli and Aringoy.

Aringoy presented his witnesses Rachel, Mercedita and Estrella to impeach the credibility of Lolita by
alleging that Lolita was a Massage Attendant and GRO in a massage parlor and videoke bar. His witness
Rachel further declared that Lolita, at the young age of 23 years, already had four children sired by four
different men, and had been previously travelling to Malaysia to work in bars. These bare allegations were
not supported by any other evidence. Assuming, for the sake of argument, that Lolita previously worked in
a Karaoke Bar and Massage Parlor and that she had four children from different men, such facts cannot
constitute exempting or mitigating circumstances to relieve the accused from their criminal liabilities. It
does not change the fact that the accused recruited Lolita to work in Malaysia without the requisite POEA
license, thus constituting the crime of illegal recruitment. Worse, the accused deceived her by saying that
her work in Malaysia would be as restaurant entertainer, when in fact, Lolita would be working as a
prostitute, thus, constituting the crime of trafficking.

The facts found by the trial court, as affirmed in toto by the Court of Appeals, are, as a general rule,
conclusive upon this Court, in the absence of any showing of grave abuse of discretion. 36 The Court,
however, may determine the factual milieu of cases or controversies under specific circumstances, such
as:

(1) when the inference made is manifestly mistaken, absurd or impossible;

(2) when there is a grave abuse of discretion;
(3) when the finding is grounded entirely on speculations, surmises or
conjectures;
(4) when the judgment of the Court of Appeals is based on misapprehension of
facts;
(5) when the findings of fact are conflicting;
(6) when the Court of Appeals, in making its findings, went beyond the issues of
the case and the same is contrary to the admissions of both appellant and
appellee;
(7) when the findings of the Court of Appeals are contrary to those of the trial
court;
(8) when the findings of fact are conclusions without citation of specific evidence
on which they are based;
(9) when the Court of Appeals manifestly overlooked certain relevant facts not
disputed by the parties and which, if properly considered, would justify a
different conclusion; and
(10) when the findings of fact of the Court of Appeals are premised on the
 absence of evidence and are contradicted by the evidence on record. 37

In this case, none of these exceptions to the general rule on conclusiveness of facts are applicable. The
Court gives weight and respect to the trial court’s findings in criminal prosecution because the latter is in a
better position to decide the question, having heard the witnesses in person and observed their
deportment and manner of testifying during the trial. 38 For this reason, the Court adopts the findings of
fact of the trial court, as affirmed in toto by the Court of Appeals, there being no grave abuse of discretion
on the part of the lower courts.

Criminal Case No. 21930 (Illegal Recruitment)

Section 6 of Republic Act No. 8042 (RA 8042) defines illegal recruitment, as follows:

[I]llegal recruitment shall mean any act of canvassing, enlisting, contracting, transporting, utilizing, hiring,
or procuring workers and includes referring, contact services, promising or advertising for employment
abroad, whether for profit or not, when undertaken by a non-licensee or non-holder of
authority contemplated under Article 13(f) of Presidential Decree No. 442, as amended, otherwise known
as the Labor Code of the Philippines.

xxx

Illegal recruitment when committed by a syndicate or in large scale shall be considered an offense
involving economic sabotage.

xxx

Illegal recruitment is deemed committed by a syndicate if carried out by a group of three (3) or more
persons conspiring or confederating with one another. (Emphasis supplied)

Article 13(f) of Presidential Decree No. 442, as amended, otherwise known as the Labor Code of the
Philippines, defines "authority" as follows:

"Authority" means a document issued by the Department of Labor authorizing a person or association to
engage in recruitment and placement activities as a private recruitment entity.

Section 7 of RA 8042 provides for the penalty of illegal recruitment committed by a syndicate (which
constitutes economic sabotage), as follows:

(b) The penalty of life imprisonment and a fine of not less than Five hundred thousand pesos
(₱500,000.00) nor more than One million pesos (₱1,000,000.00) shall be imposed if illegal recruitment
constitutes economic sabotage as defined therein.

It is clear that a person or entity engaged in recruitment and placement activities without the requisite
authority from the Department of Labor and Employment (DOLE), whether for profit or not, is engaged in
illegal recruitment.39 The Philippine Overseas Employment Administration (POEA), an agency under
DOLE created by Executive Order No. 797 to take over the duties of the Overseas Employment
Development Board, issues the authority to recruit under the Labor Code. The commission of illegal
recruitment by three or more persons conspiring or confederating with one another is deemed committed
by a syndicate and constitutes economic sabotage, 40 for which the penalty of life imprisonment and a fine
of not less than ₱ 500,000 but not more than ₱ 1,000,000 shall be imposed. 41

The penalties in Section 7 of RA 8042 have already been amended by Section 6 of Republic Act No.
10022, and have been increased to a fine of not less than ₱ 2,000,000 but not more than ₱ 5,000,000.
However, since the crime was committed in 2005, we shall apply the penalties in the old law, RA 8042.

In People v. Gallo,42 the Court enumerated the elements of syndicated illegal recruitment, to wit:

1. the offender undertakes either any activity within the meaning of "recruitment and placement"
defined under Article 13(b), or any of the prohibited practices enumerated under Art. 34 of the
Labor Code;

2. he has no valid license or authority required by law to enable one to lawfully engage in
recruitment and placement of workers; and

3. the illegal recruitment is committed by a group of three (3) or more persons conspiring or
confederating with one another.43

Article 13(b) of the Labor Code of the Philippines defines recruitment and placement as "any act of
canvassing, enlisting, contracting, transporting, utilizing, hiring or procuring workers, and includes
referrals, contract services, promising or advertising for employment, locally or abroad, whether for profit
or not, provided, that any person or entity which, in any manner, offers or promises for a fee, employment
to two or more persons shall be deemed engaged in recruitment and placement."

Clearly, given the broad definition of recruitment and placement, even the mere act of referring someone
for placement abroad can be considered recruitment. Such act of referral, in connivance with someone
without the requisite authority or POEA license, constitutes illegal recruitment. In its simplest terms, illegal
recruitment is committed by persons who, without authority from the government, give the impression that
they have the power to send workers abroad for employment purposes. 44

In this case, the trial court, as affirmed by the appellate court, found Lalli, Aringoy and Relampagos to
have conspired and confederated with one another to recruit and place Lolita for work in Malaysia, without
a POEA license. The three elements of syndicated illegal recruitment are present in this case, in
particular: (1) the accused have no valid license or authority required by law to enable them to lawfully
engage in the recruitment and placement of workers; (2) the accused engaged in this activity of
recruitment and placement by actually recruiting, deploying and transporting Lolita to Malaysia; and (3)
illegal recruitment was committed by three persons (Aringoy, Lalli and Relampagos), conspiring and
confederating with one another.

Aringoy claims and admits that he only referred Lolita to Lalli for job opportunities to Malaysia. Such act of
referring, whether for profit or not, in connivance with someone without a POEA license, is already
considered illegal recruitment, given the broad definition of recruitment and placement in the Labor Code.

Lalli, on the other hand, completely denies any involvement in the recruitment and placement of Lolita to
Malaysia, and claims she only met Lolita for the first time by coincidence on board the ship M/V Mary Joy.
Lalli’s denial does not deserve credence because it completely conflicts with the testimony of Aringoy who
claims he referred Lolita to Lalli who had knowledge of the job opportunities in Malaysia.

The conflicting testimonies of Lalli and Aringoy on material facts give doubt to the truth and veracity of
their stories, and strengthens the credibility of the testimony of Lolita, despite allegations of irrelevant
inconsistencies.

No improper motive could be imputed to Lolita to show that she would falsely testify against the accused.
The absence of evidence as to an improper motive entitles Lolita’s testimony to full faith and credit. 45

Aringoy claims that no conspiracy existed in illegal recruitment, as he denies even knowing Relampagos,
who is currently at-large. Lalli denies any involvement in the illegal recruitment, and claims that she only
met Relampagos through Lolita on board the ship M/V Mary Joy on 6 June 2005, and learned that
Relampagos was bringing Lolita and their other girl companions to Malaysia to work as sales ladies.

Under Article 8 of the Revised Penal Code, there is conspiracy "when two or more persons come to an
agreement concerning the commission of a felony and decide to commit it."

In People v. Lago,46 the Court discussed conspiracy in this wise:

The elements of conspiracy are the following: (1) two or more persons came to an agreement, (2) the
agreement concerned the commission of a felony, and (3) the execution of the felony was decided upon.
Proof of the conspiracy need not be based on direct evidence, because it may be inferred from the
parties’ conduct indicating a common understanding among themselves with respect to the commission of
the crime. Neither is it necessary to show that two or more persons met together and entered into an
explicit agreement setting out the details of an unlawful scheme or objective to be carried out. The
conspiracy may be deduced from the mode or manner in which the crime was perpetrated; it may also be
inferred from the acts of the accused evincing a joint or common purpose and design, concerted action
and community of interest. 47

In this case, Lolita would not have been able to go to Malaysia if not for the concerted efforts of Aringoy,
Lalli and Relampagos. First, it was Aringoy who knew Lolita, since Aringoy was a neighbor of Lolita’s
grandfather. It was Aringoy who referred Lolita to Lalli, a fact clearly admitted by Aringoy. Second, Lolita
would not have been able to go to Malaysia if Lalli had not purchased Lolita’s boat ticket to Malaysia. This
fact can be deduced from the testimony of Nora Mae Adling (Nora), ticketing clerk of Aleson Shipping
Lines, owner of the vessel M/V Mary Joy 2 plying Zamboanga City to Sandakan, Malaysia route and of
M/V Kristel Jane 3. Nora testified in open court that "Hadja Jarma Lalli bought passenger tickets for her
travel to Sandakan, not only for herself but also for other women passengers." Lalli’s claim that she only
goes to Malaysia to visit her daughter and son-in-law does not explain the fact why she bought the boat
tickets of the other women passengers going to Malaysia. In fact, it appears strange that Lalli visited
Malaysia nine (9) times in a span of one year and three months (March 2004 to June 2005) just to visit
her daughter and son-in-law. In Malaysia, it was Relampagos who introduced Lolita and her companions
to a Chinese Malay called "Boss" as their first employer. When Lolita and her companions went back to
the hotel to tell Relampagos and Lalli that they did not want to work as prostitutes, Relampagos brought
Lolita and the girls on board a van to Sangawan China Labuan, where they stayed in a room for one
night. The next day, they were picked up by a van and brought to Pipen Club, where Lolita and her
companions worked as prostitutes. To date, accused Relampagos is at large and has not been brought
under the jurisdiction of the courts for his crimes.
Flight in criminal law is the evading of the course of justice by voluntarily withdrawing oneself in order to
avoid arrest or detention or the institution or continuance of criminal proceedings. 48 The unexplained flight
of an accused person may as a general rule be taken into consideration as evidence having a tendency to
establish his guilt.49 Clearly, in this case, the flight of accused Relampagos, who is still at-large, shows an
indication of guilt in the crimes he has been charged.

It is clear that through the concerted efforts of Aringoy, Lalli and Relampagos, Lolita was recruited and
deployed to Malaysia to work as a prostitute. Such conspiracy among Aringoy, Lalli and Relampagos
could be deduced from the manner in which the crime was perpetrated – each of the accused played a
pivotal role in perpetrating the crime of illegal recruitment, and evinced a joint common purpose and
design, concerted action and community of interest.

For these reasons, this Court affirms the CA Decision, affirming the RTC Decision, declaring accused
Ronnie Aringoy y Masion and Hadja Jarma Lalli y Purih guilty beyond reasonable doubt of the crime of
illegal recruitment committed by a syndicate in Criminal Case No. 21930, with a penalty of life
imprisonment and a fine of ₱ 500,000 imposed on each of the accused.

