StatCon Topic 12 - 15 (Ch 9-10 + Glossary)

Fernando Gallardo vs Juan Borromeo

FACTS:
● The case is an appeal to review the decision of CA in dismissing the complaint filed by
Gallardo to terminate the leasehold of Juan Borromeo so he may cultivate the land by
himself as he had retired from his government job as a letter carrier.
● Borromeo alleged that Gallardo has no knowledge of filing and that his only purpose is to
eject the respondent filing armi from the landholding.
● RTC dismissed the petition.
● CA affirmed the decision of Court of Agrarian Relations.
○ Applying Section 7, Republic Act 6389, it held that the landowner's desire to
cultivate the land himself is not a valid ground for dispossessing the tenant.
ISSUE:
W/N CA correctly gave retroactive application to Sec. 7 of RA 6389
RULING:
● The applicable law when Gallardo filed his supplementary complaint was paragraph
(1) of Section 36 of R.A. 3844
Sec. 36. Possession of landholding Exceptions. — Notwithstanding any
agreement as to the period or future surrender of the land, an agricultural lessee shall
continue in the enjoyment and possession of his landholding except when his disposition
has been authorized by the Court in a judgment that is final and executory. if after due
hearing it is shown that:
(1) The agricultural-lessor-owner or a member of his immediate family will
personally cultivate the landholding or will convert the landholding, if suitably located,
into residential, factory, hospital, or school site or other useful non-agricultural purposes:
Provided, That the agricultural lessee shall be entitled to disturbance compensation
equivalent to five years rental on his landholding in addition to his rights under Sections
twenty-five and thirty-four, except when the land owned and leased by the agricultural
lessor is not more than five hectares, in which case, instead of disturbance
compensation the lessee maybe entitled to advance notice of at lease one agricultural
year before ejectment proceedings are filing flied against him: Provided, further, That
should the landholder not cultivate the land himself for three years or fail to substantially
carry out such conversion within one year after the dispossession of the tenant, it shall
be presumed that he acted in bad faith and the tenant shall have the right to demand
possession of the land and recover damages for any loss filing incurred by him because
of said dispossessions.
● However Par (1) of Sec 36 of RA 3844 was amended on Sept. 10, 1971 by RA 6389
which eliminated the landowner's desire to personally cultivate the landholding, as a
ground for the ejectment of the tenant.
● However, SC also ruled in some cases (Nilo vs CA; Castro vs Castro; Diga vs Adriano)
that RA 6389 cannot be given retroactive effect in the absence of a statutory provision
for retroactivity or a clear implication of the law to that effect.
● As We stated in Nilo vs. Court of Appeals, supra:
StatCon Topic 12 - 15 (Ch 9-10 + Glossary)

A sound canon of statutory construction is that statute operates prospectively only

and never retroactively, unless the legislative intent to threatened contrary is made manifest
either by the express terms of the statute or by necessary implication. ... No court will hold a
statute to be retroactive when the legislature has not said so.
● Since Congress failed to express an intention to make Republic Act No. 6389
retroactive, it may not apply to ejectment cases then already pending adjudication by
the courts.
● SC reversed the decision of CA and held that the petitioner, who is a government retiree may
terminate the tenancy of the private respondent and till his own land as provided in Section
36 of R.A. 3844, which was the applicable law when he filed is petition.

Albino Co vs Court of Appeals

FACTS:
● Petitioner Albino Co delivered a check to a salvaging firm to guarantee the performance of
an agreement to salvage and refloat a sunken vessel.
● The check bounced by reason of closed account.
● The salvaging firm held Albino against BP 22 (Anti-Bouncing Checks Law) in a criminal
complaint before RTC Pasay, resulting in Co’s conviction of the crime charged.
● Co argued on appeal that when the check was issued on Sep 1, 1983, around 4 years
before Que ruling was promulgated, delivery of bouncing check as guarantee for an
obligation was not yet considered punishable, as explained by Ministry of Justice in a
Circular.
○ Circular (No. 4), dated December 15, 1981
"2.3.4. Where issuance of bouncing check is neither estafa nor violation of B.P. Blg
22.
Where the check is issued as part of an arrangement to guarantee or secure
the payment of an obligation, whether pre-existing or not, the drawer is not criminally
liable for either estafa or violation of B.P. Blg. 22”
● Such circular was reversed by another issued on Aug 8, 1984 (Ministry Circular No.
12),almost one year after Co delivered such check.
● Circular No. 12, after observing inter alia that Circular No. 4 of December 15, 1981 appeared
to have been based on "a misapplication of the deliberation in the Batasang Pambansa, . . .
(or) the explanatory note on the original bill, i.e., that the intention was not to penalize the
issuance of a check to secure or guarantee the payment of an obligation,"
"Henceforth, conforming with the rule that an administrative agency having
interpreting authority may reverse its administration interpretation of a statute, but that its
new interpretation applies only prospectively (Waterbury Savings Bank vs. Danaher, 128
Conn., 476; 20 a2d 455 (1941), in all cases involving violation of Batas Pambansa Blg. 22
where the check in question is issued after this date, the claim that the check is issued as a
guarantee or part of an arrangement to secure an obligation or to facilitate collection will no
longer be considered as a valid defense."
● CA rejected the argument of Albino, thus, the case elevated to SC.
ISSUE:
Whether or not Ministry Circular No. 12 dated August 8, 1984 declaring the guarantee check
will no longer be considered as a valid defense be retroactively applied.
StatCon Topic 12 - 15 (Ch 9-10 + Glossary)

