It is a general principle of the public law that on acquisition of territory the previous political relations of the

ceded region are totally abrogated -- "political" being used to denominate the laws regulating the relations
sustained by the inhabitants to the sovereign.

On American occupation of the Philippines, by instructions of the President to the Military Commander, and by
proclamation of the latter, the municipal laws of the conquered territory affecting private rights of person and
property and providing for the punishment of crime (e.g. the Spanish Penal Code) were nominally continued in
force in so far as they were compatible with the new order of things.

Article 256 was enacted by the Government of Spain to protect Spanish officials who were the representatives
of the King. But with the change of sovereignty, a new government, and a new theory of government, was set
up in the Philippines. No longer is there a Minister of the Crown or a person in authority of such exalted
position that the citizen must speak of him only with bated breath. Said article is contrary to the genius and
fundamental principles of the American character and system of
government. It was crowded out by implication as soon as the United States established its authority in the
Philippine Islands.

"From an entirely different point of view, it must be noted that this article punishes contempts against
executive officials, although its terms are broad enough to cover the entire official class. Punishment for
contempt of non-judicial officers has no place in a government based upon American principles. Our official
class is not, as in monarchies, an agent of some authority greater than the people but it is an agent and
servant of the people themselves. These officials are only entitled to respect and obedience when they are
acting within the scope of their authority and jurisdiction. The American system of government is calculated to
enforce respect and obedience where such respect and obedience is due, but never does it place around the
individual who happens to occupy an official position by mandate of the people any official halo, which calls for
drastic punishment for contemptuous remarks."
He cannot be held liable because the Code of Commerce is the Spanish Code of Commerce which was
extended to the Philippines by Royal Decree. Upon the transfer of sovereignty from Spain to US to the
Philippines, it is deemed to have been abrogated. Where there is changed in sovereignty, political laws of
former sovereign are automatically abrogated unless reenacted by affirmative act of new sovereign.

The Code of Commerce partakes of the nature of political law because it regulates the relationship between
the government and certain public officers and employees.

As defined, Political Law is that branch of public law which deals

with the organization and operation of the governmental organs of
the State and defined the relations of the State with the inhabitants
of its territory.

Upon the transfer of sovereignty from Spain to the United States and later on from the United States to the
Republic of the Philippines, Article 14 of this Code of Commerce must be deemed to have been abrogated
because where there is change of sovereignty, the political laws of the former sovereign, whether compatible
or not with those of the new sovereign, are automatically abrogated, unless they are expressly re-enacted by
affirmative act of the new sovereign.

Likewise, in People vs. Perfecto (43 Phil. 887, 897 [1922]), this Court stated that: “It is a general principle of
the public law that on acquisition of territory the previous political relations of the ceded region are totally
abrogated. ”

There appears no enabling or affirmative act that continued the effectivity of the aforestated provision of the
Code of Commerce after the change of sovereignty from Spain to the United States and then to the Republic of
the Philippines. Consequently, Article 14 of the Code of Commerce has no legal and binding effect and cannot
apply to the respondent, then Judge of the Court of First Instance, now Associate Justice of the Court of
Appeals.