Criminal Case No. 21908 (Trafficking in Persons)

Section 3(a) of Republic Act No. 9208 (RA 9208), otherwise known as the Anti-Trafficking in Persons Act
of 2003, defines Trafficking in Persons, as follows:

Trafficking in Persons – refers to the recruitment, transportation, transfer or harboring, or receipt of

persons with or without the victim’s consent or knowledge, within or across national borders by
means of threat or use of force, or other forms of coercion, abduction, fraud, deception, abuse of power or
of position, taking advantage of the vulnerability of the person, or, the giving or receiving of payments or
benefits to achieve the consent of a person having control over another person for the purpose of
exploitation which includes at a minimum, the exploitation or the prostitution of others or other forms of
sexual exploitation, forced labor or services, slavery, servitude or the removal or sale of organs. x x x
(Emphasis supplied)

Section 4 of RA 9208 enumerates the prohibited acts of Trafficking in Persons, one of which is:

(a) To recruit, transport, transfer, harbor, provide, or receive a person by any means, including those done
under the pretext of domestic or overseas employment or training or apprenticeship, for the purpose of
prostitution, pornography, sexual exploitation, forced labor, slavery, involuntary servitude or debt bondage.

The crime of Trafficking in Persons is qualified when committed by a syndicate, as provided in Section
6(c) of RA 9208:

(c) When the crime is committed by a syndicate, or in large scale. Trafficking is deemed committed by a
syndicate if carried out by a group of three (3) or more persons conspiring or confederating with one
another. It is deemed committed in large scale if committed against three (3) or more persons, individually
or as a group.

Section 10(c) of RA 9208 provides for the penalty of qualified trafficking:

(c) Any person found guilty of qualified trafficking under Section 6 shall suffer the penalty of life
imprisonment and a fine of not less than Two million pesos (₱2,000,000.00) but not more than Five million
pesos (₱5,000,000.00).

The Anti-Trafficking in Persons Act is a new law passed last 26 May 2003, designed to criminalize the act
of trafficking in persons for prostitution, sexual exploitation, foced labor and slavery, among others.

In this case, Aringoy claims that he cannot be convicted of the crime of Trafficking in Persons because he
was not part of the group that transported Lolita from the Philippines to Malaysia on board the ship M/V
Mary Joy. In addition, he presented his niece, Rachel, as witness to testify that Lolita had been travelling
to Malaysia to work in bars. On the other hand, Lalli denies any involvement in the recruitment and
trafficking of Lolita, claiming she only met Lolita for the first time on board M/V Mary Joy going to
Malaysia.

The testimony of Aringoy’s niece, Rachel, that Lolita had been travelling to Malaysia to work in bars
cannot be given credence. Lolita did not even have a passport to go to Malaysia and had to use her
sister’s passport when Aringoy, Lalli and Relampagos first recruited her. It is questionable how she could
have been travelling to Malaysia previously without a passport, as Rachel claims. Moreover, even if it is
true that Lolita had been travelling to Malaysia to work in bars, the crime of Trafficking in Persons can
exist even with the victim’s consent or knowledge under Section 3(a) of RA 9208.

Trafficking in Persons under Sections 3(a) and 4 of RA 9208 is not only limited to transportation of victims,
but also includes the act of recruitment of victims for trafficking. In this case, since it has been sufficiently
proven beyond reasonable doubt, as discussed in Criminal Case No. 21930, that all the three accused
(Aringoy, Lalli and Relampagos) conspired and confederated with one another to illegally recruit Lolita to
become a prostitute in Malaysia, it follows that they are also guilty beyond reasonable doubt of the crime
of Qualified Trafficking in Persons committed by a syndicate under RA 9208 because the crime of
recruitment for prostitution also constitutes trafficking.

When an act or acts violate two or more different laws and constitute two different offenses, a prosecution
under one will not bar a prosecution under the other. 50 The constitutional right against double jeopardy
only applies to risk of punishment twice for the same offense, or for an act punished by a law and an
ordinance.51 The prohibition on double jeopardy does not apply to an act or series of acts constituting
different offenses.

DAMAGES

Lolita claimed actual damages of ₱ 28,000, which she allegedly paid to the accused as placement fee for
the work of restaurant entertainer in Malaysia. The trial court did not award this amount to Lolita. We
agree and affirm the trial court’s non-award due to Lolita’s inconsistent statements on the payment of
placement fee. In her sworn statement, Lolita alleged that she paid ₱ 28,000 as placement fee to
Lalli.52 On cross-examination, however, she admitted that she never paid ₱ 28,000 to the accused. 53

We, however, modify and increase the payment of damages in the crime of Trafficking in Persons from ₱
50,000 to ₱ 500,000 as moral damages and ₱ 50,000 to ₱ 100,000 as exemplary damages.

The Civil Code describes moral damages in Article 2217:

Art. 2217. Moral damages include physical suffering, mental anguish, fright, serious anxiety, besmirched
reputation, wounded feelings, moral shock, social humiliation, and similar injury. Though incapable of
pecuniary computation, moral damages may be recovered if they are the proximate result of the
defendant’s wrongful act for omission.1avvphi1

Exemplary damages, on the other hand, are awarded in addition to the payment of moral damages, by
way of example or correction for the public good, as stated in the Civil Code:

Art. 2229. Exemplary or corrective damages are imposed, by way of example or correction for the public
good, in addition to the moral, temperate, liquidated or compensatory damages.

Art. 2230. In criminal offenses, exemplary damages as a part of the civil liability may be imposed when
the crime was committed with one or more aggravating circumstances. Such damages are separate and
distinct from fines and shall be paid to the offended party.

The payment of ₱ 500,000 as moral damages and ₱ 100,000 as exemplary damages for the crime of
Trafficking in Persons as a Prostitute finds basis in Article 2219 of the Civil Code, which states:

Art. 2219. Moral damages may be recovered in the following and analogous cases:

(1) A criminal offense resulting in physical injuries;

(2) Quasi-delicts causing physical injuries;

(3) Seduction, abduction, rape, or other lascivious acts;

(4) Adultery or concubinage;

(5) Illegal or arbitrary detention or arrest;

(6) Illegal search;

(7) Libel, slander or any other form of defamation;

(8) Malicious prosecution;

(9) Acts mentioned in Article 309;

(10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.

The parents of the female seduced, abducted, raped, or abused, referred to in No. 3 of this article, may
also recover moral damages.

The spouse, descendants, ascendants, and brothers and sisters may bring the action mentioned in No. 9
of this article, in the order named.
The criminal case of Trafficking in Persons as a Prostitute is an analogous case to the crimes of
seduction, abduction, rape, or other lascivious acts. In fact, it is worse. To be trafficked as a prostitute
without one’s consent and to be sexually violated four to five times a day by different strangers is
horrendous and atrocious. There is no doubt that Lolita experienced physical suffering, mental anguish,
fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, and social humiliation
when she was trafficked as a prostitute in Malaysia. Since the crime of Trafficking in Persons was
aggravated, being committed by a syndicate, the award of exemplary damages is likewise justified.

WHEREFORE, we AFFIRM the Decision of the Court of Appeals dated 26 February 2010, affirming the
Decision of the Regional Trial Court of Zamboanga City dated 29 November 2005, finding accused Lalli
and Aringoy guilty beyond reasonable doubt of the crimes of Illegal Recruitment and Trafficking in
Persons committed by a syndicate, with the following MODIFICATIONS:

1. In Criminal Case No. 21908, each of the accused is sentenced to suffer the penalty of LIFE
IMPRISONMENT and to pay a fine of ₱ 2,000,000;

2. In Criminal Case No. 21930, each of the accused is sentenced to suffer the penalty of
LIFEIMPRISONMENT and to pay a fine of ₱ 500,000;

3. Each of the accused is ordered to pay the offended party Lolita Plando y Sagadsad, jointly and
severally, the sum of ₱ 500,000 as moral damages, and ₱ 100,000 as exemplary damages for
the crime of Trafficking in Persons; and to pay the costs.

The Court cannot pronounce the liability of accused-at-large Nestor Relampagos as jurisdiction over his
person has not been acquired.

SO ORDERED.

SECOND DIVISION

G.R. No. 194255 June 13, 2012

THE PEOPLE OF THE PHILIPPINES, Plaintiff-Appellee,

vs.
NURFRASIR HASHIM y SARABAN a.k.a "FRANZ/FRANS," MAKDUL JAMAD y BUKIN (AL) a.k.a.
"MACKY," a certain "TAS," and a certain "JUN," Accused,
BERNADETTE PANSACALA a.k.a. "Neneng Awid," Accused-Appellant.

DECISION

SERENO, J.:

On appeal is the Decision1 of the Court of Appeals (CA) in CA-G.R. CR-HC No. 00644-MIN promulgated
on 20 July 2010, which affirmed the conviction of herein accused-appellant Bernadette Pansacala a.k.a
Neneng Awid, together with co-accused Nurfrasir Hashim y Saraban a.k.a "Franz/Frans," Makdul Jamad
y Bukin a.k.a. "Macky," a certain "Tas" and a certain "Jun" for the crime of illegal recruitment as defined
under Section 6 in relation to Section 7(b) of Republic Act. No. (R.A.) 8042 or the Migrant Workers and
Overseas Filipinos Act of 1995.

The Facts

On 10 March 2004, accused-appellant was charged as follows: 2

That on or about June 11, 2003 and for sometime prior or subsequent thereto, in the City of Zamboanga,
Philippines, and within the jurisdiction of this Honorable Court, the above-named accused, conspiring and
confederating together, mutually aiding and assisting with one another without having previously obtained
from the Philippine Overseas Employment Administration, license or authority to engage in the
recruitment and deployment of overseas workers, did then and there willfully [sic], unlawfully and
feloniously, illegally recruit for a promised employment abroad particularly in Brunei and Malaysia, thus
causing and prompting the persons of BBB and AAA 3to apply which employment however did not
materialize because in truth and in fact, the promised employment is non-existent, in flagrant violation of
the above-mentioned law and causing damage and prejudice to said complainants; further, the
commission of the above stated offense tantamount to economic sabotage in that the same was
committed by a syndicate.
Only accused-appellant and Nurfrasir Hashim y Saraban were arrested, and both entered a plea of "not
guilty" when arraigned.

Private complainants AAA and BBB, Police Chief Inspector Ronald Añonuevo, and police officers Edmond
Ranel Villareal and Renato Rabuya dela Peña were presented by the prosecution to prove the following:

On 10 June 2003, accused-appellant approached AAA, who was then doing her job as a waitress at a
stall in Paseo de Zamboanga, Buenavista, Zamboanga City, to encourage AAA to work in Malaysia, as
accused-appellant knew certain persons who would soon be leaving for that country.

On the next day, 11 June 2003, private complainant BBB was at her house in Talon-talon Loop,
Zamboanga City, when accused-appellant paid her a visit and invited her to work as a saleslady in Brunei.
After being assured that the prospective employment was above board and that she would be well
compensated, BBB accepted the invitation.

The day after, accused-appellant, together with co-accused Makdul Amad y Bukin a.k.a. "Macky" (Macky)
and a certain "Jun," returned to the house of BBB. Accused-appellant informed BBB that the latter would
be escorted to Malaysia by the two men, and that they would meet the next day at 1:00 p.m. at Plaza
Pershing, Zamboanga City.

On 13 June 2003, BBB, Macky and Jun met as planned. They proceeded to Shop-O-Rama, where they
met with co-accused Nurfrasir Hashim, a.k.a. "Franz" (Franz), who assured BBB that she would be easily
hired because of her beauty and height. They then agreed to meet at 3:00 p.m. that same day at Paseo
de Zamboanga.

At Paseo de Zamboanga, BBB, accused-appellant, Macky, and Jun met with AAA, a certain CCC
(allegedly another recruit) and Arlene (allegedly AAA’s employer). Then at 7:00 p.m. of that same day,
they all proceeded to the wharf, where they met accused Franz and a certain Cristy, who was also
allegedly invited by accused-appellant to work in Malaysia.