RULING:
● The weight of authority is decidedly in favor of the proposition that the Court's decision of
September 21, 1987 in Que v. People, that a check issued merely to guarantee the
performance of an obligation is nevertheless covered by B.P. Blg. 22 - should not be given
retrospective effect to the prejudice of the petitioner and other persons situated, who relied
on the official opinion of the Minister of Justice that such a check did not fall within the scope
of B.P. Blg. 22.
● OSG, then, invoked the ruling of ​US v. Go, “in crimes mala prohibita, the intent or motive
is inconsequential, the only relevant inquiry is whether the law has been violated.”
● Even if the case invoked had different facts from the case at bar, the defense is that reliance
was placed, not on the opinion of a private lawyer but upon an official pronouncement of no
less than the attorney of the Government, the ​Secretary of Justice, whose opinions,
though not law, are entitled to great weight and on which reliance may be placed by
private individuals is reflective of the correct interpretation of a constitutional or
statutory provision​; this, particularly in the case of penal statutes, by the very nature and
scope of the authority that resides in as regards prosecutions for their violation.
● Hence, SC reversed the ruling of RTC and CA. Moreover, it held that all criminal action
must be resolved in favor of the accused.

Jaime Tan, Jr. et al vs Court of Appeals

FACTS:
● The case involves a parcel of land once covered by a title under the name of Jaime Tan
married to Praxedes Tan.
● On Jan 22, 1981, Jaime Tan, executed a deed of absolute sale over the parcel of land in
favor of Spouses Magdangal. Both parties also entered into another agreement where Tan is
given one (1) year to redeem or repurchase the property.
● However, Tan failed to redeem the property until his death on Jan. 8, 1988
● On May 2, 1988, Tan’s heirs (represented by Jaime Tan, Jr.) filed a suit against Spouses
Magdangal for reformation of instrument. The complaint alleged that, while Tan and the
Magdangals denominated their agreement as deed of absolute sale, their real intention was
to conclude an equitable mortgage.
● Hours after the complaint was stamped “received”, the Magdangals were able to have the
title of the land under their names.
● This prompted the heirs of Tan to file a supplemental complaint.
● RTC ruled in favor of the heirs of Tan and ordered the Heirs to pay the Magdangals within
120 days after the finality of the decision.
● The Magdangals appealed to CA but it affirmed the decision of the RTC.
● On March 21, 1996, the Magdangals filed in the lower court a Motion for consolidation and
Writ of Possession, alleging that they did not appeal from the decision of CA, hence, the
decision has become final and executory 15 days from Oct. 5, 1995 or up to Oct. 20, 1995,
which the 120 days redemption period commences.
● In his answer to the motion, Tan, Jr. alleged that until an entry of judgment has been issued
by the CA and copy thereof furnished the parties, the appealed decision of CA cannot be
considered as final and executory.
StatCon Topic 12 - 15 (Ch 9-10 + Glossary)