Thereafter, AAA, BBB, CCC, Cristy, Macky and Jun boarded the M/V Grand Flora and were given pieces
of paper containing a name. Franz, accused-appellant Bernadette and a certain Titing did not board the
boat. Accused-appellant informed private complainants and their companions that she and Franz would
follow and bring their passports. We quote the Decision of the CA to describe the journey of the group
after boarding the M/V Flora bound for Bongao, Tawi-Tawi, at 10:00 p.m.: 4

On June 14, 2003, they (BBB, AAA, CCC, Cristy, accused Macky) and Jun disembarked at Bongao, Tawi-
Tawi, and then they proceeded to Sitangkai, Tawi-Tawi where they stayed for two days. On June 16,
2003, they went to Pundohan, which is a terminal going to Lahad Datu, Sabah, Malaysia.

On June 17, 2003, at 6:00 o’clock [sic] in the morning[,] they arrived at Lahad Datu and soon thenafter
[sic] they boarded a van going to Samporna, Malaysia where they met accused Macky’s cousin named
Pat. They waited at Samporna until 5:00 o’clock [sic] in the afternoon when accused Franz and Tash[,]
who was allegedly their financier[,] arrived. Accused Franz then distributed to AAA, BBB, CCC and Cristy
their respective passports.

Thereafter, they boarded a bus going to Kota Kinabalu, Malaysia, and they arrived thereat at 7:00 o’clock
[sic] in the morning of June 18, 2003. Later, they boarded again a bus going to Minumpo, Malaysia and
then a barge going to Labuan, Malaysia where they stayed at a hotel [the Classic Hotel] for three nights or
from the night of June 18, 2003 until June 20, 2003.

On June 21, 2003, accused Franz instructed BBB, AAA, CCC and Cristy to wear "sexy clothes" because
they were going to meet their supposed boss named Bunso at Cape Imperial located at Labuan,
Malaysia.

When they arrived at Cape Imperial, accused Macky and Jun talked to Bunso but they failed to reach an
agreement on the purported compensation of the four girls. So, accused Macky and Jun brought the girls
to Golden Lotus Barber Salon (Salon for brevity) where the latter were introduced to a certain person
named Mommy Cindy, the alleged owner of the salon, and their purported manager Hako who was called
Mommy Susan.

The prosecution also alleged that while the group was staying at the Classic Hotel in Labuan, BBB was
forced on numerous occasions to have sexual intercourse with Franz at his bidding, even in the presence
of other people. She followed his orders for fear that he would inflict physical harm on her.

At first, private complainants were not aware of the circumstances surrounding their employment at the
Golden Lotus. It was only after they agreed to stay there for employment that they were forced to become
sex workers to earn money and pay off the debts they incurred from their travel from Zamboanga City to
Labuan, Malaysia.
Thus, from 21 June 2003 to 13 July 2003, AAA and BBB worked as prostituted women. Each of the girls
would be booked to a customer for the whole night for 300 Ringgit at a certain hotel near the Golden
Lotus. Meanwhile, during the day, they would be hired by customers for a "short time" for 150 Ringgit in
one of the rooms of the Golden Lotus. The girls were told that they would be made to pay a fine of 150
Ringgit if they refused to have sexual intercourse with the customers.

On 12 July 2003, BBB had a customer who was a law enforcer at Kota Kinabalu, Malaysia. She sought
his help for her return to the Philippines, and he agreed.

The following day, on 13 July 2003, the Golden Lotus was raided by the Immigration Officers of Kota
Kinabalu, Malaysia, and the prostituted Filipino women, including AAA and BBB, were detained at the
Balay Polis (Police Department) in Labuan until all the women were deported to the Philippines.

The defense, on the other hand, presented three witnesses: accused-appellant Bernadette, her common-
law partner Majujie Jailya Misuari, and co-accused Franz.

According to accused-appellant, she and BBB were friends and neighbors in Talon-talon, Zamboanga
City. Sometime in April 2003, when asked by BBB why accused-appellant returned to the Philippines from
Malaysia, the latter said that she had been made a prostituted woman in Malaysia.

Accused-appellant denied having offered BBB a job in Malaysia, a denial corroborated by Majujie Jailya
Misuari. Accused-appellant also denied knowing AAA and Franz. She claimed that she only met AAA
when the latter, together with BBB, visited her in jail and offered to withdraw the case if accused-appellant
would give them money.

Co-accused Franz merely denied knowing AAA, BBB or accused-appellant.

On 27 June 2008, after trial on the merits, the Regional Trial Court (RTC) of Zamboanga City rendered a
Decision,5the dispositive portion of which states:6

WHEREFORE, the Court finds both accused NURFRASIR HASHIM y SARABAN a.k.a "FRANZ/FRAS"
and BERNADETTE PANSACALA a.k.a "NENENG AWID" GUILTY BEYOND REASONABLE DOUBT of
the crime of ILLEGAL RECRUITMENT defined under Section 6 and penalized under Section 7(b) of
Republic Act No. 8042 otherwise known as the "Migrant Workers and Overseas Filipinos Act of 1995", as
principals by direct participation, committed by a syndicate, against BBB and AAA, and SENTENCES
each of said accused to suffer the penalty of LIFE IMPRISONMENT and to pay a fine of ₱ 1,000,000.00
each;7 to pay each of the above victims ₱ 50,000.00 as moral damages; ₱ 300,000.00 as exemplary
damages, and to pay the costs.

SO ORDERED.

The trial court considered that, in the course of the trial, the prosecution and the defense had entered into
a stipulation that neither accused-appellant Bernadette nor Franz had a license or an authority to recruit
or deploy workers for overseas employment.

Moreover, the trial court found that the crime was committed in conspiracy by the accused and other
persons. It painstakingly enumerated the overt acts of the accused-appellant showing her direct
participation in the commission of the crime. These acts included inducing AAA and BBB to work in
Malaysia; introducing Macky, Jun and Franz to the victims; and escorting them to the wharf, where the
victims boarded the vessel that took them away from their families and their country and brought them to
Malaysia, where – heretofore unbeknownst to them – they were made to work as prostituted women.

It further held that the credible and positive testimonies of the witnesses for the prosecution prevailed over
those of the defense of mere denial, absent any showing that the witnesses for the prosecution had any ill
motive to falsely testify and implicate the accused in the commission of the crime charged.

On appeal, the CA affirmed the findings of fact of the trial court in the former’s assailed Decision, but
modified the award of damages, to wit:8

WHEREFORE, the Appeal is DISMISSED. The assailed Decision dated June 27, 2008 of the Regional
Trial Court, Branch 16 of Zamboanga City in Criminal Case No. 19921 is AFFIRMED with
MODIFICATION that the amount of exemplary damages in favor of the private complainants be reduced
to ₱ 25,000.00 each.

SO ORDERED.

In the present appeal, instead of filing a supplemental brief, both accused-appellant and the Office of the
Solicitor General opted to adopt their respective Briefs filed with the CA.

The appeal is unmeritorious.

To be convicted of the crime of illegal recruitment committed by a syndicate, the following elements must
occur:9

1. The accused have no valid license or authority required by law to enable them to lawfully
engage in the recruitment and placement of workers.

2. The accused engaged in this activity of recruitment and placement by actually recruiting,
deploying and transporting.

3. Illegal recruitment was committed by three persons conspiring and confederating with one
another.

As to the first element, accused-appellant admitted that she did not have a valid license to recruit persons
for overseas employment, consistent with her defense that she did not engage in the recruitment of
persons for employment.

Anent the second element, both victims, AAA and BBB, narrated in great detail how they were induced by
accused-appellant to accept an employment opportunity, and how they were successfully transported
from Zamboanga City to Malaysia where they eventually worked as prostituted women.

On the third element, accused-appellant posits that the prosecution failed to prove that there were more
than two persons involved in the alleged crime of illegal recruitment, since the trial court held only two of
the accused liable for the crime. The prosecution, she alleges, failed to establish that the other accused
Macky, Jun, and Tas also had no license or authority to recruit workers for overseas employment.

In the recent case People v. Lalli, 10 we affirmed the trial court’s findings in which 2 of the 3 accused were
convicted of illegal recruitment committed by a syndicate, even though the third accused was at-large. In
so ruling, we took note of the fact that the victim would not have been able to go to Malaysia were it not
for the concerted efforts of the three accused. We held thus:

Flight in criminal law is the evading of the course of justice by voluntarily withdrawing oneself in order to
avoid arrest or detention or the institution or continuance of criminal proceedings. The unexplained flight
of an accused person may as a general rule be taken into consideration as evidence having a tendency to
establish his guilt. Clearly, in this case, the flight of accused Relampagos, who is still at-large, shows an
indication of guilt in the crimes he has been charged.

It is clear that through the concerted efforts of Aringoy, Lalli and Relampagos, Lolita was recruited and
deployed to Malaysia to work as a prostitute. Such conspiracy among Aringoy, Lalli and Relampagos
could be deduced from the manner in which the crime was perpetrated — each of the accused played a
pivotal role in perpetrating the crime of illegal recruitment, and evinced a joint common purpose and
design, concerted action and community of interest.

For these reasons, this Court affirms the CA Decision, affirming the RTC Decision, declaring accused
Ronnie Aringoy y Masion and Hadja Jarma Lalli y Purih guilty beyond reasonable doubt of the crime of
illegal recruitment committed by a syndicate in Criminal Case No. 21930, with a penalty of life
imprisonment and a fine of ₱ 500,000 imposed on each of the accused. (Emphasis supplied.)

In the case at bar, the prosecution was similarly able to establish that accused-appellant Bernadette and
Franz were not the only ones who had conspired to bring the victims to Malaysia. It was also able to
establish at the very least, through the credible testimonies of the witnesses, that (1) Jun and Macky were
the escorts of the women to Malaysia; (2) a certain Tash was their financier; (3) a certain Bunso
negotiated with Macky for the price the former would pay for the expenses incurred in transporting the
victims to Malaysia; and (4) Mommy Cindy owned the prostitution house where the victims worked. The
concerted efforts of all these persons resulted in the oppression of the victims.

Clearly, it was established beyond reasonable doubt that accused-appellant, together with at least two
other persons, came to an agreement to commit the felony and decided to commit it. It is not necessary to
show that two or more persons met together and entered into an explicit agreement laying down the
details of how an unlawful scheme or objective is to be carried out. Conspiracy may be deduced from the
mode and manner in which the offense was perpetrated; or from the acts of the accused evincing a joint
or common purpose and design, concerted action and community of interest. 11

Findings of fact of the CA, when they affirm those of the trial court, are binding on this Court, unless the
findings of the trial and the appellate courts are palpably unsupported by the evidence on record, or
unless the judgment itself is based on a misapprehension of facts. 12

Likewise, we have time and again ruled that mere denial cannot prevail over the positive testimony of a
witness. A mere denial, just like an alibi, is a self-serving negative evidence, which cannot be accorded
greater evidentiary weight than the declarations of credible witnesses who testify on affirmative matters.
As between a categorical testimony that has the ring of truth on the one hand and a bare denial on the
other, the former is generally held to prevail.13
We, however, find it proper to modify the amount of moral and exemplary damages awarded by the CA.

On 12 May 2003, Congress passed R.A. 9208 or the Anti-Trafficking in Persons Act. This law was
approved on 26 May 2003. Ironically, only a few days after, private complainants found themselves in a
situation that this law had sought to prevent.

In Lalli, we increased the amount of moral and exemplary damages from ₱ 50,000 to ₱ 500,000 and from
₱ 50,000 to ₱ 100,000, respectively, having convicted the accused therein of the crime of trafficking in
persons. In so doing, we said:

The Civil Code describes moral damages in Article 2217:

Art. 2217. Moral damages include physical suffering, mental anguish, fright, serious anxiety, besmirched
reputation, wounded feelings, moral shock, social humiliation, and similar injury. Though incapable of
pecuniary computation, moral damages may be recovered if they are the proximate result of the
defendant's wrongful act for omission.