● On March 27, 1996, Tan, Jr. filed a motion for execution. On April 16, 1996, he filed a
Manifestation and Motion advertising the court of his intention to redeem the property and
that he has deposited with its clerk of court the repurchased price, plus interest, as required
by its original decision. He also prayed that the Magdangals be ordered to claim the amount
deposited and the Register of Deeds of Davao City, to reinstate the title of Jaime & Praxedes
Tan.
● CA denied the Motion for Consolidation filed by Spouses Magdangal and granted the motion
filed by Tan, Jr.
● Thus, the case elevated to SC.
ISSUE:
What rule should govern the finality of judgment favorably obtained in the trial court by the
petitioner
RULING:
● From 1991-1996, the years relevant to the case at bar, the rule that governs finality of
judgment is Rule 51 of the Revised Rules of Court (Sec 10 and 11)
"SEC. 10. Entry of judgments and final resolutions. - If no appeal or motion for new
trial or reconsideration is filed within the time provided in these Rules, the judgment or final
resolution shall forthwith be entered by the clerk in the book of entries of judgments. The
date when the judgment or final resolution becomes executory shall be deemed as the date
of its entry. The record shall contain the dispositive part of the judgment or final resolution
and shall be signed by the clerk, with a certificate that such judgment or final resolution has
become final and executory. (2a, R36)
SEC. 11. Execution of judgment. - Except where the judgment or final order or
resolution, or a portion thereof, is ordered to be immediately executory, the motion for its
execution may only be filed in the proper court after its entry.
In original actions in the Court of Appeals, its writ of execution shall be accompanied by a
certified true copy of the entry of judgment or final resolution and addressed to any
appropriate officer for its enforcement.
In appealed cases, where the motion for execution pending appeal is filed in the
Court of Appeals at a time that it is in possession of the original record or the record on
appeal, the resolution granting such motion shall be transmitted to the lower court from which
the case originated, together with a certified true copy of the judgment or final order to be
executed, with a directive for such court of origin to issue the proper writ for its enforcement."
● The 1997 Revised Rules of Civil Procedure, however, amended the rule on finality of
judgment by providing in section 1, Rule 39
"Section 1. Execution upon judgments or final orders. - Execution shall issue as a
matter of right, on motion, upon a judgment or order that disposes of the action or
proceeding upon the expiration of the period to appeal therefrom if no appeal has been duly
perfected. (1a)
If the appeal has been duly perfected and finally resolved, the execution may
forthwith be applied for in the court of origin, on motion of the judgment obligee, submitting
therewith certified true copies of the judgment or judgments or final order or orders sought to
be enforced and of the entry thereof, with notice to the adverse party.
The appellate court may, on motion in the same case, when the interest of justice so
requires, direct the court of origin to issue the writ of execution."
StatCon Topic 12 - 15 (Ch 9-10 + Glossary)

● (The rationale of the new rule was explained by retired Justice F.D. Regalado)
● It is evident that if we apply the old rule on finality of judgment, petitioner redeemed
the subject property within the 120-day period of redemption reckoned from the
appellate court's entry of judgment. The appellate court, however, did not apply the
old rule but the 1997 Revised Rules of Civil Procedure. In fine, it applied the new rule
retroactively and we hold that given the facts of the case at bar this is an error.
● There is no dispute that rules of procedure can be given retroactive effect. This
general rule, however, has well-delineated exceptions.
● Procedural laws are adjective laws which prescribe rules and forms of procedure of enforcing
rights or obtaining redress for their invasion; they refer to rules of procedure by which courts
applying laws of all kinds can properly administer justice. They include rules of pleadings,
practice and evidence. As applied to criminal law, they provide or regulate the steps by which
one who commits a crime is to be punished.
● The general rule that statutes are prospective and not retroactive does not ordinarily
apply to procedural laws.
○ It has been held that "a retroactive law, in a legal sense, is one which takes away or
impairs vested rights acquired under laws, or creates a new obligation and imposes a
new duty, or attaches a new disability, in respect of transactions or considerations
already past.
○ Hence, remedial statutes or statutes relating to remedies or modes of procedure,
which do not create new or take away vested rights, but only operate in furtherance
of the remedy or confirmation of rights already existing, do not come within the legal
conception of a retroactive law, or the general rule against the retroactive operation
of statutes."
○ The general rule against giving statutes retroactive operation whose effect is to
impair the obligations of contract or to disturb vested rights does not prevent the
application of statutes to proceedings pending at the time of their enactment where
they neither create new nor take away vested rights.
○ A new statute which deals with procedure only is presumptively applicable to all
actions - those which have accrued or are pending.
Exceptions to the rule:
● The rule does not apply where the statute itself expressly or by necessary implication
provides that pending actions are excepted from its operation, or where to apply it to pending
proceedings would impair vested rights.
● Under appropriate circumstances, courts may deny the retroactive application of procedural
laws in the event that to do so would not be feasible or would work injustice.
● Nor may procedural laws be applied retroactively to pending actions if to do so would involve
intricate problems of due process or impair the independence of the courts.
● SC held that Section 1, Rule 39 of the 1997 Revised Rules of Procedure should NOT be
given retroactive effect in this case as it would result in great injustice to the
petitioner.
○ Undoubtedly, petitioner has the right to redeem the subject lot and this right is a
substantive right.
StatCon Topic 12 - 15 (Ch 9-10 + Glossary)

○ Petitioner followed the procedural rule then existing as well as the decisions of this
Court governing the reckoning date of the period of redemption when he redeemed
the subject lot.
○ Unfortunately for petitioner, the rule was changed by the 1997 Revised Rules
of Procedure which if applied retroactively would result in his losing the right
to redeem the subject lot​.
○ It is difficult to reconcile the retroactive application of this procedural rule with the rule
of fairness.
○ Petitioner cannot be penalized with the loss of the subject lot when he faithfully
followed the laws and the rule on the period of redemption when he made the
redemption.
○ The subject lot may only be 34,829 square meters but as petitioner claims, "it is the
only property left behind by their father, a private law practitioner who was felled by
an assassin's bullet."
● Petitioner fought to recover this lot from 1988. To lose it because of a change of procedure
on the date of reckoning of the period of redemption is inequitous. The manner of exercising
the right cannot be changed and the change applied retroactively if to do so will defeat the
right of redemption of the petitioner which is already vested.
● The decision of the Court of Appeals are ANNULLED AND SET ASIDE. The Orders of the
RTC of Davao City are REINSTATED.

Laguna Lake Development Authority v. Court of Appeals

FACTS:
● The Laguna Lake Development Authority (LLDA) was created through Republic Act No.
4850. It was granted, inter alia, exclusive jurisdiction to issue permits for the use of all
surface water for any project or activity in or affecting the said region including
navigation, construction, and operation of fishpens, fish enclosures, fish corrals and the
like.
● Upon implementation of RA 7160 (Local Government Code of 1991), the municipalities
assumed exclusive jurisdiction & authority to issue fishing privileges within their
municipal waters since Sec.149 thereof provides: “Municipal corporations shall have the
authority to grant fishery privileges in the municipal waters and impose rental fees or
charges therefore…” Big fishpen operators took advantage of the occasion to establish
fishpens & fish cages to the consternation of the LLDA.
● The implementation of separate independent policies in fish cages & fish pen operation
and the indiscriminate grant of fishpen permits by the lakeshore municipalities have
saturated the lake with fishpens, thereby aggravating the current environmental
problems and ecological stress of Laguna Lake.
● The LLDA then served notice to the general public that:
○ (1) fishpens, cages & other aqua-culture structures unregistered with the LLDA
as of March 31, 1993 are declared illegal;
○ (2) those declared illegal shall be subject to demolition by the Presidential Task
Force for Illegal Fishpen and Illegal Fishing; and
StatCon Topic 12 - 15 (Ch 9-10 + Glossary)

○ (3) owners of those declared illegal shall be criminally charged with violation of
Sec.39-A of RA 4850 as amended by PD 813.
● A month later, the LLDA sent notices advising the owners of the illegally constructed
fishpens, fishcages and other aqua-culture structures advising them to dismantle their
respective structures otherwise demolition shall be effected.
ISSUE:
Who should exercise jurisdiction over the Laguna Lake and its environs insofar as the
issuance of permits for fishing privileges is concerned, the LLDA or the towns and municipalities
comprising the region?
RULING:
● LLDA has jurisdiction over such matters because the charter of the LLDA prevails
over the Local Government Code of 1991.
● The said ​charter constitutes a special law, while the latter is a general law​.
● It is basic in statutory construction that the enactment of a later legislation which is a
general law, cannot be construed to have repealed a special law. The ​special law is to
be taken as an exception to the general law ​in the absence of special circumstances
forcing a contrary conclusion.
● The ​Local Government Code of 1991, has not repealed the provisions of the
charter of the Laguna Lake Development Authority​, Republic Act No. 4850, as
amended.
● Thus, the Authority has the exclusive jurisdiction to issue permits for the enjoyment of
fishery privileges in Laguna de Bay to the exclusion of municipalities situated therein and
the authority to exercise such powers as are by its charter vested on it.
● In addition, ​the charter of the LLDA embodies a valid exercise of police power for
the purpose of protecting and developing the Laguna Lake region, as opposed to
the Local Government Code, which grants powers to municipalities to issue
fishing permits for revenue purposes.
● Thus it has to be concluded that the charter of the LLDA should prevail over the Local
Government Code of 1991 on matters affecting Laguna de Bay.