Exemplary damages, on the other hand, are awarded in addition to the payment of moral damages, by
way of example or correction for the public good, as stated in the Civil Code:

Art. 2229. Exemplary or corrective damages are imposed, by way of example or correction for the public
good, in addition to the moral, temperate, liquidated or compensatory damages.

Art. 2230. In criminal offenses, exemplary damages as a part of the civil liability may be imposed when
the crime was committed with one or more aggravating circumstances.1âwphi1 Such damages are
separate and distinct from fines and shall be paid to the offended party.

The payment of ₱ 500,000 as moral damages and ₱ 100,000 as exemplary damages for the crime of
Trafficking in Persons as a Prostitute finds basis in Article 2219 of the Civil Code, which states:

Art. 2219. Moral damages may be recovered in the following and analogous cases:

(1) A criminal offense resulting in physical injuries;

(2) Quasi-delicts causing physical injuries;

(3) Seduction, abduction, rape, or other lascivious acts;

(4) Adultery or concubinage;

(5) Illegal or arbitrary detention or arrest;

(6) Illegal search;

(7) Libel, slander or any other form of defamation;

(8) Malicious prosecution;

(9) Acts mentioned in Article 309;

(10) Acts and actions referred to in Articles 21, 26, 27, 28, 29, 30, 32, 34, and 35.

The parents of the female seduced, abducted, raped, or abused, referred to in No. 3 of this article, may
also recover moral damages.

The spouse, descendants, ascendants, and brothers and sisters may bring the action mentioned in No. 9
of this article, in the order named.

The criminal case of Trafficking in Persons as a Prostitute is an analogous case to the crimes of
seduction, abduction, rape, or other lascivious acts. In fact, it is worse. To be trafficked as a prostitute
without one’s consent and to be sexually violated four to five times a day by different strangers is
horrendous and atrocious. There is no doubt that Lolita experienced physical suffering, mental anguish,
fright, serious anxiety, besmirched reputation, wounded feelings, moral shock, and social humiliation
when she was trafficked as a prostitute in Malaysia. Since the crime of Trafficking in Persons was
aggravated, being committed by a syndicate, the award of exemplary damages is likewise justified.
(Emphasis supplied.)

We find no legal impediment to increasing the award of moral and exemplary damages in the case at
bar.1âwphi1 Neither is there any logical reason why we should differentiate between the victims herein
and those in that case, when the circumstances are frighteningly similar. To do so would be to say that we
discriminate one from the other, when all of these women have been the victims of unscrupulous people
who capitalized on the poverty of others. While it is true that accused-appellant was not tried and
convicted of the crime of trafficking in persons, this Court based its award of damages on the Civil Code,
and not on the Anti-Trafficking in Persons Act, as clearly explained in Lalli.

WHEREFORE, in view of the foregoing, the Decision of the Court of Appeals in CA-G.R. CR-HC No.
00644-MIN dated 20 July 2010 is hereby AFFIRMED with MODIFICATIONS. Accused-appellant
Bernadette Pansacala a.k.a. "Neneng Awid" is ORDERED to pay AAA and BBB the sum of ₱ 500,000
each as moral damages and ₱ 100,000 each as exemplary damages and to pay the costs.

SECOND DIVISION

G.R. No. 129093 August 30, 2001

HON. JOSE D. LINA, JR., SANGGUNIANG PANLALAWIGAN OF LAGUNA, and HON. CALIXTO
CATAQUIZ,petitioners,
vs.
HON. FRANCISCO DIZON PAÑO and TONY CALVENTO, respondents.

QUISUMBING, J.:

For our resolution is a petition for review on certiorari seeking the reversal of the decision 1 dated
February 10, 1997 of the Regional Trial Court of San Pedro, Laguna, Branch 93, enjoining petitioners
from implementing or enforcing Kapasiyahan Bilang 508, Taon 1995, of the Sangguniang Panlalawigan of
Laguna and its subsequent Order 2 dated April 21, 1997 denying petitioners' motion for reconsideration.

On December 29, 1995, respondent Tony Calvento was appointed agent by the Philippine Charity
Sweepstakes Office (PCSO) to install Terminal OM 20 for the operation of lotto . He asked Mayor Calixto
Cataquiz, Mayor of San Pedro, Laguna, for a mayor's permit to open the lotto outlet. This was denied by
Mayor Cataquiz in a letter dated February 19, 1996. The ground for said denial was an ordinance passed
by the Sangguniang Panlalawigan of Laguna entitled Kapasiyahan Blg. 508, T. 1995 which was issued on
September 18, 1995. The ordinance reads:

ISANG KAPASIYAHAN TINUTUTULAN ANG MGA "ILLEGAL GAMBLING" LALO NA ANG

LOTTO SA LALAWIGAN NG LAGUNA

SAPAGKA'T, ang sugal dito sa lalawigan ng Laguna ay talamak na;

SAPAGKA'T, ang sugal ay nagdudulot ng masasamang impluwensiya lalo't higit sa mga

kabataan;

KUNG KAYA'T DAHIL DITO, at sa mungkahi nina Kgg. Kgd. Juan M. Unico at Kgg. Kgd. Gat-Ala
A. Alatiit, pinangalawahan ni Kgg. Kgd. Meliton C. Larano at buong pagkakaisang sinangayunan
ng lahat ng dumalo sa pulong;

IPINASIYA, na tutulan gaya ng dito ay mahigpit na TINUTUTULAN ang ano mang uri ng sugal
dito sa lalawigan ng Laguna lalo't higit ang Lotto;

IPINASIYA PA RIN na hilingin tulad ng dito ay hinihiling sa Panlalawigang pinuno ng Philippine

National Police (PNP) Col. [illegible] na mahigpit na pag-ibayuhin ang pagsugpo sa lahat ng uri
ng illegal na sugal sa buong lalawigan ng Laguna lalo na ang "Jueteng". 3

As a result of this resolution of denial, respondent Calvento filed a complaint for declaratory relief with
prayer for preliminary injunction and temporary restraining order. In the said complaint, respondent
Calvento asked the Regional Trial Court of San Pedro Laguna, Branch 93, for the following reliefs: (1) a
preliminary injunction or temporary restraining order, ordering the defendants to refrain from implementing
or enforcing Kapasiyahan Blg. 508, T. 1995; (2) an order requiring Hon. Municipal Mayor Calixto R
Cataquiz to issue a business permit for the operation of a lotto outlet; and (3) an order annulling or
declaring as invalid Kapasiyahan Blg. 508, T. 1995.

On February 10, 1997, the respondent judge, Francisco Dizon Paño, promulgated his decision enjoining
the petitioners from implementing or enforcing resolution or Kapasiyahan Blg. 508, T. 1995. The
dispositive portion of said decision reads:

WHEREFORE, premises considered, defendants, their agents and representatives are hereby
enjoined from implementing or enforcing resolution or kapasiyahan blg. 508, T. 1995 of the
 Sangguniang Panlalawigan ng Laguna prohibiting the operation of the lotto in the province of
Laguna.

SO ORDERED.4

Petitioners filed a motion for reconsideration which was subsequently denied in an Order dated April 21,
1997, which reads:

Acting on the Motion for Reconsideration filed by defendants Jose D. Lina, Jr. and the
Sangguniang Panlalawigan of Laguna, thru counsel, with the opposition filed by plaintiff's counsel
and the comment thereto filed by counsel for the defendants which were duly noted, the Court
hereby denies the motion for lack of merit.

SO ORDERED.5

On May 23, 1997, petitioners filed this petition alleging that the following errors were committed by the
respondent trial court:

THE TRIAL COURT ERRED IN ENJOINING THE PETITIONERS FROM IMPLEMENTING

KAPASIYAHAN BLG. 508, T. 1995 OF THE SANGGUNIANG PANLALAWIGAN OF LAGUNA
PROHIBITING THE OPERATION OF THE LOTTO IN THE PROVINCE OF LAGUNA.

II

THE TRIAL COURT FAILED TO APPRECIATE THE ARGUMENT POSITED BY THE

PETITIONERS THAT BEFORE ANY GOVERNMENT PROJECT OR PROGRAM MAY BE
IMPLEMENTED BY THE NATIONAL AGENCIES OR OFFICES, PRIOR CONSULTATION AND
APPROVAL BY THE LOCAL GOVERNMENT UNITS CONCERNED AND OTHER CONCERNED
SECTORS IS REQUIRED.

Petitioners contend that the assailed resolution is a valid policy declaration of the Provincial Government
of Laguna of its vehement objection to the operation of lotto and all forms of gambling. It is likewise a valid
exercise of the provincial government's police power under the General Welfare Clause of Republic Act
7160, otherwise known as the Local Government Code of 1991. 6 They also maintain that respondent's
lotto operation is illegal because no prior consultations and approval by the local government were sought
before it was implemented contrary to the express provisions of Sections 2 (c) and 27 of R.A. 7160. 7

For his part, respondent Calvento argues that the questioned resolution is, in effect, a curtailment of the
power of the state since in this case the national legislature itself had already declared lotto as legal and
permitted its operations around the country.8 As for the allegation that no prior consultations and approval
were sought from the sangguniang panlalawigan of Laguna, respondent Calvento contends this is not
mandatory since such a requirement is merely stated as a declaration of policy and not a self-executing
provision of the Local Government Code of 1991. 9 He also states that his operation of the lotto system is
legal because of the authority given to him by the PCSO, which in turn had been granted a franchise to
operate the lotto by Congress.10

The Office of the Solicitor General (OSG), for the State, contends that the Provincial Government of
Laguna has no power to prohibit a form of gambling which has been authorized by the national
government.11 He argues that this is based on the principle that ordinances should not contravene statutes
as municipal governments are merely agents of the national government. The local councils exercise only
delegated legislative powers which have been conferred on them by Congress. This being the case,
these councils, as delegates, cannot be superior to the principal or exercise powers higher than those of
the latter. The OSG also adds that the question of whether gambling should be permitted is for Congress
to determine, taking into account national and local interests. Since Congress has allowed the PCSO to
operate lotteries which PCSO seeks to conduct in Laguna, pursuant to its legislative grant of authority, the
province's Sangguniang Panlalawigan cannot nullify the exercise of said authority by preventing
something already allowed by Congress.

The issues to be resolved now are the following: (1) whether Kapasiyahan Blg. 508, T. 1995 of the
Sangguniang Panlalawigan of Laguna and the denial of a mayor's permit based thereon are valid; and (2)
whether prior consultations and approval by the concerned Sanggunian are needed before a lotto system
can be operated in a given local government unit.

The entire controversy stemmed from the refusal of Mayor Cataquiz to issue a mayor's permit for the
operation of a lotto outlet in favor of private respondent. According to the mayor, he based his decision on
an existing ordinance prohibiting the operation of lotto in the province of Laguna. The ordinance, however,
merely states the "objection" of the council to the said game. It is but a mere policy statement on the part
of the local council, which is not self-executing. Nor could it serve as a valid ground to prohibit the
operation of the lotto system in the province of Laguna. Even petitioners admit as much when they stated
in their petition that:
 5.7. The terms of the Resolution and the validity thereof are express and clear. The Resolution is
a policy declaration of the Provincial Government of Laguna of its vehement opposition and/or
objection to the operation of and/or all forms of gambling including the Lotto operation in the
Province of Laguna.12

As a policy statement expressing the local government's objection to the lotto, such resolution is valid.
This is part of the local government's autonomy to air its views which may be contrary to that of the
national government's. However, this freedom to exercise contrary views does not mean that local
governments may actually enact ordinances that go against laws duly enacted by Congress. Given this
premise, the assailed resolution in this case could not and should not be interpreted as a measure or
ordinance prohibiting the operation of lotto.