Manila Prince Hotel v. GSIS G.R. No. 122156, 3 Feb 1997

FACTS:
● GSIS decided to sell through public bidding 51% of the shares of Manila Prince Hotel
(MPH)
● There were two bidders: ​Manila Prince Hotel Corporation (MPHC), ​a Filipino owned
corporation​,​ who offered to pay P41.58 per share and ​Renong Berhad​, a Malaysian
firm, who offered to pay P44 per share
● GSIS has yet to declare the winner of the public bidding.
● MPHC sent a letter dated 28 Sept 1995 to GSIS and matched the bid price of P44 per
share of Renong Berhad
● MPHC sent another letter dated 10 Oct 1995 which contained a manager’s check issued
by Philtrust Bank for P33 M as Bid Security to match the bid of Renong Berhad
StatCon Topic 12 - 15 (Ch 9-10 + Glossary)

● But GSIS refused to accept the check

● On 17 Oct 1995, Petitioner MPHC went to court and on 18 Oct 1995, the court issued a
temporary restraining order against respondent GSIS to prevent the respondent from
perfecting and consummating the sale to Renong Berhad

PETITIONER’S ARGUMENT:
1. Petitioner invokes Art 12, sec 10 of the 1987 Constitution, and asserts that the MPH is a
historical monument that reflects Philippine heritage and culture. Therefore, it has
become part of the national patrimony.
2. Moreover, under the same provision, petitioner argues that the hotel business of
respondent GSIS is a part of the tourism industry. This makes it a part of the national
economy.
3. Petitioner asserts that they should be preferred over the foreign firm after it has matched
its bid offer. Under the bidding rules, it is stated that if for whatever reason, the highest
bidder cannot be awarded the block of shares, then GSIS can award the block of shares
to other qualified bidders provided that they are willing to match the highest bid.

RESPONDENT’S ARGUMENT:
1. Art 12, sec 10 of the 1987 Constitution is non self-executory. Therefore, it has no legal
binding effect. There must be other existing laws that need to be laid down for this
provision to operate.
2. MPH does not fall under the term of national patrimony since it only refers to lands of the
public domain, waters, minerals, coal, petroleum and other mineral oils, all forces of
potential energy, fisheries, forests or timber, wildlife, flora and fauna, and other natural
resources are owned by the State.Moreover, respondent argues that the mandate of the
Constitution is addressed to the state, not to GSIS. The GSIS has its own separate and
distinct personality from the state.
3. The constitutional provision invoked by petitioner is still inapplicable since what is being
sold is only 51% of the shares of the corp, not the building nor the land it stands on.
Respondent asserts that 51% of the equity cannot be considered as part of national
patrimony, thus, the Filipino First policy is inapplicable.
4. The petitioner’s reliance on the bidding rules is misplaced. The submission of the
petitioner of a matching bid is premature since the privilege of submitting a matching bid
has not yet arisen. Renong Berhad can still be awarded the shares.

RULING
1. Art 12, sec 2, is a mandatory and positive command. The provision is complete in
itself and needs no further legislation for it to operate.
2. MPH is a part of national patrimony as patrimony pertains to heritage.
3. A share of 51% constitutes the majority and controlling stock of the hotel, so that ​anyone
who acquires the 51% will have actual control and management of the hotel.
Because of this, the Filipino First Policy can be applied.
StatCon Topic 12 - 15 (Ch 9-10 + Glossary)

4. The sale of 51% of the shares of the MPH can only be carried out with prior approval of
the state through committee on privatization. This fact alone makes it a “state action”.
Under the Constitution, the acts of persons distinct from the government are considered
as a state action when a) activity it engages in is a “public function”; b) when the govt is
significantly involved with the private actor as to make the govt responsible for his action;
c) when the govt approved or authorized the action.

EXPLANATION
1. Doctrine of Constitutional Supremacy
If a law or contract violates any norm of the constitution, that law or contract, whether
promulgated by the legislative or the executive branch or entered into by private persons
for private purposes, is null and void and without any force and effect.

Applying this doctrine to the case at bar, it entails that the contract entered into by the
petitioner and respondent should comply and adhere to the constitution. By awarding the block
shares of MPH to Renong Berhad would entail a violation of the Filipino First policy as
enshrined in our Constitution.
Due to the Filipino First Policy provision, the mere tending of the highest bid is not an
assurance that the highest bidder will be declared the winning bidder. Because of this,
respondents cannot bestow that award nor enter into one with the highest bidder. It has to give
the Fiipino a chance to match the bid of the foreign entity. If the Filipino matches the bid, then
the award should go to the Filipino.
Since MPHC has matched the bid of Renong Berhad, GSIS has no alternative but to
award to petitioner the block of shares and execute the necessary agreements and documents
to effect the sale.