The game of lotto is a game of chance duly authorized by the national government through an Act of
Congress. Republic Act 1169, as amended by Batas Pambansa Blg. 42, is the law which grants a
franchise to the PCSO and allows it to operate the lotteries. The pertinent provision reads:

SECTION 1. The Philippine Charity Sweepstakes Office. — The Philippine Charity Sweepstakes
Office, hereinafter designated the Office, shall be the principal government agency for raising and
providing for funds for health programs, medical assistance and services and charities of national
character, and as such shall have the general powers conferred in section thirteen of Act
Numbered One thousand four hundred fifty-nine, as amended, and shall have the authority:

A. To hold and conduct charity sweepstakes races, lotteries, and other similar activities, in such
frequency and manner, as shall be determined, and subject to such rules and regulations as shall
be promulgated by the Board of Directors.

This statute remains valid today. While lotto is clearly a game of chance, the national government deems
it wise and proper to permit it. Hence, the Sangguniang Panlalawigan of Laguna, a local government unit,
cannot issue a resolution or an ordinance that would seek to prohibit permits. Stated otherwise, what the
national legislature expressly allows by law, such as lotto, a provincial board may not disallow by
ordinance or resolution.

In our system of government, the power of local government units to legislate and enact ordinances and
resolutions is merely a delegated power coming from Congress. As held in Tatel vs. Virac,13 ordinances
should not contravene an existing statute enacted by Congress. The reasons for this is obvious, as
elucidated in Magtajas v. Pryce Properties Corp.14

Municipal governments are only agents of the national government. Local councils exercise only
delegated legislative powers conferred upon them by Congress as the national lawmaking body.
The delegate cannot be superior to the principal or exercise powers higher than those of the
latter. It is a heresy to suggest that the local government units can undo the acts of Congress,
from which they have derived their power in the first place, and negate by mere ordinance the
mandate of the statute.

Municipal corporations owe their origin to, and derive their powers and rights wholly from the
legislature. It breathes into them the breath of life, without which they cannot exist. As it creates,
so it may destroy. As it may destroy, it may abridge and control. Unless there is some
constitutional limitation on the right, the legislature might, by a single act, and if we can suppose it
capable of so great a folly and so great a wrong, sweep from existence all of the municipal
corporations in the state, and the corporation could not prevent it. We know of no limitation on the
right so far as the corporation themselves are concerned. They are, so to phrase it, the mere
tenants at will of the legislature (citing Clinton vs. Ceder Rapids, etc. Railroad Co., 24 Iowa 455).

Nothing in the present constitutional provision enhancing local autonomy dictates a different conclusion.

The basic relationship between the national legislature and the local government units has not
been enfeebled by the new provisions in the Constitution strengthening the policy of local
autonomy. Without meaning to detract from that policy, we here confirm that Congress retains
control of the local government units although in significantly reduced degree now than under our
previous Constitutions. The power to create still includes the power to destroy. The power to grant
still includes the power to withhold or recall. True, there are certain notable innovations in the
Constitution, like the direct conferment on the local government units of the power to tax (citing
Art. X, Sec. 5, Constitution), which cannot now be withdrawn by mere statute. By and large,
however, the national legislature is still the principal of the local government units, which cannot
defy its will or modify or violate it.15

Ours is still a unitary form of government, not a federal state. Being so, any form of autonomy granted to
local governments will necessarily be limited and confined within the extent allowed by the central
authority. Besides, the principle of local autonomy under the 1987 Constitution simply means
"decentralization". It does not make local governments sovereign within the state or an "imperium in
imperio".16
To conclude our resolution of the first issue, respondent mayor of San Pedro, cannot avail
of Kapasiyahan Bilang 508, Taon 1995, of the Provincial Board of Laguna as justification to prohibit lotto
in his municipality. For said resolution is nothing but an expression of the local legislative unit concerned.
The Board's enactment, like spring water, could not rise above its source of power, the national
legislature.

As for the second issue, we hold that petitioners erred in declaring that Sections 2 (c) and 27 of Republic
Act 7160, otherwise known as the Local Government Code of 1991, apply mandatorily in the setting up of
lotto outlets around the country. These provisions state:

SECTION 2. Declaration of Policy. — . . .

(c) It is likewise the policy of the State to require all national agencies and offices to conduct
periodic consultations with appropriate local government units, non-governmental and people's
organizations, and other concerned sectors of the community before any project or program is
implemented in their respective jurisdictions.

SECTION 27. Prior Consultations Required. — No project or program shall be implemented by

government authorities unless the consultations mentioned in Section 2 (c) and 26 hereof are
complied with, and prior approval of the sanggunian concerned is obtained; Provided, that
occupants in areas where such projects are to be implemented shall not be evicted unless,
appropriate relocation sites have been provided, in accordance with the provisions of the
Constitution.

From a careful reading of said provisions, we find that these apply only to national programs and/or
projects which are to be implemented in a particular local community. Lotto is neither a program nor a
project of the national government, but of a charitable institution, the PCSO. Though sanctioned by the
national government, it is far fetched to say that lotto falls within the contemplation of Sections 2 (c) and
27 of the Local Government Code.

Section 27 of the Code should be read in conjunction with Section 26 thereof. 17 Section 26 reads:

SECTION 26. Duty of National Government Agencies in the Maintenance of Ecological Balance. -
It shall be the duty of every national agency or government-owned or controlled corporation
authorizing or involved in the planning and implementation of any project or program that may
cause pollution, climatic change, depletion of non-renewable resources, loss of crop land, range-
land, or forest cover, and extinction of animal or plant species, to consult with the local
government units, nongovernmental organizations, and other sectors concerned and explain the
goals and objectives of the project or program, its impact upon the people and the community in
terms of environmental or ecological balance, and the measures that will be undertaken to
prevent or minimize the adverse effects thereof.

Thus, the projects and programs mentioned in Section 27 should be interpreted to mean projects and
programs whose effects are among those enumerated in Section 26 and 27, to wit, those that: (1) may
cause pollution; (2) may bring about climatic change; (3) may cause the depletion of non-renewable
resources; (4) may result in loss of crop land, range-land, or forest cover; (5) may eradicate certain animal
or plant species from the face of the planet; and (6) other projects or programs that may call for the
eviction of a particular group of people residing in the locality where these will be implemented. Obviously,
none of these effects will be produced by the introduction of lotto in the province of Laguna.

Moreover, the argument regarding lack of consultation raised by petitioners is clearly an afterthought on
their part. There is no indication in the letter of Mayor Cataquiz that this was one of the reasons for his
refusal to issue a permit. That refusal was predicated solely but erroneously on the provisions
of Kapasiyahan Blg. 508, Taon 1995, of the Sangguniang Panlalawigan of Laguna.

In sum, we find no reversible error in the RTC decision enjoining Mayor Cataquiz from enforcing or
implementing the Kapasiyahan Blg. 508, T. 1995, of the Sangguniang Panlalawigan of Laguna. That
resolution expresses merely a policy statement of the Laguna provincial board. It possesses no binding
legal force nor requires any act of implementation. It provides no sufficient legal basis for respondent
mayor's refusal to issue the permit sought by private respondent in connection with a legitimate business
activity authorized by a law passed by Congress.

WHEREFORE, the petition is DENIED for lack of merit. The Order of the Regional Trial Court of San
Pedro, Laguna enjoining the petitioners from implementing or enforcing Resolution or Kapasiyahan Blg.
508, T. 1995, of the Provincial Board of Laguna is hereby AFFIRMED. No costs.

SO ORDERED.
 SECOND DIVISION

G.R. No. 90707 February 1, 1993

ONAPAL PHILIPPINES COMMODITIES, INC., petitioner,

vs.
THE HONORABLE COURT OF APPEALS and SUSAN CHUA, respondents.

Zosa & Quijano Law Offices for private respondents.

CAMPOS, JR., J.:

This is an appeal by way of a Petition for Certiorari under Rule 45 of the Rules of Court to annul and set
aside the following actions of the Court of Appeals:

a) Decision * in Case CA-G.R. CV No. 08924; and

b) Resolution ** denying a Motion for Reconsideration

on the ground of grave abuse of discretion amounting to lack or excess of jurisdiction and further
ground that the decision is contrary to law and evidence. The questioned decision upheld the trial
court's findings that the Trading Contract 1 on "futures" is a specie of gambling and therefore null
and void. Accordingly, the petitioner (as defendant in lower court) was ordered to refund to the
private respondent (as plaintiff) the losses incurred in the trading transactions.

In support of the petition, the grounds alleged are:

1) Article 2018 of the New Civil Code is inapplicable to the factual milieu of the instant case considering
that in a commodity futures transaction the broker is not the direct participant and cannot be considered
as winner or loser and the contract itself, from its very nature, cannot be considered as gambling.

2) A commodity futures contract, being a specie of securities, is valid and enforceable as its terms are
governed by special laws, notably the Revised Securities Act and the Revised Rules and Regulations on
Commodity Futures Trading issued by the Securities and Exchange Commission (SEC) and approved by
the Monetary Board of the Central Bank; hence, the Civil Code is not the controlling piece of legislation.

From the records, We gather the following antecedent facts and proceedings.

The petitioner, ONAPAL Philippines Commodities, Inc. (petitioner), a duly organized and existing
corporation, was licensed as commission merchant/broker by the SEC, to engage in commodity futures
trading in Cebu City under Certificate of Registration No. CEB-182. On April 27, 1983, petitioner and
private respondent concluded a "Trading Contract". Like all customers of the petitioner, private
respondent was furnished regularly with "Commodities Daily Quotations" showing daily movements of
prices of commodity futures traded and of market reports indicating the volume of trade in different future
exchanges in Hongkong, Tokyo and other centers. Every time a customer enters into a trading transaction
with petitioner as broker, the trading order is communicated by telex to its principal, Frankwell Enterprises
of Hongkong. If the transaction, either buying or selling commodity futures, is consummated by the
principal, the petitioner issues a document known as "Confirmation of Contract and Balance Sheet" to the
customer. An order of a customer of the petitioner is supposed to be transmitted from Cebu to petitioner's
office in Manila. From Manila, it should be forwarded to Hongkong and from there, transmitted to the
Commodity Futures Exchange in Japan.

There were only two parties involved as far as the transactions covered by the Trading Contract are
concerned — the petitioner and the private respondents. We quote hereunder the respondent Court's
detailed findings of the transactions between the parties:

It appears from plaintiff's testimony that sometime in April of 1983, she was invited by
defendant's Account Executive Elizabeth Diaz to invest in the commodity futures trading
by depositing the amount of P500,000.00 (Exh. "A"); She was further told that the
business is "profitable" and that she could withdraw her money anytime; she was
furthermore instructed to go to the Onapal Office where she met the Manager, Mr. Ciam,
and the Account Executive Elizabeth Diaz who told her that they would take care of how
to trade business and her account. She was then made to sign the Trading Contract and
other documents without making her aware/understand the risks involved; that at the time
they let her sign "those papers" they were telling her that those papers were for "formality
sake"; that when she was told later on that she made a profit of P20,480.00 in a span of
 three days in the first transaction, they told her that the business is "very profitable" (tsn,
Francisco, March 14, 1985, p. 11).

On June 2, 1983, plaintiff was informed by Miss Diaz that she had to deposit an additional
amount of P300,000.00 "to pay the difference" in prices, otherwise she will lose her
original deposit of P500,000.00; Fearing the loss of her original deposit, plaintiff was
constrained to deposit an additional amount of P300,000.00 (Exh. "B"); Since she was
made to understand that she could withdraw her deposit/investment anytime, she not
knowing how the business is operated/managed as she was not made to understand
what the business was all about, she wanted to withdraw her investment; but Elizabeth
Diaz, defendant's Account Executive, told her she could not get out because there are
some accounts hanging on the transactions.

Plaintiff further testified that she understood the transaction of buying and selling as
speculating in prices, and her paying the difference between gains and losses without
actual delivery of the goods to be gambling, and she would like to withdraw from this kind
of business, the risk of which she was not made aware of. Plaintiff further testified that
she stopped trading in commodity futures in September, 1983 when she realized she was
engaged in gambling. She was able to get only P470,000.00 out of her total deposit of
P800,000.00. In order to recover the loss of P330,000.00, she filed this case and
engaged the services of counsel for P40,000.00 and expects to incur expenses of
litigation in the sum of P20,000.00."2

A commodity futures contract is a specie of securities included in the broad definition of what constitutes
securities under Section 2 of the Revised Securities Act.3

Sec. 2 . . .:

(a) Securities shall include bonds, . . ., commodity futures contracts, . . . .

The Revised Rules and Regulations on Commodity Futures Trading issued by the SEC and
approved by the Monetary Board of the Central bank defines such contracts as follows:

"Commodity Futures Contract" shall refer to an agreement to buy or sell a specified

quantity and grade of a commodity at a future date at a price established at the floor of
the exchange.

The petitioner is a duly licensed commodity futures broker as defined under the Revised Rules
and Regulations on Commodity Futures Trading as follows:

"Futures Commission Merchant/Broker" shall refer to a corporation or partnership, which

must be registered and licensed as a Futures Commission Merchant/Broker and is
engaged in soliciting or in accepting orders for the purchase or sale of any commodity for
future delivery on or subject to the rules of the contract market and that, in connection
with such solicitation or acceptance of orders, accepts any money, securities or property
(or extends credit in lieu thereof) to margin, guarantee or secure any trade or contract
that results or may result therefrom.

At the time private respondent entered into the transaction with the petitioner, she signed a
document denominated as "Trading Contract" in printed form as prepared by the petitioner
represented by its Branch Manager, Albert Chiam, incorporating the Rules for Commodity
Trading. A copy of said contract was furnished to the private respondent but the contents thereof
were not explained to the former, beyond what was told her by the petitioner's Account Executive
Elizabeth Diaz. Private respondent was also told that the petitioner's principal was Frankwell
Enterprises with offices in Hongkong but the private respondent's money which was supposed to
have been transmitted to Hongkong, was kept by petitioner in a separate account in a local bank.

Petitioner now contends that commodity futures trading is a legitimate business practiced in the United
States, recognized by the SEC and permitted under the Civil Code, specifically Article 1462 thereof,
quoted as follows:

The goods which form the subject of a contract of sale may be either existing goods,
owned or possessed by the seller, or goods to be manufactured, raised or acquired by
the seller after the perfection of the contract of sale, in this Title called "future goods".

There may be a contract of sale of goods, whose acquisition by the seller depends upon
a contingency which may or may not happen.

Petitioner further argues that the SEC, in the exercise of its powers, authorized the operation of
commodity exchanges to supervise and regulate commodity futures trading. 4
The contract between the parties falls under the kind commonly called "futures". In the late 1880's, trading
in futures became rampant in the purchase and sale of cotton and grain in the United States, giving rise to
unregulated trading exchanges known as "bucket shops". These were common in Chicago and New York
City where cotton from the South and grain from the Mid-west were constantly traded in. The name of the
party to whom the seller was to make delivery when the future contract of sale was closed or from whom
he was to receive delivery in case of purchase is not given the memorandum (contract). The business
dealings between the parties were terminated by the closing of the transaction of purchase and sale of
commodities without directions of the buyer because his margins were exhausted. 5 Under the rules of the
trading exchanges, weekly settlements were required if there was any difference in the prices of the
cotton between those obtaining at the time of the contract and at the date of delivery so that under the
contract made by the purchaser, if the price of cotton had advanced, he would have received in cash from
the seller each week the advance (increase) in price and if cotton prices declined, the purchaser had to
make like payments to the seller. In the terminology of the exchange, these payments are called
"margins".6 Either the seller or the buyer may elect to make or demand delivery of the cotton agreed to be
sold and bought, but in general, it seems practically a uniform custom that settlements are made by
payments and receipts of difference in prices at the time of delivery from that prevailing at the time of
payment of the past weekly "margins". These settlements are made by "closing out" the contracts. 7 Where
the broker represented the buyer in buying and selling cotton for future delivery with himself extending
credit margins, and some of the transactions were closed at a profit while the others at a loss, payments
being made of the difference in prices arising out of their rise or fall above or below the contract price, and
the facts showed that no actual delivery of cotton was contemplated, such contracts are of the kind
commonly called "futures".8 Making contracts for the purchase and sale of commodities for future delivery,
the parties not intending an actual delivery, or contracts of the kind commonly called futures, are
unenforceable.9

The term "futures" has grown out of those purely speculative transactions in which there are nominal
contracts to sell for future delivery, but where in fact no delivery is intended or executed. The nominal
seller does not have or expect to have a stock of merchandise he purports to sell nor does the nominal
buyer expect to receive it or to pay for the price. Instead of that, a percentage or margin is paid, which is
increased or diminished as the market rates go up and down, and accounted for to the buyer. This is
simple speculation, gambling or wagering on prices within a given time; it is not buying and selling and is
illegal as against public policy.10

The facts as disclosed by the evidence on record show that private respondent made arrangements with
Elizabeth Diaz, Account Executive of petitioner for her to see Mr. Albert Chiam, petitioner's Branch
Manager. The contract signed by private respondent purports to be for the delivery of goods with the
intention that the difference between the price stipulated and the exchange or market price at the time of
the pretended delivery shall be paid by the loser to the winner. We quote with approval the following
findings of the trial court as cited in the Court of Appeals decision:

The evidence of the plaintiff tend to show that in her transactions with the defendant, the
parties never intended to make or accept delivery of any particular commodity but the
parties merely made a speculation on the rise or fall in the market of the contract price of
the commodity, subject of the transaction, on the pretended date of delivery so that if the
forecast was correct, one party would make a profit, but if the forecast was wrong, one
party would lose money. Under this scheme, plaintiff was only able to recover
P470,000.00 out of her original and "additional" deposit of P800,000.00 with the
defendant.

The defendant admits that in all the transactions that it had with the plaintiff, there was
(sic) no actual deliveries and that it has made no arrangement with the Central Bank for
the remittance of its customer's money abroad but defendant contends in its defense that
the mere fact that there were no actual deliveries made in the transactions which plaintiff
had with the defendant, did not mean that no such actual deliveries were intended by the
parties since paragraph 10 of the rules for commodity trading, attached to the trading
contract which plaintiff signed before she traded with the defendant, amply provides for
actual delivery of the commodity subject of the transaction.

The court has, therefore, to find out from all the facts and circumstances of this case,
whether the parties really intended to make or accept deliveries of the commodities
traded or whether the defendant merely placed a provision for delivery in its rules for
commodity futures trading so as to escape from being called a bucket shop, . . .

xxx xxx xxx

. . . the court is convinced that the parties never really intended to make or accept
delivery of any commodity being trade as, in fact, the unrebutted testimony of Mr. Go is to
the effect that all the defendant's customers were mere speculators who merely forecast
the rise or fall in the market of the commodity, subject of the transaction, below or above
the contract price on the pretended date of delivery and, in fact, the defendant even
discourages its customers from taking or accepting delivery of any commodity by making
it hard, if not impossible, for them to make or accept delivery of any commodity. Proof of
this is paragraph 10(d) of defendant's rules for commodity trading which provides that the
 customer shall apply for the necessary licenses and documents with the proper
government agency for the importation and exportation of any particular commodity. 11

The trading contract signed by private respondent and Albert Chiam, representing petitioner, is a contract
for the sale of products for future delivery, in which either seller or buyer may elect to make or demand
delivery of goods agreed to be bought and sold, but where no such delivery is actually made. By delivery
is meant the act by which the res or subject is placed in the actual or constructive possession or control of
another. It may be actual as when physical possession is given to the vendee or his representative; or
constructive which takes place without actual transfer of goods, but includes symbolic delivery or
substituted delivery as when the evidence of title to the goods, the key to the warehouse or bill of
lading/warehouse receipt is delivered.12 As a contract in printed form, prepared by petitioner and served
on private respondent, for the latter's signature, the trading contract bears all the indicia of a valid trading
contract because it complies with the Rules and Regulations on Commodity Futures Trading as
prescribed by the SEC. But when the transaction which was carried out to implement the written contract
deviates from the true import of the agreement as when no such delivery, actual or constructive, of the
commodity or goods is made, and final settlement is made by payment and receipt of only the difference
in prices at the time of delivery from that prevailing at the time the sale is made, the dealings in futures
become mere speculative contracts in which the parties merely gamble on the rise or fall in prices. A
contract for the sale or purchase of goods/commodity to be delivered at future time, if entered into without
the intention of having any goods/commodity pass from one party to another, but with an understanding
that at the appointed time, the purchaser is merely to receive or pay the difference between the contract
and the market prices, is a transaction which the law will not sanction, for being illegal. 13

The written trading contract in question is not illegal but the transaction between the petitioner and the
private respondent purportedly to implement the contract is in the nature of a gambling agreement and
falls within the ambit of Article 2018 of the New Civil Code, which is quoted hereunder:

If a contract which purports to be for the delivery of goods, securities or shares of stock is
entered into with the intention that the difference between the price stipulated and the
exchange or market price at the time of the pretended delivery shall be paid by the loser
to the winner, the transaction is null and void. The loser may recover what he has paid.

The facts clearly establish that the petitioner is a direct participant in the transaction, acting through its
authorized agents. It received the customer's orders and private respondent's money. As per terms of the
trading contract, customer's orders shall be directly transmitted by the petitioner as broker to its principal,
Frankwell Enterprises Ltd. of Hongkong, being a registered member of the International Commodity
Clearing House, which in turn must place the customer's orders with the Tokyo Exchange. There is no
evidence that the orders and money were transmitted to its principal Frankwell Enterprises Ltd. in
Hongkong nor were the orders forwarded to the Tokyo Exchange. We draw the conclusion that no actual
delivery of goods and commodity was intended and ever made by the parties. In the realities of the
transaction, the parties merely speculated on the rise and fall in the price of the goods/commodity subject
matter of the transaction. If private respondent's speculation was correct, she would be the winner and
the petitioner, the loser, so petitioner would have to pay private respondent the "margin". But if private
respondent was wrong in her speculation then she would emerge as the loser and the petitioner, the
winner. The petitioner would keep the money or collect the difference from the private respondent. This is
clearly a form of gambling provided for with unmistakeable certainty under Article 2018 abovestated. It
would thus be governed by the New Civil Code and not by the Revised Securities Act nor the Rules and
Regulations on Commodity Futures Trading laid down by the SEC.

Article 1462 of the New Civil Code does not govern this case because the said provision contemplates a
contract of sale of specific goods where one of the contracting parties binds himself to transfer the
ownership of and deliver a determinate thing and the other to pay therefore a price certain in money or its
equivalent.14 The said article requires that there be delivery of goods, actual or constructive, to be
applicable. In the transaction in question, there was no such delivery; neither was there any intention to
deliver a determinate thing.

The transaction is not what the parties call it but what the law defines it to be. 15

After considering all the evidence in this case, it appears that petitioner and private respondent did not
intend, in the deals of purchasing and selling for future delivery, the actual or constructive delivery of the
goods/commodity, despite the payment of the full price therefor. The contract between them falls under
the definition of what is called "futures". The payments made under said contract were payments of
difference in prices arising out of the rise or fall in the market price above or below the contract price thus
making it purely gambling and declared null and void by law. 16

In England and America where contracts commonly called futures originated, such contracts were at first
held valid and could be enforced by resort to courts. Later these contracts were held invalid for being
speculative, and in some states in America, it was unlawful to make contracts commonly called "futures".
Such contracts were found to be mere gambling or wagering agreements covered and protected by the
rules and regulations of exchange in which they were transacted under devices which rendered it
impossible for the courts to discover their true character. 17The evil sought to be suppressed by legislation
is the speculative dealings by means of such trading contracts, which degenerated into mere gambling in
the future price of goods/commodities ostensibly but not actually, bought or sold. 18
Under Article 2018, the private respondent is entitled to refund from the petitioner what she paid. There is
no evidence that the orders of private respondent were actually transmitted to the petitioner's principal in
Hongkong and Tokyo. There was no arrangement made by petitioner with the Central Bank for the
purpose of remitting the money of its customers abroad. The money which was supposed to be remitted
to Frankwell Enterprises of Hongkong was kept by petitioner in a separate account in a local bank. Having
received the money and orders of private respondent under the trading contract, petitioner has the burden
of proving that said orders and money of private respondent had been transmitted. But petitioner failed to
prove this point.

For reasons indicated and construed in the light of the applicable rules and under the plain language of
the statute, We find no reversible error committed by the respondent Court that would justify the setting
aside of the questioned decision and resolution. For lack of merit, the petition is DISMISSED and the
judgment sought to be reversed is hereby AFFIRMED. With costs against petitioner.

SO ORDERED.

Narvasa, C.J., Feliciano, Regalado and Nocon, JJ., concur.

EN BANC

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.

EN BANC

G.R. No. L-11602 March 6, 1917

THE UNITED STATES, plaintiff-appellee,

vs.
WALTER E. OLSEN and BILLY MARKER, defendants-appellants.

Gaston M. Ashe for appellants.

Attorney-General Avanceña for appellee.

MORELAND, J.:

The appellants in this case were convicted of operating a lottery. The facts upon which the charge is
based are that Walter E. Olsen and Co., dealers in tobacco, and especially cigars and cigarettes, desiring
to introduce to the Philippine trade a brand of cigarettes known as the "Omar" brand, conceived and put
into execution a scheme by which it was hoped to place in the hands of a larger number of persons
packages of the cigarette named. To that end, and purely as a method of advertising and of introducing
the cigarette to the trade, the appellants, acting for and on behalf of the company, inclosed a certain
coupon inside of one of the packages of Omar cigarettes and then placed the package among about five
hundred similar packages in such manner that it could not be distinguished from them. They thereupon
advertised that the 500 packages of cigarettes would be sold to the public at the regular price, and that
the person who was fortunate enough to buy the package containing the coupon would be entitled to
receive from the company a gold watch described in the advertisement. The 500 packages were to be
sold at 30 cents a package, which was the regular market price of the cigarette at that time. Nothing in
addition to the market price was required to be paid by a purchaser of any one of the 500 packages.
Every person who bought one of the packages received the full value of his money in cigarettes and,
accordingly, lost nothing by the purchase. On the other hand, the company gained nothing by the sale of
any one of the 500 packages, and necessarily lost the value of the watch in case all of the packages were
sold. The situation presented, therefore, was such that a person becoming a party to the scheme by
purchasing a package of cigarettes could lose nothing while the company from which the cigarettes were
purchased could gain nothing, except the profit normally obtained by the sale of any other package of
cigarettes. In other words, a purchaser of a package of cigarettes paid absolutely nothing for the naked
chance to win the watch; while the company did not take and could not possible take anything from the
purchaser in return for the chance which it gave him to win the watch. In other words, the player could
lose nothing and the operator could gain nothing by the venture.
Upon these facts the appellants were charged with maintaining and operating a lottery in violation of Act
No. 1757. They were tried and convicted and sentenced to pay a fine of P10, with subsidiary
imprisonment in case of nonpayment. They appealed.

We are of the opinion that the judgment of conviction cannot stand. We base that opinion on (1) the title of
Act No. 1757; (2) the nature of the Act itself as shown by the essential provisions thereof; and (3) the
connection, and, therefore, the sense, in which the word lottery is used in the Act and the mischief which
the Act sought to prevent.

The Act is entitled "An Act to prohibit gambling," etc. Section 1 of the Act provides as follows:

Gambling within the meaning of this Act consists in the playing of any game for money or any
representative of value or valuable consideration or thing, the result of which game depends
wholly or chiefly upon chance or hazard, or the use of any mechanical invention or contrivance to
determine by chance the loser or winner of money or of any representative of value or of any
valuable consideration or thing.

Section 2 defines a gambling house; section 3 defines gambling in a public place, or in any building,
structure, vessel, or part thereof, to which the public is ordinarily admitted; section 4 punishes any person
having charge of gambling in a public place; section 5 punishes any person being in charge or possession
or control of any building, structure, or vessel, or any part thereof, who permits any gambling game to
take place therein at which game a charge of any kind is made for playing or for the use of the premises
or apparatus, or for which game any percentage is taken or collected; section 6 punished any person who
shall keep, maintain, or have charge or possession or control of any gambling house, or who shall have
any interest in any gambling house; and section 7, the one under which the appellants were charged and
convicted, punishes "the playing at and the conducting of any game of monte, jueteng, or any form of
lottery or policy or any banking or percentage game." The other sections and parts of some of the section
already referred to deal with the rights of person who have lost money or other valuable thing while
playing prohibited games, and with the punishment of officers charged with the suppression of gambling
who fail to perform their duties. As will be seen from these observations and references, the Act is
essentially and solely a gambling Act. It deals exclusively with gambling games or operations. It prohibits
only those games or operations in which the player stakes his money or property, or some part thereof,
upon a naked chance — those in which for the money or property or some part thereof which he invests
he receives no consideration and can receive no consideration. It prohibits that class of games or
operations in which the operator obtains something for which he has given nothing except a naked
chance.

The word "lottery" is found in the statute in conjunction with monte, jueteng, policy and banking or
percentage games. These words and phrases deal exclusively with what the statute defines as gambling
games or operations — those in which the player pays something for a naked chance to win. They do not
refer to schemes, such as the one presented by this case, in which the player, if we may call him such,
obtains full value for his money; and in which the opportunity to obtain more than his money's worth is a
mere incident. The player loses nothing by virtue of his failure to win the prize; while the playing of the
scheme does not result in giving the operator an opportunity to obtain the player's money without giving
therefor a consideration which law and justice recognize not only as valuable but as adequate also.

We are aware that it might be urged that Walter E. Olsen & Co., gained or obtained an advantage as a
result of the scheme described in view of the increased sale of the cigarette which the prize feature
includes. Even so; aside from the obvious reply which could be made, it is to be remembered that the
player (purchaser) lost nothing and could not possibly lose anything as a result of his playing. He might
gain but he could not lose. On the other hand, the operator could not gain anything as a direct result of
the element of chance. On the contrary, he was certain to lose the value of the watch. Thus, in the case
before us the element of chance did not enter either as to the operator or the player as it enters in the
gambling transactions defined by the statute.

We are of the opinion that Act No. 1757 does not cover the case in hand. We are not concerned with the
question whether the scheme or system involved in this case is or is not subject to criticism from the
standpoint of business or society or whether, if pushed to extremes, it would produce pernicious results.
Those are matters for the Legislature to consider. We are concerned solely with the question whether it
was the intention of the Legislature, when it passed Act No. 1757, to include in its prohibition operations
like the one before us and whether, carrying out that intention, such languages was used as could
properly be held to cover them. In holding that the prohibition of the Act does not include the acts charged
in the information, we have been governed by the principle, universally accepted, that an act will not be
held to be a criminal act unless the statute clearly and unmistakably makes it so.

The judgment appealed from is reversed and the accused acquitted. So ordered.

Arellano, C.J., Torres and Araullo, JJ., concur.

 SECOND DIVISION

[G.R. No. L-29062. March 9, 1987.]

PHILIPPINE REFINING COMPANY, Plaintiff-Appellee, v. HON. ENRICO PALOMAR, in his capacity

as Postmaster General, Defendant-Appellant.

Paredes, Poblador, Nazareno & Adaza Law Office for Plaintiff-Appellee.

RESOLUTION

PARAS, J.:

This is an appeal from the decision of the Court of First Instance of Manila in Civil Case No. 72498, 1
entitled "Philippine Refining Company v. Hon. Enrico Palomar," finding that plaintiff-appellee’s promotion
schemes ("Breeze Easy Money" and "CAMIA Lucky-Key Hunt") were not in the nature of a lottery and
enjoining appellant from issuing a "fraud order" on the aforementioned schemes of appelle e.chanrobles
virtual lawlibrary

It appears that the Philippine Refining Company, herein appellee, resorted to two schemes to promote the
sale of its products: Breeze Easy Money and CAMIA Lucky-Key Hunt, both of which envisioned the giving
away for free of certain prizes (without additional consideration) for the purchase of Breeze soap and
CAMIA cooking oil. In other words, the participants would get the exact value of the price for the goods
plus the chance of winning in the scheme. No one would be required to pay more than the usual price of
the products.

This Court has consistently ruled that a plan whereby prizes can be obtained without any additional
consideration (when a product is purchased) is not a lottery (Uy v. Palomar L-23248, February 28, 1969;
U.S. v. Baguio, 39 Phil, 862; Caltex (Phil.) Inc. v. Postmaster-General, 18 SCRA 247). It is thus clear that
the schemes in the case at bar are not lotteries.chanroblesvirtualawlibrary

The allegation that the prohibition by the Postmaster General should have first been appealed to the
Department Secretary concerned in view of the doctrine denominated as "the exhaustion of administrative
remedies" has no application here because one recognized exception to the doctrine is when the issue
raised is purely a legal one.

In view of the foregoing, the Court RESOLVED to DISMISS this appeal and to AFFIRM the assailed
decision of the Court of First Instance.chanrobles law library

Fernan, Gutierrez, Jr., Padilla, Bidin and Cortes, JJ., concur.

Alampay, J., on leave.

EN BANC

G.R. No. L-6941 March 6, 1913

THE UNITED STATES, plaintiff-appellant,

vs.
ISIDRO HILARIO, defendant-appellee.

Attorney-General Villamor, for appellant.

T.L. McGirr, for appellee.

TRENT, J.:

The accused Isidro Hilario, was charged in the municipal court of the city of Manila with a violation of
section 621 of the Revised Ordinances of that City. A demurrer to the complaint was sustained by that
court, and the Government appealed to the Court of First Instance, where a demurrer was again
sustained upon the ground that the facts stated in the complaint to not constitute a public offense. From
that order sustaining the demurrer the Government appealed to this court. The complaint reads as
follows:
That on or about the 17th day of March, 1911, in the city of Manila, Philippine Islands, the said accused,
being the owner or in charge of the premises and billiard hall situated in Pulung-Mayaman Street of this
city, voluntarily and illegally permitted the playing in the same of a game called nones y pares for money
and things of value, in violation of section 621, Revised Ordinances of the city of Manila.

The court a quo said:

The third ground (of the demurrer) raises the question as to whether or not the keeping of a house or
place where the game of "nones y pares" is played for money as charged in the complaint constitutes a
violation of section 621, Revised Ordinances of the city of Manila, and if it does, whether or not said
section is in harmony with the general laws of the state on the same subject.

It is admitted by counsel that the game called "nones y pares" is a game played with cues, balls, and pins
upon a billiard or pool table and similar to the American games of pool, "cocked hat," and "skittle." It is
further admitted and the court judicially notices that it is a game depending for success upon the skill,
experience and practice of the player; a game peculiarly dependent upon the player's judgment of
distance, of the elasticity of cushions, and of the action and tractability of billiard balls; a game requiring
for successful playing a perfect coordination of brain, eye, nerve and muscle.

xxx xxx xxx

The municipal board of Manila derives the power to legislate on the subject of gambling from section 17 of
Act No. 183. At the time of the delegation of this power (July 31, 1901) gambling in the Philippine Islands
was defined and punished by articles 343-4-5 of the Penal Code. Since such delegation the Commission,
by Act No. 1757, enacted October 9, 1907, has repealed said articles of the Penal Code and has by
section one of said Act clearly and unequivocally defined "gambling" to be the playing for money or other
thing of value of any game the result of which depends wholly or chiefly upon chance or hazard; thereby
by a clear inference declaring to be licit the playing of any game the result of which depends on skill.

It is a well-settled and universal rule that a grant by a legislature to a municipality to make by-laws or
ordinances is always restricted in its scope to the confines of subsequent general legislation on the same
subject. In other words, such grant or delegation is amended and any ordinances passed thereunder
repealed or modified by such subsequent legislation.

xxx xxx xxx

The game of "nones y pares" being a game of skill, the keeping of a house or place where such game is
played for money does not constitute the keeping of a gambling house, and in consequence the demurrer
is sustained in the cause dismissed, with costs de oficio.

It will be noted that the court said:

It is further admitted, and the court judicially notices, that it (nones y pares) is a game depending for
success upon the skill, experience, and the practice of the player; a game peculiarly dependent upon the
player's judgment of distance, of the elasticity of cushions, and of the action and tractability of billiard
balls; a game requiring for successful playing a perfect coordination of brain, eye, nerve, and muscle.

Or, in other words, the court said that it was admitted and the court judicially notices that the game of
nones y pares is a game of skill and not a game of result of which depends by any means wholly or
chiefly upon chance or hazard. These admissions could not have been legally taken into consideration by
the court for the reason that the court was passing upon the sufficiency of the complaint raised by a
demurrer, and in so doing it should have confined itself strictly to the allegations in the complaint. If the
complaint had been amended by inserting these admissions, then they could properly have been
considered. No such amendment was made by the prosecution, and the Attorney-General does not now
say that the said admissions were made. Again, the court erred in judicially noticing that the game of
nones y pares is a game of skill. If this game be one of skill, this fact is not so generally accepted and
known as a truth that it cannot be and is not seriously disputed. We must therefore confine ourselves
strictly to the allegations contained in the complaint.

Two questions present themselves: (1) Do the allegations in the complaint show that the defendant
maintained or permitted to be maintained gambling devices upon premises occupied by him; and (2) if the
first question be answered in the negative, does section 621 of the Revised Ordinances of the city of
Manila prohibit the keeping or maintaining of any table or other instrument or device for the purpose of
playing other games than gambling games? The two questions will be considered together.

The ordinance in question reads:

SEC. 621. Gambling devices, maintenance of. — No person shall set up, keep, or maintain, or
permit to be set up, kept, or maintained, on any premises occupied or controlled by him, any table or
other instrument or device for the purpose of gaming or gambling, or with which money, liquor, or anything
of value shall in any manner be played for.

SEC. 622. Gambling devices, possession, etc., of. — No person shall bring into the city, expose in a
street or public place, or have in his possession for the purpose of gaming or gambling any table,
instrument, or device of any kind whereon or with which money or other thing of value may in any manner
be played for.

SEC. 623. Frequenting, or acting as banker, etc., of gambling house. — No person shall frequent,
visit, become an inmate of, solicit, run, or act as banker, dealer, agent, or doorkeeper for any house,
store, hall, clubroom, or other place where any game of chance is conducted, or where is kept any table,
instrument, or device of any kind used for gaming or gambling whereon or with which money or other
thing of value may in any manner be played for.

SEC. 624. Penalty; confiscation. — A violation of any of the provisions of the last three preceding
sections shall be punished by a fine of not more than two hundred pesos, or by imprisonment for not more
than six months, or by both such fine and imprisonment in the discretion of the court, for each offense. All
money and every table, instrument, or other device used, set up, kept, or maintained for the purpose of
gaming or gambling shall be seized and confiscated.

SEC. 625. Faro, roulette, and other games of chance; penalty. — No person shall play or engage in
faro, roulette, or any other device or game of chance or hazard in which money or other thing of value is
in any manner played for, under a penalty of not more than two hundred pesos, for each offense.

At the time of the enactment of this municipal legislation, the general law on the subject was to be found
in the Penal Code, Book 2, Title 6, and articles 529 and 579, and Book 4, Title 12, Chap. 3, of the Civil
Code. Under these provisions a clear distinction was made between gambling and betting; gambling
referring only to games of luck, chance, or hazard, while betting in case the loser lost more than he could
afford to lose. By Act No. 1757 of the Philippine Commission, gambling is defined to include the playing at
or the betting upon games the result in which depends wholly or chiefly upon chance. Gambling is,
therefore, no longer restricted to games of chance, luck or hazard, but may include those in which some
element of skill affects the result. But although the definition of gambling is thus somewhat enlarged by
Act No. 1757, it has remained materially the same in that games depending wholly or chiefly upon skill
are excluded. That "gambling" under these statutes has a limited and restricted sense not coterminous
with the generally accepted sense of the term must be conceded.

Any contest or course of action commenced and prosecuted in consequence of a bet or wager, and with a
view to determine the bet or wager upon the event of such contest or course of action, is gaming. To
constitute gaming there must not only be a betting upon the termination of an event, but the course of
action to bring about such event must have been originated with a view to determine the bet." (Words and
Phrases, Vol. 4, p. 3024, Title, Gambling-Gaming. See also other definitions thereunder.)
In this jurisdiction, therefore, gambling has a limited, statutory definition which excludes some forms of
betting. Comparing the provisions of the Spanish Codes with Act No. 1757, it is concluded that the
statutory definition of gambling has been practically the same during the whole time that the city of Manila
has had a corporate existence under Act No. 183, with the exception noted.

That the municipal board of that city had before it the provisions of the general law on the subject of
gambling at the time section 621 et seq. of the Revised Ordinances were passed must be presumed.
These sections were passed by the municipal board without attempting to make any distinction between
gambling in its statutory sense in this jurisdiction and its broad, commonly accepted meaning. The
provisions of the Penal Code in respect to gambling were construed by the supreme court of Spain in a
decision published on December 28, 1887. (U.S. vs. Reyes, 3 Phil. Rep., 611.)

Where words have been long used in a technical sense and have been judicially construed to have a
certain meaning prior to a particular statute in which they are used, the rule of construction requires that
the words used in such statute should be construed according to the sense in which they have been so
previously used, although that sense may vary from the strict, literal meaning of the words. (Sutherland,
Stat. Const., § 255.)

In section 621, although the phrase "gambling devices" appears in the heading and also in the text of the
section, no attempt is made to make it more comprehensive than its statutory signification. Again, in
section 622, which prohibits the possession of gambling devices, no attempt is made to use the words in
other than their statutory sense, and the arrangement of the text is a still stronger indication that only
gambling in its statutory sense is considered, as it prohibits for the purpose of gaming or gambling any
table, instrument, etc. Section 623 refers to "gambling houses" and to "games of chance" without
qualifying these expressions. Section 624, which provides the penalty for the violation of the three
preceding sections, provides for the confiscation of "every table, instrument or other device used, set up,
kept, or maintained for the purpose of gaming or gambling." And section 625 prohibits the playing of faro,
roulette, or any other device or game of chance or hazard. Under the most liberal construction of section
625, it cannot be said to include other than games of chance or hazard. It first names two games of the
prohibited class — nones y paresfaro and roulette — nones y paresand then provides, "or any other
device or game of chance or hazard." If the section merely stated "or any other device or game," there is
abundant authority for construing the prohibition to include only games ejusdem generis to faro and
roulette. But with the addition of the phrase "of chance or hazard" the prohibition is restricted beyond the
possibility of argument to games of that class. Referring again to the preceding sections, it certainly
appears inconsistent and improbable that the board would have penalized the possession or maintenance
of instruments or devices which were used for playing games not depending upon chance or hazard, and
at the same time provide no penalty for the actual participants of such games. Reading all these sections
together in the light of the general law on the subject, it seems clear that only games of chance were
being prohibited. The enlarged definition of gambling under Act No. 1757 to include those games the
result of which depends chiefly upon chance can in no wise affect the questions under consideration.

This distinction between games of chance and games of skill, making betting upon the former illegal, is
quite well treated in State vs. Gupton (30 N.C., 271), where a game of tenpins was held not to be a game
of chance, but a game depending chiefly upon the skill of the players, and betting thereon consequently
not prohibited by a statute prohibiting bets or wagers upon games of chance.

Nor is it unknown in other jurisdictions. In State vs. Quaid (43 La., 1076), the defendant was indicted
under a city ordinance prohibiting "gambling with dice, cards, or other means" or "keeping a banking
game or gambling house," for maintaining a game of pin pool on his premises. It was held that this game
was exclusively a game of skill, and a conviction under the ordinance in question for that reason illegal.

In Ridgeway vs. Farndale (22 Q.B. (1892), 309), where the sufficiency of the complaint was under
consideration, the court said:

The original offense, as described by the Vagrancy Act, 1824 (5 Geo. 4, c. 83), s. 4, was "playing or
betting in any street, road, highway, or other open and public place, at or with any table or instrument of
gaming, at any game or pretended game of chance." The Act of 1873 (36 & 37 Vict., c. 38), s. 3, contains
a similar provision, with the addition of the words "or any coin, card, token, or other article used as an
instrument or means of such wagering or gaming;" but in that Act the words "at any game or pretended
game of chance" remain a part of the essential definition of the offense. In the present case those words
are omitted from the information, and the magistrate has come to no finding on an essential part of the
case, namely, that the appellant was wagering or gaming at a game or pretended game of chance. The
conviction is invalid on the face of it, and must be quashed.

See also State vs. Grimes (49 Minn., 443).

Furthermore, this court has already construed section 621 of the Revised Ordinances. In United States
vs. Chan-Cun-Chay (5 Phil. Rep., 385), it is said:

An examination of the provisions of the said ordinance in connection with the provisions of said article
(343) of the Penal Code will disclose the fact that the said ordinance provides for the punishment of a
different offense than that provided for by the said article of the Penal Code. The ordinance punishes a
person who shall set up, keep, or maintain, etc., on any premises occupied or controlled by him,
instruments for the purpose of gaming or gambling, etc., which may be used for gambling for anything of
value. It will be seen that under this ordinance these things need not be used for gambling, whereas
article 343 of the Penal Code punishes bankers and proprietors of houses where games of chance,
stakes, or hazard are played. The ordinance punishes the maintenance of a house in which are kept
gambling paraphernalia, while the Penal Code punishes the maintenance of a house where games of
chance are actually played. Therefore the ordinance punishes a different offense from that provided for by
the Penal Code in said article.

It is therefore clear that the Municipal Board, in enacting section 621 et seq. was only dealing with the
subject of gambling in its statutory sense, and paraphernalia used for that purpose, and did not prohibit
the playing of games or the betting thereon, or the possession of paraphernalia used in playing thereof,
the result of which does not depend wholly or chiefly upon chance. The result is that, unless the complaint
alleges that the defendant was maintaining gambling devices on his premises, it does not allege facts
sufficient to constitute a public offense.

The complaint alleges that the defendant voluntarily and illegally permitted the playing of a game called
nones y pares for money and other things of value upon his premises in violation of section 621 of the
Revised Ordinances of the city of Manila. It is nowhere alleged that nones y pares is a gambling game,
nor can this be inferred from the allegations in the complaint. It therefore follows that the allegations in the
complaint do not constitute a public offense. In reaching this conclusion, we have found it unnecessary to
decide whether or not the Municipal Board is empowered to prohibit by municipal legislation the playing at
or the betting or wagering upon games which are not gambling, but which might be in the opinion of the
board detrimental to the welfare of the city. Neither have we found it necessary to decide at this time
whether, in view of the provisions of Act No. 1757, a municipality can, by ordinance, penalize gambling.
The only questions involved in this case, and which we have decided are: (1) That section 621 et seq. of
the Revised Ordinances deal with matters relating to gambling only; and (2) that the complaint does not
allege that nones y pares is a gambling game.

For the foregoing reasons the judgment appealed from is affirmed, with costs against the appellant.

Arellano, C.J., Torres and Johnson, JJ., concur.